Netflix Wants To Have It All

0:05Emily Peck: Hello and welcome to Slate Money, your guide to the business and finance news of the week. I'm Felix Salmon of Bloomberg. I'm here with Elizabeth Spiers of the opinion side of The New York Times. Hello. I'm here with Emily Peck of Axios.

0:23Felix Salmon: Hi.

0:24Emily Peck: And we have a super special guest today, the one and only Nick Kulish from the news side of the New York Times. Thrilled to be here. Nick, introduce yourself. Who are you?

0:36Nicholas Kulish: Oh, I didn't know I was going to introduce myself. My name is Nicholas Kulish. I'm a reporter with the New York Times. I have been there now for 20 years. And I have been writing a lot recently about philanthropy.

0:47Emily Peck: 20 years. Wow. Now you're really making me feel old. Nick and I have some past history, which if you are a Slate Plus subscriber, that you will learn a little bit about because we have a Slate Plus segment on kids' movies, which is kind of interesting and you get to learn what Nick and I got up to, what, 27 years ago? We do have a main show before that, though, and we, of course, are going to talk about just movies in general and film and TV because Netflix is buying Warner Brothers, so we're going to talk about that. We are, of course, going to talk about the Michael Dell $6 billion donation to kids with American passports.

1:27Emily Peck: We are going to talk about dollar stores and whether and why and how they overcharge for goods. It's all coming up. It's a fun one this week. Welcome to Slate Money.

1:44Emily Peck: So obviously, the big business and finance news of the week is that Netflix is buying Warner Brothers, which has had various different suitors and owners over the years. We all remember when AOL bought Time Warner, which included Warner Brothers, and that was one of the most disastrous M &A transactions of all time. A lot of us will remember when AT &T bought Warner Brothers because reasons. And I remember having Ed Lee on this show multiple times going, can you explain this to me? It doesn't make any sense to me. And he would talk about strategy and I would still not understand it. and eventually that fell apart.

2:20Emily Peck: AT &T gave up, basically sold it off the scrap to David Zaslav, who had like some also-ran group of cable TV stations, became this company called Warner Brothers Discovery, still failed. And now it is finally reaching its natural and teleologically predetermined home, which is Netflix. That seems to be the news. Are we happy about this or are we not happy about this?

2:47Felix Salmon: I think this is the most fun to talk about business news that has hit us in a long, long time because there are so many amazing components to it. First, there's the storied history that you've just laid out of like the broken deals hall of fame or like the worst bloated awfulest deals ever. then there's like there's like the comeback story or like the david goliath back and forth of netflix and hbo since 2010 i was looking at a quote from jeff bukes does anyone remember yeah he was like the water brothers guy he said i could look it up i shared something about the albanian army he said yeah netflix taking over hbo would be or conquering hollywood would be like the Albanian army conquering the United States or something like that.

3:37Felix Salmon: Do you need the exact quote? We do not need the exact quote.

3:39Emily Peck: He definitely said Albanian army, even as the stated ambition of Netflix at the time was Netflix needs to become HBO before HBO can become Netflix, which then Netflix was like, HBO, we're much bigger than HBO. We want to become like an entire movie studio. And in fact, we're now bigger than Warner Brothers.

4:00Felix Salmon: Correct. So yes, so then after he said that in 2010, 2013, Sarandos or 2012, Ted Sarandos, who's now the co-CEO, says we want to be HBO. Then a few years later, he says, actually, HBO is nothing. We want to be all the things. And so now, of course, Netflix has so much money, so much power. They're the number one streamer. They've also put out Oscar-winning movies. There's no doubt here who is on top.

4:26Emily Peck: Well, I mean, so we are going to talk about asterisks. You know, we are going to talk about antitrust. And I'm sure that Netflix is going to be spending every minute of every day until this deal receives antitrust approval saying that they are not the number one streamer. And that the number one streamer is YouTube. And they are competing aggressively with YouTube and they need this kind of scale to compete with YouTube. But yeah, since we're on the subject, Nick, I know you're the antitrust expert suddenly, all of a sudden.

5:01Nicholas Kulish: I covered antitrust for the Wall Street Journal. Exactly.

5:04Emily Peck: So I feel like a lot of people will kind of take one look at it and say on its face, this looks anti-competitive. But my feeling is it's going to go through.

5:17Nicholas Kulish: Yeah, I think it probably will as well for the reason that you said. Antitrust is all about defining the market. And if you can define the market broadly, then you can skate through. And if you define it really narrowly, then you get busted. But also, I mean, it doesn't seem like the Trump administration has a real trust buster vibe. I know they're not.

5:39Elizabeth Spiers: Do Netflix happen to donate anything to the Trump ballroom? They probably will now.

5:44Nicholas Kulish: They will. My biggest question coming in was, does this mean we don't have to have rush hour four? I mean, that's going to be Amazon, right? Please.

5:51Felix Salmon: No, so this is the wild card, I think, is Larry Ellison, Paramount, the Rush Hour 4 angle. Ellison, who now has Paramount and who is very close to the Trump administration, obviously, wanted to buy Warner Brothers Discovery. And apparently, sources are saying, I don't know, not my sources, that they're upset. And like as we were getting on the chat today, there was, you know, some anonymous tweet of like Trump officials are looking closely at this deal. I feel like it's true. Everything Nick said is totally true about narrowly drawing the competitive landscape or whatever. But antitrust, everything is we're living in this Trump world, this Trump era now.

6:33Felix Salmon: So the real regulatory wildcard is not like what the market is. The regulatory wildcard is just we have this like very abnormal White House and they can do all kinds of shenanigans here if they want to.

6:48Emily Peck: When Ellison bought Paramount, the big sticking point that the Trumps, the Trumpers got caught up on was CBS News. And they wound up paying him like a huge amount of money to make that sticking point go away, paying Trump to be precise. And a bunch of CBS News people like quit in, you know, protest. but here there's no like cnn is not part of this deal cnn is part of the cable channels that are getting spun off from warner brothers discovery before they buy warner brothers so i think the thing that trump really cares about is cnn more than he cares about movie studios and then the other thing is that the sort of gop take on antitrust as opposed to the sort of lina khan hipster antitrust, is we are going to look for consumer harms.

7:38Emily Peck: If this is bad for consumers, then maybe it's anti-competitive. But if it's good for consumers, then we'll let it go through. And on its face, if you can get HBO Max and Netflix for the price of Netflix, that's good for the consumers, right?

7:58Elizabeth Spiers: No. I think this gives Trump administration too much credit for sticking to the normal parameters of antitrust. And I wonder how much of this is really going to be driven by the fact that he feels very aligned with David Ellison.

8:11Nicholas Kulish: Well, Comcast was the deal that he was most against, right? He didn't want to see CNN and MS falling into the same hands. But yeah, I mean, we're trying to predict how somebody's going to wake up, what mood he's going to wake up in bed one morning and whether he's going to tweet out that he doesn't like the deal or not.

8:28Emily Peck: The other thing is I don't think that David Ellison has much sway in the White House. I think Larry Ellison has sway in the White House. And so we would need David to persuade his dad to persuade Trump. And that's just like one extra degree of separation, which I think what happened by all accounts, all of this is very personal between David Ellison and David Zaslav, who's selling Warner Brothers, that they got into a big fight over South Park about a year ago. and they don't really trust each other and Ellison wanted to buy Warner Brothers, but Zaslav was like, fuck you, and eventually just said, fuck you, I'm going to go with Netflix instead.

9:08Emily Peck: Whether Ellison actually bid more than Netflix will probably get leaked at some point, but I suspect that ultimately, for all that Larry Ellison is like the second richest person in the world, Netflix has more money to do this kind of deal than, you know, Alison Feese.

9:27Felix Salmon: Felix, to your question about is this good or bad for consumers, I mean, the price of Netflix has gone up. I didn't look up the numbers before we hopped on, but I think it's up double or threefold over the past few years. It's really expensive now. They're the number one pay. Well, we could fight over the YouTube point. I don't want to. They're really big. They are a Goliath to these many Davids who are fussing about and fighting. they're buying HBO Max, which is, if you don't count YouTube, I believe the third biggest streamer. Number one and number three are combining. Netflix said today that they're going to keep HBO Max, whatever they'll call it next.

10:08Felix Salmon: We know it's had many names. They're going to keep it separate for now, which means there's no two for the price of one situation yet. Maybe that comes. I was hoping. But Netflix will have all these amazing, they'll have Sopranos, they'll have Sex and the City. They'll have succession, people. They'll have succession. Like Game of Thrones, like they're going to charge more. That is the future for consumers. More and more expensive streaming until we're way past where we were with cable when this whole mess started. So I don't think it's good for, there's less competition. That's not good for consumers.

10:44Emily Peck: I just don't see this as an area where anyone ever competes on price. Like prices only ever go up. No one's like, use my streamer because it's cheaper. Netflix has tried a little bit with its ad supported tier. And I guess Amazon is kind of trying. But ultimately, these things are sold on the breadth of offerings rather than we are cheap.

11:10Elizabeth Spiers: Maybe, but I think, you know, we're in a situation now in an economy where we're seeing consumer spending pull back. And, you know, that could happen indefinitely. So maybe in the long run, that's true. but I do think that people will pull back on things like subscriptions that they don't consider pure necessities when the economy is doing badly.

11:29Emily Peck: I think that's the vibe. I mean, last consumer spending figures I saw were pretty healthy.

11:34Nicholas Kulish: But it is stratifying where you have these free services, right, like Tubi and Roku. And just the standard YouTube where you watch Mr. Beast or whatever.

11:44Emily Peck: Versus now, yeah, you'll have the super, super premium HBO Max Netflix. I agree with Nick. I think it's going to go through. I don't think the Trump administration really has any antitrust appetite against anyone. They made a bunch of anti-big tech noises when they were campaigning, and those noises seem to have died down a bit. Like, Trump is very transactional, and so there is definitely a world in which, you know, he's going to be like, take a look at this deal and go, if you have 82 billion reasons why you want Warner Brothers, you can give me like one billion somehow to buy another plane for my presidential library or whatever.

12:24Emily Peck: But if he tries to get anything out of it, it's going to be like some kind of grift rather than just stopping it because he has some noble reason why he feels sorry for David Ellison, who, to be clear, absolutely no one feels sorry for David Ellison.

12:41Felix Salmon: He's probably never watched Netflix, I would bet, the president.

12:44Emily Peck: It's entirely possible.

12:45Felix Salmon: He hasn't seen House of Cards, nothing. He's just out there watching cable news.

12:50Emily Peck: He's really, he totally watches news shows. He has such a, you know, your grandpa stuck in front of Fox News. That's all he watches.

13:11Emily Peck: We should also, because we have Nick Kulish on, talk about the other billionaire in the White House, Michael Dell, who...

13:22Nicholas Kulish: Nick... Weren't we going to say that Ted Sarandos is going to make a big donation to the Trump administration?

13:26Emily Peck: Exactly. So, I mean, this is... I was talking to my colleague, John Others, about this at Bloomberg, and he was like, the thing I don't get about Michael Dell is if you're going to make a$6 billion donation to anything, like the first thing you do when you make a$6 billion donation to anything is you put your name on it. And when Michael Dell set up, you know, his computer company, he called it Dell. And now he has an investment bank, which is like his initials. But like, what's he doing with the$6 billion? He's naming it after Trump. But anyway, Nick, give us what happened and why is it interesting?

14:01Nicholas Kulish: Well, Michael Dell gave an amount of money roughly equal to the size of the entire Rockefeller Foundation's endowment in increments of$250 to 25 million children. Which is, I mean, just on its face is just really, really wild as a donation. Because we talk about the biggest donations of all time and it's usually Bill Gates gave$20 billion to the Gates Foundation. You know, it's just like moving money from column A to column B. But if you think of a direct donation, meaning the money goes from the billionaire to the recipient, I think this is the biggest one.

14:40Emily Peck: I mean, I was thinking about this. I would say that the Buffett donations to the Gates Foundation come close because they are not going into the endowment. They were all designed to pass through within a year. Within a year.

14:53Nicholas Kulish: But as a single – yeah, but then that's being parceled out to like little different groups. I mean listen. I mean Buffett has obviously – Warren Buffett has obviously given away more money total more generously than Michael Dell. Mackenzie Scott has given away more money total than Michael Dell.

15:08Emily Peck: But it is an absolutely massive donation. The other thing that it reminds me of, because it's so political, because it's going to this insanely politicized entity. And since we're talking about AOL Time Warner, it reminds me of Ted Turner giving a billion dollars to the UN a million years ago. It's that kind of donation.

15:33Nicholas Kulish: It's super political, right? Well, I mean, it's interesting. So I talked to Michael and Susan Dell about this. And I noticed something, which was that they never called them Trump accounts. They called them Invest America accounts throughout the interview because they've been pursuing this idea since 2021. And they kept saying, we took this to the Biden administration. We talked to Cory Booker about this and Ro Khanna. To them, this was like a good idea regardless of administration. Now, once you watch the press conference at the White House, you can sort of see how anything called a Trump account that's happening under the Trump administration is going to be immediately and like seriously politicized.

16:14Nicholas Kulish: But I think they saw it a different way.

16:16Emily Peck: In order to open up one of these accounts, and if you are a kid who's eligible for one of these accounts, your parent needs to fill out a form when they're filing their taxes. And that form is going to be called Form 4547. Why those numbers? Why those numbers?

16:32Elizabeth Spiers: It's just completely random.

16:34Emily Peck: Like, obviously, Trump has done an incredibly good job of making this all about him, even if the Dells didn't particularly want him to. And they were perfectly happy to trek to the White House and do the press conference at the White House, you know, and give him all of that positive publicity at the same time.

16:51Felix Salmon: It's interesting. I wrote a story late last week. I was speaking to the Republican lobbyist, Matt Lira, who's behind the push to get these into the big, beautiful bill, the Trump accounts. And they were originally called Invest America accounts when they were pitched in the Biden era. And then they – up until the last minute with the bill, and then they changed it to Trump accounts for obvious reasons. But he was saying that there's this now this like there was before this week a shift where companies, lawyers, policy people are trying to call the accounts 530A accounts because that's the section of the bill that they're in, 530A.

17:26Felix Salmon: And, you know, and everyone I talked to was like, we just we don't want them to be politicized. We want everyone to put money in these things if they're Republican. Like they don't want like Democrat parents filling out their taxes and they see the word Trump account and they're like, fuck this. because they would actually miss out on money and Wall Street would miss out on all those dollars, right? So no one actually wants them in the long run to be politicized. And I don't think, honestly, I know everyone likes to say things about the president and the White House and how transactional it is, but I think it's fine that they're called Trump accounts.

17:57Felix Salmon: We have Obamacare. Like, things become politicized, but if there's pickup, if there's money that Americans can get somehow, like, probably everything will work itself out.

18:08Nicholas Kulish: And they were actually briefly called MAGA accounts. So they were introduced as Invest America accounts by Senator Cruz. Then House Republicans called the MAGA accounts. And then the Senate said, OK, well, maybe we'll just call them Trump accounts. Look, they're called Roth IRA. Like, you know, this is like a this is OK. We can do this. But yeah, there was a brief moment. senator roth i looked it up there was a senator roth who was involved in that the bigger question is is whether like every other program 529 college savings accounts whether this is going to become a thing where rich people pour tons of money into it and you know poor people miss the boat and and

18:45Emily Peck: sadly probably so nick you you've you've talked to the dells about this um you've looked into it more than I have. To me, and I am very willing to hear you tell me that I'm wrong about this, but to me, if I was making a$6 billion charitable donation, I would be incredibly hard pushed to do something which has a smaller overall effect than throwing it all into index funds for 15 years and waiting for them to mature and then asking people to pay taxes on it when it does and like giving people money in a kind of technical sense but not in a sense of them being able to spend it and then you know at the end of 15 years they have 500 bucks which will buy you a cup of coffee at that point it strikes me as a peculiarly small bore intervention with an enormous amount of money where normally you would expect someone spending this amount of money to really, there will have been loads of like RCTs, there will be, it would be super evidence-based, there would be massive returns on investment.

20:01Emily Peck: And there's very little of that. The best I can find is basically, well, if you open up these accounts for kids, then they're more likely to go to college, which is not nothing, but like, come on, for$6 billion, you could save millions of lives. Well, it seems like part of the logic is that they really are betting on the idea that other people are going to come behind them and put more money into these accounts.

20:25Elizabeth Spiers: But I don't really understand how this works. Like if you write a giant check to the government, do you get tax benefits or anything from that? What's the incentive for other bajillionaires to do this?

20:36Nicholas Kulish: They're going to write the regs so that this is a charitable donation.

20:40Emily Peck: But also, Elizabeth, the overwhelming majority of the money they are hoping will end up in these accounts is not philanthropic capital and it's not government capital. It's capital coming from grandparents and friends and parents and employers. And the idea is you open up one of these accounts and then your employer will throw$1 ,000 a year into it and that kind of thing. And that's how they grow. It's not like we're going to find another few billionaires to throw in more money at$100 a pop.

21:11Nicholas Kulish: I was joking to my editor this morning that they should be called Rorschach accounts because, like, if you ask progressives, they're like, we got the account started. And now, you know, in a future Democratic Congress, we'll be able to cede them with way more money. And this is like this was just like the foot in the door to, like, create the kinds of baby bonds that progressive economists have advocated for. and Scott Besant made comments saying that this was a backdoor to abolish social security although he walked those back and said it was additive to social security but he had a bright part of it he said that and then the Dells are like yeah all of my friends have said they're going to kick in a few billion too so it's 250 now but it's going to be five thousand dollars once every once the cavalry arrives and once the parents chip in and everything so it's like everybody everybody has a bold vision for these accounts.

21:59Nicholas Kulish: And they'll probably just end up like 529s, which is, you know, rich people use them to build wealth tax-free.

22:07Emily Peck: What's your expectation, Nick, for take up of these things? You know, obviously the idea here is that, what is it, 85 % of kids, like every single kid in the zip code where the median income is less than$150 ,000 is going to be eligible with a massive asterisk, by the way, saying that kid has to be a US citizen. If you're not a US citizen, you're not eligible, which is going to create all manner of disparities. But to its credit, I mean, I will say this, it is going to make it interesting to do natural experiments on this in 10 years. There will be lots of neighborhoods where a bunch of kids don't have them and a bunch of kids do have them.

22:43Emily Peck: And you'll be able to see whether or not they actually made that much of a difference. But it is still wild to me that that is still a completely open question and that we are throwing this much money at a program which is so unproven.

22:57Elizabeth Spiers: Also, the thing is, you know, there's a certain amount of administrative burden here where the very poorest families are probably not going to take advantage of it because they just, the understanding that, you know, you have to fill out this separate form, you know, all this stuff that just makes it a little bit more difficult, I think is going to mean that it's just, it's mostly going to fund middle class people.

23:20Emily Peck: I think mostly is maybe stretching it depending on how you define middle class. But yes, I think the people, it's not going to reach everyone. And the people it doesn't reach are going to be mostly the poorest and obviously anyone whose kids are not U.S. citizens. I do wonder about that. Is there a world, Nick, where like a democratic administration can come in and like fix that?

23:45Nicholas Kulish: I mean, I think anything is possible that way. it's all a matter of like how easy you make it or how automatic you make it for people to enroll i think you know so many different kinds of studies show if you wait for people to opt in or make it hard for them to opt in then it kind of never works out and if you if you kick it off and get it started you know and that's and that's i think michael dell deserves some credit here even if you don't like the name trump accounts even if you don't you know agree with the administration like he's saying i'm kicking off an amount of money that will try to grab the attention of tens of millions, hundreds of millions of people and get them interested and get them working on these accounts.

24:22Nicholas Kulish: And a$6.3 billion bet is a pretty hefty bet.

24:27Felix Salmon: A couple of things. I was talking to Neil Mahoney, he's an economist at Stanford, and he was talking about how putting money, seeding, just kind of like we said earlier, seeding a little bit of money into these accounts really incentivizes people to open them up. And once they open them up, it becomes like this kind of sticky thing that maybe snowballs and grows to your question of like, how many people are going to actually do this or whatever. So, okay. But then I was thinking about 401ks and how they have become huge. I don't need to give you any more information on that. We all know this. But they were just like an afterthought thrown into a bill that these accounts were created.

25:04Felix Salmon: But then employers were like, hang on, pensions are really expensive. This 401k thing looks interesting. They had a huge incentive to offload pensions into 401ks and build out that whole world. And then obviously Wall Street, the whole industry had an incentive also to make 401ks huge. So there was a lot of momentum coming from that. But with these accounts, I'm like, what's the momentum? It's not the same thing. Employers and employees don't care like that much. Like it's a nice add-on benefit, but it's not like workers are clamoring for this.

25:39Emily Peck: Nick, I need to ask you, like I think the really important question here, and I genuinely don't know the answer, is like the reason 401ks took off is because you put pre-tax money into them rather than post-tax money. If I'm pretty sure, correct me if I'm wrong here, but if I want to give my niece 300 bucks for her Trump account, that's post-tax money. So like at that point, the incentive that you see with 401ks is just not there.

26:07Felix Salmon: But employers, if you're getting your money for your Trump account through your company, that comes in pre-tax up to$2 ,500 a year. They can do the same. Instead of giving you, they can give you X to your 401k and then Y to your Trump account for your kid or for yourself if you're a kid. You know, if you're 17 and you work some job and for some reason they want to give you that money.

26:30Nicholas Kulish: And this is where it gets a little weird in touting how they're going to close the wealth gap because companies like Microsoft and NVIDIA have said that they're going to donate to their employees' children.

26:41Felix Salmon: Oh, that'll do it. Yeah. Those poor Microsoft and NVIDIA employees are really struggling.

26:46Emily Peck: No, the employees are struggling. They're working very hard, Emily, and their kids don't see their parents. But at least the kids will now have$500 on top of the$50 million that their parents have.

26:57Nicholas Kulish: And then at the White House press conference, Ted Cruz said that a single mother earning a living waiting tables could put$5 ,000 a year into their child's. Sorry, Emily. I wasn't actually trying to create a real spit take. This is true. And then that child would have it with something like$700 ,000 when they were 25 or 30 or something.

27:18Felix Salmon: It's so easy.

27:19Nicholas Kulish: Yeah.

27:21Elizabeth Spiers: You went to Harvard.

27:23Felix Salmon: I wrote about this a little too this week. There's this like big push for the past decades to sort of put the safety net on people, on individuals to save for their retirement, to save for their health care. Earlier this year, I wrote about there's this Republican effort mostly now to do what they call portable benefits, which is like instead of giving you sick days or sick time, your employer gives you a few hundred dollars a year to pay for a sick day if you want to take it off and you put it in a savings account. And they call those portable benefits. And now we're seeing with the fight over Obamacare subsidies, you know, there's a lot of talk of health care savings accounts, which already exist, but they're like, we'll make them even better.

27:59Felix Salmon: And I feel like this is just like the latest, you know, move in that direction. And like you said, Nick, like to the point where there has been some chatter from the Treasury Secretary about making these a substitute for Social Security.

28:15Emily Peck: So the question then arises, if this is all part of this kind of libertarian privatization of the welfare state, how would they ever progressive idea to begin with?

28:29Nicholas Kulish: Well, I've actually been talking to the people who came up, well, talking in one case and emailing in the other because he had a painful oral surgery apparently. But these two economists, like one at Duke and one at the New School here in New York, were looking at the wealth gap and specifically the black-white wealth divide kind of in the wake of the Great Recession and sort of as the understanding shifted from income inequality to wealth inequality and how important that was. And so they came up with – sometimes they're called child savings account. Connecticut has a version of this where every child who I think is Medicaid born gets a couple of thousand dollars in an account.

29:10And so the version that they helped Cory Booker put together is every child born gets$1 ,000 in their account like the Trump version for the next four years. but then children under the poverty line get$2 ,000 a year until they turn 18.

29:30Nicholas Kulish: Children at twice the poverty line get, it was like 1 ,500, three times the poverty line, 1 ,000. And then once you're at five times the poverty line, you don't get anything. So it was incredibly progressive and it was intended to, with compounding and so on, mean that poor children as defined by the federal poverty line would have like$50 ,000 when they graduated from high school. You know, middle class kids would have 20 grand to help supplement, you know, going to college or whatever. And rich kids would have this account that their parents could donate to, you know, tax free. So that's like sort of where in the old meme sense, you know, where it started, where we are.

30:07Nicholas Kulish: And we ended up with the carnival of capitalism with all. And maybe we can kill social security with this.

30:13Elizabeth Spiers: That's the.

30:14Nicholas Kulish: Yes. Yeah.

30:15Emily Peck: Did you ask the Dells about that? Did you ask if they were worried that this was going to threaten social security?

30:21Nicholas Kulish: It hadn't come up yet.

30:23Felix Salmon: Ask them.

30:24Nicholas Kulish: Next time you talk to them, ask them. Hold on, let me text them. Give me a second.

30:28Felix Salmon: Dash it off, quick.

30:30Nicholas Kulish: When I first talked to them, it wasn't entirely clear about the whole zip code thing. And so I said, you know, people are going to say, why didn't you put some kind of income restriction on this? You know, somebody's going to say, why are Elon Musk's kids eligible for this?

30:43Emily Peck: I think they are.

30:44Nicholas Kulish: I think South Texas is where he lives. And it's got a low median income. Well, Michael Dell said, I saw Elon last week and his kids are not in one of the zip codes.

30:55Felix Salmon: But his kids will be eligible for the thousand.

30:57Nicholas Kulish: The ones that keep on getting born.

30:59Emily Peck: If he continues having them born, yes. I mean, but yeah, when you like, the going rate, we've talked about this for an Elon Musk baby mama is 30 million per kid. So that's not enough to get by. You need that extra thousand.

31:13Nicholas Kulish: but this I think does get to a point because there's in philanthropy there's this kind of central question where rich people always say it's really hard to give away a lot of money well and they're kind of right because if you give to like a group and then they embezzle it or they tweet crazy things like you you like take the hit so they have all this kind of due diligence and stuff and but there's like this question of oh sure rich people it's so hard to give away money you know and the rich people are like no i swear it really is it's really hard and so this kind of raises that question and elon musk is the perfect example because elon musk once upon a time signed the giving pledge set up a real foundation with all the federal requirements and it has just gonzo grown and is now one of the has like 14 billion dollars or whatever uh teddy schleifer and david fahrenholdt reported um like huge amount of money and he could say oh i'm friends with michael dell This is a great idea.

32:08Nicholas Kulish: It goes straight to the kids. It's capitalist because it's invested in the S &P 500. And it's natalist, right? Which is very must-coded. Right, exactly. So he could give that$14 billion. And on the Dell model, that's what? Like more than twice as much. So then every kid in America has$750. So it's like that's what the Dells are hoping is going to happen.

32:29Elizabeth Spiers: How do you shame these people into doing this?

32:32Nicholas Kulish: Well, Elon is unshamable. We know that. I think you just wait for their mergers to go before the FTC or the Justice Department.

32:39Felix Salmon: I was thinking about that. They say it's so hard to give away money at the same time. They're like doing everything they can to work the tax system so they pay less taxes. It's like, you know, it's an easy way to give money. Like just freaking pay your taxes. Like stop fighting it.

32:53Emily Peck: There is an interesting extra twist to this about like.

32:57Felix Salmon: I don't know anything about the Dell's taxes.

32:59Emily Peck: No, no, but in terms of the hard to give away money thing, and this goes back to what Nick was saying at the beginning about really big donations to a single recipient, it's hard to think of anything on this scale because it is not easy to give$6 billion for a single recipient without making that recipient a multi-billionaire, at which point they're part of the problem because, as we all know, every billionaire is a policy failure. Anyway, there is this feeling that the solution to this problem, insofar as it's a problem, and we can debate whether or not it's actually a problem. But if you believe that it's hard to give away money at scale, then the solution to the problem is unconditional cash transfers, of which this is one flavor.

33:44Emily Peck: It's not my favorite flavor at all because it's going to kids in the richest country in the world and they have to be US citizens and they're already very privileged for that reason and it goes to untouchable savings rather than money you can spend. And there's a whole bunch of reason why if you're doing UCTs, like you wouldn't do it this way. But it does kind of help places like GiveDirectly sort of say, well, yeah, like you can't say that giving away money is hard because giving away money is easy once you sign on to UCTs. And the one thing I will just mention, because I think it's worth mentioning for the Slate Money audience, is that at the end of last year, kind of quietly, GiveWell, which does a very good job of judging charities, re-rated GiveDirectly.

34:34Emily Peck: And they basically said GiveDirectly was actually, after the re-rating, four times more effective than they had previously thought. UCTs are holding up pretty well these days.

34:45Nicholas Kulish: Well, and what's really interesting is how it's kind of this convergence of very progressive people who love them because they're, you know, anti-colonial and they're like giving back the power to the people, you know, letting the people decide what they want. You know, very conservative people like them because they don't trust the progressive leaning staffs at foundations and they all worry that their money is going to turn into the Ford Foundation where, you know, a conservative donor ends up with really liberal endowment. And then the technocratic, you know, effective altruist types like it too.

35:20Nicholas Kulish: So it's like all these people are kind of moving away from that like Bloomberg, Gates, you know, super, super, you have to do it exactly the way I tell you to model and toward a like here, just like push in the chips and let the people decide what to do with them.

35:33Felix Salmon: Let me also point out as I guess the resident liberal today or in this segment anyway, sorry, Elizabeth, like we had sort of unconditional cash transfers in 2021 when we expanded the child tax credit and families around the country got like real money every month, hundreds of dollars, and the poverty rate fell. Like, and it wasn't hard. It wasn't a hard thing to pull off. It was pretty easy, actually, for the, I mean, not politically, but as a mechanism, it was pretty swift and effective. And there are easy ways to do that again, if instead of complaining that it's hard to pay, you know, to do philanthropy, you just, again, pay your taxes.

36:15Emily Peck: And we do know that Trump loves them, he's still banging on about how everyone's going to get$2 ,000 somehow. I'm not holding my breath.

36:22Felix Salmon: But these were targeted payments to families.

36:25Emily Peck: Unconditional does not mean untargeted. You can target them.

36:29Elizabeth Spiers: But also the Trump administration has also complained about pandemic checks, even though those had a similar effect. They reduced property by 17%.

36:37Emily Peck: Didn't the Trump administration send out the first tranche of pandemic checks? Yeah.

36:41Elizabeth Spiers: And then they turned around. Well, when inflation started going up, they found a way to kind of pin it on Biden and pretend that they were not responsible for any of it.

36:51Nicholas Kulish: They did Operation Warp Speed, too.

36:53Elizabeth Spiers: Yeah.

36:54Felix Salmon: But I'm just saying the most effective mechanism isn't give directly. The most effective mechanism is the federal government. It pains me to say it and people don't like to hear it, but it's just true.

37:15Emily Peck: Let's move on because since we're talking about the plight of poor people, here's a little stupid, dumb, illegal tax that poor people pay that they shouldn't, which is they live in food deserts and they don't have a lot of choices to where to shop. And the one thing they are surrounded by is dollar stores. And they go into the dollar stores and they and the dollar store is like here have a skillet for five dollars and they're like great i'll buy a skillet for five dollars and they take it to the checkout and it rings up at like 7.95 and the dollar stores both big chains seem to endemically overcharge or rather charge more than the sticker price for an astonishingly high percentage of the goods in their stores and i'm sitting here going, how is this even like my, I remember when I told Emily this, she's like, what really?

38:14Felix Salmon: But then I read the guardian piece and I was like, oh my God. It was like, what did they say? 4 ,300 government inspections in 23 States. Uh, the dollar stores have, have dollar general stores have failed because their sticker prices are lower than the register prices. And And then the customers that catch it, they'll complain. And the staff often says there's nothing we can do about it. And they won't take a return, which I thought was astonishing.

38:42Emily Peck: My favorite one was like, oh, you should have told us before you left the door. But since you found out after you left the door, we can't do anything about it. Like, what? Yes, you can.

38:51Elizabeth Spiers: What's crazy about this is that it is directly a labor problem as much as it is, you know, the company's not prioritizing this. because when you have one staffer in the entire store and they change prices as frequently as they do, there's just no way to relabel everything and then make sure it's accurate in the system. Elizabeth, yes, there is.

39:08Emily Peck: It's the thing that Target and everyone else does, which is just have e-ink prices rather than paper prices.

39:15Elizabeth Spiers: I think, well, but Felix, the whole dollar store shtick is that they don't have the scale of technology and they're not willing to invest that way.

39:24Emily Peck: I don't think that having e-ink prices is like an expensive thing that they can't afford. Like that is now cheap. The reason they don't do it is because, partly because they want to have like big flashing signs saying like three for$5 and partly because I think they want to get away with mischarging.

39:41Felix Salmon: Also interesting, producer Jessamine included a piece in our prep about Kroger from Consumer Reports, which was an excellent story. And Kroger also has a similar problem that's been called out by attorneys general around the country. and consumers have complained about where in their more understaffed supermarkets, they don't change the prices frequently enough and people are getting overcharged quite often as well. Yeah, and they have no excuse. So I wonder like how many other, I bet it's not just dollar stores. I bet it's not just Kroger. I bet it's more than that.

40:10Nicholas Kulish: I have been noticing this at my grocery store in Brooklyn recently. And I was like, wow, this just suddenly keeps happening a lot. And when I read this article, I thought, oh, tactic, not just mistake. I thought the Guardian piece was amazing and stunning.

40:23Emily Peck: And the fines are so small compared to the excess profits. And it's all done on a state-by-state basis. And there are states where they don't even do the inspections. There are states where they're like, well, it's on the consumers to care about this, and it's not our problem.

40:37Felix Salmon: Yeah, and pricing is so much more dynamic now, which we've talked about so many times on the podcast before. But we usually talk about it as an online issue. Like with Amazon, if you subscribe to paper towels at$10 a pack, you don't even notice. And I don't think they always tell you when the paper towel pack goes up. You know, things are just changing all the time. But with this, it's brick and mortar. And you would have thought it would be more, it would be less susceptible to that kind of problem.

41:03Emily Peck: Yeah, it even happened to me with Uber, you know, where they're like, this trip is going to cost$37. And then you do the trip and then you get billed. And then they're like, oh, sorry, it went up to$57. And you're like, what?

41:16Felix Salmon: Sorry. Yeah, it seems bad. And I don't know, everyone's talking about affordability these days. And we know that inflation doesn't, we don't want it to go negative or anything like that. But it seems like an effective way to cut costs for people would be to just make sure companies charge you what they say they're going to charge you. Like, that seems pretty much like a good idea. If only there were, like, agencies to.

41:38Emily Peck: And it is the law. I mean, they are legally obliged to do that. But, like, again, like, we're in this kind of bizarre laissez-faire world where it seems that the cost of breaking the law on this kind of thing is negative increasingly. me.

41:54Felix Salmon: So not that we like to give advice, but I think the advice here is like, keep your eye on the scanner and like eagle eye, like watch everything at the store. You can't just like look at your phone while they're ringing you up.

42:06Emily Peck: But they had like, if you read the stories, they have all of these people who do that and they eagle eye it and they're like, wait, no, that's not the price on the shelf. And that don't pay. And the cashier is just like, nothing I can do. They will not give you that price. The only choice you have is not to buy the thing, but if the dollar store is the only choice in town, that's no choice at all.

42:28Felix Salmon: Then I guess what you need to do is steal at the self-checkout. Does dollar store have self-checkout? Like, just don't scan it. Just put it in the bag. They can implement self-checkout and then have no employees.

42:54Emily Peck: Guys, we should have a numbers round. Emily, do you have a number?

42:58Felix Salmon: Yeah, well, at first I had a number I prepared and it involved a toilet. Then I was like, no, I'm not going to do that number. I can talk about it. Or maybe Elizabeth has it as hers. My number is 67.

43:09Nicholas Kulish: That's right. Oh, no, not 67.

43:11Emily Peck: I have the same number. Not 67 again.

43:14Felix Salmon: Not the same number, but the same. Not the same. Yes, it's 67 because that is, according to Spotify wrapped, my listening age. No! I am old. I'm an old.

43:26Emily Peck: Wow. I was 47. I feel so much younger than you now.

43:29Felix Salmon: I've seen so many young people that are old that I feel almost like I'm young because I got the old number. And you can't convince me otherwise. Wait, Elizabeth, are you 67 as well?

43:38Elizabeth Spiers: No, but this was my number idea. I'm 61 though.

43:42Felix Salmon: Oh.

43:43Elizabeth Spiers: And IRL, I'm 48.

43:45Nicholas Kulish: My wife is losing her mind because Spotify thinks she's seven. Seven years old.

43:52Elizabeth Spiers: Is there a lot of baby shark in your playlist?

43:55Nicholas Kulish: It's a little, oh yeah, no, she got this. It was like, remember the day, Spotify said to her the other day, remember the day when you listened to this My Little Pony song? She was mad. She was screenshotting it and sending it to people. And the upshot is that I am now being forced to take all the child playlists

44:12Felix Salmon: onto my account. There was a meme going around that was like, every parent with their Spotify wrapped today, and it was that scene from Titanic where the guy goes, I have a child. I have a child.

44:25Elizabeth Spiers: So true. Elizabeth, do you have a spare number? I'm operating on less than four hours of sleep. I'm so sorry.

44:31Felix Salmon: Do you want the 599 number that I also prepared? I can send it to you. Sure.

44:36Emily Peck: Well, Emily is back channeling with Elizabeth. I will reveal my number, which is 1 ,044 ,000. And that is the price at auction paid for a painting called Cabinet Sunset by, we've talked about him before, Bob Ross. And this was not one of the paintings that we talked about before. The three paintings that sold on November 11, they sold for between$114 ,000 and$318 ,000 each, which is still an insane amount of money to pay for a terrible painting. And that all went to something called American Public Television, whereas the Cabinet Sunset, which is also a terrible painting, went to something called the Public Media Bridge Fund.

45:29Emily Peck: So obviously, like, people care about which flavor of public TV charity they want to support because I can guarantee you that no one's paying this because they love the painting so much. Or maybe they are. Maybe people just have really bad taste. I love the painting.

45:45Felix Salmon: Why do you have to malign Bob Ross constantly on the show? I mean, he's a good person. He's a good person. Blessed, bushy-haired man.

45:52Emily Peck: A pleasant, bushy-haired man who is also a terrible artist. No. He just goes like this and it looks like a pine tree. Exactly. It's like pine tree, pine tree. It's beautiful. I like this Nick guy. But the other reason, and we should maybe talk about this, I feel like I want to do a money talks about this. It's just like the sort of psycho drama of auctions. I think the real reason that this thing sold for a million dollars is the auctioneer. Like the identity of the auctioneer is really important. And if you have a good auctioneer, they can really get people het up and bidding more. And in this case, the auctioneer was a certain gentleman, an Englishman, by the name of John Oliver.

46:28Felix Salmon: He probably donated his time, right?

46:30Emily Peck: Yeah, but there are people who do it professionally. If you are a charity auctioneer and you are a Slate Money listener, please email us on slatemoneyatslate.com, and I want to interview you, and I will ask you how much you get paid, and you will answer because you like me. Elizabeth, what's your number?

46:47Elizabeth Spiers: Yes, I have a number on loan from Emily Peck. It's the price of the Dakota device, which is a Kohler product that analyzes your poop and tells you about your gut health. So this device - What's the number? Oh, it's$599. Okay. Plus - Tax. Plus tax. But also, this is a subscription product. Mandatory.

47:09Nicholas Kulish: Right, swabs.

47:11Elizabeth Spiers: $6.99 a month. And there's a$12.99 a month package for a family package if you want the entire family's poop to be analyzed.

47:20Felix Salmon: They analyze your poop and you get an app for it. And they'll be like, congratulations, you drank the proper amount of water.

47:26Emily Peck: I feel like this is biohacking just run amok. We had a whole Bloomberg Weekend story about poop scanning toilets.

47:33Felix Salmon: But this is not why it's in the news this week. Oh, why is it in the news this week?

47:36Elizabeth Spiers: Oh, also, they were promising end-to-end encryption, and they are misusing that term. So your poop data is not fully encrypted.

47:48Emily Peck: Just FYI. From your end to their end, yeah.

47:51Felix Salmon: They lied about the end-to-end encryption on the video camera for your toilet bowl.

47:56Emily Peck: End-to-end, so to speak. I'm sorry. I'm just going to cut this short right now. Nick, what is your number?

48:02Nicholas Kulish: Okay, my number is$148 billion. And that is Michael Dell's remaining net worth. If he chose to do so, that means he could put about$6 ,000 more into each of those 25 million accounts.

48:20Emily Peck: Or, you know, he could give it to really poor people rather than Americans. He could spread it on bad nuts. Come on, Felix.

48:28Felix Salmon: America first. No? Oh, my God. Okay.

48:34Emily Peck: That's why he can afford to give away$6 billion is because he's worth$148 billion. And it's like it will make precisely zero difference to his life in any way, shape, or form beyond he's now buddies with Donald Trump, which has got to help somehow.

48:50Felix Salmon: Didn't you say in your story like his wealth made$6 billion? Didn't I read that somewhere? This year alone or something like that.

48:56Elizabeth Spiers: I think it's like a quarter of what he made in the last 12 months or something.

49:02Nicholas Kulish: Well, there's like the made versus like what the value of his stake in the company went up. Which is never the same thing. I mean, I haven't tracked this down exactly. And now I'm saying it in front of people who work for Axios and Bloomberg. But I'm pretty sure he had this investment in VMware that got turned into Broadcom. And then the company got a lot of money from the acquisition. But then he personally got a lot. And I think there's some way where there's an actual transaction that left him with a bunch of money. I think if you do an old-fashioned Homeland yarn chart on the wall, you can see where the$6.25 billion came from.

49:40All right.

49:41Emily Peck: I think that's it for the main show this week. Nick, we are going to put you on the spot in Slate Plus about Zootopia 2. because I do actually want to talk about Zootopia 2 and the rise and rise and rise and rise of children's movies. In a special segment, by the way, I should add, where Emily is going to tell me that I'm completely wrong about everything, so I'm looking forward to that. But otherwise, thank you so much for listening to Slate Plus. Thanks for emailing us on slatemoneyatslate.com. Thank you very much to Jessamyn Molly, Shana Roth, Merit Jacob, Micah Phillips, and the whole Slate crew for making this happen.

50:18Emily Peck: Thank you especially to Nick Kulish for braving sub-Arctic weather and going to various places in Brooklyn before finding his way here. Nick, thank you so much for coming on. Happy to be here. And we will be back next week with more Slate Money.