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Scott, you know what I did this weekend. What'd you do? I moved. How to go. It was exhausting. I was up to four in the morning. I got to tell you, I have so much stuff. I have so much crap. And I have, it's very exhausting. But we're now in, we're now in and it'll be a couple of about seven, eight months before we move back. I never want to move again. That's my. How have you done it again? I know. Especially with kids. Are you back in DC? Yes, I'm in DC temporarily.
I'm going to New York this weekend to this week's, excuse me, the Livingston Awards are on. I'm in. More awards. No, this is for young journalists. They're amazing reporting. I know you don't love reporting, but these are great reporters. You know, oh, let me put words in your mouth so I can change. No, no, I've decided that I have a bone to pick with you about insulting things like the Washington Post. They do amazing work. But nonetheless, you said they don't matter.
These businesses don't matter. They don't matter. Washington Post. Any of them. They're the paramounts, anything else, but the Washington Post does matter. Okay. Okay. Come on. I said that paramounts, economic value that it's an amusing story, but in terms of real impact, it doesn't mean a whole lot. I think Washington Post, in terms of influence on the world, dramatically punches above its way. I hope it survives.
Yeah. You know, and by the way, I'm, I just want to point out that I'm recruiting an editor in chief. So anyone at the Washington Post wants out of that dysfunctional fucking nightmare. Just send me. I'm serious now. We're hiring an editor in chief. By the way, we're growing their shrinking. We pay well. I don't know if they pay well. And as dysfunctional as we are, we seem strikingly functional compared to the shit that's going on there. But also we are. It is run by a boss. It is run as well.
It is run by a white male. So we have that. No, well, you're real boss is that is your long time partner. The whole firm is run by women. Yeah. But what let me say I have to so the Livingston Wars are given to the to journal the young journalist under 35 and they're really astonishing stories. The nominees and everyone who won every new prize are really it's really heartening every year that I do it. It should be interesting to me. And then I'm going to Canada get the Canadian of the year award.
I'm sorry. You're getting the Canadian of the year award. The Canadian journalist federation or foundation. I can't decide if that's the weakest flex in the world or going to be really fun. I'm going to Toronto. It'll be fun. It'll be fun. They're giving it to me. It's another lifetime achievement. I got one in San Francisco last week. And so now I'm getting my Canadian one. So. Well, you know how you get a hundred drunk Canadian fraternity guys out of your pool.
Guys, could you please get out of the pool? Yeah. Yeah. Yeah, we don't think about Canada enough. Yeah, I'm excited. I'm excited to go. I love Toronto. So that's a great city. It's a great city. So I'm going to run up there and get there. They have a lot of the same problems we do actually. Oh, it's a beautiful city. And then catch one other thing I'm doing this week. There's this really cool movie coming out called war games.
And it's all these high level people like Republicans and Democrats who wargamed out a situation. And they made a documentary of it. And I'm going to see the documentary and then talk interview the cast. Well, not the cast. It's like senators and defense officials. I'm super weirdly excited for it. It's all about an insurrection, like an insurrection where the military participates. So I'm excited to do that. And it's a movie, right? It's a doc. Yeah, it's a doc. But we're going to show.
They're going to show the doc and then we're going to talk to the participants, which I think will be very. It's very timely given Trump's talking about revenge. It's very exciting. Yeah. I discovered this weekend. I discovered an amazing hack. I spent a lot of time with the dogs this weekend. And my little one, the big one's super friendly, but the little one occasionally snaps. So when someone comes near him, I just say, I just say not friendly. And people avoid us.
And when we're on a, people always stopped to see Leia because she's a big, beautiful dog. Yeah, and when I'm in a hurry, I'll say, I'll just say not friendly. So I can just keep moving. I've started saying that even when I'm not with the dogs and it works perfectly. Just anyone gets near me. I'm like, not friendly. Not friendly. You're a very different. Not friendly. Is that great? So where that mega hat, you got to wear the mega hat like there. Not friendly. Not friendly. Go away.
Move it along. That is funny. That's Larry David would say that you become not. There you go. Not friendly. So anyway, we've got a lot to get today, including a big win for Sandy Hook families who deserve every win they get. And they propose a Texas stocks exchange that wants to give New York a run for its money. Plus our friends of pivot, our journalists and brothers Wall Street Journal investigative reporter Brody Mullins and Politico contributing writer Luke Mullins.
They've written a new book, The Wolves of K Street, The Secret History of how big money took over big government. But first, more conflict between AI companies and news publishers. Why? Prophecy to AI, which some people think is really great as in some hot water after being called out for not attributing sources. The AI powered search engine company recently released a new feature, Prophexity Pages, which is essentially a news summary feature.
Then a Forbes reporter pointed out similarities between a Prophexity News summary and a Forbes article saying the company had scraped and repurposed investigative reporting without acknowledging it. Forbes pointed to several cases of Prophexity using exclusive reporting from pay walled sites with only a small footnote of the link to source. In response, the company's CEO said the feature still knew the company is working to address the issue. He also said everything on the internet is free.
He also has said that in the past. And I used to have this problem, but it was more like websites from all kinds of sketchy areas. It used to just suck up all things D stuff and spit it out again. But this is them doing it as a business. So what do you think about this? And this is this happened in a different way. This is just faster and more efficient.
I'm actually more optimistic that this time did that the Washington Post distinct of all the dysfunction or other media companies are going to find an actual revenue source here that this is another example.
I think the more articles that come out like this and the more discovery that they're essentially just repurposing other people's IP is going to give them more power and court and more mojo to say, okay, anthropic or llama or open AI, you know, what Adobe did that was really interesting around generative AI for design was they said from the get go. Where it's going to be their hours or we're going to have the licenses for it. So when you use Firefly, you don't have to worry.
It's all they own it. They have they've created a walled ecosystem of things they own or that they have come to a licensing agreement. Yeah, just like photos or songs. Yeah. That's right. So I think this is actually a good thing for these media companies. The Washington Post is dysfunctional given that seems like. This is for. Yeah. Well, but I'm just using Washington Post as an example. I mean, Forbes, Forbes is kind of in left for debt. Is it?
No, actually, interestingly, the editor in the text section used to work for me, John Paschakowski. And they do some very strong articles. And he texted me over the weekend because I had always complained of people ripping off our stuff many years ago, both the internet and other media organizations that wouldn't attribute our stories to us. And that we would break. And I said, welcome to my world. Now you can be annoying. And they were always like, why are you so mad at these people?
I'm like, because you guys worked hard. And they just ripped it off. But I agree. I didn't have anything. I had no recourse in that case at all whatsoever. Anyway, one of the stories for Peckson, the allegedly ripped off was about Eric Schmidt. This is the one. The former Google CEO is arming his AI-powered military drone venture with top tech talent. The endeavor named Project Eagle has been poaching talent from tech giants like Apple Space X and Google.
Project Eagle has been testing drones in Silicon Valley and Ukraine. After leaving Google, Schmidt serves a chair of both the Department of Defense's Innovation Board. He was very early to this and the National Security Commission on AI. You know, of course, he's probably looking at Andrew and a paleteer and saying, give me some of this sweet defense money, I guess. And so these are military drones, which are being heavily used in Ukraine.
I can't believe they're testing in Silicon Valley, although I'd like to see that happen. I don't want to see that going on. You're going to be thrown to people. Yeah. One, I think Eric is the few times I've had conversations with Eric or I've seen speak. I do think he is strikingly intelligent. And also, if you look at the economy of the innovation that's going to come out of the Ukraine, Russia war, it is drone technology. This is innovation.
And this is the notion that a country that doesn't have nearly the capital of the crew of ferocious kinetic power of Russia can strike back using kind of this cheap and cheerful technology where they have independent AI that's not dependent upon GPS that actually surveys the landscape and can make its own way. And potentially, supposedly, I think 20 or 30% of what is called the black fleet, Russia's Navy has been taken out.
But drones are the new kind of drones are the new, you know, the new front on military technology. There was one, there's showed a drone show. They showed it going through woods with lots of lots of trees moving through by themselves autonomously avoiding trees. And it was like a member of Star Wars where they had the, they were on those riders through the forest. That's exactly what it looked like. It was crazy.
You know, I think there's got to be regulatory things on the use of military drones, autonomous, especially autonomous military drones. I mean, think of the, I mean, this is cheap and easy to use. So crazy people will employ it. So there should be just like there is with cloning or things like that, even if people violate it, there should be a global decision making on the application of these things, which I think is, is not any time coming.
So we'll see. Eric is an interesting guy. He, he's been at this for a while. He, I covered him since he was way of no val and a Google and, etc. He's a funny guy. It's a funny guy. We used to have a ball gag at all things D every time he said something dopey at Google that would got them into trouble. So we had a picture of him with a red ball gag on. I'm sorry. I heard nothing after you said we used to have a ball gag way.
So whenever he would say dumb things sometimes and a lot more than most people and just some, he likes to talk. And so we had a ball gag with picture of him with a ball gag. John Tachkowski made it. That would every time you said it, the picture would be Eric and a ball gag and said Eric today, once again, needs the ball gag. Anyway, that's neither here nor there. Let's move on. Apple is expected unveil all things AI and it's worldwide developers conference as we take on Monday.
I'm going to be talking to them afterwards. Apple intelligence will be available for new versions of iPhones iPads and Max and will be powered by Apple's own technology and tools from open AI. Some of the features Apple is expected to announce are AI summarization of articles and web pages a Siri revamp. Thank God. The ability to make custom AI emojis on the fly AI enhanced photo editing.
You know, this is important for Apple, even if they're not running the AI themselves, which I assume they will do eventually. This is this is a real good application of AI for and they'll probably do it well in terms of not ripping people off making it useful, making Siri, whatever they I hope they rename it. I think it's probably a good thing. I don't know what do you think it'll make the iPhones much more useful for sure or the or the any different technology you have. What do you think?
Apple is the kind of quintessential case study in the second mouse and that is people overused the word innovation. Innovation is actually a really true innovation being first pioneering doing things at the cutting edge is actually a terrible strategy for for shareholder value. And that is when you're out at the frontier, you get mud on your face arrows in your back. It's too expensive to figure shit out.
Apple wasn't the first in MP3. They weren't the first in graphic user interface and were the first in laptops. I mean, smartphones, they were not first what they do is they wait. They come in, they commercialize it, they make it more friendly, they use their brand. So I'm very excited to see what they do. I hope they do something in healthcare. I hope they the front end for it will be Siri. But I hope they do something in healthcare and I hope they do something around.
We talk a lot about generative AI. I think the real opportunities what I call integrated or integrative AI that just makes my life easier by saying Scott, we see you're watching all these videos on your shoulder hurting. Here are some physical therapists that are also Siri enabled. Do you want us to send you free times or schedule a point? It's the ultra assistant is what we're talking about. I mean, from the like from the movie her or anything like that of all the companies that can do this.
Apple's already very helpful when I'm walking it goes, are you walking for exercise? Would you like us to record it? You know, I give them for me, but it's all permission based, which means I they ask me first if they want me to do it, which I like and often Apple is telling me things like, oh, your car is part here, Cara, like just so you remember.
And I'd like it to talk to me too at the same time. Yeah, I just think I think the place that AI is going to add the most value is around really boring stuff. I just want everyone to go, okay, Scott, we see on Thursdays, we like to whatever do the following things or you're in this city. This is I mean, there's just so much information they have on that handset and all they have to do to respect your privacy is go. Can we have access and we won't sell it to anybody else, but we'll use it.
The privacy is so overrated in terms of actual consumer behavior, especially my young people, we exchange privacy for utility at the drop of a hat. And I think with the interface they have with the billion wealthiest people in the world, whether it's travel, whether it's, you know, opportunities, logistics services and how friendly the brand is, I think it's one of two things, make your life easier. Do something about healthcare, maybe something about media. I don't know, I'm excited to see.
I am too. I'm excited. I'm going to get a briefing from them afterwards. Like that you are. Oh, I am. Oh, I am. Are you going to get a briefing like you did on the mix? The big reality headset? I used to get the other day from watching a movie. I bet you did. I'm aware of that show. I did. I watch movies on it all the time. You watch movies on that. I do. I like them better. They're very immersive. I have very noisy children. So it's lovely. It's a lovely.
You sit there with a headset on watching a movie. Well, they talk a lot in the morning. Yeah, not in the morning, but they talk a lot. Yes, I do. I watched the headset with the movie at night. Okay. Let me get this. The kids are running crazy. Amanda is trying to keep a lid on the household. And you're in the corner with that fucking headset. No, I do it. I do it. I do it. Yeah. I got to say is you better make more money because number three is coming your way, maybe. No, no, no.
Two words pre-nop. Hopeful question mark. Yeah. Anyway, Apple's stuck. What's going to happen? Listen, here's what happened to it over the last year. It's back up again to 194. It had a real dip in April, end of April or mid April. Then it went up and up and up and then it had a little dip because of cautious outlook on the iPhone sales. So where do you see it?
You know, stock. The stock is on a momentum now. It's just ran right up over the last about since May for let's look down since April 22nd. It's been on a run. So what do you think it's been an unbelievable performer. It's quadrupled over the last five years. I'm an Apple shareholder. I'm actually thinking about about selling it because I think that there's going to be rotation out of some of these high fires that have done that have done really well, but it's been.
You know, it's not really they have some really big issues when they seem a little bit late to some stuff and also China is a big specter at some point. We're wondering what's the next thing beyond the iPhone and also again, see above number one when 20% of your business and I don't know the majority of your supply chain is out of a country where we keep making.
Which they've been in which they've been moving to Vietnam and other places, but yeah, here's the deal. I think if this stuff with AI works really well. It's a lock in. I was using a Windows computer when I was getting I got a storage space. That's another thing I did this weekend went to my storage space and and they were having me fill out the form on a Windows computer and I use one in years.
And it was so done. I was like, oh my God, I forgot it was like a bad feeling. I just think if it locks you into Apple. And and the guy goes, you use Apple right and I go, yes, I do. Yes, I do. You should too.
Anyway, we'll see what happens. We'll see what happens. Well, I'm really eager to hear and give their examples of what they're going to do and how they're going to introduce it because they have been behind, but they are have strictures around privacy compared to other companies that they have to stick to because it's a brand attribute.
Anyway, let's go on a quick break. We come back Alex Jones gets ready to liquidate his assets. I like Alex Jones to liquid himself. Anyway, we'll speak with friends of pivot Brody and Luke moans about how big tech became a huge lobbying force in Washington.
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Scott, we're back with the latest on conspiracy theorist Alex Jones and all around terrible person. Jones may finally pay the Sandy Hook families of the 1.5 billion dollars in damages. He owes them as he moves to liquidate his personal assets. I'm always thinking he's up to something. So the judges set to rule this week on whether free speech systems apparent company of Jones is in for wars will be liquidated.
The Sandy Hook families won their defamation suits against Jones in 2021 but did not receive any money since Jones and his company filed for bankruptcy in 2022. Jones is personal and company financial assets combined or worth between 10 and 12 million. He said on the show that even a free speech systems and employers are sold he could still find a way to broadcast. He's going to keep going. I mean, honestly.
You know, he doesn't he'll not have info wars, which will mean he could start something else. I've started a million things. So he's still popular with the conspiracy theorists and of course, a Trump wins. He's back in gravy again. What do you think about this?
I think it's wonderful. I think that when you bring that sort of misery to people knowing that you're going to create that sort of misery against people who have already incurred the ultimate tragedy. I love that he's going to be near bankrupt and I hope they chase him to the four corners of the earth or the rest of his life.
And I hope it sets. I hope it set with look, everything comes into incentives and there needs to be incentives in place that say, look, if you trade and traffic and people's misery, it's going to cost you a lot.
And he is he is made a conscious decision to make not only bring shame on him and his family, but his kids and his his entire family is going to get a struggle because he's going to be forced to liquidate assets. I just don't I I would imagine there's some very smart people representing the families and investigators and they're going to make sure that wherever he pops up, whatever assets he manages aggregate. It's chapter seven versus chapter 11, which means he can't restructure.
I was even thinking about trying to find I wonder if the media camera is going to be sold for sale. I'd like to see a go to a liberal news outlet. I was even thinking about it. There you go. We have to buy a media. You don't want to do a business with me to here. I'm in business with you. I understand, but a real business like if we bought info wars and made it like real a girl and like, you know, had transferred full on all the time. Drag.
First guest, AOC. That's it. Brought to you by mother Jones. Today we have some food. So today we have Ben and Jerry honest our guest. I think we should do that would be really fun. I think if I was really rich, I would do something like that. I was really rich. I'd fuck people like him. Sure. Sure. Why not? Why not? All right, moving on Alex Jones. Fuck you. You're a mandatious fuck. You're the mandatious of mandatious fucks going.
Amazon self driving unit. Zooks is going to start testing Robo Taxi's in Austin and Miami. The unit has been testing his vehicles in San Francisco last few years. I have ridden in them. The announcement comes as Zooks is investigated by the National Highway Traffic Safety Administration after two sudden breaking accidents led to crashes. Federal theories also open a probe into Alphabet's Waymo vehicles last month following reports of unexpected behavior.
Can companies get these Robo Taxi's past safety concerns and go mainstream? I think they can. This is part of the part of the process. People don't know go both ways. They're like a, it's like a box. It's like a Dyson. It's like a Dyson. I don't want to say they go forward and backward. And you get in and there's compartments and you sit in your compartment. So no, so a couple people can be picked up by the Robo Taxi and you don't have to touch anybody.
So you just get in and it takes you to your spot and then. Like a total recall. Yes, yes, exactly. But you can put four people in it. I think four or more people in it. It's been around in San Francisco. It's it's a really the woman who runs. It's really interesting. It's owned by Amazon. You know, I think these things are inevitable. I know that people are like, oh, they're not don't work, but I just wrote a bunch in San Francisco with the Waymo's and I love them.
I get the problems with them, but I the problems are people like I'm sorry. The problems are people usually in these cases. Every now and then it has an issue, but there's so many human accidents happening. I'm still I'm still very bullish on these things. They're very expensive getting them out there, but eventually I think everyone will be riding. Do you think it's going to happen?
I was thought it was going to happen in in Long Hall trucking before I'm with taxes. I'm in favor of it. I don't I can't imagine that's a great job. I use something here called the Wheely in London that I absolutely adore. I think they do a fantastic job. Is that autonomous? Oh, no. No, it's it's actually coming on. I think it's a Russian company. It's it's essentially a high end Uber and I find they just do they just do a better job and I left my keys there and the guy.
The guy came I mean, they're just so good. They don't I don't know. I find some of the I find some there's not a great deal. What I'll call training or professional standards around Uber. And I think these guys do a great job, but I like I love the idea for the first time in my life last couple years. I haven't owned a car and I absolutely love it. So would you get in a way? I get I ride them all the time. Yeah. I don't know who's driving the subway when I get on that thing. I don't care.
But I get the safety concerns and cities being concerned and it's appropriate that federal authorities and others look into that. The national highway safe. You know, I think the problem will always be Elon Musk is he always promises and under delivers over promises on these things. And he's been saying full self driving was around the corner. And I think it's said expectations far too far. You know that it's this is something that'll work out over time and cities.
I used to go every my friend Orlando Moshan had a home in Montaugh and every year used to go out there for a week and just hang out with him. I have the best time. And I remember I was taking a taxi from East Hampton airport and this guy had printed out and put in like the past is taped to the dash. A printed sign that said $100 surcharge if you vomit and car and I just sat there going, what can I do for 150 bucks? What would you let me do in here for like $200?
Anyway, we'll see where these go. I'm very I were bullish on this eventually and I think it's probably safe for people over time. There I have I visited a rural which is one of the what the truck. Startups. They're very expensive to get started. It just is it's going to be a big investment and eventually someone will benefit from them. But they're testing them in Texas because these straight roads.
Speaking of Texas, the New York Stock Exchange in Nasdaq may be facing some new competition from Texas. The proposed Texas Stock Exchange, which is backed by Block Rock and Citadel Securities. Those guys has raised approximately one hundred you know I'm talking about 120 million from individuals and large investment firms. The exchange known as TXSE plans to register with the SEC later this year began facilitating trades next year and launched by 2026.
The TXSE just flips off the tongue could be fully electronic and would allow dual listings with companies also in the New York Stock Exchange. Texas Governor Greg Abbott told CNBC the new exchanges for companies whose only agenda is capitalism. Oh, shut the fuck up Greg Abbott. Anyway, what do you think about this? I like a new stock exchange but they're going to like say where the not woke stock exchange or some stupid marketing thing like that.
It's great. I don't like the politicization of everything that now we were politicizing stock exchanges that they'll try and position NYSC and Nasdaq is blue. The Nasdaq and NYSC do I think get out in front of their skis and start getting into social engineering and deciding what the composition of boards should be, which I'm just not sure that's their job.
But they are I think you need more competition and Texas is not getting around it has done an amazing job. The economy in Texas now is larger than Russia, Canada and Italy has more Fortune 500 companies now than anyone but anyone but anyone but California it's tied with New York. They value proposition here will be more business friendly, lower filing fees, probably less disclosure requirements. I feel like I'm curious if you agree with this. I smell Elon Musk here.
I would I I would bet he's going to be their first customer and move all of his companies onto this exchange. And if you look at if you look at these exchanges now the flip side of having these additional standards is that the average PE of stocks.
Trading on the London or Shanghai exchanges is 13 the average P of companies trading on the Nasdaq of NYC is 26 because that additional it's like it's why people get a higher salary coming out of Princeton or NY or Stanford is the screening the ability to get into these schools is so great that people assume you're better.
It's the same or more qualified I should say it's the same when you manage to get listed on the Nasdaq or the NYC people assumed that the vetting and the screen means your real company and should trade at iron multiple why do listings will you explain it I didn't quite understand if you allow do listings what's the difference why would you be on one exchange if you can do a list and both minimize well right.
Well yeah but you know on an exchange you're essentially charging the exchange with pairing shares and I'm I don't know like which shares get allocated to one exchange I just don't think logistically it makes sense to be trading on multiple exchanges although some companies do trade an ADR on a foreign exchange.
But look this is another case study I think competition is good it'll bring down fees it'll put pressure Texas has done a great job putting pressure on other states and other companies and I think that's a good thing I just take the politicization of it I don't I don't just electric red sucks remember the energy crisis there yeah but that's a different
ball of wax that's a lack of infrastructure payments or lack of infrastructure. No taxes no but when you have we should have more than two big exchanges we just have the OTC we're in the US you said so I think it's I think it's a cool thing but my my gut is Elon Musk they called him and said would you move and he said I'm down with it I want the following things and I don't want you to ever ask me for my financials or ask me what my CEO compensation is or disclosure
requirements about X Y and Z build position themselves is more business friendly and less woke they'll say because for example I think it's a NASDAQ requires you have at least one female board member and I I think OK that makes sense I think well should the NASDAQ be dictating that I don't shouldn't aren't investors smart enough to demand that why why is the NASDAQ in a business of figuring out board composition and I think there's good arguments on both
hands they'll exploit that and take advantage of and say that's not the business we're in we're in exchange yeah yeah I get it I get it it'll be interesting to see what happens we like competition at the same time if you go on on a go on you're going to exhaust us with your stupidity anyway you're just some money exchange so just hush hush up and just see if you can
give good services to companies I don't know if you like that annoyed by that one that role necessarily we'll see we'll see I think the thing is you're going to stick with New York and NASDAQ I don't know just feel like the big ones yeah I don't know I but you know it
this I would just be shocked if they haven't already said Elon Musk when SpaceX goes public have you thought about moving Tesla and he's like right on right on yeah you're right 100% they're going to come out of the gates and I'll eat at the the the
CFO or the treasure of of Texas will start putting pressure on Texas companies to list on the Texas exchange they'll create some regional like my team versus their team red state versus Texas versus New York you know you can just see how this is going to shape up and at the end of the day in Texas they're going to do all that big Texas Texas has a ton of great it'll force the NASDAQ and NYC to bring their fees down on the whole I like it I wonder what the oil gas company
so do I don't think they care they just want to make money anyway let's bring in our friends of pivot Brody Mullens is an investigative reporter for the Wall Street Journal Luke Mullens is a contributing writer for Politico they are authors of a new book the walls of K Street the secret history of how big money took over big government and they also happen to be brothers it's how sweet Brody and Luke welcome thank you so the book traces the history of
lobbying in Washington through several dynasties tell us the story because we're focused on tech and media but I love you to sort of give us an overall a look at them in the generations of lobbyists from regular people like Paul people we know of Paul Manafort and Roger Stone those lovely guys and sort of the shifts and then I'd love to start talking about tech yeah so we start by you are say what this is Brody Mullens the older brother in their relationship
which is important so we look at lobbying last four years and what we found out was really remarkable is that companies right now are dominant in Washington big companies have all the power over consumer groups and environmental groups and labor unions but it wasn't always the case that for most of the last century companies had very little influence in Washington so we found that sort of remarkable sort of we dive into how companies got that power
how they wielded and how they bend rules and regulations to favor the wealthy and the corporate elite and not the rest of us so how well this is this is Luke here so we basically start the the book in the 1970s which is this pivotal period where corporations come to power in Washington and essentially what happened is corporations were on the defensive for the for the 60s and the early 70s and you know there was a lot of power in
consumer groups guys like Ralph Nader and public interest groups and you know there was this sense at that time that corporations really just hadn't invested in Washington so so basically there's this sort of revolution of of you know corporate power in Washington where they start investing a lot of money in sort of direct lobbying start to fund a lot of these ideological think tanks and then also developed then also develop these sort of more novel techniques which we think of as
we call outside influence which is these sort of newer tactics that are designed to reach out specifically to voters really to to in order to put pressure on on their members of Congress and these characters who did this was Manafort and Stone or who we trace four or five lobbies over time who helped tell this story I mean we're talking about you complicated deep issues and so we try to write this lately as possible black bombs and great
characters the first one is Tommy Boggs we consider the first modern lobbyist then we go to Paul Manafort and Roger Stone and then to Tony Pedesta and some other folks so we sort of trace the evolution through the decades so they become more aggressive but one of the companies you read about is Google begins lobbying efforts and they were determined not to repeat the mistakes by made by Bill Gates and Microsoft now I was in a meeting with
Bill Gates before the the monopoly case and he was at the Washington Post and he said what do I need lobbyists for you know and he had some guy up in Rockville I for what his name was he became their main lobbyists for years Jack Jack Crumbholt Jack Crumbholt but he's like I don't really care about Jack he said this in this meeting and I was like I put my hand up I was a very young reporter is it well they care about you
and there it's a bunch of ex-student body vice presidents with subpoena power so I think you should be worried but tech wasn't wasn't that way and Microsoft has gotten very good sense obviously but talk a little bit about the evolution of tech you know well that's you're exactly right we should have pulled you in as a third by line for this book sounds like you know exactly everything happens so Microsoft basically
you know dumbness knows of Washington they didn't care about Washington Bill Gates doll that he was the smartest person and he knew exactly what they needed to do in the marketplace and didn't care about these bureaucrats in Washington you know unfortunately bureaucrats in Washington for Microsoft have a lot of power and they file a series of cases lawsuits accusing Microsoft being a monopoly the whole point in our book about Bill Gates and Microsoft is that they did it the wrong way
they ultimately prevailed in the case but it took them a decade you know billions and billions of dollars of actions focusing on Washington and paying for lawyers instead of battling out in the marketplace when Google came along they looked at what Microsoft did and said hey we don't want to repeat that mistake so unlike thumbing instead of thumbing if there are nose at Washington they embrace Washington they invested in lobbyists and invested in campaign donations to this day
you know they've continued to invest in Washington so far you know they've held off any antitrust decision they didn't initially Larry and Sergey were like what the fuck do we need these people for and there was a real disconnect between the why I mean I think it's Susan Molinari was there
initially that was their first big hire and they really didn't like the Googleplex ran everything that's and I the complaints were on that side Scott Sure nice to meet you guys so I'll just put forward a thesis and I want you to respond to it my sense is that the greatest ROI any tech company can make is not in human capital or AI but in lobbying because and that this is the thesis that after looking into this a little bit what I found is it's not
disappointing or surprising that our politicians are horrors would really struck me as what cheap horrors they are that how much you can get for so little money your thoughts Yeah I mean I think gosh you're right on the money there I mean especially when you look at something like antitrust
right which for a lot of these companies is is really the only way that they can they can expand right there they need to expand through Washington so we read a lot about Tony pedestrian one of the things he was doing it's during this period where Google was eating you know buying up all these companies and we had this sort of antitrust tradition then that was pretty last to begin with in terms of waving a lot of these through that that's a lot of what Tony
pedestrian was doing was sort of getting up getting on the hill and sort of framing these mergers the way that that showing that they would be beneficial to the market they would they were drive down prices and things along along those lines and you know that ends up being you know very influential in terms of of the Google's growth and how it is essentially able to see the accumulate so much power now that that
is sort of changing now right where in this this different things are changing at the moment but for many years why did they do that because I had a lot back and forth with the Google guys about them when they tried to take over Yahoo search if you remember and I was like I'm going every federal regulator to stop you like this is fucking ridiculous they did pull back from that but now as you noted a federal judge just rule that the
DOJ's antitrust case against Google and sabotage neck noise will be decided by a judge not a jury so what's changed because they did nothing like Irishman was in the Lincoln bedroom every five minutes with Obama and you know not together not not to insinuate anything although not that there's anything wrong with that but what changed in the shift from your perspective I think there's been a long shift long coming shifts mainly in
the Republican party among American people me more and more Republicans have switched have sort of gotten rid of their views that bigger is better when it comes to corporate mergers and detect and Republicans out in the country are turning against big corporations kind of following Donald Trump's populism on this more and more bills on Capitol Hill to try to regulate tech or to give more power more money to the FTC and DOJ to break up big tech so I think it's coming from the people
I mean the people are saying these companies are too big they're too influential they have too much control over my life and it's crazy for Republicans to say but and therefore the federal government needs to do something to rein them in Well I'm just curious who do you think if you were to name if you were to give an award for who has best weaponized Washington created more regulatory capture and who wins the award for best lobbying that has done the best job of managing
and executing lobbying effort potentially to the benefit of the detriment of the Commonwealth consumers investors who who does the best job manipulating Washington so I think at this point the word goes to Google I mean the American people in Congress have come after Google for 10 15 years the FTC had an antitrust case against Google 15 years ago that failed I mean they have really again going back to Microsoft they saw the mistakes that Microsoft made
they invested in Washington there was a point where almost all the top tech advisors at the Obama's White House had either worked at Google or went to go work for Google either so after so I mean they really have have done a great job in terms of blocking any attacks against the company So give us two three and four I mean I did over Amazon Facebook I mean they have also the same ideas it's they have pushed back on attempts to rein in the entire industry if you take a list of Joe Biden's top
Dillon of top sources of cash it's those three companies plus Microsoft you know if you look at the top spending lobbyists lobbying firms in DC it's those three plus Microsoft Yeah so Luke talk about Amazon is facing an antitrust suit brought by the FTC last fall
the trial is set to get underway in 2026 which is 100 years away how what's it doing now as the run up to the trial besides Jeff Bezos buying a handsome home in in DC and throwing parties what what what what do you think is going to happen with theirs case Well I assume that they're doing a lot of what what Google did during when they were facing the same issue and you know the idea is one you have your own sort of direct lobbyists that are out there talking to members of Congress
but a lot of the action these days are on these what's known as sort of so shadow lobbying right and essentially there you have people that aren't necessarily registered lobbyists but sort of public relations strategist grassroots strategists and and basically you know what what I imagine they're doing because that's what what Google was doing is trying to reach out to sort of ordinary members you know ordinary voters right and trying to get them whipped up against you know they you
have showing that this is some you know intrusion of federal power into the marketplace Yeah and you know that there's more than I mean looks exactly right they've actually built off of we say that Google learned from Microsoft Amazon is learned from Google Amazon is actually hired a bunch of the people who used to work for Google running these outside campaigns they've hired the people who who organized their academic opposite research campaign
and we've seen the ads they run I heard it before last few months ago when Schumer's deciding whether to bring those bills up for a vote or not the companies went out into this states and ran a huge advertise of campaigns basically saying like if you vote for this bill you know we're going to come out come after with everything we have and the bill never gonna go No because Schumer has almost zero backbone when it comes to tech companies almost what's less than zero
he's been terrible I have to say I mean he ran right over Amy Klobuchar I think let me ask you what happens with companies with the ascendance of right wing companies like Elon's companies and things like that how much lobbying do they do or is it Twitter or what interestingly Elon Musk doesn't do much in terms of the lobbying game in terms of Washington and they could be making the mistake of Microsoft by the way it was any other companies have learned from it
me Elon Musk sounds a lot like Gates he's saying stay away from you Washington I'm bigger than you I'm smarter than you I'm faster you all those things are true but you know he's ignoring Washington he has a small team of lobbyists at SpaceX a small team at twelenberry small team at Twitter
they as you know don't have any public relations team in DC and you know so far he's winning but he's left himself exposed the question to me is is there a scandal that something happened in China is there is some bigger issue that could blow up the
Elon's face at that point you want to already have friends he doesn't have he doesn't not made the connections personally in Washington no the exception of course is that lots of Republicans and members of Congress are probably not be hard just lobby on Musk
but that's not a no those are not personal friendships those are just they like Musk because he goes after Biden and Democrats so Mike when I say my kids my students the last me what are the best industries to go into assuming you're just an economic animal I'm like okay
first and foremost anything to do with software to anything to do you know with finance and if you look at the fact we're spending seven trillion dollars a year on five trillion in receipts in every year our government spending increases faster than GDP isn't one of the most lucrative jobs in the world to be part of the lobbying industrial complex isn't this a great career and it's easy it's easy you know come to DC put in a couple years on Capitol Hill literally a couple three four
and go triple your salary it's not hard you know I would absolutely agree I mean we've seen that for many years now that that a lot of these counties you know have been you know increasing in in wealth and a lot of that is coming from again not just traditional obvious but also this this much larger industry of industrial lobbyists yeah exactly yeah so last question I have you wrote in the book no matter what new obstacles
have emerged K street has always managed the which K street's the street in Washington where they all had their offices though they think they're dispersed now I've always managed to invent new ways to exercise its power over Washington give us each of you one thing they're doing new and fresh now what's their newest way the new thing is moving outside of Washington lobbyists in the court you know influence pedal for companies aren't going
to members of Congress asking for favors they're going out into the states and trying to gin up support or opposition to bills using actual constituents because if 51% of a member of Congress's constituents want a trade bill or don't want tech regulation the member Congress is going to follow so go to the member or go to the the voters and yeah and one of the ways that they do that is by this technique that's known as intercepts
which is you essentially get someone in a in a congressional district to run into a member of Congress and have some supposedly organic conversation you know run into them at the grocery store here in the parking lot and you get them to bring up some something you know whatever issue that they're that they're hired for to say hey you know I'm really upset about this this is something you should be you should be paying attention to but again the whole
idea is to get around these members of Congress outside you know in their home districts outside of Washington where it looks like it's a real groundswell of public support when in fact it's just being ginmed up by lobbyists I hate these people anyway Brody and Luke Mullins again the book is the wolves of K Street the secret history of how big money took over big government thank you thanks guys thank
you so much all right thank you all right Scott one more quick break will be back for wins and fails support for the show comes from service now the AI platform for business transformation you've heard the big high-per-round AI the truth is AI is only as powerful as the platform it's built into service now is the platform that puts AI to work for people across your business removing friction and frustration for your employees supercharging
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Okay so my fail is that according to an article in Business Insider it reported that 11% of men so one in 10 men age 25 to 54 don't have a job and aren't looking for one and that's more than triple the percentage recorded about 50 years ago. There's something like or it's reported that 2 to 3 million able-bodied working-age men between the age of 25 and 54 are not even looking for work.
And this isn't an economy I wouldn't even call them discouraged workers because this is an economy that's pretty much at full employment and these men men who drop out of the workforce are more likely to suffer from opioid addiction. 44% of the men who were out of the workforce said that they had to take pain meds and more than double the portion recorded in employment.
And some whereas when workers to be physically really demanding work was bad for your health I think there's a lot of evidence now that work is actually good for your health and it's just sort of strange to see an entire cohort of young men who've decided essentially just to drop out. They're kind of sequestering from society these are men that don't date. They're not taking care of their parents.
They've just kind of decided it's like we're evolving to a different species and I think it's something to do. I wonder if we're becoming as a species or at least the component of our species is becoming asexual, asocial and much more prone to conspiracy theory. We'll die much sooner, essentially work and usefulness are key to health and that we're becoming much more prone to conspiracy theory thinking too much about politics, thinking too much about envy and really ugly.
It's just a different wing, a different vestige of our society that's really unhealthy and I read this and I thought that would just be unthinkable when I was the only reason the only excuse you could have when I got out of business school only one in three of us had jobs but in a full employment economy to decide not to make money which is a lot of fun when you start making money to decide just to opt out. It was just very discouraging. Yep, that is. All right, what's your positive thing?
You could probably guess this one. My win is the Heroic Hospital Rescue Operation and the heart of the Gaza Strip. Essentially, under tremendous risk, this Israeli Operation Saturday involved hundreds of troops and heavy air support that freed captives, Noah Argamani, Al-Magh, Maier, Yann, 21, Andre Khazalov, 27, and Shlomi Zif, 40, were in good health. Casualties from the Operation, according to Israeli Defense Forces, were less than 100. The Gaza Ministry of Health has announced 274 deaths.
But I want to just shout out my win is the Heroic IDF operation that freed these four hostages. All right, I have some different ones. I think the European elections have been really disturbing for a lot of people in Europe. It's really upset these sort of political establishment, which is a shift to the far right. They don't control everything.
But as Macron in France called for snap elections because he's betting that they won't, they think he thinks they're angry at him, but not letting a far right prime minister had the new French government. But the indications are very clear that a lot of voters have had it with the established political class there and voted with their feet. So I think it's a really something we should pay attention to here in this country. I don't think we're in the same place.
They certainly have a more established establishment than we have. I think we have a much more dynamic political establishment in that regard. So it's really, you know, it's something to pay attention to and people should, you know, Biden particularly should be paying attention to those trends. And in a positive thing, I would say there's a show on Netflix called Hitman, which is by Richard, I think, link later. Wonderful. This Glenn Powell.
He's a very handsome man, but he's very delightful in this movie. He looked to me. He looked like a him, but was essentially, but he's actually, he's been on a couple of anybody. You a bunch of movies. He was in Top Gun. He was the, he was the, he was the, he was the Val Kilmer character in the new Top Gun. Essentially against the other guy, handsome man, handsome man. Anyway, I really liked it. I really enjoyed it. Which one was what took home? Hitman. Oh, yeah, I saw it. It looks really good.
Yeah. Yeah. That guy. He's dreaming. Yeah. He's dreaming. He's dreaming. I think you believe my understanding of what's happening in Europe has been alerts to the far right. And I think you will probably see, you will probably see our we risks, a certain amount of Islamophobia as people. I think are going to have a pretty negative reaction to some of the things they've gone on in this country. And they'll, they never kind of, we can never kind of figure out a middle speed.
We kind of lurch from one extreme to the other. And I think that's happening in Europe. But I explain again, what you, what you're worried about. I think our country is a little different than Europe. I think they have a real heavy political establishment that have been running things for a long long time. And so this is an expression of that.
I think we've had a much more dynamic, whether you like it or not, Trump, we've had years and years of all kinds of different things happening and the elections. And here, this is the first time you've seen a shakeup of this group. And especially in Italy, the party there has stuck to power and stuff. So it's just, I think it's just a bright red shift. They have to be paying attention to because of all kinds of reasons, including immigration, and all kinds of issues.
I think we have had a more dynamic, as I said, a more dynamic political environment than they do there. It's much more stasis. It's interesting that Macron called for these snap elections. So we'll see if they gain power, if they really mean it. He doesn't think they really want a right wing, a far right prime minister. They can have, if they write as well here, there can be a president and prime minister who are very different parties, who are different parties.
So that could be interesting, that could be an interesting. So it's kind of a split government. We'll see. We'll see. It's something to pay attention to. All right. We want to hear from you. Send us your questions about business tech or whatever's on your mind. Go to nymag.com slash pivot to submit a question for the show or call 85551Pimit. On our other pods this week, my interview with former plan, parenthood president, Cecille Richards is out.
We're talking about the legal threats to women's health, Garenhau, Cecille is using technology to broaden abortion access in red states. Justice Donald Trump is meeting with some figures who want, who's a group that wants to completely get rid of abortion. He's meeting with them or he's going in front of them, like completely get rid of abortions. He's really, he's really working everybody's last and everyone on this topic. So we'll see. It was really great.
Cecille also has brain cancer and she's been battling it. It's a really wonderful and she talked about that quite a bit too. She found out about maybe just late last year. Anyway, Scott, that's the show. We'll be back on Friday with more. Please read us out. Today's show was produced by Larry Neiman's doing Marcus and Taylor Griffin. Ernie and her tight engineer this episode. Thanks also to Drew Bros and mealsterVario. You shot a crew as box media's executive producer of audio.
Make sure you subscribe to the show wherever you listen to podcasts. Thanks for listening to pivot from New York Magazine of Box Media. You can subscribe to the magazine at nymag.com slash pod. We'll be back later this week for another breakdown of all things tech and business and pivot. Have a good rest of the week, sure.