Democrats Divided, Market Roller Coaster, and Southwest Airlines

24:07It's the power of branding. She talks about things like hash rates with her big chunky glasses and says, send me a billion dollars and I will turn it into 220 million, but look how cool my big chunky glasses are. And CNBC keeps bringing me on because I have a price target of$10 ,000 on Tesla. I know. And that will enable them to sell more opioid-induced constipation ads, despite the fact I have very few people. It is literally the lesson. I'm going to have a class on branding, how branding can supersede actual performance on Cathie Wood. Oh, my God. I'm so glad you're going to teach again. You should.

24:42That would be a really good class. Anyway, okay, Scott, let's go on a quick break. When we come back, more agency cuts by the Trump administration.

25:15today. Not all journalism is the same. Take The Guardian. Our coverage has something unique, fierce independence. Nobody owns us or tells us what we can and can't say. So we're free to report the whole picture. We connect what's happening in Washington to the rest of the globe, expose corruption wherever we find it, and give fresh perspective on everything from wellness and soccer to culture, the climate, and more. Read, watch, and listen to The Guardian for free at the guardian.com. From Pushkin Industries, I'm Jonathan Goldstein, and Heavyweight is back. The new season is bigger than ever. Bigger hopes.

25:56I keep waiting for this moment when he says, mom, I get it. I'm sorry. Bigger dreams. Tom Hanks wants to meet with you. This is a real chance. and bigger heartbreaks. I thought it would be my movie moment. And maybe he would even whisper in my ear, I've always been in love with you. Check out new episodes of Heavyweight on Apple Podcasts.

26:30Scott, we're back. President Trump has placed another round of agencies on the chopping block, including the Voice of America, or VOA. It's kind of a screw you to Carrie Lake, but that's another issue. I am perfectly happy with that. The VOA, run by the U.S. Agency for Global Media, broadcasts United States domestic news to hundreds of millions around the world to extend U.S. influence and to combat authoritarianism. Carrie Lake, who Trump chose to run VOA, she was the one who keeps losing in Arizona, the loud, nasty lady who keeps losing in Arizona, was planning to transform the outlet to fight an information war.

27:03The cuts made in an executive order also targeted agencies which address homelessness, fund libraries, and promote economic development for minority and low income communities. So basically everybody but the rich people. I don't know if the VOA cut matters. What do you think of this Voice of America cut? No big deal? Big deal? I mean, what is really, really staggering is there was an analysis done of how many deaths are going to happen this year, unnecessary deaths from things like malaria, hunger from this cut of$75 billion of USAID. And they're estimating just this year alone, there's going to be 3 million deaths.

27:39And people say, OK, there's some powerful memes online saying, what other nation taxes their people and sends money to us? And the answer is, okay, the whole point, one of the basic tenets of a post-World War II America, starting with what is arguably the most visionary act in economic political history, is we said, okay, Germany and Japan treated us really poorly. They were our enemy. But this is what we're going to do. We're going to, in an act of extraordinary vision and generosity, we're going to pay for the reconstruction of their society. And overnight, not overnight, over a decade, we turned to formidable, unbelievable cultures that were incredibly formidable enemies into incredible allies.

28:31And it has really held the post-World War II peace and prosperity is that these two, the kind of the number two and number three economies around the world until China were our allies. And they realized through this act of generosity. And we recognize that soft power is the hardest power in the world because you don't even know what wars don't break out. You don't even know what individual in an African country with a strong anti-American contingent refuses to work with them and cooperate because they think, you know what? They're actually good people. Maybe we don't agree with them. We need to be there.

29:07Maybe they make bad decisions, but at the end of the day, they try to do the right things. They're trying to stop AIDS in our country. They're trying to stop hunger. They're willing to send aircraft. They're willing to send people in, put their boots on the ground when they sense there's actual genocide. That soft power for about 1 % of our deficit creates margin power and goodwill that affects millions of decisions made every week around whether to help, work with, want to send your best and brightest to this nation. These are investments in, for lack of a better term, brand building, where people think, I want to go to the U.S.

29:48I want to work with U.S. companies. I don't want to take an American tourist hostage or kill them because they're nice people and their memory is long and their reach is far. Let's not fuck with them. Let's work with them. And so this withdrawal of soft power, when you look at the actual return we have gotten on this soft power, is extraordinary. And something like the Voice of America, and I want to be clear, I believe as an educator, the Department of Education should probably be smaller than it is. Universal testing nationally was a good idea. It hasn't worked. The 500 people of the 4 ,000 that work for the Department of Education should probably lose their job.

30:24I'm not against reducing the size of government. But when you just start cutting everything, including things that are working really well and making people fool good about America and creating prosperity and margin power, and it's going to take decades to rebuild once we realize it was a bad idea to do away with it. So it's fun. Carrie Lake is a fucking distraction. That's a distraction. The question is, should we be spending a little bit of money to have our viewpoints transmitted in a thoughtful, well-produced way around the world? I think it's such a good spending of money. And by the way, guess who's running into the space?

31:02The Russians and the Chinese. 100%. That's the thing. It's the smallest amount of money to spend, one, to keep it away. We have a better story. And we're good at it. We're good at media. And by the way, the media is good. It's actually very clear. It's, you know, they're like, oh, they're anti-Trump. This is the whole thing, you know, obsessing them. But if you're in, listen, Carrie Lake, who I'm sorry, is a village idiot. He was going to transform the outlet to fight in information war. Yes, Carrie, that's what you need to do. But not in your trumped up ridiculous way. It's giving people good information about the United States and what we're doing here.

31:37It shows we're present. It shows we care. It's like, even if it's, it's just very solid. I have listened to Voice of America elsewhere. And we also fund things like Radio for Europe, et cetera. I know there's some things, and I do think about this a lot, that are of a different era and we shouldn't do anymore. Like sometimes we have to change and things. But this is money well spent, especially when the Chinese and the Russians and other people are putting out all kinds of misinformation around the world and information about themselves, right? Not just misinformation, but look at us. Look what we're doing and stuff like that.

32:13And I just think it's just the best way to say, you know, here's America. We're still here. We still are great. And I just, what a, what a, the only thing that I get pleasure in is she doesn't really have a job, but that's fine. Like, that's just my personal pleasure. But the cuts they're making are so targeted to things that make us better as a nation that it's really, it's just sort of a fend for yourself kind of thing that's happening, which I think is not the picture America has of itself. Or maybe they do now. Yeah. Carrie Lake is a physical embodiment of AI right now. And that is she put herself out of business.

32:48I love that she said on a campaign trail as if it was a feature, not a bug that I'm going to be the media's worst nightmare. Well, OK, she got herself fired. She's right. She's the worst. She's the worst thing that happened to media, including the Voice of America. Now she's out of work. Like, I'd, it's just. And she wanted to bring all her skills as a news, she was on a local news station, Carrie. Sorry, I don't find you to be the top level media thinker of our generation. You know who's playing, you know who's playing the long game right now? It's the Gulf, Al Jazeera, or, or funding, you know, quote unquote, Middle Eastern Studies Department slowly but surely across universities across America.

33:24That's what you should do, America. You should do that. They're getting rid of all these democracy organizations. You know, there's a million democracy organizations. Do you think these, what a lot of people believe, including myself, these anti-Semitic protests on campus just happened overnight? No, they took a lot of thoughtful, long-term investing. Do you think that empathy towards whatever you want, you know, different viewpoints out of the Gulf just happened overnight? Al Jazeera. Do you think that when my son on the way to sushi asks me, says, Dad, when did we take their land away? Do you think that opened overnight?

33:58No. The Chinese are playing. The Chinese in the Gulf are playing the long game. And we used to think about this. We used to think about, okay, how can soft power slowly but surely get people to our viewpoint such that every decision, every action, every economic, every military, we have 700 military bases in like 70 or 80 countries. Do you realize how many decisions and a view of our country and most of these people making these decisions have never been to America? No. So your brand. And your people's perception of you. I'm just not inclined to do business with a company from Afghanistan. I've never been there.

34:36I don't know there are many Afghanis. It is an unfair snap decision. But it's based on the impression I have, the perceptions of their country. This is such a marketing opportunity missed. If somebody comes from New Zealand, I'm like, I like them. I'd like to hire them. Why do I like the New Zealand? Lamb. If they start rounding up Jews, I'm shoving Bitcoin up my ass and I'm heading to New Zealand. And I'm going to spend more money there. All of these brand perceptions are so, they are more important than the actual, in many ways, the actual activities. 100%. And we are pulling back on all of our brand building activities.

35:10And our polling is going to go down, Carrie Lake, but mostly because of you. Anyway, President Trump also visited the Justice Department, speaking of ruining something that had a very good reputation, to give an hour-long speech focused mostly on criticizing those who investigated him. What a tiny-minded person is. Presidents do not typically speak at the Justice Department for good reason. Here are some of the things Trump said. He proclaimed himself the chief law enforcement officer in our country, which usually is the attorney general. He also suggested it's illegal for networks to cover him in what he sees as an overly negative light.

35:39He said the classified documents case against him was bullshit. When the speech ended, YMCA played and he did his signature dance on stage. Oh, my God. How are we losing to this person? And this is marketing. Give me a marketing thing here, because obviously this is all such nonsense. He shouldn't have been there. This is a line we should never cross, and he does it constantly back and forth. And again, in an ideal world, what should Democrats be doing in response to this? Yeah, look, there is such a void here of Democratic leadership for someone just to stand up and say, you know, this is bullshit.

36:14More importantly, and I know this is going to drive you crazy. I have literally, I'm about to be indoctrinated into the woke church. I'm about to become an apostle, a cardinal. They are burning white smoke in the ballots because I am now doing a live podcast with my other side piece. Basically, she's you, but younger, which is what I like to do, what I'll do with my third and fourth wife. I am speaking at the 92nd Street Y, and all I can think about, all I can think about is when they introduce me standing up and screaming out, Young man, there's no me to feel down. I said, young man. You're going there with Tarloff?

36:51You're doing a Tarloff event? Me and Jessica Tarloff were invited. I literally have to pull fucking teeth. We have been offered 10 of these and you've turned them all down. You know that. Like at Aspen. Yeah, but I'm trying to impress the new wife. Honestly, literally. We're not doing France because you won't do it. We're not doing, oh my God. We're not doing France. When did we get invited to France? We got invited to France. You're busy doing something else, an expensive speech. To Le Web or something like that? Something, whatever. Anytime I try to get one of these going, which people are desperate for, you say no and you say yes to her.

37:23Unless there's hot people or a ton of Benjamins for daddy. And it's for the 90 seconds to do. Why? It's not like anything really big. No, not the France one would have been fun. We would have enjoyed ourselves. But no, the one in Aspen you won't do. I'm just saying. Just saying. Just saying. I got to pretend to be young and hip with the new wife. I cannot get you to take me out to dinner, Scott. There you go. Anyway, that will be very nice for you. I'm going to move on now. I'm going to move on. The Democrats, you have a huge wide hole you could drive a truck through, and you are not driving it.

37:56You're driving it into a wall, Chuck Schumer. All right, Scott, let's go on a quick break. We come back. Southwest Airlines is no longer offering free bags.

38:07In business, they say you can have better, cheaper, or faster, but you only get to pick two. What if you could have all three at the same time? That's exactly what Cohere, Thomson Reuters, and Specialized Bikes have, since they upgraded to the next generation of the cloud, Oracle Cloud Infrastructure. OCI is the blazing fast platform for your infrastructure, database, application development, and AI needs, where you can run any workload in a high availability, consistently high-performance environment, and spend less than you would with other clouds. How is it faster? OCI's block storage gives you more operations per second.

38:45Cheaper? OCI costs up to 50 % less for compute, 70 % less for storage, and 80 % less for networking. Better? In test after test, OCI customers report lower latency and higher bandwidth versus other clouds. This is the cloud built for AI and all your biggest workloads. Right now with zero commitment, try OCI for free. Head to oracle.com slash Vox. That's oracle.com slash Vox. The pumpkin spice latte is back at Starbucks. Crafted with our signature espresso and real pumpkin sauce. Then topped with whipped cream, cinnamon, and nutmeg. The PSL. Get it while it's hot or iced. Only at Starbucks. Support for this show comes from Airbus.

39:34It took 100 years for electric vehicles to catch on. Modern solar panels? Half a century. Lithium batteries? Decades to go from their debut to daily use. It's a pattern. Energy tech breaks through, stalls, and then something tips the scales. But for every success, there are even more almosts. So what if there was a breakthrough sitting at this crossroads right now? The potential to cut carbon emissions with sustainable aviation fuel, or SAF, is real. SAF works just like Jet A1, which is a standard jet fuel used worldwide. But the difference is its contribution to aviation emissions reduction. It could change the future of flight, and that's why several major U.S.

40:23carriers have already increased their commitments to fuel with SAF. But it's not just up to the airlines. What's needed is an industry-wide push to increase the supply to meet growing demand. You can learn more about how Airbus is contributing to accelerating this journey at fly.airbus.com slash the flight path.

40:50Scott, we're back. Southwest Airlines will soon end its policy of allowing free check bags. Bags fly free has long been what Southwest is known for, along with having no assigned seating, which the airline will also eliminate this year. Frequent flyers and credit card holders will still be allowed one free bag, but the move has been met with criticism online. Activist and mentor Elliott Management has been increasing pressure on the airline to raise profits. Obviously, it's expensive to do this. Meanwhile, Spirit Airlines is fresh out of bankruptcy and the CEO said it's ready to take on competitors.

41:21We'll take advantage of the time. It takes Southwest to find its new footing with the new rules. Brand assessment. This is what Southwest was actually a good version of a cheap airline, right? Look, until about 10 years ago, Southwest Airlines had a greater market capitalization than the rest of the U.S. industry combined. And what Southwest was able to do was build an amazing brand sort of around freedom. And that was, we don't charge your owners cancellation fees. It's very flexible. You can sort of get up and go. Even being located in the Southwest, we were all about low cost. They always had 737s to try and create operational efficiency.

41:58They implemented a great culture that was sort of fun and quirky. And the idea was, if things aren't going well for you, you want to take a vacation, or quite frankly, you want to peace out and move to Vegas. Southwest is about freedom. and had this amazing brand. And when you look at an industry where it is near impossible to establish differentiation, think about it. They're all flying to the same place. They're all flying the same goddamn equipment. They're all hiring effectively the same people. How do you maintain any sort of differentiation that creates an industry that is non-commoditized and results in shareholder value?

42:33And Southwest was able to do that. And one of the key components of their brand was we don't rip you off or nickel and dime you by charging you for bags. And I see this, by the way, I think Elliot are some of the smartest people in investment disclosure. I've worked with them. I like them. They've been very generous with me. I think this is the wrong move. I think this is straight trading off short-term profits and financial engineering to make a quick buck and then basically lose one of the few, one of the few precious, scarce forms of differentiation in an industry that has been totally commoditized.

43:09And so then the question is, if you take away these few things that differentiate Southwest, what is their differentiation? Exactly. It just becomes a search on Expedia for who is the lowest price. Who do I go to first? So I see this as a pure example of short-term juicing of profits. The stock will probably go up. It will substantially increase their EBITDA. Elliott will sell their stake. and Southwest further melds into this giant amorphous bubble of all airlines with no differentiation. This again is another lesson. Branding is like working out. The next day it hurts. It sucks. It requires discipline.

43:50But if you're disciplined about it and willing to make the consistent investments in working out, everything gets a little bit easier. You get a little bit stronger. It's easier to go up the stairs. People want to hang out with you. You're less likely to have bouts of depression. Brand building, and this is brand building, the free bags, is working out every day. And what they've decided to do is like, I'm done. I want the profits. I think this is a bad move. I think this is trading off brand equity for a short-term hit in EBITDA. Yep. I would agree with you. I think you're correct on all these things.

44:21I just, this is, I don't know why I would take, I used to take Southwest a lot because of these things. Like it was always cheaper. It was always more flexible. Now I'm like, well, if I have to pay, I might as well like have the things I like and then collect, you know, I don't know if you know this, Scott, I'm a global services on United now. I am. I don't even know what that means. The top tier. They have a secret room. That's a sign that your relationships are struggling and your life sucks. I know, but I'm still very happy. I'm very happy. I have to say I like the separate entrances. They have separate entrances?

44:51Yeah, they do. Mm-hmm. Mm-hmm. Separate little rooms. They give you a little food. You walk in, you go through security. There's a separate security entrance, too. It's not even the special TSA, whatever, clear line. It's an even better line. It's really nice. I have to say, I like it. I just can't wait till I'm single again and I dress up for Halloween. I'm going to dress up as Southwest Airlines and fuck a bunch of people. Anyway, I don't fly Southwest anymore, and I used to fly it a lot. And the bag was an attraction. It was. It was different. It was the cheap airline that was decent, if that makes the sense.

45:25Like if I had all the kids at once and it was just so ridiculously, it was always the cheap airline that you always had a good experience on, if that makes sense. That you always, like it was, you felt, it didn't make you feel like spirit, which always made you feel like they're going to stick you in a box and shove you in or Russian air or something like that. And you're right. It's a short-term solution to it. Well, the bottom line is the airline industry is a terrible industry for investors because about 30 years ago, the Gulf, who are very smart and have a tremendous amount of capital, said, we need a coming out party.

45:58And instead of having the Olympics, they built and overfunded the world's best airlines in the world because they did the math and they said people's brand impression of you is based on, first and foremost, the airline that brought you there and back and to the airports. And so Singapore and then UAE basically said the best investment we could make as a halo for our entire nation would be to build these extraordinary airlines. And essentially, Singapore and then Emirates Airlines and then Qatar built by far the best airlines in the world. And when you buy a ticket on Emirates Airlines, if you're spending$1 ,000, you're getting$1 ,400 in service.

46:38And the American Airlines and every other long-haul airline in the world just can't compete. They can't afford to compete with a company, with an airline that is offering, you know. Did you see the ads for Penelope Cruz on the Emirates, the premium economy seat that looks like a beautiful seat? It's these ads that are on and she looks at you. You had me at Penelope Cruz. She goes, premium economy. And it's like such a good ad. Like, let me just say, I was like, first of all, I went Penelope Cruz. And secondly, I went, that's a fucking nice seat there in premium economy. I would fly on that. The two things worked, Penelope Cruz and the seat.

47:18Go ahead. Sorry. The airlines, the domestic carriers across the economies that demand that the airlines not be subsidized by the government, which you can argue for, just can't compete with Singapore, Emirates and Qatar Airlines. domestically, I think, I want to say of the big three, Delta does the best job. By far, the best operator in the domestic market is JetBlue Mint, seats two, aisles two and four, where you get your own pod, obviously fly a lot. But everything else is a distant second to the Gulf Airlines and quite frankly, to JetBlue domestically. It is a shitty airline. Consumers have said that they will endure absolute atrocious service just to get from point A to point B less expensively.

48:00That industry is an example of just, I think just this last year, airlines, since kind of the inception of commercial aviation, are finally starting an aggregate to turn a profit. It is, as Warren Buffett, your hero said, if we could, if we had a time machine, we would go back and murder the Wright brothers. It has been a terrible place to invest. I've been flying, I've been molesting the earth for the last 30 years. I can break down almost every airline good and bad. Worst airline in Europe, KLM, by the way. There's just such a range of good to bad. By the way, the best new first class is Lufthansa's first class and also the apartment, the apartment from Singapore Airlines.

48:40But anyways, I think a lot about flying. I love it. I do like flying. Just a quick shout out to all the single ladies out there. I am the Southwest Airlines of men. Baggage is free. My baggage is free. A lot of baggage. This is literally like four bad jokes. What is happening? Daddy's bringing erectile dysfunction. Daddy is bringing self-hate. Daddy is bringing a little bit of alcohol abuse. Okay. All right. One more quick break and we'll be back for wins and fails. Obviously, fails are four penis jokes in a row.

49:17Mercury knows that to an entrepreneur, every financial move means more. An international wire means working with the best contractors on any continent. A credit card on day one means creating an ad campaign on day two. And a business loan means loading up on inventory for Black Friday. That's why Mercury offers banking that does more, all in one place, so that doing just about anything with your money feels effortless. Visit Mercury.com to learn more. Mercury is a financial technology company, not a bank. Banking services provided through Choice Financial Group Column N.A. and Evolve Bank and Trust members FDIC.

49:56The spirit of innovation is deeply ingrained in America, and Google is helping Americans innovate in ways both big and small. From improving emergency response times to protecting against cyber attacks, local, state, and federal governments are innovating with Google AI. This is a new era of American innovation. Find out more at g.co slash American Innovation. I would like you to meet Ares, the ultimate AI soldier. He is biblically strong and supremely intelligent. You think you're in control of this? You're not. On October 10th... What are you? My world is coming to destroy yours. But I can help you.

50:39The war for our world begins in IMAX. Tron Ares. Rated PG-13. May be inappropriate for children under 13. Only in theaters October 10th. Get tickets now.

50:53Okay, Scott, let's hear some wins and fails. I shall go first. I shall go first. Let me say a win. I know you're with him this weekend, but Severance is so fucking good. Ben Stiller. Yeah, it's really good. I love you, Ben Stiller. Let me just say, both Amanda and I, it's so incredibly dense, but also utterly fascinating, and you think about it all week. Like, it is one of those shows. And I got to say, I was like, I like a lot. I love The Sopranos. I like The Bear. This one has me thinking and thinking and thinking about all kinds of issues around identity, everything else. But it's also really gripping at the same time and entertaining.

51:32People love it. And let me just say, I don't, and I always can say, oh, that's going to happen next. Like, when I watch White Lotus, as much as I like it, I get, I know exactly what's going to happen, essentially. I don't know what's going to happen in this fucking thing. And I, they're so inventive. I have to say, Patricia Arquette, they're all good on this show. There's not a person that's not good. The guy who plays Mr. Milchak, he's amazing. But I love this show. And Ben, kudos. And it's like doing incredibly well for Apple. It's like one of the, like it's growing, the audience is growing.

52:03And it's not one of those small audiences that is like everyone's talking about. It's a big audience for Apple. It's making a ton of money. Kudos, kudos, kudos. These are people at the top of their game. I have to say, I think about it all the time. So that is my win. My fail, well, obviously, Chuck Schumer, because, by the way, his book tour events were postponed after the backlash. He has a new book out called Antisemitism in America, A Warning. That's been postponed for security reasons, apparently. But that's not my loss. I heard the original title, Where Are My Testicles, that they changed.

52:37Where are my testicles? That's right. Yeah, yeah. I would say this ridiculous. Trump is always doing a ridiculous thing and a distracting thing. But his statement this weekend about Biden's pardons are void in bank because of the auto pen. There's no power to undo a pardon in the Constitution or case law. If he wants to do all his stupid parts, I'm not a fan of the pardon system by presidents in any way whatsoever. I think they should get three and that's it. And they can't get paid for it. But get your just like stop with this fucking ridiculousness. And the way he does it, he goes, hereby declared in capital letters, void, vacant, and no further force than effect, because they were done by the auto pen.

53:17Fuck you. Like, honestly, like, this was even for him was a ridiculous, stupid thing to do. And he has a list of stupid things. So, like, look, if we're going to keep these dumb pardons, just stop acting like this is what occupies your brain. Like, good, maybe, I suppose. So I was really irritated by that for some reason. Anyway, that's my positive and negative. Severance, fantasticness, Trump as usual, distraction, distraction, distraction. And it's working, unfortunately. We share the same fail. There's always a good excuse for failure. And the Democratic Party has a total lack of leadership.

53:52I would like to see. Who do you like in the Democrats? Can I ask you to pick someone? Chris Murphy is being kind of spicy, AOC. I think he's been fantastic. I think, you know, I wish I'm a huge fan of obviously Senators Bennett and Warner. I think AOC, I appreciate, I think, Representative Crockett. Is that? Crockett, Chasmin Crockett. I mean, at least they're getting out there and they're saying shit. My favorites are, I really like Representative Torres. I just love that he comes out with moderate policies and the far left just does not have to deal with the intersectionality of a black Latino gay man saying these moderate things.

54:33I just love that he's driving everyone crazy. Governor Wes Moore, who in a State of the Union address said his administration was going to focus on the struggles of young men. I thought that was a very brave thing to do in a blue state. He's the one the Republicans are nervous about, I can tell you. So what I would say is anyone who's willing to come out right now and say the Democratic Party lacks leadership and take an aggressive stand against this slide into autocracy see, and I will give money to right now for your campaign. We are desperate for someone to go a little bit gangster and have a strong voice here.

55:08I think this is, we are literally the party of eunuchs right now. Eunuchs. It's a word you don't use very often. I like that word. That's my favorite character in Game of Thrones is the eunuch. Is that my favorite character? That's a tough one. I like the Prince of Dorne. A bisexual who drinks a lot and kills people. That guy's so fucking hot. By the way, just so you know, people kept asking me while I was dancing around on stage with my shirt off at South by Southwest. And what they don't realize is that we had to bargain for our South by Southwest spot. And they said, okay, but if we come to you and ask you for a favor, you have to accept.

55:49And I said, yes. and before us, I don't know if you know this, this is a true story, was The Last of Us cast. And Pedro Pascal went on stage and all the women were literally going fucking crazy. And they said, okay, Scott, we need you to go out there and cool down the women. Okay, that's good. That's good. I love him. I have a hot for him. Who doesn't love that guy? Who doesn't love that guy? Anyways, where the fuck were we? Oh, you're winning fail. Oh, you're fail is the Democrats. Look, we have got to find our footing here. The bad news is our leadership brightens up a room by leaving it. They are literally, they're just so ineffective.

56:30They've just acquiesced. They've basically given now the Republicans carte blanche to do whatever they want. And it's just so incredibly discouraging. The good news is we have a fantastic bench. And what I would say to this bench is command the space you occupy. Get out there. Be fearless. Push back on this. What's going on here? There's an enormous void for the new generation of Democratic leadership to step into. So my fail is, Senator Schumer, I think it is time for you to move on. I think you are just not up to the job, quite frankly. My win is I think Europe is a union again. It's a$19 trillion economy.

57:12They are figuring out that with the resolve and the capital, the latter of which they have in spades, the former of which we have to decide. in 1939 or 1940, my mother was sleeping and her family were sleeping in tube stations and passing out gas masks in the shape of Disney characters. The real fulcrum here is that to be fair, Russia has shown tremendous resolve. Russia is willing to send 600 young men to their death by quite frankly, offering money to these families and small villages in Russia. But you got to give it, I mean, you got to acknowledge the core competence of Russia is resolve and the willingness to sacrifice.

57:53The EU nations are a$20 trillion or$19 trillion economy. Russia is an economy that's$2 trillion that's smaller than Canada. They have the capital. They have better weapons. They have better IP. Their AI and drone technology will be far superior. The question is, do they have the resolve? If they do, then let Trump bluster about pretending he gets to decide the terms of the surrender. He doesn't. If Europe wants to decide to come up and fill the void of leadership and capital and resolve that the U.S. has abdicated from, they can absolutely, as they did in 1939, push back against a murderous autocrat.

58:37And I think we're beginning to see signs of it. I think these two meetings, one in England, one in Brussels, are showing that Starmer, Hulse, and Macron are filling that void. So I'm hopeful. My win is that the European Union is going to begin to push back and fill the void of American leadership. I also believe, and I've said this before, it could inspire a dramatic upward spiral in the economy through the technology spillover and the stimulus of increased military spending and greater coordination and cutting the red tape. And we're already seeing that in the stock market. Yeah. Can I put something out there?

59:15So they interviewed, political interviewed Chris LaCivita, who was one of the campaign managers of Donald Trump. And he was saying how stupid Europeans are. I'd love you to answer this. He goes, we basically subsidized Europe for the last 50 years, 60 years of post-World War II. And of course, we did the rebuilding. We've done all those things. We're able to create these social paradises where the government paid for everything they didn't have to pay for was their national defense. You know, at some point in time, the gravy trains got to end. Well, the gravy trains ending now, the Cold War's over, the balance of power shifts.

59:43All these things have changed. Politicians in Europe don't want to change. They sure don't want to change at the pace that's being forced on them to change how they go about spending. So it's going to create a new level of angst. And then he said, at the same time, they're arrogant as hell. I've spent time in Europe in the last couple of years. They still don't get it. They don't understand there's a new sheriff in town. And he's a very, very set ways and pensions about America first means we're first, you're second. I think this guy's a fucking idiot. Like he doesn't see what's actually. We're actually going to make them stronger by this.

1:00:12Correct? That's what you argue. Well, of course, I spent too much time in these private members clubs in New York. And I went to Costa Cipriani and I went with some friends and we had some drinks and some carpaccio. It was lovely little pasta dinner, like nice in the corner. And the bill was 740 bucks. And I know the general manager, and I came over and I said, I said, who is here? It's all young people. And I said, who are these young kids who can afford to spend 700 bucks on drinks and a light dinner? And he said, no one here is paying. And that is the young women here, someone else is paying for them.

1:00:47Do you think that sex is fine? It's also true. And the men, the young men, it's their parents' credit card. They're all trust fund kids. And this is an interesting thing. They said they're trust fund kids from New Jersey. I know a lot of trust fund kids. And to a certain extent, Europe has been a little bit of the negative externalities of being a trust fund kid, and that it is dependent upon the military and to a lesser extent, the economic umbrella of the US. And quite frankly, they have become indulgent and spoiled. And that is a harsh statement, and it is true. And what Europe realizes now is that they're smart, they can work hard, they have incredible skills, IP, artisanship.

1:01:22They literally are the home of the renaissance. They are the home of great philosophers. If they get their shit together, they cut the regulation, and they show some of the resolve, some of the grit, and some of the innovation that America and China has filled the void. If you look at the rise of China, it hasn't come at the expense of the U.S. The U.S. still has the same GDP growth. The U.S. still has the same number of big companies of unicorns. Who it's come at the expense of is Europe. And I think a lot of this is that Europe needs to finally say, okay, we're going to become a union. I believe this in some ways might be back sit.

1:01:59It might take England back into the European Union, and they need to coordinate, lower the bureaucracy, lower the lack of, or what I would say, the administrative state. They need to really increase their substantial spending, and they need to say, if need be, we're going to put boots on the ground. And yeah, fine, Trump, wave your arms, be an ass clown. Fine. We're the ones that are going to decide we're going to back Ukraine. We have seen what happens when you let a murderous autocrat run unchecked. We're not down for this anymore. We'd love your help. If it's there, great. If it's not, we're going to count on it.

1:02:34Keep in mind that the Europeans substantially pushed back, pushed back viciously and victoriously on a murderous autocrat for two years before the Americans weighed into the war in 1930. You know, there were two long years of the greatest, one of the greatest industrial war machines ever, the Third Reich, was invading a Europe that had stopped spending and stopped preparing and stopped coordinating. That's where we are now. Europe can absolutely push back on Russia. Crystal Savita, you're an idiot. You're the arrogant prick. Anyway, we want to hear from you. 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.

1:03:18Elsewhere in the Kara and Scott universe, I talked to Ezra Klein this week on with Kara Swisher. Let's listen to a clip. There is an Orwellian-ness to this, but efficiency needs a goal, right? I mean, if you want a government that can be more efficiently taken over by Elon Musk's companies, and yeah, Doge is doing great. If you want a government that can more efficiently do things in service of the public and execute big public projects. I'm like, no, it's not doing great. Goals here really matter. And what they're doing is trying to build something that is more open to high levels of crony capitalism, right?

1:03:52It's a sort of an oligarchic takeover. I just want to fight that. I thought it was good. His book is really interesting. It's about the government, the Democrats getting a set of balls, essentially. And I think it's an interesting book. I know you've interviewed him, too. Okay, that's the show. Thanks for listening to Pivot. And be sure to like and subscribe to our YouTube channel, which is doing very well. We're getting... Do you think Ezra Klein has spoken of the 90-second one? Yes, many times. He's very popular. He's like the media sexy guy now. And you have to really compete. You need to compete, okay?

1:04:22Anyway, we'll be back on Friday, by the way. Scott, do not sing YMCA and read us out. Today's show was produced by Lara Neiman, Taylor Griffin, Corinne Ruff, and Kate Gallagher. Who are all these new people and who's paying for them? Ernie Undertide engineered this episode. Thanks also to Drew Burrows and Mia Saverio and Dan Shulon Nishat Kruas, Vox Media's executive producer of audio Make sure you're subscribed to the show wherever you listen to podcasts Thanks for listening to Pivot from New York Magazine and Vox Media You can subscribe to the magazine at nymag.com slash pod We'll be back later this week for another breakdown of all things tech and business Who's going to decide not to surrender to a murderous autocrat?

1:04:58Two words, first E, second U

1:05:07Thank you.