Trump Is Stuck in the '80s

0:06Emily 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 Emily Peck of Axios.

0:18Felix Salmon: Hello Felix.

0:19Emily Peck: With Elizabeth Spiers of The New York Times.

0:22Felix Salmon: Hello.

0:24Emily Peck: And very excitingly, we are giddy with anticipation with the one and only Lizzie O 'Leary of Slate.

0:33Lizzie O'Leary: Hello.

0:34Emily Peck: Hi, Lizzie. Welcome. You also podcast on Slate.

0:38Lizzie O'Leary: I also podcast on Slate. I host a podcast called What Next TBD.

0:42Emily Peck: So we have brought you on basically because you're the best person and we love you very much and you're great. but also because you have been doing a big deep dive into X, GROC, Elon, and various ickiness thereabouts. So we are going to talk about that. We are also going to talk about, well, we are also going to allow Emily to go off on her own deep dive that she has done into, what's it called? It's not called welfare anymore. It's called temporary assistance for needy families.

1:15Felix Salmon: I think it sounds the most boring possible.

1:17Emily Peck: It is actually going to be a good rant.

1:20Lizzie O'Leary: It underpins the economy in so many ways, Felix.

1:23Emily Peck: When Emily gets the good rant going, you want to stay around for that. But of course, we are going to lead with Venezuela because that's the big news of the week. We have a Slate Plus segment about reeks and plays and joyce and fun and why you all need to buy a ticket to the Ulysses at Public Theater. And, well, mainly because Lizzie's here, it's just going to be an awesome, awesome episode. So stay tuned. It's all coming up on Slate Money.

1:58Emily Peck: So let's start this week with Venezuela, which we didn't talk about last week because it hadn't happened yet. But we all woke up over the weekend and there were lots of headlines of bombs and deaths and kidnappings and whatnot. And now, a week later, things are a little bit coming into focus. Elizabeth, you've actually written about this. So bring us up to speed very quickly on, is Venezuela part of America now?

2:28Elizabeth Spiers: I think Donald Trump would like it to be. Over the weekend, they abducted Nicolas Maduro, the head of state in Venezuela. And initially, the sort of explanation for this was that we were charging him on charges of drug running. even though Trump's fentanyl obsession doesn't really apply here because there have been cocaine issues with Venezuela, but no fentanyl. And then he sort of blurted out in a press conference that it was really about the oil. He said, we're taking back the oil. And so now it's about the oil and everybody kind of acknowledges that.

2:59Emily Peck: Like when he says he's taking back the oil, that kind of implies that the oil used to be American and then the Venezuelans took it and now it's going to be American again. Was there ever a point at which this oil was American?

3:10Elizabeth Spiers: As with many things, Trump says he distorts things, possibly from a place of misunderstanding as much as from malice. But in 2007, Venezuela nationalized several oil fields that were being run by American companies. Now, since then, this has sort of been straightened out in international courts, and Venezuela has billions of dollars in debt that it owes to these American companies, that it's in the process of, or has been in the process of paying down. So when Trump says we're going to take the oil back, That's kind of what he's referring to, but he's sort of aligning the whole thing that, you know, this has already been worked out.

3:47Emily Peck: I was under the impression that Venezuela was very much in default on all of that debt and has not been paying it down.

3:52Felix Salmon: It has not been paying it down. It's in default. Because of the sanctions imposed by the Trump administration, Venezuela can't negotiate its debt or do anything to get out of its default status.

4:03Elizabeth Spiers: Yes, that's true. But it's also the case that we're partly responsible for the fact that it can't get out of default status. So whenever he suggests that this is just, you know, remedies the whole problem, I think that's disingenuous. But at any rate, he's now sort of claiming that we're going to take this oil back and this is going to solve everything. But the reality is he didn't consult any of the American oil companies before he did this. And in order for American companies to benefit from the oil that is in the ground in Venezuela, they have to repair a lot of broken infrastructure that would cost them a lot of money.

4:42Elizabeth Spiers: And there's no evidence that they actually want to do that.

4:44Emily Peck: Well, I mean, again, this is still very early days. And certainly Scott Besson, the Treasury Secretary, says that he's been talking to the CEO of Chevron, whose name I forget, quite frequently. And apparently Trump has been talking to him, too. Chevron being by far the biggest player in Venezuela.

5:00Elizabeth Spiers: And they're the only American player in Venezuela. The only American player.

5:04Emily Peck: The biggest player is Pedovesa, which is the Venezuelan oil company. Chevron is a significant number two. And in the era of sanctions, when Pedevese is not allowed to sell any oil, Chevron is the only company that is really allowed to pump oil and sell oil. Chevron is also owed money as part of in the way that we are talking about. And part of the financial aspect of all of this is very much that there is this idea that sanctions will be lifted, oil money will start flowing again, and some quantum of that money at some point will make its way to the American companies who are owed a lot of money to recoup them for the expropriations and yada, yada, yada.

5:48Emily Peck: But like, that's all a long way off. And it seems, I have to say, it seems like a kind of second order effect of this whole invasion, kidnapping, putting on trial and all the rest of it. The first order effect, as far as I can tell, is just sort of muscle flexing. You know, people are talking about the Monroe Doctrine, but really, I feel like this is really just bringing back the right of conquest. You know, he doesn't want to really take over Venezuela, but he wants to show that he could if he wanted to. And he talks about the way that U.S. is in charge of Venezuela. And he's talking about taking over Greenland.

6:29Emily Peck: And basically, I mean, I was kind of surprised about this. The right of conquest only really ended in 1933. It isn't that long ago that the United States claimed a sort of right of conquest over various dominions. And Roosevelt, in the depths of the Great Depression, kind of said, well, actually, there is this thing called sovereignty and we won't mess with that. And Trump is now sort of rolling that back in a way that is really quite profound, I think.

6:57Elizabeth Spiers: I wrote a column for The Nation about this. And my theory was because it drives me crazy when all the pundits get up and say, you know, Trump is pursuing a strategy that is pursuant to everything we know about political theory. And in this case, they keep saying, you know, he cares about spheres of influence. And my contention is that he doesn't even know what that means. He cares about acquisition. And this comes from his mentality as a commercial real estate guy. So he just views foreign countries as properties and assets to be acquired. And he doesn't see why you can't just go out and buy Greenland.

7:29Emily Peck: And specifically, as we have discovered very much with trade war and in many other cases, he lives very much in a world of goods rather than services. So even though 70 % of the US economy is services-based, what he really cares about is goods trade and the balance of trade and goods. And specifically when it comes to goods, again, he's not really interested in the super sort of high-end stuff. He's interested in as far down the value chain as you can get. He really cares about commodities and oil, yes, and also critical minerals, of which Greenland has quite a lot. And I think one of the reasons, like, again, while, you know, can do the sort of Alison Janney speech from the first season of The Diplomat about why Greenland is so strategically important.

8:13I think when it comes to Trump, it's again like those minerals

8:18Emily Peck: and natural resources that he's eyeing. And he's like, I want that to be American. And while under sort of international law and even American law, the massive oil reserves underneath Venezuelan waters are clearly Venezuelan and not American. I think that's a sort of nicety as far as Trump is concerned.

8:37Felix Salmon: It really does seem like he is taking us back to a very different time when commodities were everything and countries fought each other over the oil or the gold or the minerals, whatever.

8:51Emily Peck: The silver, remember. The silver. Argentina is called Argentina. The name of Argentina is named after the silver that is there.

8:58Felix Salmon: Right. And the question I have, is this a good idea. I mean, it's 2026 now. The U.S. economy is massive and free trade has enabled us for a long time to build out a services economy that makes an awful lot of money and isn't dependent on, you know, commodities prices. We have a big tech industry that, yes, needs commodities to operate and increasingly more and more energy to operate. But that's not where like our big money comes from. That's not where our power comes from. Our power doesn't come from like the oil. We have the largest oil reserves, I believe the United States does in the world, but our power doesn't derive from our oil.

9:40Felix Salmon: It derives from our, it used to derive from our stability, our services sector, our financial sector and trust. People trusted the United States as an actor on the world stage. And what he's doing now is destabilizing that trust in favor of showing this kind of like old fashioned show of power that I just don't know if we can go back to that world anymore.

10:05Emily Peck: Yeah. And let me add as well a strong dollar, an independent judiciary and, you know, the idea that everyone can do business in America and trust that they will be treated fairly.

10:17Felix Salmon: An independent fed. Right. He's dismantling those things. And I think more than commodities, those have been really important to America's power over the past, what, like 50, since World War II, since the New Deal, maybe even you could argue.

10:33Lizzie O'Leary: You all have this very like high minded commodity centered economic focus. I've just over the holiday break became obsessed with the idea that he just wanted to rerun the Panama invasion and that he's such an 80s guy that like the template for whatever he was going to do in Venezuela was the invasion of Panama. The timing is pretty close. I was texting Mary Harris, do you think this will happen on Christmas Day? If the weather had been favorable for Trump, it probably would have happened on Christmas Day. I just feel like he can't get out of like the 1989 cycle. Or even the late 70s with the oil thing.

11:14Elizabeth Spiers: That was the exact thesis of my column. I love you. You know, he also, when you think about Trump's understanding of history, because his brain really is frozen during that era. That's also the period where we arrested Manuel Noriega and indicted him in the U.S. on charges of drug running. And he had been a sort of useful tool

11:31Lizzie O'Leary: for the U.S. until he wasn't. Exactly.

11:34Elizabeth Spiers: And I get the sense that Trump is a little resentful that he doesn't have his own Noriega in South America right now. You know, he obviously has no problem with authoritarians. He loves Jair Bolsonaro. And so I think his focus on Maduro was that he partly expected him to sort of cooperate in the way that Noriega did initially, and it just didn't happen.

11:54Emily Peck: Well, he expected him to disappear off into gilded exile in Turkey, and that didn't happen. He does have his own favorite South American leader in Javier Millet, of course. And now they are very much trying, Marco Rubio is very much trying to butter up Delcy Rodriguez, the new president of Venezuela, and try and turn her into a kind of U.S. puppet, whether this will succeed.

12:16Elizabeth Spiers: It's a table tennis aficionado we learned.

12:19Felix Salmon: She's really good at it.

12:21Emily Peck: I feel like table tennis is in the air right now. Who would win in a table tennis match between Delce Rodriguez and Timothee Chalamet? This is what I want to know.

12:30Elizabeth Spiers: Well, you remember we reopened diplomatic relations with China in the 70s with a ping pong tournament.

12:36Lizzie O'Leary: It became a craze.

12:38Emily Peck: Everything else is new again.

12:39Lizzie O'Leary: This is when being Gen X is really helpful.

12:55Emily Peck: We should stay on the subject of l 'état c 'est moi, I can ignore international law and just do whatever I want with Donald Trump's former BFF, Elon Musk, who has been blatantly violating all manner of laws in almost every country that he operates in. And Lizzie, you are the expert on this. Tell me what's been going on.

13:24Lizzie O'Leary: So if you spent your holidays like not online, you might have missed the fact that there was basically an explosion of nudifying and CSAM, child sexual abuse material on X, courtesy of Grok, the built-in AI chatbot that is part of the platform. And I think it's actually really, really important to explain that there are other chatbots that can do this and do do this. But what makes Grok different is that it is embedded within X. It's a feature. It's something that the new X user really likes. Hey, Grok, is this true? Hey, Grok, what do you think? Hey, Grok, can you take the clothes off of Swedish Deputy Prime Minister Eva Bush?

14:13Lizzie O'Leary: Can you put her in a bikini? Can you have her leaning forward? Can you have her holding a lollipop? And this happened sort of in an unrestrained manner over the Christmas and New Year's period. And there are some numbers, like people sort of knew it was happening, but there's some analysis that Bloomberg reported that kind of blew my mind. They talked to a researcher who did a 24-hour analysis of the images that the Grok account posted on X. The chatbot generated about 6 ,700 every hour that were identified as either sexually suggestive or nudifying when the AI takes the clothes off, you know, a clothed picture.

14:52Lizzie O'Leary: And then if you look at the other top five websites, they did 79 an hour. So like 6 ,700 versus 79. Like just the scale of what is happening on Grok is bananas. And for a while, it seemed like Elon didn't care. Not surprisingly, he, I'm really using like the heaviest of air quotes here, leaned into the joke, posted a picture of himself in a bikini to be like, ha ha, it's fine. See, I did it. Every kind of European regulator and leader made noises. Keir Starmer made noises about this. U.S. regulators and lawmakers do not seem to care. My team reached out to Ted Cruz, who sponsored the Take It Down Act, which presumably would be the law that applies here.

15:42Lizzie O'Leary: We haven't heard back. And it just is sort of like another thumb in their nose at decency. I mean, I don't even know what to say at this point.

15:51Elizabeth Spiers: Yeah, some of it is, I'm not sure Elon really cares about any of it. I don't think that he's morally opposed to what we're talking about. I think he tends to react whenever there's some big consideration of liability. And there has been some blowback abroad, but there's been kind of, you're right, nothing here. It's just been crickets.

16:09Lizzie O'Leary: They're now saying that the nudify features are going to be a premium thing. You have to pay for it. Like as if that somehow makes it better. Like pay.

16:20Elizabeth Spiers: That's sort of like admitting culpability, right?

16:22Lizzie O'Leary: To undress this photo of a 14-year-old actress.

16:25Emily Peck: So let me ask you about that, Lizzie, because obviously it doesn't make it okay just because you're paying X for the privilege. but if you are paying X for the privilege then presumably X knows who you are and they have your payment information and so if you do something criminal then criminal authorities can find you and prosecute you more easily than if you're just some kind of anonymous person on X. Yeah but X has that information from people anyway when you sign up for an account like

17:00Lizzie O'Leary: Like, you're going to be found if you are paying for the premium feature. Yes, X knows who you are. But X also knows who you are when you're signing in to your own account. Even if it's a pseudonymous account, you have an IP address. You have various details that you have entered into the platform. They can find this stuff. I mean, one of the, like, hallmarks of reporting on this, and reporters who have covered this for a while have learned not to do this. People used to say to X when it actually responded to reporter inquiries instead of writing back mainstream media lies or sending you a poop emoji, they would say, hey, the following accounts, bloop, blop, blip, have posted what appears to be child sexual abuse material.

17:43Lizzie O'Leary: Do these violate your terms of service? Don't you need to take them down? Aren't they legal? And then the company would just take them down and be like, yeah, we did that. And reporters learned not to give them the examples in advance to say, I have seen these things so that the companies, and it was not just X that would do this, Meta would do this too, wouldn't like preemptively take the thing down and be like, yes, we were on it. Thank you for bringing that to our head.

18:09Felix Salmon: But don't you want the companies to take these things down? Yes, you do.

18:11Lizzie O'Leary: But like they were doing it in this window of time where like the reporter would tip them off, then they would take it down and be like, aha, we did it.

18:19Elizabeth Spiers: Or we don't have this problem.

18:20Lizzie O'Leary: We don't have it yet, right.

18:21Felix Salmon: We handled it. What actually is illegal? Children, you can't undress children on the internet. That's definitely criminal and illegal. And even Elon Musk says, you know, we don't want to do that. Beyond that, like this argument of like, we're all just having fun. Here I am, Elon Musk in a bikini. We, this is just fun stuff. How illegal is that? The quote unquote fun harassment.

18:45Lizzie O'Leary: This is where the Take It Down Act kind of comes into play. So the law was passed in May. It criminalized non-consensual sharing of intimate images and digital forgeries. So deep fakes. But it sort of has this mix of penalties. There's some fines. There's some jail time. But you have to say, take that down. They have 48 hours to comply. But the platforms have until May to fully comply with the law. So we're in this period of time where it's not entirely clear to me that the platforms have to do this yet until May.

19:19Felix Salmon: You have to take it down. The law is clear. It's the title. Do you have to not offer a feature that lets you make the thing? Is that illegal to just have the feature? Because if it's not, then that just seems like a crazy, like, cat and mouse. Shouldn't you have to ban the nudify capability? The publication of the thing is the violation.

19:40Lizzie O'Leary: I know. So now this is why you're starting to see calls for just ban X, just ban the platform. What else is it for? Like, it is so overwhelmingly for this at this point. Like, yes, like I still have a shell account that is on there. Go on there. Governments still put stuff out on there. People do still talk on there. But like when you look at the overwhelming mush of stuff, it's like crypto bros and weight loss and nudifying.

20:13Emily Peck: So let me ask you about X because a few months ago, I think it was last year sometime, X ceased to exist as an independent company. It got merged into XAI, which is Elon's AI company. And the primary product of XAI is not X, it's Grok.

20:36Lizzie O'Leary: It's Grok.

20:36Emily Peck: And X has basically now become Grok Playground, a place where XAI can ingest huge amounts of people typing intelligent things and dumb things and just all the things that people type and learn about language and all the different languages that people use on the platform and can roll out Grok and allow people to play with Grok. Two of the most, if not the two most valuable AI startups in the world are OpenAI and XAI because they are the two that are most used by normal people.

21:11Lizzie O'Leary: That word normal is doing a lot of heavy lifting.

21:15Emily Peck: But like ChatGPT has 300 million users, whatever it is. And Grok has also got hundreds of millions of users because it's managed to infiltrate itself via what used to be known as Twitter.

21:27Lizzie O'Leary: And it just raised$20 billion this week.

21:30Emily Peck: And it just raised$20 billion this week from people who clearly think this is a feature rather than the bug. So in this world of kind of AI land grabs where you ask forgiveness rather than permission because the most important thing is to just get out there in the hands of as many users as you can, does this strategy actually make perfect sense from the point of view of what Elon is doing?

21:54Lizzie O'Leary: I mean, he's got you there. He does kind of got me there. Well, I guess the question is like, what's the strategy, right? It's just to make money. Yeah. And OpenAI has been talking about rolling out its erotic mode. Porn makes money. Porn has always made money. And this gets into this really murky area where you have First Amendment questions, but then also questions about the age. Because people are taking photos of adults when they were younger and nudifying them. And so like adult adult content has a lot of First Amendment protections. It should. But like adult content that's made out of children?

22:41Lizzie O'Leary: No. And I think the companies don't want to answer these questions because it's profitable.

22:47Emily Peck: Well, it's losing a lot of money. It's not actually profitable.

22:50Lizzie O'Leary: But now they're making it a premium feature. Who knows? I'm saying porn is profitable. Historically, porn makes money.

22:57Felix Salmon: And porn does lead to tech innovation. We know that. So like if porn is what Grok is for, that leads to more innovation and integrating AI into social media. It kind of makes a lot of sense. Right.

23:09Lizzie O'Leary: But if it's revenge porn and kiddie porn, not so much.

23:13Felix Salmon: I think they've a little bit succeeded with Grok because the times I go on X, people really engage with Grok as they've really anthropomorphized Grok. And, you know, they're always asking, Grok, is this true? Like no one uses the term X very much to describe that site. Everyone still says Twitter. Yeah, all the reporters. But the term Grok is a thing. Like he made it a thing and that's no small thing. So it is interesting to think about that.

23:36Lizzie O'Leary: It's not, but it also drives me insane when people anthropomorphize Grok. Like there were all these news stories that were like, Grok apologizes. Grok didn't apologize. Grok is not a representative of the company. Yeah, we're down a rabbit hole here. Grok is a word prediction machine.

23:49Emily Peck: And also an image generator.

23:52Lizzie O'Leary: Yes, and an image generator.

23:53Emily Peck: So just so I'm clear about this, was this like some upgraded version of Grok that got rolled out around Christmas time that suddenly allowed all of this to happen? Or was this something it could do all along and then everyone just realized and they jumped on it?

24:07Lizzie O'Leary: I actually can't answer that in a perfect way. I think it's the latter, though, because there have always been people like doing this in the darker corners of the Internet. There's like telegram channels that are dedicated to jailbreaking every AI model, finding the prompt that will make it disregard its instructions. And so I think Grok has always had this capability. But I'm a little over my skis in saying that.

24:31Elizabeth Spiers: I feel like, you know, companies that make these kinds of technologies, they know these problems are going to emerge because they do anytime you have technologies that can do this. I remember when 3D animation was just starting to become sophisticated, there were a lot of discussions about, well, what if people make CSAM, but they're animated characters? When VR was nation, there was a lot of discussion about that, too. It's like, what if somebody sexually assaults a character or somebody else's avatar in cyberspace? What does that mean? So it's not like they couldn't anticipate that this was going to happen.

25:05Elizabeth Spiers: So the sort of like reactionary response from them, like, oh, well, oops, just seems completely disingenuous.

25:13Emily Peck: I don't think they are saying. Elon in particular is leaning into it and he's like, ha ha, this is great. Yeah. And like he has said many, many times that trust and safety teams are a woke thing that ought to be abolished.

25:26Lizzie O'Leary: Right. They basically don't exist. I don't think he's even like crying crocodile tears over this.

25:32Emily Peck: I think he's absolutely loving every minute of it.

25:35Lizzie O'Leary: It reminds me in some ways, go with me on this, of the allegations of extremely egregious racism at the Tesla Fremont plant. So the Tesla Fremont plant was sued by the state of California. When you read into or talk to some of the workers who were involved, when you read the legal documents and have done that, talk to some of these people, the stuff that was being said was so astonishingly awful that it was really sickening. And Elon's response was very similar. He had this blog update that was like, hey, you shouldn't do things that hurt people's feelings. But also people need to grow up and like get on with it.

26:20Lizzie O'Leary: And that attitude of his like seems to carry through to all of this. Like, yeah, maybe don't make child porn, but also whatever. Here we are on the Internet. And like that kind of crystallizes his philosophy. And the thing about Elon Musk, which we have been saying since Doge, since before that, and Tesla investors need to think about this too, is I don't see anything on Earth that can stop Elon Musk. He's just so rich that there are no consequences. Well, he's also, I think he's just a nihilist.

26:55Elizabeth Spiers: If he has any values anywhere in there, I don't know what they are. you know, because he's certainly never drawn lines anywhere without somebody putting a gun to his head.

27:04Emily Peck: His value is colonizing Mars, but it's the only thing he cares about.

27:08Felix Salmon: But this is the Max Reid column, right? Max Reid wrote this week, like, everyone seems to be afraid of Elon Musk, in the US especially, as Lizzie already discussed, the regulators are doing jack nothing. And in Europe, there's some threats, maybe like whispers of threats is my sense from reading the coverage, but nothing really is happening. But Max Reed makes the point, like, maybe don't be so afraid of Elon Musk. Like, we saw the backlash to what he did with Doge. He was out at the federal government. I mean, the consequences are long lasting and ongoing, believe me. But like, people don't like this stuff.

27:44Felix Salmon: Like, the US and these European countries are still democracies. People's opinions still matter. And like, people don't like nudifying pictures of young kids. Maybe they like nudifying pictures of women in power. That's like a whole other topic. That's not what this podcast is about. But regulators shouldn't be so afraid, was his point. And I think it's a good point.

28:04Elizabeth Spiers: He had that great line. He said, when you think about it this way, you understand why Congress isn't doing anything about it. He said, the single largest Republican donor refuses to shut down CSAM machine. And that's why when Lizzie's people call Ted Cruz, he's like, I don't know.

28:18Felix Salmon: He did do a tweet or an ex Ted Cruz saying that this was bad. Just putting that out there.

28:23Elizabeth Spiers: Not going to do anything about it, but it's bad.

28:25Lizzie O'Leary: I do think there's one person who can defeat Elon Musk, by the way. Who's the one person? This is going to sound deranged. I just want to be clear.

28:33Emily Peck: Say it.

28:33Lizzie O'Leary: I think the one person who could and probably should have sued when this happened to her and has the power to do this is Taylor Swift.

28:43Emily Peck: She is rich.

28:44Lizzie O'Leary: She is powerful. She is rich. She is not powerful.

28:50Elizabeth Spiers: Culturally, she's very powerful. Do what now?

28:52Emily Peck: She has the power to sell vintage Cartier watches, but it was amazing how many people were urging her for years to come out and have a political opinion and tell people how to vote. And then she did that, and it had no effect at all.

29:06Elizabeth Spiers: It did, though. You're wrong about that. It increased voter registration in areas where she did concerts. I think she has—why would she be afraid of Elon Musk?

29:17Emily Peck: I don't think she—no, the reason—well, because—

29:19Lizzie O'Leary: Because if I, right, let's say they nudify me. I'm like some random middle-aged mom. But you need someone who has the standing to say, this is ugly. This is silly. You're acting like a 12-year-old with unlimited funds. Knock it off.

29:36Emily Peck: Yeah. She could try. I hope you're right. I don't think she'll do it. And I'm honestly skeptical that she would succeed. I think there would be a Streisand effect of people just nudifying her a hundred times as much.

29:48Felix Salmon: And that's why she hasn't. Don't underestimate how much people hate women, especially when they start like asserting themselves. Like the cultural support can turn pretty quickly.

29:57Lizzie O'Leary: Maybe it needs to be a menopausal woman who just doesn't care anymore.

30:00Felix Salmon: It has to be a bro, I think. It has to be a guy.

30:02Lizzie O'Leary: Like there's literally nothing you could do to me anymore. I'm just like, fine, whatever.

30:20Emily Peck: I want to stay on the subject of the Doge aspect of Elon and the way in which the U.S. government is continuing to, because remember January, like this time last year, like it was such a long time ago. But there was this point in time, like pre-Liberation Day, where the big Trump story was like his attempt to reduce the size of government and for the government to spend less money.

30:45Lizzie O'Leary: Well, OK, hold on a second, Felix. That is not actually what they were doing. That is what the headline was. But that's not what they were doing. What they were doing was firing federal workers and creating an interoperable database where you can stop the silos between the way government information is shared.

31:05Emily Peck: And also killing USAID and various other things. But But the segue here, Lizzie, before you derail my segue. Go ahead.

31:14Lizzie O'Leary: Sorry.

31:15Emily Peck: The segue here is to the federal government deciding that it is going to freeze$10 billion of, well, Emily, you explain.

31:24Felix Salmon: So at the end of the year, the beginning of the year, there was a YouTube video where a guy named Nick went to a childcare center, a few childcare centers in Minnesota with another guy who is only identified by his first name. and they discovered some of these places were empty or wouldn't let them in because why would you let some random dudes into your daycare where there are little, little babies and toddlers?

31:47Elizabeth Spiers: Come see our children.

31:49Felix Salmon: The video went very viral and landed at the same time. In Minnesota, there have been fraud scandals with public money discovered by the last administration and prosecuted, but kind of bad. So the swirl of these two things happening led the White House to say, we're going to freeze child care funds, the federal money that is used to pay for child care centers and for what's now called TANF, but which is basically welfare, not only in Minnesota, but in five states. Coincidentally, they all are run by Democrats, California, Illinois, Colorado, New York, Minnesota. And so they sent letters to these states and they said, we're freezing your flow of cash until you give us all this data.

32:35Felix Salmon: and they've asked for a tremendous amount of data. It's not clear. The states are confused how they even respond to that. And it's not even clear that they are able to get the data together. Like, it's just like a bureaucratic, administrative burden pileup like you've never seen before. And so the night before we were taping Thursday night, the five states, as you could predict, their attorneys general got together again. It's like their 50th time getting together, basically, and sued the White House and said, this is really unfair. You're targeting us. You don't have any evidence of fraud. And I've been reporting on it all week and asking them, what is the evidence of systemic fraud?

33:10Felix Salmon: And the White House has not given me any evidence. They sent me some links to stories about arrests and prosecutions like one-offs in New York, in Minnesota, in California. They haven't sent me any articles or news of arrests or prosecution in Colorado, for example. And I asked Colorado. They're like, we don't know. There's nothing going on here. This is crazy. You know, anyway. It's just the latest.

33:33Emily Peck: I mean, not to mention, I feel like I should just jump in with a little bit of common sense here, which is even if there is fraud, freezing all of the money for child care is super crazy remedy. It doesn't. Yeah.

33:45Felix Salmon: Right. Someone told me it's like killing a fly with a bazooka, basically. And the laws establishing these three programs, it's child care block grants, it's temporary assistance for needy families and these smaller block grants that fund things like foster care. all of these laws have very clear rules and provisions and processes in place for fighting fraud that pretty much do work. And those laws don't have a provision for freeze all the funds. That's one of the things the lawsuit says. You can't just freeze all the funds. It's not how it works. But doing this, crying fraud, and then cutting off help for the most disadvantaged, and to be clear, the most disadvantaged people, they're cutting off welfare money, the poorest people in the country is a very successful strategy.

34:30Felix Salmon: It's not one the White House is coming up with de novo. Like this is like, you can listen to Slate's amazing podcast about the welfare queen era and go back to Ronald Reagan. Crying fraud and then taking away people's social services money is like guaranteed to work. It's really hard to fight back against it, I think.

34:50Emily Peck: So Emily, let me try and ask you the first big question I have here, which is, is this money that reimburses the states for the money that they spend on child care? Has there been any actual effect on the child care services yet? Or is this just like pushing the burden that used to be borne by the feds onto the states?

35:12Felix Salmon: So the states get this money from the federal government and then they like draw it down and then they hand it out to the child care providers or sometimes they give it to parents in the form of vouchers. The money is still flowing. Like this new freeze hasn't had an effect yet because it's so early, but it's like a matter of time. And then whether or not the states can step in really depends on the state. Like some states are like really well placed to keep things going. Like New York State just this past week announced more funding for child care. They're going to do care for two-year-olds now in the city, which is like awesome.

35:43Felix Salmon: So they can afford it. But then there's other states like Indiana, Colorado. Indiana doesn't count, but Colorado, who probably won't be able to make up the difference. And we already know about this because there was all this extra funding that went to these child care grants during the pandemic, like records amount of money. States took it and ran with it. I mean, it was temporary, but they opened new child care centers. They raised pay. They gave bonuses. They did all this stuff. The money is gone. And now we're seeing what happens when the money is gone. It's to bring up Indiana, like worst child care situation in the country, long waiting list, providers going out of business, all of this.

36:22Felix Salmon: So you can expect if this freeze goes on, you'll see even more of that because this is like a big washout of the tide, 10 billion. And it's important economically. Like it's not just about the I find that when reporting on this stuff, people don't care very much about poor people. But with these child care centers, a lot of them, they depend on the federal money and the state money and they take private paying people as well as subsidized people. So if they lose their funding, the private paying people who aren't the poorest and most disadvantaged, they still lose too because these centers close down and like none of the kids can go.

36:57Felix Salmon: It's like a rolling kind of thing. And none of the parents can work. And none of the parents can work. So that's why we say we care about it in the business pages. So it seems bad.

37:07Emily Peck: Thank you, Emily. You're welcome. It is bad.

37:09Felix Salmon: Thank you for letting me talk about that. I wrote like 10 stories, but I feel like they're all over the place.

37:14Emily Peck: Do you think this is a kind of resurgence of the we're going to take a chainsaw to government thing that we saw at the beginning of the Trump administration? Or is this just part of the general scattershot? We're just going to crack down on anything that seems leftish.

37:33Felix Salmon: I think it's a continuation of what Lizzie started out with us talking about. Because remember, like the thing with Doge was we're going to crack down on, quote, waste, fraud and abuse, waste, fraud and abuse. and they have really succeeded in getting everyone to say waste, fraud, and abuse. Even when I speak to people on the left and progressives and advocates, they're like, of course we don't want any waste, fraud, and abuse. It's just become like a mantra. And so I think it is more about cracking down on waste, fraud, and abuse and less about cracking down on leftists. But I could be wrong.

38:03Felix Salmon: I mean, I wonder what Elizabeth would say.

38:04Elizabeth Spiers: No, I think they're trying to thread two needles here. One is that they want these programs to be smaller anyway, but they're also using them in the culture war. They keep suggesting that assistance programs are heavily benefiting undocumented migrants and minorities in particular. They're just rerunning the welfare queen playbook from the 80s.

38:24Felix Salmon: Yeah, it does seem like that. And they announced or Scott Besson announced on Thursday they're creating a new position like an AG that will just work on fraud stuff. And they're like putting more restrictions on sending money out of the country, remittances. It's a lot.

38:39Elizabeth Spiers: What's crazy, and I feel like this is a little undercovered in media, I was a public policy major and one of the things that kept getting hammered into us by people who actually work on policy is that fraud in the government sector is so much lower than it is in the private sector because there are all these guardrails and they're heavily litigated and so on. But if you were just looking at the news and you had no idea, you would think government was just the worst purveyor of fraudulent activity. Because we hear about it disproportionately because Republicans have successfully made it a part of the public discourse.

39:13And even Democrats often take it for granted that there is copious fraud in every government program.

39:20Emily Peck: I blame the movie Dave. I think it all goes back to the movie Dave.

39:24Felix Salmon: Who's the movie Dave? I don't know.

39:26Lizzie O'Leary: Oh, Kevin Kline's like the accountant and he goes through and is like, oh, well, I would never do books this way. And then he like, do, do, do, do, do, do, do.

39:36Emily Peck: And then the federal budget.

39:36Elizabeth Spiers: When did that movie come out? Was that like a Reagan-ish?

39:40Lizzie O'Leary: It's a Clinton era thing. It's like a welfare reform, triangulatory Democrat.

39:47Emily Peck: It was the point at which the household metaphor, like we should treat the fiscal situation of the country just as you would treat your household budget. when that went super mainstream. And we've never really recovered.

39:58Lizzie O'Leary: 93. 93. I'm sorry to get so exercised about the Doge thing. I just like, but when you actually step back and look at what they did, there's this, oh, we're going to save a trillion dollars. They didn't save any money. Federal spending didn't go down at all. It went up.

40:12Emily Peck: Well, that's because they're spending it all on the ice.

40:14Felix Salmon: So Jonathan Cohn wrote a really good, my former colleague at HuffPost, who's now at the Bulwark. Excellent. He wrote a great piece sort of breaking down the Minnesota fraud scandal. And he makes this really good piece, which is, And there is fraud in some of these programs sometimes. And one of the reason is because the programs are structured so poorly. It's not government run, right? The government gives money to the states. The states give money to these private actors. So there's like room to screw it up. Because Republicans shaped the policy to look like that. Because Republicans shaped the policy to look like that.

40:44Felix Salmon: It makes it more susceptible to fraud. That's one point I want to make. And the other point I want to make, because who knows when I'll be allowed to talk about this subject again.

40:51Emily Peck: It's not like you're the host of the show or anything.

40:54Felix Salmon: But we all have to breach a consensus.

40:57Emily Peck: This is like the Swiss government. We only do it if we all want to do it.

41:00Felix Salmon: Yeah, we all have to turn our keys or whatever.

41:02Emily Peck: Yeah.

41:03Felix Salmon: So I started looking into TANF, Temporary Assistance for Needy Families, because the most of the$10 billion is from TANF, which is welfare because Bill Clinton made it. He ended welfare as we know it, and he made it into TANF. And what I realized and learned, which maybe all of you already know, but welfare, temporary assistance for women with children that was created alongside Social Security a bajillion years ago. But it was more of a targeted program, targeted to poor people. And over the years, poor women, disproportionately poor black women, people started to hate it, the program, right?

41:38Felix Salmon: Not the people receiving it, but everyone else. And they were able to craft this narrative of welfare queens and ultimately to get rid of the program. But it's so interesting because it came up alongside Social Security, which everybody loves. It's universal and you can't do anything to touch Social Security. People will freak out. Even Donald Trump has pledged over and over. I'm not going to mess with it. I'm not going to mess with it. People love it. And that is all I wanted to say, except for the one other thing is that one of the knocks on welfare was like, we're paying these freeloading women to just sit home and get fat and live off the public dime.

42:11Felix Salmon: They don't even work. But Social Security, women who have never worked when they're older, they get paid by the federal government because if they were married, you know, they get Social Security. And, like, no one ever complains about those freeloading women.

42:25Elizabeth Spiers: It's about the perception of who the recipients are. And overwhelmingly, people do perceive the recipients of assistance as being minority women who are single. And so when you do this in polling and you ask people, do you support without kind of framing it as a specific policy? The answer for a lot of people, and these are people who are risingly skew Republican, about whether they support a policy is who they think the intended recipient is. And so because Reagan era people branded the average recipient of assistance as a single black woman, the underlying racism there is the difference in support.

43:02Elizabeth Spiers: It's that people do understand that old white men get social security and then they should.

43:09Felix Salmon: And their wives never worked a day in their lives. They get it too, and it's fine. But anyway, now I guess it's not about welfare queens. It's about undocumented immigrants. They're the ones that are now the scapegoats. That's the demonization.

43:21Lizzie O'Leary: I'm sure you all have listened to it because you're all brilliant, but my former colleague, Chrissy Clark, made this amazing podcast that continues, but it's called The Uncertain Hour. And it is like the history of welfare and all the ways welfare touches the American system that we don't think about because that Reagan narrative is the one that takes over.

43:46Felix Salmon: Fascinating. I'm going to listen to that podcast. Very exciting. So good. Once I'm done listening to Lizzie O 'Leary's podcast, of course. See you, Sam.

43:54Lizzie O'Leary: Of course.

44:04Emily Peck: We should have a numbers round. Elizabeth, do you have a number?

44:07Elizabeth Spiers: I do. And it's$50 ,000 and that's a dollar. And that's what you can pay to a new dating slash matchmaking company called Keeper that's powered by AI. You can pay them$50 ,000 for marriage bounty where you'll pay an intro fee for each match. And then if the matches lead to a long-term relationship, you pay them the full$50 ,000. But this company is being run by three guys in Silicon Valley who are basing the company on things like predictive analytics, AI, and what someone termed meta-rational marriage practices. So it also won't surprise you that some of the things that they measure for, you go through a whole process where they ask you a million questions.

44:48Elizabeth Spiers: and your SAT scores, your feelings about entrepreneurs, your ideal ethnicity, and they will scan your photos to estimate your body fat percentage and the strength of your jawline. So Barry, this is from a Times article, and about two-thirds of the way down when you're already sort of creeped out, one of the founders has an account on X where in his bio it says, I love eugenics. And so the reporter sort of asked the other co-founders about this. and the co-founder, whose name is Hunter Ashe, said something like, well, I'm not actually advocating for sterilization of minority people, literally. I was sort of shocked that this wasn't the whole story.

45:29Elizabeth Spiers: So a typical thing, and he's their marketing director, so one of their pieces of marketing information was something like, if the woman is half a standard deviation, more agreeable than the man, that's the optimal point for relationship durability. So if you're an aspiring eugenicist looking for a heavily algorithmically driven mate, I guess this is the company for you.

45:53Emily Peck: Absolutely amazing. Wow. I'm just going to move straight on here with 24, which is the estimated number of months it is going to take to move the Apple card from Goldman Sachs to Chase. Chase is now officially, everyone sort of understood that this was going to happen, but it is now officially going to happen. If you have an Apple card right now, you are borrowing money from Goldman Sachs every time you use it. In 24 months, more or less, that will then be Chase. Goldman Sachs has lost about$7 billion on its ill-fated attempt to get into consumer finance. They are selling about$20 billion of balances to Chase at a discount of a billion dollars.

46:39Emily Peck: So Chase is basically paying$19 billion for these$20 billion of bounces. So that's another billion dollars that Goldman is losing here. The Apple Card itself is a perfectly good product. And one has to kind of wonder at some point, is one of the reasons it's so good is because it's been like subsidized to the tune of like many billions of dollars by Goldman Sachs. And will it continue to be good if Chase runs it on a for-profit basis? But in any case, it will basically continue. It will continue to be a MasterCard. We don't need to worry about it becoming an American Express.

47:13Felix Salmon: What about our ads?

47:14Emily Peck: What about our ads?

47:16Felix Salmon: Just change what we say in the fine print part of that? Exactly.

47:20Emily Peck: The ads will continue, but just with a different financial. Or will they? Anyway, Emily, what's your number?

47:26Felix Salmon: My number is$2.9 billion. That's dollars. That's sushi sales at retail stores, including grocery stores, for the year ending November 2025. That's up 7 % from the year before. And sushi is very popular. And the reason I'm using this number is just an excuse to tell you about this Wall Street Journal Ahead, which was about parents going broke, spending all their money on sushi for their kids who love it more than chicken nuggets or french fries or tater tots. They just want to eat$200 sushi dinners. And the parents apparently have no control over this. And they interviewed a kid named Elliot. He is eight years old and he lives in Calgary.

48:04Felix Salmon: And his quote is, quote, I love sushi. I don't like it.

48:10Elizabeth Spiers: I mean, Harold loves, he likes sushi, but only salmon and tuna. But he still eats enough chicken nuggets that I bought him a hat for Christmas that says chicken nuggets in a goth font. And now it's his favorite hat.

48:24Lizzie O'Leary: That does sound like a cool hat. I would love to have my child eat sushi. I would love to have my child eat something that isn't beige.

48:29Felix Salmon: Be careful what you wish for. Be careful what you wish for.

48:31Emily Peck: It's true.

48:31Felix Salmon: You got to pay your mortgage.

48:33Emily Peck: Can you afford it, Lizzie?

48:34Elizabeth Spiers: You can have some sushi from the place around the corner. Fine. Whatever. Your kid's going to be like, I only do tasting menus, Mom.

48:40Emily Peck: Exactly. No, I need to do the thing which I have done occasionally on this show, but haven't done in many years, which is tell everyone to dig up the now ancient Nick Tosh's piece on sushi from Vanity Fair from years and years and years ago, which to this day is the best thing ever written about sushi. And he basically asks the question, how did sushi become this massive cultural phenomenon in America and in like Midwestern America and in places that are incredibly conservative and that any normal, especially in like the 1950s and 60s when the memory of the war against Japan was very fresh and in a world where no one ever ate raw fish and raw fish sounds kind of disgusting.

49:20Emily Peck: How is this possible that it took off so successfully? And the answer you will not be surprised to hear is sugar.

49:29Felix Salmon: Sugar in the rice. They say it in the journal story too. It's the sugar.

49:32Emily Peck: It's just a very sweet thing. and that's why kids love it so much.

49:36Felix Salmon: Yes, that's what it said in the piece. There's a quote even from a sushi chef who says, I just learned the more sugar you put in there, the more the kids are going to eat it. So I felt betrayed because I never realized that sugar was even playing a role in the sushi. Sneaky kids.

49:51Emily Peck: All right, Lizzie, what is your number?

49:53Lizzie O'Leary: My number is seven. And this is 100 % lifting a joke from a friend of mine who after seven days of 2026 was like, thank you for my free trial.

50:05Elizabeth Spiers: I would like to unsubscribe from 2026.

50:09Lizzie O'Leary: I've had a week. We're good now. Take it back.

50:14Emily Peck: But do they want 2025 back?

50:18Lizzie O'Leary: I don't know. Maybe you can just pick a year at random and rerun it.

50:22Emily Peck: 1999, that was a good year. Yes.

50:25Lizzie O'Leary: Not for me.

50:26Felix Salmon: Good movie year.

50:27Lizzie O'Leary: I love 98. 98 was good. 99, I was just out of college and clueless.

50:31Elizabeth Spiers: and yeah.

50:31Lizzie O'Leary: I think like maybe 2003. That was fun.

50:34Emily Peck: Lots of blogs happening in 2003. Yeah, yeah. Well, okay. On that note, I'm going to open it up to the listeners. Send us an email on slatemoneyatslate.com and tell us if you could teleport out of 2026 and into any year of your choice, which year would that be? That email we read by all of us, not including Lizzie because she's only a guest here but the other three of us will see it.

51:02Lizzie O'Leary: I have access to your Slack channel. I might just get in there and read it.

51:04Emily Peck: We will share some of them in the Slack so that Lizzie can read it. It will be read by Jessamyn Molly and Shana Roth who are our producers. I should also thank Merit Jacob in Brooklyn for getting Lizzie on the air and Micah Phillips making us all look beautiful on YouTube. And mostly you guys for listening. We love you. If you are Slate Plus listeners you will get to hear all about Greek things. and otherwise thanks for listening and we'll be back next week with more Sleeped Honey