How Trump's Chaos Distracts from Elon's Power Play | Pivot

Kara Swisher 0:00 You're my junkyard dog.

Scott Galloway 0:01 I like that. Thanks for saying that.

Kara Swisher 0:03 Yeah, mm-hmm.

Scott Galloway 0:05 Rrr. (instrumental music plays)

Kara Swisher 0:10 Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Kara Swisher.

Scott Galloway 0:15 And I'm thinking of doing ketamine recreationally tonight.

Kara Swisher 0:17 (laughs) Why?

Scott Galloway 0:17 I'm, um... Well, I used to have this incredible ability as a young man to disassociate.

Kara Swisher 0:24 Mm-hmm.

Scott Galloway 0:25 I was basically sleepwalking through life. I didn't care much about anything.

Kara Swisher 0:27 Mm-hmm.

Scott Galloway 0:28 I'm having trouble disassociating from all this bullshit.

Kara Swisher 0:31 Oh, yeah.

Scott Galloway 0:32 Uh, and so I think I'm, I'm going to a Fashion Week party tonight. I don't have my kids. I pushed my meetings back till 10:00 AM tomorrow, so that all spells ketamine for the dog tonight.

Kara Swisher 0:41 Really?

Scott Galloway 0:41 So I'm gonna try it. Yeah.

Kara Swisher 0:43 Have you... You did it once.

Scott Galloway 0:43 I don't even know how you take it though. Do you know how you take-

Kara Swisher 0:45 I don't, Scott.

Scott Galloway 0:46 How... There's medically supervised ketamine.

Kara Swisher 0:48 Yes.

Scott Galloway 0:48 There's a big difference.

Kara Swisher 0:49 Yeah.

Scott Galloway 0:49 Tonight, I'm gonna do it to like me more-

Kara Swisher 0:52 W- Why don't you-

Scott Galloway 0:53 ... have a few moves.

Kara Swisher 0:54 Why don't you just go down to Washington with the gang that's taking apart the government? That... I think they probably have some information on how to do that.

Scott Galloway 1:00 That is not tomato, tomato. Me at a Fashion Week party, h- hitting the moves, thinking I like me a little bit more than usual, doing ketamine with some strange person.

Kara Swisher 1:10 Yeah.

Scott Galloway 1:11 I... By the way, I don't even... Uh, as opposed to going to Washington, that is not tomato, tomato.

Kara Swisher 1:15 Okay, I'm just saying.

Scott Galloway 1:15 All right? That is, that is huge-

Kara Swisher 1:17 Yeah.

Scott Galloway 1:18 I wanna have a good time tonight.

Kara Swisher 1:19 All right.

Scott Galloway 1:19 I wanna forget everything.

Kara Swisher 1:21 Yeah.

Scott Galloway 1:21 I wanna disassociate.

Kara Swisher 1:22 You can't. You gotta be awake, sweetie.

Scott Galloway 1:24 (clears throat)

Kara Swisher 1:24 You gotta be awake. You gotta be woke, as they say.

Scott Galloway 1:27 Do you snort it? Do you inject it? Or what I'm hoping, do you shove it up your ass?

Kara Swisher 1:30 Uh-

Scott Galloway 1:30 Hello, ladies.

Kara Swisher 1:31 Uh... You know, again, I don't have this information.

Scott Galloway 1:32 Who's got a glove? Who's got a glove?

Kara Swisher 1:35 All right, listen to me. You can't disassociate. There's no dissociation allowed.

Scott Galloway 1:39 Oh, daddy can disassociate.

Kara Swisher 1:41 You can't. You have to be in this. You gotta... Like, everybody's writing me like, "I can't keep up, da, da, da." I'm like, "You know what? It's the long fucking run with these people." You gotta stick in there. That's what they... That they, uh, they, they, they in... They rely on your exhaustion, they rely on you being overwhelmed, and you need to not. You need to just keep going. You have to associate. That's how we win, we associate. They're dissociative people, these people.

Scott Galloway 2:05 Hmm.

Kara Swisher 2:05 Yeah, that's right.

Scott Galloway 2:06 Hmm.

Kara Swisher 2:06 Thank you.

Scott Galloway 2:07 Okay.

Kara Swisher 2:07 Why don't you do a happy drug? Like, not one that's so ruminative and, like, a-

Scott Galloway 2:11 What's a happy drug?

Kara Swisher 2:12 I don't know. I never take any drugs, so I have no idea.

Scott Galloway 2:14 Yeah?

Kara Swisher 2:15 I don't ha- I don't take drugs.

Scott Galloway 2:15 Well, uh, so let me answer that, that's called MDMA or X. And I took it a couple of times in college, and I remember thinking to myself, I don't have an addictive personality, but I remember thinking, "This is so good, I cannot do this again." (laughs)

Kara Swisher 2:27 Well, then do that. Do that. Do that.

Scott Galloway 2:29 Yeah, I don't know.

Kara Swisher 2:30 You'll hug... You'll try to hug me. You'll call me and say loving things, which would be disturbing to me, but that's okay.

Scott Galloway 2:35 No, it, it makes me happy. It doesn't make me fucking crazy.

Kara Swisher 2:37 I know, but that... There's a lot of hugs happening from what I... I never took it.

Scott Galloway 2:40 Oh, yeah.

Kara Swisher 2:40 I never took it. There's hugs, right?

Scott Galloway 2:42 Yeah.

Kara Swisher 2:42 There's a lot of hugging and dancing.

Scott Galloway 2:43 You know, you know the initial, its initial use case, how they... It, it was psychiatrists in couples therapy wanted them to open up to each other.

Kara Swisher 2:50 I'm high on life, Scott Galloway. I'm high on life.

Scott Galloway 2:52 I hate it when people say that.

Kara Swisher 2:53 I know, I do too.

Scott Galloway 2:54 No, you're not.

Kara Swisher 2:54 It's the least expressive version. (laughs)

Scott Galloway 2:56 "I don't need drugs." Well, I do, because of people like you.

Kara Swisher 2:59 Although, let me say, I'm looking out the window right now. I just got back on a red eye from, uh, Los Angeles. I was in San Francisco and Los Angeles.

Scott Galloway 3:05 Yeah, you look nice, having just been on a red eye.

Kara Swisher 3:06 Thank you. I was... I'm wearing the same clothes. I was out to dinner at a very fancy... The, uh, Mother Wolf in Los Angeles. Have you been there? It was really good. I have a secret project going on there, another secret project, which is go- will soon be revealed, but it has to do with lesbians in Washington. That's all I'll say.

Scott Galloway 3:22 I'm convinced you're pulling a Scott when his kids were little-

Kara Swisher 3:25 (clears throat)

Scott Galloway 3:25 ... in that is you're coming up with a lot of reasons to leave the house right now. (laughs)

Kara Swisher 3:28 No, no, I'm not. I spend a lot of time... I, unlike you, I do sh- very short trips and I come back on red eyes, so I'm here. I took the kid... I took, uh, uh, Claire to school t- this morning and made her lun- made the kids lunch. I get back so I can do that.

Scott Galloway 3:42 I gotta go to San Francisco. Oh, my God, it's terrible. I'll miss you guys so much.

Kara Swisher 3:47 One of the th- I went out... You know where I went out with two people, one of my brother, uh, and, uh, friends of mine to Zuni, which was amazing, in San Francisco-

Scott Galloway 3:54 Cafe Zuni?

Kara Swisher 3:55 Yes.

Scott Galloway 3:55 Yeah?

Kara Swisher 3:55 It was so good.

Scott Galloway 3:56 Yeah, yeah.

Kara Swisher 3:56 So anyway, it was great. San Francisco was great. Um, ..........................

Scott Galloway 3:59 Well, I'm glad you're back-

Kara Swisher 4:00 Yeah.

Scott Galloway 4:00 ... and you need to stop taking red eyes.

Kara Swisher 4:02 Okay.

Scott Galloway 4:02 You... When you turn 70-

Kara Swisher 4:04 Mm-hmm.

Scott Galloway 4:04 ... such as yourself, you-

Kara Swisher 4:05 (laughs)

Scott Galloway 4:05 As a gift to yourself, you need to stop doing red eyes. I don't do red eyes anymore.

Kara Swisher 4:08 Oh, really? I don't mind. It was a lay down bed. I slept.

Scott Galloway 4:11 Bad for you.

Kara Swisher 4:11 It was fine. It was fine. I'm sitting-

Scott Galloway 4:13 Your sleep, your nutrition-

Kara Swisher 4:14 All right.

Scott Galloway 4:15 Your sleep, your nutrition, and your exercise are the three pillars, and you need to prioritize sleep. You don't sleep well, I'm flying-

Kara Swisher 4:21 Fine.

Scott Galloway 4:22 No more red eyes for you.

Kara Swisher 4:23 You know, I'm wearing my Oura ring, and it tells me that I'm quite ready for the day. It's weird. I don't sleep very much.

Scott Galloway 4:28 You're rested and ready?

Kara Swisher 4:29 Yeah. I don't know why. I don't... I think it's lying to me. Anyway, we've got a lot to get to because I need to be rested and ready.

Scott Galloway 4:34 By the way, I have an Oura ring, and I just downloaded my data-

Kara Swisher 4:36 Yeah.

Scott Galloway 4:36 ... and it says one thing-

Kara Swisher 4:37 What?

Scott Galloway 4:37 ... "Try ketamine tonight."

Kara Swisher 4:38 Uh-uh. Don't do it.

Scott Galloway 4:39 That's what it's saying.

Kara Swisher 4:40 Don't do it by yourself.

Scott Galloway 4:40 I can't wait.

Kara Swisher 4:41 Oh...

Scott Galloway 4:41 I just think I'm gonna like me tonight.

Kara Swisher 4:43 You're not gonna like it. Don't... Please don't. Okay.

Scott Galloway 4:45 I'm gonna feel better about it.

Kara Swisher 4:46 All right, we've got a lot to get to today.

Scott Galloway 4:46 It's not an insurrection, it's a dance party.

Kara Swisher 4:49 (laughs)

Scott Galloway 4:49 Anyway. (laughs)

Kara Swisher 4:51 (laughs) Oh, that's funny.

Scott Galloway 4:53 Yeah.

Kara Swisher 4:53 That's a good joke. That's a good one. Okay, we've got a lot to get to today, including Democrats finally showing some backbone and Trump's plan to create a sovereign wealth fund. Th- this lunacy is every single day. I forget what yes... Well, anyway, plus earnings from Disney, Alphabet, and Spotify. But first, um, I think we know, both know why Google searches for the word coup are up this week. Elon Musk, who's now a special government employee, whatever the fuck that

Kara Swisher 5:17 is, has had a very busy couple of days, has essentially shut down USAID, offered buyouts to every member of the CIA, and his Doge team got access to the IT systems of Medicare and Medicaid, uh, A- NOAA, which is weather agencies, and other, other agencies. We're talking... Uh, we're gonna talk about Trump and Gaza and, and the craziness in a bit, but I wanna focus by focus... start by focusing on Elon. Overall thoughts, uh, what we've been seeing, Trump-... still thinks he's in control, saying this week Elon can't do and won't do anything without over-approval. Um, uh, you'll be shocked to learn that Senator Susan Collins is very concerned about Elon and Doge's actions. People at the Trump White House, they're leaking all over the place that he's too big for his britches. I'm like, "When did you start to notice his pants were tight, my friends?" He's totally too big for his britches all the time. Um, you've been saying, "Where are the Democrats?" Um, they're starting to show signs of life, protesting Elon's power grab at a rally outside the Treasury Department. Some House Democrats are trying to subpoena Elon to testify before the Oversight Committee. They're making a lot of trouble. The motion didn't pass. It probably will pass at some point. Democratic Senator Chris Murphy was on Morning Joe talking about the game plan for his party. Let's listen.

Narrator 6:25 People understand that we are the minority party. We don't run the White House. We are the minority in the House and in the Senate. But we need to act like a real opposition party in the middle of a constitutional and democracy crisis. That means we should not be moving forward nominees or legislation in the United States Senate. Democrats should not be giving votes to nominees or to legislation in the United States Senate until Republicans get serious about this crisis.

Kara Swisher 6:53 I think he's been pretty good. J- Jamie Raskin has. Obviously, AOC is terrific. So talk a little bit about the Elon situation and making, you know, they're making him the villain so that it sort of offloads it from Trump in a weird way. Um, he's sort of the, the, I'm calling him a heat-seeking shield for, for what they're doing. But, um, there's protests that have popped up around the country, doesn't mean anything's gonna happen, criticizing s- particularly Musk. So talk a little bit about, um, uh, this, uh, and what the Democrats should do.

Scott Galloway 7:25 (laughs) Well, you-

Kara Swisher 7:27 The Republicans should do, actually.

Scott Galloway 7:29 ... you said something, you said something that really resonated with me and that is, I've been, I've fallen prey to what is a really smart strategy on their part, and that is the invasion of Greenland or, you know, somehow some fucked up weird strategy for (laughs) clearing out or the ultimate, I don't know, a- a- apartheid or whatever-

Kara Swisher 7:46 Mm-hmm.

Scott Galloway 7:46 ... they're planning to do in Gaza-

Kara Swisher 7:48 Nothing.

Scott Galloway 7:48 ... or, or invading P- the Panama Canal or accusing a helicopter or saying that the people responsible for a helicopter crash are some- some- somehow a function of DEI. You're exactly right. I- i- and it struck me what an idiot I was being. That's nothing but weapons of mass distraction from what is effectively a second insurrection by the same president. And, uh, insurrection is probably the wrong term. It's probably more of a coup. But you change the entire negotiation between someone, two people, when one person holds a gun to the other person's head. And what they have done, they're, they're very smart and elegant here. Instead of a bunch of Duck Dynasty mobs with trucker hats and goatees getting out of their RAV4s, it's the wealthiest man in the world, who in my opinion is trespassing on federal property and has enlisted a bunch of acolytes and has stopped making payments for things like Head Start or the funding of AIDS programs or malaria treatment. There are people, you know, being carried out in stretchers that are in hospitals because they don't have funding. And it's not... These are l- these programs and this funding, whether you agree with them or not or think they should be subject to review, are a function of laws that were passed by three branches of government. And you have, they figured out a way to say, "Look over here at this helicopter crash," or, "It's DEI," or, uh, or, "We have a plan to clear out Gaza," to distract you from the fact that we now have, uh, insurrectionists or a coup being led by the world's wealthiest man. I think the Republicans are thinking, "I can't believe they're letting us do this, and as long as we're kind of in favor of this..." And now they're in a position, when you hold a gun to someone's head, it changes the, it changes the complexion of the negotiation. It's no longer, "Oh, you need laws to do this." It's like, "Well, we might turn the payments back on for Head Start, but let's talk about it." Well, no, we're not gonna discuss it. (laughs) Uh, I- I don't think they're going gangster enough. (clears throat) With... They probably just unmasked, uh, because of their recklessness, the names and identities of CIA officers, which is an incredible act of treason and stupidity.

Kara Swisher 9:56 I think they did that on purpose, from what I understand. They wanted it. Uh, they were sending... This, wh- what Scott's referring to is they, sending emails, uh, uh, g- not in a, in a way that's safe, uh, to the White House. They wanted things like that.

Scott Galloway 10:08 W- so I, I wanna know who are these, these young, highly intelligent, highly motivated zealots following him into these buildings and shutting off payments to, to schools and Head Starts. I wanna know their names.

Kara Swisher 10:20 Well-

Scott Galloway 10:20 I wanna see Democ-

Kara Swisher 10:21 ... you know, they're trying to, the, the local officials are trying to make that official, the new, newly installed Trump are threatening people for naming their names, just so you know. But go ahead.

Scott Galloway 10:30 Oh yeah, but they can unmask CIA officers who've put them- their lives in harm's way (laughs) to try and keep our b- to try and keep our, our Americans safe. I wanna know who their names are, and I wanna see Democratic governors saying, "I'm gonna do everything I can in my power to use the full faith and to the letter of the law to put you folks in prison. I think what you're doing is trespassing. I think this is a coup. And be clear, just because the new insurrectionist who was elected, you know, I don't believe this is legal, and I'm gonna hold the people accountable who are trespassing and a part of a coup accountable." It, it, to just sit back and say, "This is un- this is horrible and this is unlawful," we need to go gangster here and say, "Look, we are not negotiating around this stuff. This is illegal. This is a coup. This is the unlawful seizure of power. We are not gonna engage in these bullshit, ridiculous arguments over, you know, Gaza and Greenland. We are going to hold the people accountable. Here are their names. Here are their faces, and we have contacted the local authorities in where these kids live, these young adults, and we are going to hold them accountable." Uh, we need to start hitting back in a way that disrupts what is the unlawful seizure...... of resources that have been leaked. You might disagree with them, fine, but i- i- that is not anyone's right. Our elected representatives pass these laws.

Kara Swisher 11:57 No, we get that.

Scott Galloway 11:58 And they want-

Kara Swisher 11:58 I, I, I think repeating it doesn't matter because they are blowing through stop sign after stop sign. It doesn't... See, this is a very typical... I- I- I've talked to, I would say, a half a dozen governors, senators, congresspeople this week, and I would... They were like, "Well, we're gonna say something," and I was like, "He's going to break the rules." I said, "You don't understand. He's not going to stop because you tell him he's bad. There's no way he's stopping." And like, look at everything he does. He blows past the SEC. He keeps going. He does lawsuits against the press. He does lawsuits against competitors. He blows up rockets until he gets it right. I was like, this is a person with a high-risk tolerance who has noticed that when you break things or break rules or open your, open your company when the government of California says not to, they don't stop you, or, or it's very hard to stop you. And in the very act of doing it, even if he gets stopped later by a judge or whatever, uh, because it's a... Legal, legal is slow moving, as you know. Even if he gets stopped later, he's already broken it, right? Instead of reforming things, um, which is what they should be doing if they don't agree with this stuff, they're destroying them, and, and if you read any, Peter Thiel, any of their stuff, this is what they talk about, the destruction of a liberal democracy, and then starting from scratch with a unified CEO theory, which is essentially a dictatorship. This is... (laughs) And, and the question is, a lot of them are like, "What do we do?" They're literally asking me, "What do we do to stop him?" I was like, "I- I- I just don't..." I was like, "You don't. You actually don't have the means to do so," because these poor people are in these agencies, and when these idiots come in, these children, these arrogant little pricks come in and say, "We're going to call the federal marshals," or, "The President has ordered you to step aside," they kind of have to. You know, you have to be resistant and be, be walked out by security, and then security doesn't know which one to listen to, right? Essentially.

Scott Galloway 13:57 So, I've had... We've been critical of Democrats, and I've heard from about six Democrats, one senator, five representatives, and he says, "Well, what would you do?" And we talked a little bit about messaging, and he's like... And I'm like, "But that's not enough." And he said, "Well, what do you want me to do? Walk down there and stop them?" And I'm like, "Yeah, I'd like to see all, whatever it is, 48 or 49 US senators and any Republicans that want to join, I'd like to see a couple hundred members of Congress go to the fucking building where this is and demand to go in and physically stop this and let them arrest you." I'm like, "Fine, let America see that there are still people who believe in government in the US and democracy. Let them arrest you." I'm like, "Go down there..." This guy I'm talking to is a former... This representative is a newly elected guy, a former, former, um, service member. I'm like, "Dude, (laughs) if someone attacked our shores, you put yourself in harm's way." I'm like, "March down to wherever this fucking building is, where all these acolytes and the High Sparrow are, and walk in there and demand they stop and let them arrest you." Uh, uh, Democrats, this is not a time to come together. This is a time to come to the rescue. Get together, all of you, wherever the building is, wherever they're actually shutting off

Narrator 15:12 Well, they move very quickly-

Scott Galloway 15:14 ... payments to them-

Narrator 15:14 ... is the problem. They, they don't quite know where they're going. Like, they, they go from... They, they have the advantage here in that regard, is they can show up at various places and you don't know where they're showing up.

Scott Galloway 15:25 Well, we have, we have very talented smart people too with smartphones. I would create a group of people, elected representatives, that go to these places where they are and say, "You are doing... You are... I believe you are breaking the law. You are not an elected official. You need to leave this federal government building." And if the Capitol Poli- Respect the law. If the Capitol Police show up at the order of the President and say, "You need to vacate," I would not vacate, and if you get arrested, fine. I think... I'm not a fan of breaking the law. I think the law is on our side here. I think these guys are breaking the law. And just because you have permission from the President, let's fight it out in court and find out, well, can the President break the law? Because as we have seen, the President has been stopped... Anytime this shit gets in front of a judge, it usually gets stopped. So do you have the right as a citizen and an elected representative or do you have the obligation to get in the way, legislative, uh, verbally, legally, and quite frankly at this point, physically? I'm not suggesting violence. I'm not suggesting... These elected representatives have license to walk into any federal building. Millions of people have elected them. Find out where this shit is going on and go down there and say to these people, "What you are doing is illegal."

Kara Swisher 16:40 I get it. The issue is, if, if... Even when the judges stop them though, they say, "Oh, we have security clearance," but no proof of it. Like this, they, they're persistent. Elon Musk has said to me-

Scott Galloway 16:51 Move fast and break things.

Kara Swisher 16:52 And other... Exactly.

Scott Galloway 16:53 It's Mark Zuckerberg.

Kara Swisher 16:53 That's correct. This is what they're doing. And, you know, like Elon Musk has said to me, "We have self-driving in a year. We have self-driving in a year." It, uh... "We have security clearance." Anything... Like, one of them was like, "How do you know they don't have it?" I go, "Because their mouths are moving." They're lying. They lie as a practice in order to get to the next thing. They're high-risk takers. They're willing to, to... They know you're not going to stop them, you know, ultimately, because it takes effort. They don't want to govern, they want to break. And, and even though they're in charge of the government, they want to... They don't want to reform it, they want to break it. They want to destroy it. They want to take it down to its studs so that they can then rebuild in the way they see fit. And the, the, the arrogance of these people, I cannot tell you. You could, like, fuel a rocket to Mars with the arrogance of these people. And, and what's interesting is there's a bunch of lawsuits filed, as you said, as part of the counteroffensive, unions, federal employees, and others are challenging the legality of Elon, Elon and Doj to get access to federal systems, destroy agencies or push people out of jobs. I'm telling you, Elon also loves a legal fight, right? He doesn't care. He doesn't care. He, he waits people out. Um, this is perfectly designed for someone like him, like, to, to behave. And every one of his...... actions is very much the way he's behaved. Y- that's one thing, you know, when he- I said he's not gonna listen to that, he's gonna go to the next one. And someone was like, "How did you know?" And then he did it. And I'm like, because this is- this is his little act, right? This is his same thing every time. He's not particularly creative in new methods of this kind of stuff. But- but one of the things that's important to keep in mind is that he does have a pattern that he, that he, that he does all the time, and so do all these people, by the way. They all have the same pattern of making a mistake, whether it's for your team girls and making them feel bad and going, "We're so sorry, we're so sorry, we're so sorry." You know? And I think that's the one thing is not fully appreciated, uh, that they don't- they're not sorry, nor- nor will they pay attention to the law, even if a court orders, um- You know, right now, a court orders Musk out of the Treasury computer payment system so it can sort out whether the DOGE is a legal government entity. Um, you know, uh, are they out? They were in there before. Are- You know, that's the whole thing is I don't know if they're actually- nobody knows if they're out. And then let me say the last thing. What they're gonna do is find little cherry pick costs that, that look bad, right? And make things up because d- d- they just lie. They just lie.

Scott Galloway 19:31 Yeah, money laundering or something, yeah.

Kara Swisher 19:32 Money laundering, or they're criminals. This thing about subscriptions and Politico, it was $24,000 at USA Today. They were using their Politico Pro just like you'd buy a subscription. And may I point out that Elon- the government pays Elon $15 billion, so- everybo- for his wares, and then they- So it's- it's petty and unbelievable nonsense, and they'll cherry pick stupid little things, a lot of them inaccurate, like the condoms to Gaza, for example. A lot of them deeply inaccurate or based on stories that are specious. So they'll keep doing that constantly so that we're like cats chasing a laser pointer.

Scott Galloway 20:08 Th- th- but just moving to what we can do, one- the Democrats at this point, uh, I mean, I remember talking to Ray Dalio about, um, um, our, our elected officials, and he's like- And by the way, this is- he was like, "This is war. Take the gloves off." (laughs) I mean, this is like- this isn't try to understand or empathize with the people who elected this guy. This- in my opinion, this is war, and they've essentially es- They're- they're challenging cons- they're challenging the Constitution and democracy. I don't think, I don't think it's time for us to try and figure out, like understand them. The- the- what I would say is, and I've heard from a lot of Canadians who appreciate (laughs) our thoughts around, uh, the tariffs, and one person called me who, who- Uh, Canada's actually strangely, like there's like 12 families who kind of, I don't want to say run anything, everything, but kind of own the majority of stuff in

Narrator 21:02 (laughs)

Scott Galloway 21:03 So, I mean, I'd like to think that America came to the aid of a lot of nations in real times of crisis over the last 100 years, and we want to keep doing that. I mean, at this point, I'm- I believe that nations (laughs) need to come to the aid of America at this point, and I would suggest taking a, a, a page, and to the extent that people feel frustrated or worried about America no longer being the shining beacon leading democracies all over the world, or setting the tone, what Canada did was it- I'd go- I think you need to be very Machiavellian strategic. A province in Canada has canceled $100 million contract for Starlink. They've said, "We're just not going to continue to fund the lead of a coup." I, I, I'd hit them where they, they, they're in their soft tissue, and that is, if you think America plays and should continue to play a vital role in our democracy and be, be that shining beacon on a hill, and you are, uh, using Starlink or your government is in, in negotiations around subsidies, whatever it might be for EVs or Tesla, I would make it clear that you are not going to support an individual who's leading a coup in a nation that has, for the most part, been a really staunch ally. I'm now at the point where, uh, I can't call them Republicans. I think they are both kind of surprised and giddy that they're getting away with this, and also scared of crossing Elon for fear they'll be primaried by Twitter and his hundreds of millions of dollars, which he can do now, given the fact that we let one man amass $400 billion in power. And two, you know, they're surprised- And also, quite frankly, Kara, I think Senator Murphy is fantastic. We come across as neutered and feckless at this point. We are like, "Well, look over here. Oh, I can't believe you would say it was DEI around a helicopter."

Kara Swisher 22:45 Mm-hmm.

Scott Galloway 22:45 You are exactly right.

Kara Swisher 22:47 Yeah. I, uh, was-

Scott Galloway 22:47 That is a sideshow.

Kara Swisher 22:48 And may I say, the media is doing the same things. These headlines in some of these papers, it's like, "Innovative way to, to deal with government." I'm like, I say, "It's a coup, stop saying this." And one of the things, um, that, that, that, especially these young men that are working for him, it- they are so typical of the- One thing I did have as a theme in my book was the juvenilization of men, um, and the, and the coddling of them, and persistent sidelining of women in Silicon Valley, like, and people of color or anybody that was different. Um, and, and that is, that is a, that's a- this is a 30 years going of this idea that these people have the right idea. And I found some stories that I wrote. One was called The Men and No Women of Facebook, uh, and The Men and No Women of Boards, and one of the things, um, that was interesting is I was able to put those headlines because I controlled my own media. But one of the problems is that they have such disdain for people, and the press is treating it like it's like an equalized thing, and it's just not. I'm finding it so frustrating. Um, I even- You know, I- you know I'm on CNN, and on Friday, I was like, "This is a hostile takeover. You need to treat it. Stop talking about DEI in the plane crash. You can talk-" Right? "Stop. You need- this is what this- it's a hostile takeover of government, probably illegal," and you can't look at it like, "Well, look at that," kind of things. I, I just- I, I'm perplexed as to why it isn't a five-alarm fire everywhere, all day long, every minute in the media.... you know, which is-

Scott Galloway 24:22 No, your house is on fire, you shouldn't be arguing over the pattern of the couch. It just, and all of these things are important but this really is, I'm, again, I think our elected representatives who have contacts overseas should be calling him and saying, "Uh, you need to put pressure on Elon. You need..." And Trump is doing the same thing that Zuckerberg did to Sandberg. He's using him as this very powerful and effective heat shield, such that if he does go too far, and in fact they do find this is illegal and they start... Trump can back away and say, "Oh, I, I didn't know they had done that. Yeah, they went a little too far, let the courts-"

Kara Swisher 24:56 He's done that. Yeah, he's done that.

Scott Galloway 24:58 You know, uh, so, he, he's basically, I mean to a weird extent, Elon Musk is a 400-billion-dollar media platform weaponized Sandberg. He's a heat shield and he's like, "You, you understand this technology and how to go in there and shut off payments." And what they're hoping is it resets or recalibrates the playing field for negotiation. Let's start from your getting zero, despite the fact that our elected representatives (laughs) passed this law that says Head Start is a good thing and this is... They went right to the mechanism for the payment. I mean, it, it, it, and it's... I don't understand. This is illegal. I, I would just... Very simple. This is illegal and I believe the people involved in this will be, um, prosecuted.

Kara Swisher 25:41 Mm.

Scott Galloway 25:41 That is, that is what I am planning to do and by-

Kara Swisher 25:42 They won't be prosecuted by this Justice Department because all they're doing is getting rid of-

Scott Galloway 25:46 Well, I threaten to try.

Kara Swisher 25:46 ... like threatening companies that have DEI. That's the first thing Pam Bondi did.

Scott Galloway 25:51 Again, another weapon of mass distraction. That, that's not gonna go anywhere. What could go somewhere, in my view, legally, is to say, "These are the laws and they- I believe you and these 25-year-olds have broken and I plan to do everything within my power to enforce these laws."

Kara Swisher 26:09 Now the only thing that can get in the way... Well, we're gonna get to that so let's go on a quick break. Really quickly, we'll talk about Trump, including flooding the zone, which we were just talking about. This is as much a marketing issue as anything else and that's, they're very good at this. Scott, we're back. The president and President Trump is making all sorts of headlines this week. Trump surprised pretty much everyone with a plan for the US to take over Gaza and turn it into a Middle East, um, riviera, Mara Gazo. That's the joke, which is not funny actually, though some administration officials are walking that back a bit. His cabinet nominees RFK Jr. and Tulsi Gabbard appear to be on their way to confirmation. He's reportedly getting closer to an executive order abolishing the Department of Education. He's doing everything by executive order because he doesn't want to bother with, with legislators. We talked a few weeks ago, uh, questionable executive orders, let's say.

Kara Swisher 26:59 Let's talk a little about this and how people can avoid falling into the trap of distraction, Trump throwing up these crazy ideas and orders while Elon is making this power grab. Um, it's quite coordinated from what I can tell, although I don't think Trump knows what he's doing. Courts have done a few things to keep them in check. They're stopping him from... He's already was in the Treasury, now they're saying, "Get out of the Treasury." Who knows if he will, because again, liars, all of them. Um, a federal judge did block the birthright citizenship order this week, um, but then Trump was busy, uh, signing executive orders outlining plans for a government-run sovereign wealth fund, which would potentially use to buy TikTok. That's called state-run media. Um, the fund would also support other national endeavors like infrastructure projects. Um, I, you know, I don't know what to say. I, I... Talk a little bit about the, the strategy, as a marketing thing, I hate to say that, but this is, he's... And then we have a story in the New York Times that's like, "Well, it's good that he's shaking up the difficult problem in the Mideast. Maybe it will create fresh ideas." Now, I, I was sort of like, "What? Like moving people against their, two million people against their will to where they've lived their whole lives is a fresh new idea?" I mean, and as if no one... Because, especially because Gaza is absolutely destroyed, like again, they destroyed it and now, now they've destroyed it, they can't go back, that kind of thing.

Scott Galloway 28:23 Well, okay, but before we even get to the notion that Egypt... I, I mean look at the borders, look at, look at the Gaza border with, with, with, um, you know, its neighboring nations. Who's... No one wants, no one wants to take these refugees, whatever you want to call... That is such a... I understand the argument and it's an interesting argument and Dan Senor is a good person to talk to about this or someone... The, the notion that we're setting up a situation where nothing's really gonna be different and eventually we're gonna face the same problems in two, five, ten years again, that's a powerful argument. So, the notion that we need to be creative and thoughtful, fine. This is not the time... If you go into an emergency room, okay, the term "stop the bleeding" originates from a very logical place, and that is if you go into the emergency room with a gunshot or you've fallen and hit your head and you're hemorrhaging blood, they don't take your PSA. They don't talk about, they don't say, "Check his or her cholesterol." They stop the bleeding. Everything else at this point is a worthy conversation that should be had by our elected representatives. But if we let a coup be successful and change the complexion of the negotiation, whereas opposed to arguing over who is prosecuted here and under what laws and how do we immediately arrest this coup such that we're not negotiating, "Well, will you give us 50% of the funding back for Head Start, dear person who wasn't elected to make these decisions?" Focus on stop the bleeding, and the bleeding here, America is bleeding out in a small building somewhere that has access, that is being remotely accessed by different locations by a group of people under the cover of dark to stop payments based on programs that were passed by laws by our elected representatives. This is a coup, and it's not a slow-moving coup, it's a fast-moving coup. And everything else is an ER doctor saying, "Okay, they lost their leg and they're gonna be dead in three minutes if they continue to bleed out, but let's, let's figure out-"Let's find out what their good and bad... Let's figure out what their blood pressure. I mean, no, none of that's important at this point. Stop the bleeding. This is our focus.

Kara Swisher 30:46 Well, here's the problem.

Scott Galloway 30:47 Ketamine. (laughs)

Kara Swisher 30:48 I know, ketamine, exactly. But this, this plan literally, Israeli Defense Minister said, has instructed the military to drop the plan to allow voluntary departure of Gaza from residents. The only way they're leaving is if you, if you ethnically cleanse them. And I know-

Scott Galloway 31:02 None of it makes any sense.

Kara Swisher 31:03 Uh, and, and you know what's funny? Like, one of, one of... Right? Uh, most of the conservative, uh, think tanks are sort of like, "Oh, dear." Like, right now, if you look at some of... They were like, "No, this government thing isn't good. This Gaza thing isn't good." Um, and they're like, "Don't be hysterical and use the term 'ethnic cleansing'." But I'm like, only the comedy shows are getting it right. Like the Daily Show, they keep saying, they have different euphemisms for what it is, like, um, you know, voluntary departure or, um, refugee, moving them as refugees. And, and, and they... The word was, password of the day is ethnic cleansing. And they keep doing different words, and they go, "Buh," when they have the wrong word. I... Only the comedy shows are actually calling out this stuff for exactly what it is. Only the comedy shows are calling it a Nazi salute that Elon did, or saying this is illegal, or just explicitly doing it. And I guess it's under the cover of comedy, because some of it's very funny, but it's actually quite strong, I guess. I don't know what else to say. 'Cause that's where I'm seeing the best coverage of this stuff, or the best commentary, I guess.

Scott Galloway 32:15 Yeah, I, I just... Look, again, I, I'm, I'm just remiss to engage in a conversation about how ridiculous it is, because I don't think it's, I don't think it's gonna happen. I don't... I think this is, again, an attempt to say, "Look over here. Let me talk about gender in the workplace as I figure out a way to create algorithms for profit that make it more likely that your 15-year-old girl is gonna engage in self-harm."

Kara Swisher 32:38 Right.

Scott Galloway 32:38 Look over here. I have a book signing.

Kara Swisher 32:41 Yeah.

Scott Galloway 32:42 I mean, it's just... Uh, uh, uh, I don't care.

Kara Swisher 32:43 Yeah, the wealth fund thing. I, you know, someone, they wanted me to go and talk about the wealth fund. I said, "That's fucking ridiculous. State-run media, it's not allowed." And they're like, "Well, what do you think it would be?" I'm like, "I don't. I don't." What do I think of the Loch Ness Monster, you're like asking me? It's not... Doesn't exist. Or maybe that does. Um, but the, the wealth fund, I'm sort of like, state-run media. Does everyone have a problem with state-run media in a country with a First Amendment? Like, yeah, I do. Like, other countries do have sovereign wealth funds that invest surplus income. The US, by the way, runs a budget deficit. So, we don't even have money to put into this sovereign wealth fund. Um, I mean, I don't... You understand sovereign wealth funds better than I do, but this is nutty. Like, it's not... To buy TikTok? What?

Scott Galloway 33:29 Look, a sovereign wealth... Yeah. In the case... They play different roles. In the case of the Kingdom, it's like, we need to figure out a way to transition away from fossil fuels. We have a ton of money. We want to be strategic. We want to turn it into... We want to turn it into more, a greater return. We want to be thoughtful about it such that we can then make the investments we need to pivot away from an economy that's dependent upon a sea of oil, which is gonna dry up in 30, 57 years. Such that, you know, we enter the quote-unquote "modern world." In Norway, it's a means of saying, okay, Norway owns 1.5% of the world stocks, and they create an incredible standard of living for their folks, for their folks because they have thoughtful people trying to figure out how to invest their excess capital at a greater ROI than their competition. America doesn't need a sovereign wealth fund. (laughs) We have so much capital being invested private, privately. That's the financial argument. But the other thing is when you buy one firm... This is... A sovereign wealth fund invests and tries, tries to find alpha dislocation for the benefit of its citizens. We don't need that here. In addition, this is... The sovereign wealth fund, again, is a distraction from what he's really suggesting, and that is the government owning a business which is socialism.

Kara Swisher 34:40 Right.

Scott Galloway 34:41 And the UK could have-

Kara Swisher 34:41 And a media business. A media business. It's not like it's potatoes or something.

Scott Galloway 34:46 (laughs) But, but the UK made a very compelling argument at the time. I see why they probably thought that we need manufacturing to come back, and we have this really compelling guy who built the Pontiac GTO, and we're gonna bring manufact- We have an opportunity here to be one of the largest shareholders in this amazing new technology and manufacturing brand called DeLorean. And so they made him back. I, I believe that the, the critics, Republicans were right to criticize Obama for some of his subsidies around solar firms. The whole Republican argument is that that public sector shouldn't be in the business of picking winners and losers. I kind of get that. Now, if you're gonna do it systemically and say we want to support companies who are building our chips for defense reasons, fine. But this is the state controlling the means of production, and even saying this, I'm taking the de- the bait. This is never going to happen. But again, (laughs) I go back to where we're bleeding.

Kara Swisher 35:41 Right.

Scott Galloway 35:41 So this, again, is another distraction. It's a stupid idea. It will never happen. They know it, in my opinion. Maybe he just thought about it and thought, "I'm a deal guy. I can make money here for the government." No, we don't want to own TikTok. We want to regulate it or ban it. We want to promote, uh, uh, uh, the rule of fair play and even playing fields such that startups have a shot and everyone is playing under the same rules. And meanwhile, if you in fact have an algorithm that can be reverse-engineered to polarization, radicalization, or self-harm among teens, maybe you should be subject to the same liability as traditional media. Okay, that's, that's an art-... That's the government's role. The government's role isn't to start cosplaying business. Trump has been cosplaying business his whole life.

Kara Swisher 36:24 His whole life.

Scott Galloway 36:24 This is the reality of Trump. If he had invested his father's massive fortune, which he inherited, in any index fund, he'd have more money than he has now, but he's been cosplaying business. He was hugely insecure. I ran across Trump businesses all the time doing business, and the general reputation of Trump and his family was they were a bunch of rich kids who didn't know what they were doing, that they just weren't very good at what they did. He's been cosplaying business his entire life.

Kara Swisher 36:52 Absolutely.

Scott Galloway 36:53 And this is, again, him thinking, "I've got an idea."

Kara Swisher 36:55 Yeah.

Scott Galloway 36:55 "We'll own TikTok and we'll make money." That is not a government role.

Kara Swisher 37:00 Absolutely not.

Scott Galloway 37:01 It's not... And again, here I am taking the de- taking the bait.

Kara Swisher 37:04 Yeah.

Scott Galloway 37:04 Look over here.

Kara Swisher 37:05 Yeah, it's just not happening.It's just such nonsense, it's fucking nonsense, like nonsense. Every time they ask me to comment on things, I'm like, "It's nonsense." I, what else can I say? This is bullshit. This is such a, there's no, there's no interest. Like, sometimes I think it is good. Like, let's think of some fresh ideas, right? Let's, "Huh, what should we do here with this? How do we protect our national security and yet protect the First Amendment? Like, how do we do that?" Like, there's always a room and that's the good part of Silicon Valley. Like, let's think of new ways to do things. Let's, and by the way, they don't have, let me just say, uh, this attack, I'm gonna just have one slight rant here. I got contacted by Bijan Sabet. Do you know him? He's a great investor. He was in Twitter early and stuff like that, and he's written a piece called... There are people in Silicon Valley that are not like this, just so you know. And he wrote a great piece called Public Service: The Backbone of American Democracy, and he really didn't like this one line in these Doge, uh, press releases where he says, "The way to greater American prosperity is encouraging people to move from lower productivity jobs in the public sector to higher productivity jobs in the private sector reveals a staggering ignorance of the essential work performed by those in government. It is not only offensive, but also demonstrably false." I was so happy to read that, you know, that, that, um, the private s- he's put, simply put, "The narrative that the private sector is inherently superior to the public sector does a disservice to the millions of Americans who serve their country every day. It risks demoralizing a workforce already under strain and undermines the very institutions that protect and, or advance our shared values." These people who have had so many friggin' failures of their startups, they fuck up so much and, and Donald Trump is the top fuck up, the top fuck up of business. They're allowed to say they're innovative and they then insult government officials who have done a pretty fucking good job keeping us safe, um, every day. And it's so, it's so offensive and so easy to, to insult the government and their, its workers. And it's, they have fucked up so many times that we should start making lists of all the different stupidities they have perpetrated. I, I, I find it, the whole thing just, it's nonsense. I don't know. It's just-

Scott Galloway 39:17 So the, there's, there's, there's also, there's parsing kind of mendacious to just stupid and dangerous. Um, the CIA, uh, I've had the pleasure of working with several, um, officers. These are incredibly bright people, (laughs) incredibly skilled, and instead of going to work for Google or Procter & Gamble, they decide to serve their country and they take enormous risks. And the fact that, the fact that they have so little regard for our national security apparatus, that they might be unmasking these folks, either recklessly, negligently, it is, that is 100% the right word. It's traitorous and it's stupid because what is the likelihood... The Central Intelligence A- Agency recruits out of every top business school, every top college, they try and find the best and brightest from a very early age. Do you think you're more or less inclined to go to work for the (laughs) Central Intelligence Agency right now knowing that your own government might out you? What if you're overseas on assignment right now? Oh, sleep well tonight. They might know, they might know who I am and what I'm doing here. And by the way, it's not like these guys lose their pension if they're found out. It's not like they get fired. They are tortured and then murdered trying to protect our shores, and you have people who have so little regard for their sacrifice and their patriotism.

Kara Swisher 40:46 One, let me just take one thing and we gotta move on, is someone who is very interesting, some of his comments, is Bill Gates. He's on a book tour for a book called Source Code. Um, he has met with Trump 'cause he's trying to stop him from defunding AIDS things, and I, he has to do that. He, he's, he's the president, he's gotta go in there and make his argument why not to, and he has been defending USAID. He's someone who was very arrogant about government. I, when I met him, he was super arrogant. He now is like, "I was arrogant, and let me tell you, there's some amazing people working for the government. I've had govern- There's, there's, uh, dedicated important people doing important work if you partner with the government." He's, he's very quietly doing the right messaging around w- why this is wrong, and every now and then he's like, "What Elon's doing is, is nonsense and irresponsible and here's why." I don't think, I, I'd like him to yell more, but I have to say, I was pretty surprised how explicit he is being. There's very few other leaders that are doing that. None of them, like none of them. He was the only one that you see, 'cause he knows he doesn't have a price to pay because he's Bill Gates, right? So, he can do that. So, all you other rich fuckers who don't think this is right not saying anything is heinous on your behalf. Anyway, let's go on a quick break. When we come back, we'll talk about this, this week's earnings. Scott, we're back

Kara Swisher 42:04 with our second big story. There's lots of earnings news. We sh- we still have to talk about earnings. Um, Disney beat expectations, reporting a 4.8% increase in revenue. The company's experienced business which includes parks, cruises, and resorts rose 3%. Its entertainment b- division saw a 9% jump in revenue. Disney+ saw a 1% decline in subscribers following an increase in prices last year. They had been, they're doing pretty well. They're make, they're, their, their streaming business is quite stabilized and it's moving forward. Um, at some point, you run out of subscribers essentially, like, and there's a lot of churn, et cetera. Um, Alphabet, I'm gonna go through them and then you can comment on. Shares in the company are down almost 6% in the last five days at the time of the taping. Alphabet's overall revenue grew, um, 12% compared with 13% in the same quarter last year. Advertising revenue grew 10.6% compared to 11% last year. The company announced plans to invest an a- a- a- above expectations $75 billion in capital expenditures as it continues to build its AI offerings. Um, uh, one of the things they did n- note is they're gonna stop, uh, their, all their efforts in DEI 'c- 'cause they're gonna... Unlike Costco and Apple, they've decided to, to cave, um, and there are threats from Pam Bondi and state attorney generals and they've just decided to cave in all their different programs, um-... now onto Spotify. Shares are up 12% in the last five days at the time of the taping, after the company reported its first, uh, ever profitable, first profitable year. The company reported 40% gross profit growth year over year and operating income of 477 million euros. Monthly active users grew by 35 million, up 12% for the year. Um, lastly, Uber reported a lower than expected operating income of 770 million. 3., uh, 1 billion trips were completed on the platform, up 18%, uh, year over year. Uber all, Uber also announced it's ramping up for a public launch of robo-taxis in Austin through its partnership with Waymo. Waymo is killing it in San Francisco, I can tell you that. Well, then, the company's optimistic about the autonomous vehicle market, admit there are many, many years to scale. They're absolutely right. So which one of these would you like to take? Um, they all did okay, I think. It was pretty good, given all the-

Scott Galloway 44:13 Well, I'll touch on each of them-

Kara Swisher 44:14 Okay.

Scott Galloway 44:14 ... and then try and extract what I think is, is an interesting-

Kara Swisher 44:16 Mm-hmm.

Scott Galloway 44:17 ... theme. So Disney, essentially, the streaming wars, everyone's fighting to be Lyft. What do I mean by that?

Kara Swisher 44:23 (laughs)

Scott Galloway 44:23 Netflix is running away with it.

Kara Swisher 44:25 Definitely.

Scott Galloway 44:25 So everyone's, everyone's fighting for number two.

Kara Swisher 44:28 Mm-hmm.

Scott Galloway 44:28 And they, they've, I don't want to say they've given up, but Netflix, I mean, just to give you a sense. In t- 2015, Disney price to sales was four, Netflix was five. So they saw them in kind of spitting distance of each other from a shareholder's standpoint. As we sit here today, Disney trades at two times revenue, and Netflix trades at 11 times revenue.

Kara Swisher 44:48 Yep.

Scott Galloway 44:49 Disney, they lost 700,000 subscribers, but that was in the face of a price increase. Now it wasn't a huge price increase, but it does show kind of the strength of Disney's positioning around family.

Kara Swisher 45:01 Mm-hmm.

Scott Galloway 45:01 Whereas Netflix added 19 million subscribers-

Kara Swisher 45:04 Mm-hmm.

Scott Galloway 45:04 ... um, Disney's added, Disney+ has added 13 million. And the, the big thing comes down to churn.

Kara Swisher 45:10 Mm-hmm.

Scott Galloway 45:10 And that is, there's this really uncomfortable dynamic where, uh, everyone but Netflix has to reinvent their entire customer base every ten years-

Kara Swisher 45:18 Mm-hmm.

Scott Galloway 45:18 ... or two years. Because they go on and they download the entire season of Ted Lasso, and then they cancel Apple TV+.

Kara Swisher 45:24 Mm-hmm.

Scott Galloway 45:24 And ch- and Netflix has so much, so much gross tonnage, that their churn is only 2%. Disney is number two, but it's at 4.8%. And then the other guys have even higher churn rates.

Kara Swisher 45:37 Yeah, they do.

Scott Galloway 45:37 They, uh, let's, moving on-

Kara Swisher 45:38 Can I just make a note here?

Scott Galloway 45:39 Oh, yep.

Kara Swisher 45:40 Real competitor, and this is me talking to Hollywood people yesterday, is YouTube. YouTube-

Scott Galloway 45:44 Oh, 100%. 100%.

Kara Swisher 45:45 ... is the competitor of Netflix. The real-

Scott Galloway 45:47 That no one talks about.

Kara Swisher 45:48 They are killing it at Netflix. So go onto Google and Alphabet, which is part of-

Scott Galloway 45:51 To, to your, but to your point, total, total share of video viewership is like 8 or 9% for Netflix.

Kara Swisher 45:56 Mm-hmm.

Scott Galloway 45:57 YouTube is 11.

Kara Swisher 45:57 Yeah.

Scott Galloway 45:58 You- YouTube, you could argue YouTube is the number one streamer, but it's still categorized as a, as a different-

Kara Swisher 46:03 Mm-hmm.

Scott Galloway 46:04 ... a different sector. For, for Disney-

Kara Swisher 46:05 I think they're gonna do a lot more originals, FYI, but go ahead.

Scott Galloway 46:08 Disney's parks, cruises and resorts continues to be, you know, the gift that keeps on giving. Revenue up 3%, but the operating income was up six to 8%. Disney's done a good job incorporating ESPN into a pretty compelling bundle with Hulu. Moving onto Google. Their full-year revenue grew 14%, but people are freaked out about slower than expected cloud growth, 'cause they see that as a proxy for their AI offering. Uh, so they took the stock down a little bit. They're also worried about the amount of capex. Um, their capital expenditure is supposed to increase to 75 billion. The thing about Google, though, is that they have five separate businesses that do more than 30 billion in annual revenue.

Kara Swisher 46:46 It's amazing.

Scott Galloway 46:46 If their stock were to go down, I mean, uh, l- look at it this way. Th- uh, that's like saying they have f- the revenue power of five different Starbucks or five different Visas with, with different businesses. They are just a, they are just a cash, a series of cash, uh, volcanoes. Seven products and platforms with over two billion users. Search, Maps, Gmail, Android. You know, they're just doing incredible. Spotify is probably the most impressive, uh, from, uh, performer from where it was, say, 12 or 24 months ago. And that is, they've, they essentially, uh, set quarterly record highs for revenue growth, margin operating income. The stock has tripled in the last year. Their platform growth is accelerating. Their total monthly active users hit 675 million. Their premium subscribers, up 11%. Their avering- average revenue per user, or ARPU, is up 5%. Um, the, the, and now kind of what I'll say, and I'll come back to it in a second. But the big theme here, or something hopefully resembling insight, is the following. If you look at the acceleration in Spotify's stock and in Netflix's, I believe that that's more than just growth in the category. It's effectively, uh, so Netflix now has more than 50% of its production overseas. And, uh, if you look at, uh, Spotify, less than 1% of its artists garner more than 92% of its, uh, streaming revenues. Effectively, with the scale that these companies have, and by not sharing analytics or information, what Netflix has done is it has transferred a massive amount of capital, earnings power, money from the means of production, specifically artists, to Netflix shareholders. And that is, when you put something on Netflix, they don't tell you how successful it is. They might produce it in Spain or in Seoul. But they've basically extracted a shit ton of capital from California-based employees, from actors, from producers, and said, "We're kind of the big dog here, and you have to operate under this new religion or this new operating model. Because by the way, if you don't want to be in our Netflix drama, there's 179,000 other SAG-AFTRA people that are looking for work."

Kara Swisher 49:08 And, and can I just make a point? They also put out so much content that's pretty good, right? It's not-

Scott Galloway 49:12 Mm-hmm.

Kara Swisher 49:12 None of it's really ... One of, the way, uh, someone was telling me a story, uh, who I was with last night who used to work at Google, was Susan Wojcicki, the late Susan Wojcicki. And they were thinking about getting into originals, and they walked her through the, the, the economics of Hollywood, 'cause she wasn't familiar. You know, she had been very successful at Google, and she had just taken over YouTube. And they, they walked, walked her through it, and she got up and she goes, "This isn't a business." Like, what, only one hit?... carries all the losses. Like, she was like, she immediately clocked the problem, right? Like, she goes, "This isn't a really sustainable business if you don't have this one hit." And she goes, "Why are they operating like this?" And she was... I think she had insight into the idea that if you had a lot of little hits, or, or spread it out with stuff that people like, you would do a lot better. And that's what Netflix has kinda done here. They have... Nothing's... Every now and then, they have a big one, but all the others are fine, and they help sustain the fact that, that it's a good product. You, you find, you find efficacy in the product. You find pleasure in the product. Same thing with Spotify. It's a good... At, at the, at its heart, it's a good product. I don't know what else to say. It's, like, enjoyable to use. You find what you want. Maybe it's not, like, soaring, like an HBO can be sometime, but every now and then, it is. And it's... So that's... You know, it's a good... I don't know what else to say. It's a good product. Like, that's how I feel about both those companies.

Scott Galloway 50:39 But you, you, you touched on what the secret... Uh, there, there's two ingredients to the secret sauce here, and it's an asymmetry. They both have, both have to do with an as- symmetry of information. If Deadpool does $1.3 billion, the agent for Ryan Reynolds and for Hugh Jackman know that, and the next time they wanna do Deadpool meets Fast and Furious 18 or whatever, the agent from WME goes to the studio and says, "I know how important Hugh Jackman is," (laughs) and, uh, they extract a shit ton of Pound of Flesh. In streaming, the only evidence that Ben Stiller has that Severance got more than one viewer is they order seasons three and four. So, the asymmetry of information always benefits the person that has symmetrical information. When Jennifer Aniston's agent knew that the Thursday night lineup counted, depended, was, was resting on the pillar of Friends, the people producing and acting in Friends could extract a lot of revenue. No one in streaming has any fucking idea. And then the second big number out of the Disney earnings that fascinated me and explains why, explains why, uh, Netflix trades at 11 times revenue and Disney at two times, is that now more than half of Netflix's content budget is spent overseas. And some of it's done to be more multinational, but the majority of the reason they do it, and the reason why they're building big studios in New Jersey, is 'cause New Jersey just supersized their tax subsidy. They realized, "If we can produce two eights in Spain or Seoul, instead of producing one possible eight or nine in LA, go with the eights overseas." Over 50% of their content budget is now spent overseas. Do you know what percentage of Disney's content budget is spent overseas?

Kara Swisher 52:28 I bet none. Like-

Scott Galloway 52:30 4%.

Kara Swisher 52:31 Right, none. Like, none.

Scott Galloway 52:32 So, eh, so what... Essentially, what Japan did to Detroit, Netflix is doing to Los Angeles. And na- I don't care. You wanna talk about nuclear code secrets? When we launch our series on Netflix, and I say, if I call them and say, "I am not working with you again unless you tell me how many people downloaded this relative to your other dramas," they're gonna say, "Well, it was nice working with you, Scott."

Kara Swisher 52:54 Yeah. See ya.

Scott Galloway 52:55 (laughs) Because they don't want anyone to have that leverage.

Kara Swisher 52:59 Mm-hmm. That's the fascinating-

Scott Galloway 52:59 So asymmetry of information and the globalization of content production-

Kara Swisher 53:04 And a decent product.

Scott Galloway 53:05 ... are the reason-

Kara Swisher 53:05 A decent, pleasurable product.

Scott Galloway 53:07 Oh, it's a fantastic product. But all of those benefits, all of... I mean, this is a straight line. There's a lot of innovation, a fantastic product, but you wanna talk about a massive flow to the bottom line and who it's coming from beyond the natural growth, organic growth of the sector? It's coming from the g- It's coming from the gaffer, the lighting guy, and the, and the woman who ran, who wrote season four of SpongeBob SquarePants and used to make 200 grand a year. And Netflix has said, "You know what? I figured out a way to pay you 40 grand." And all of that, all of that capital coming out of high-production states and people has moved to Netflix shareholders. And it represents a much broader trend in our society, and that is the notion that we give a shit about stakeholders and not shareholders is just not true. Everything is run for shareholders. And by the way, there's some upside to that. I'm not arguing that it's the wrong way, but be clear, folks. Everything is now optimized to transfer as much capital as possible from states, from workers. The workers here are not being prioritized. Production in Los Angeles was off 40% year on year, not because they're not talented, but because they're too goddamn expensive. And Netflix has found a way to keep them in the dark and then hire 80% as talented a person overseas for 30 to 40% of the price. It's a transfer of wealth from artists at Spotify and from the creatives in Hollywood to Netflix and Spotify shareholders. And Spotify has made the jump, so they have so much leverage, they are now extracting revenue from the bottom 99.9 of artists. They're gonna make less and less money.

Kara Swisher 54:49 All right, very quickly on Uber, 'cause we gotta move on to predictions.

Scott Galloway 54:53 Incredibly well-managed. I just think you gotta give it to Darrah. He, he, he and Apple were the ones that said, "No, I'm not gonna jump into the shallow end head-first here and make huge capital-"

Kara Swisher 55:05 Mm-hmm.

Scott Galloway 55:05 "... allocations to autonomous."

Kara Swisher 55:08 He pulled back. He pulled back on it, actually. He-

Scott Galloway 55:09 "I'm gonna wait. I'm gonna rent other..." Just as... I mean, they're good at this. Uber's innovation is Airbnb's innovation, and that is, "I'll build a thick layer of software on top of other people's capital expenditure, on top of their apartments, their houses, and their cars," right? So, it's in their DNA to say, "Well, why don't we just ride? Why don't we just be the remora fish off of Google's multi-decade, multi-tens of billions of dollars investments in autonomous?"... that's where we should be riding.

Kara Swisher 55:38 Yeah.

Scott Galloway 55:38 That's where we should be playing the game. They are-

Kara Swisher 55:40 (laughs)

Scott Galloway 55:41 He is doing a great job imagining that.

Kara Swisher 55:42 And let me say, uh, you're right, it's on top of it. I, I gotta say, Waymo's so integrated into San Francisco now, and you're gonna see it all over the country. It's so convenient. And, and they live together with Uber, by the way. That's in a very comfortable way. I took both in San Francisco this week, and both were great. Prices are still too high for all of them, um, and I know they need to make money and stuff, but it's a really interesting time. You're right, Dara's done a, a nice job here. And there are no competitors, really. I mean, Lyft is sort of a competitor, I guess. Anyway, um, one more quick break and we'll be back for predictions.

Kara Swisher 56:15 Okay, Scott, let's hear a prediction.

Scott Galloway 56:20 Well, if you think about the three layers in AI, there's the, there's the infrastructure layer, the NVIDIAs of the world. There's the, um, LLM layer, the Anthropics, the ChatGPTs, and then there's the application layer. And the entire infrastructure and LLM world was thrown into, uh, disarray when, shocker, Chi- China came up with something cheaper, right? Uh, but I think what you're about to see is a, uh, kind of a golden age or a bun- dozens of new unicorns in what I call the application layer. And I met with this incredibly impressive young man yesterday who founded a company called Rogo, which is essentially, they take all of these financial data streams, whether it's cap IQ or Bloomberg, and then they put a layer of intelligence, AI weaponized intelligence, on top of it, and they turn, they turn an investment banking analyst into someone fighting on horseback to someone in a Panzer tank. So, you can type into this AI that's customized for financial services or institutions, uh, IPO, put together an IPO road show deck for, you know, a fast fashion company that does this revenues and these are the concerns, and it'll put together a 60-slide deck of which 48 are pretty good. So, you can basically do the job of three analysts. And they'll say that it's making people more productive, but it's gonna result in massive layoffs. Anyways, I think you're about to see dozens of new unicorns in the application layer. I do think that the infrastructure and the LLM layer is about to shed tens of billions of dollars-

Kara Swisher 57:49 Yeah.

Scott Galloway 57:49 ... as people realize the moats aren't as big as they thought. That if Sam Altman can copy everything out there, someone's gonna be able to figure out a way to copy Sam Altman's shit.

Kara Swisher 57:57 Yep.

Scott Galloway 57:58 But the, the additional customization or artisinal, um, AI application layer in healthcare and in financial services-

Kara Swisher 58:06 Agreed.

Scott Galloway 58:07 ... fitness, and all sorts of things, is gonna create a bunch of branded consumer AI applications. I mean, that's what Airbnb is, right?

Kara Swisher 58:14 Yep.

Scott Galloway 58:14 That's what Uber are. They, they took existing infrastructure and breakthroughs and they branded it and they created interesting vertical niche applications. I think that you're about to see-

Kara Swisher 58:23 Yep, living off-

Scott Galloway 58:24 ... a-

Kara Swisher 58:24 ... living off other people's stuff. That is a real big theme you're talking about here, living off other people's costs.

Scott Galloway 58:30 So, we're about to see, um, a bunch of companies... I mean, this guy, I had breakfast with this kid. 25, Jesus Christ, like, in my... Can I come back as you? By the way, I'm gonna be him tonight under the influence of ketamine.

Kara Swisher 58:41 No, you're not. You're just gonna... I'm gonna get a call from the police and I'll have to come get you or something, something

Scott Galloway 58:45 Uh, no, by the way, you're not my, you're not my call. Preet Bharara is my call.

Kara Swisher 58:49 (laughs) It's true. All right.

Scott Galloway 58:51 I call Preet. I literally, I have him. He's, I'm about to make him and his phone number tonight my screensaver.

Kara Swisher 58:56 Oh, that's a good idea. Call Preet.

Scott Galloway 58:57 When you see my boys tonight, it's like, "This is the guy. Here's his number." I've told Preet this.

Kara Swisher 59:02 (laughs) I know. He thought he was very touched.

Scott Galloway 59:03 I'm like, "I just need you to do one thing. You can ask me for anything, but if you see my name come up-"

Kara Swisher 59:09 Yeah.

Scott Galloway 59:09 "... I need you to answer."

Kara Swisher 59:10 Yeah.

Scott Galloway 59:11 "And I'm not calling to say hi."

Kara Swisher 59:12 Yeah.

Scott Galloway 59:12 "I'm not calling to say hi."

Kara Swisher 59:14 Oh, wow. Okay. All right.

Scott Galloway 59:15 Anyways-

Kara Swisher 59:15 All right. All right. I have-

Scott Galloway 59:16 And he's now-

Kara Swisher 59:17 Go ahead.

Scott Galloway 59:17 And, and I, I've told him I'll send millions of dollars of money to this, to this law firm he's now like the rain maker for.

Kara Swisher 59:23 Mm-hmm.

Scott Galloway 59:23 Anyways, but, uh, no, I'm not calling you. I'm calling Preet.

Kara Swisher 59:27 All right.

Scott Galloway 59:27 I want to get as a scold from you.

Kara Swisher 59:28 I would leave you. I would scold you. I would. I'm gonna make a very brief, um, prediction. You know, there's a lot of new polls out. The Economist had a poll that, um, back in November, uh, 47% of those surveyed Republicans says they wanted Elon Musk to have a lot of influence in the Trump administration, while 29% wanted a little, and 12% want him to have none at all. Today, the number of Republicans that say Musk have, they want him to have a lot of influence has fallen substantially to 26%, according to this story in The Hill. Meanwhile, 43% of Republican respondents said they wanted Musk to have a little influence, and 17% they want him to have none at all. I see that. He, he... But I have to tell you, I had thought they would have a falling out. I think he is, as I have said, he is, uh, he is little pussy for, for, um, for Trump, the mob boss, essentially. He is the heat shield. He is the junkyard dog. And I think Trump understands this intuitively. There's one thing about Donald Trump, intuit- he has an intuitive sense of things. T- Musk is good for him because he gets the shit done, even if it's illegal and he's willing to, and nobody else is. And as much as these insiders are gonna complain about him being bigger than his britches or overstepping, I don't... I, I, I think maybe he might be around a little longer. I think I was wrong about that falling out. I, I wish I wasn't, but I do think, um, even if people are indignant, this guy has a sta- he... Everything has shown, when everyone thinks Musk is gonna lose on the pedophile case or with the SEC, he's, he's got a, he's got an ability to, not just to take risks, but also take ridiculous, heinous risks, but to also stick it out. So, I don't know. I think he's, Trump recognizes that it's good to have a junkyard dog. It's good to have one.

Scott Galloway 1:01:16 Uh, this is a-

Kara Swisher 1:01:16 You're my junkyard dog.

Scott Galloway 1:01:18 I like that. Thanks for saying that.

Kara Swisher 1:01:20 Mm-hmm.

Scott Galloway 1:01:20 Rrrr!

Kara Swisher 1:01:21 (laughs)

Scott Galloway 1:01:21 Yeah! Get her. Get o- get away from her! Rrrr!

Kara Swisher 1:01:23 Yeah, that's right (laughs) .

Scott Galloway 1:01:25 Uh (laughs) .

Kara Swisher 1:01:25 Yeah.

Scott Galloway 1:01:27 Anyways, uh, this is, I mean, this is insanity or crazy, but I would describe it more apt as like late stage syphilis crazy.

Kara Swisher 1:01:35 Yeah, that's what they were saying (laughs) like syphilis crazy.

Scott Galloway 1:01:37 And, but the thing is, that can go on for years.

Kara Swisher 1:01:40 Mm-hmm. You can have syphilis for a long time.

Scott Galloway 1:01:42 Yeah. N-

Kara Swisher 1:01:42 Please don't get it.

Scott Galloway 1:01:43 I, I'm- (laughs) No, no. No, un- unfortunately. I- th- the good news is, I'm so unattractive and unappealing now-

Kara Swisher 1:01:50 Mm-hmm.

Scott Galloway 1:01:50 ... that you have to have someone else to engage in giving you syphilis, and that's just not gonna happen.

Kara Swisher 1:01:53 That's not a word we use enough, syphilitic.

Scott Galloway 1:01:55 It's a great word, isn't it?

Kara Swisher 1:01:56 Let's o- let's use it, like, several times, like syph-

Scott Galloway 1:01:57 I used to like, I used to like the word encephalitic-

Kara Swisher 1:02:00 Yeah. No, it's not. No.

Scott Galloway 1:02:00 ... but that's not syphilis, that's a brain disease, cloudiness. But syphilis-

Kara Swisher 1:02:03 Jesus. (laughs)

Scott Galloway 1:02:04 I do like syphilis.

Kara Swisher 1:02:05 Can I tell you-

Scott Galloway 1:02:05 I like that.

Kara Swisher 1:02:05 ... Amanda's always like, "Scott used that word wrong." She's, like, such a word person. The way, she... Several times you've used words that i- are-

Scott Galloway 1:02:12 She means I used it incorrectly.

Kara Swisher 1:02:13 Incorrectly, that's correct. Yeah.

Scott Galloway 1:02:15 (laughs)

Kara Swisher 1:02:15 Anyway, she's often (laughs) doing that to me. I'm like, "Did he? I don't know." Like, she's like, "You need to tell him." Like, I'm not telling him. I forget, I completely forget the minute she tells me what-

Scott Galloway 1:02:22 I wouldn't mind her. Your texts are mean.

Kara Swisher 1:02:24 (laughs)

Scott Galloway 1:02:24 If she calls me and says, "You meant this," I'm open to that.

Kara Swisher 1:02:27 All right. I'll tell her.

Scott Galloway 1:02:28 Um...

Kara Swisher 1:02:28 I'll tell her. She can be your spelling lady. Anyway,

Kara Swisher 1:02:31 uh, elsewhere in the Kara and Scott universe, which is growing by the second... Uh, by the way, thank you, Elan.

Scott Galloway 1:02:36 It's expanding.

Kara Swisher 1:02:37 Thank you, Elan, for all this content. This week on Prof G Conversations, Scott spoke to Mo Gawdat, the former chief business officer at Google X. Oh my god, Google X. You know, my ex-wife used to run it. Um, bestselling, uh, author and founder of One Billion Happy.

Narrator 1:02:53 The truth is, uh, the, uh, the world is, is not ready for what is about to hit us. Whether you take the simple things, like the economics of the world and how they will change as a result of AI, all the way to the change of the dynamics of power and, and, you know, the, the resulting deprivation of freedom, you know, uh, all of the, all the way to how, uh, the economics of the world are gonna change and how, you know, the, the jobs are gonna change and how the human connection is gonna change and how our understanding of reality is gonna change, and these are decisions that are not made by us anymore. I'm, you know... Think about it this way, uh, Spider-Man's "With great, uh, power comes great responsibility." We've disconnected power from responsibility. Uh, there is massive, massive power concentration, concentrated in hands that do not answer to anyone.

Scott Galloway 1:03:43 He's a very thoughtful guy. Mo Gawdat, I really, I really enjoyed the conversation with him. And basically, uh, it, you should w- listen to the conversation, but he basically summarized, like, you know, Sam Altman is, is reshaping the way we think about things, the way we approach problems, potentially what types of weapons are developed, and he was kinda like, "Who the fuck is Sam Altman to get to do this?" (laughs) And that, that-

Kara Swisher 1:04:03 Correct. Who the fuck is Elan Musk? Who the fuck are any of these people?

Scott Galloway 1:04:07 I mean...

Kara Swisher 1:04:07 But that's where we're going. Okay, Scott, that's the show. Thanks for watching. Uh, pivot. We're wa- They're watching us, Scott, now. They're watching. Look pretty. S- do something pretty right now. Be sure to like and subscribe to our channel. We'll be back next week.