J.P. Morgan's First Republic Deal, Twitter v. Bluesky, and Friend of Pivot Joelle Emerson

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Hi, everyone.

This is Pivot from New York Magazine and the Vox Media Podcast Network.

I'm Kara Swisher.

And I'm Scott Galloway.

Scott asked me about my electric hummer.

Tell me about your electric hummer, Kara.

Oh, I thought you'd make a dirty joke with a hummer.

So, you know,

they're discontinuing Chevy Boltzmann.

I don't know if you know this.

It's a long story.

So I was at a number of things this week.

That's a tragedy for anyone looking to stay in incel.

But anyways, go ahead.

Okay.

Anyway, so one of the top people in the marketing department came up to me and said, we thought you'd be upset.

And I said, no, I'm fine.

It's good.

They're doing all kinds of,

you know, they're spending a lot of money to get into this market, obviously,

and a lot of money at billions of dollars.

And they have a a whole bunch.

They're showing off the lyric and everything else.

And then when I, this was the White House correspondence dinner weekend.

Guess what?

They lent me to use to drive around.

An electric hummer?

That's correct.

I didn't drive it because I would have killed people, but they had an electric hummer.

Yeah.

Yeah.

They had a service.

You and an electric hummer is

something out of a, like, that's when I get a massive hit of ketamine and it just doesn't go out according to plan.

I know, exactly.

But it was cool.

You and electric hummus.

It was well done.

And everyone, of course, wants to insult the Hummer, but then you're like, it's electric.

And then, of course, Amanda was like, well, it's still big.

Anyway.

Don't you need like a ladder and seven

hired people to get you into that thing?

How do you get into a Hummer?

I climbed up into it.

Mike was the driver.

He was great.

It was really cool.

That looks like a four-year-old clawing in the back seat of a Jeep.

Yes, yeah, exactly.

I got to say, it's a handsome, like, it's nice to it not to be gas because that's one of the issues people have around the hummers, I guess.

I guess the people by the Hummers could give a fuck.

But in any case, it drove beautifully.

Did you go to the White House correspondence, Sarah?

I didn't go to the dinner.

I went to all the parties.

That's how was that?

I bet that was fantastic.

We'll talk about it in a minute because lots happen.

Today, we'll talk about J.P.

Morgan's purchase of First Republic Bank and what it means for the overall banking industry.

We'll also talk about the Twitter beef between its former and current CEOs.

And our friend of Pivot, Joel Emerson, joins us to discuss what's happened to all of those big DEI promises corporations made after the death of George Floyd.

But anyway, we did miss you this weekend, Scott.

The highlight of a full weekend of parties was the White House correspondence dinner.

This year's host was Roy Wood Jr.,

who took aim at the staying power of American politicians.

Let's listen.

We should be inspired by the events in France.

They rioted when the retirement age went up two years to 64.

They rioted.

Because they didn't want to work till 64.

Meanwhile, in America, we have an 80-year-old man begging us for four more years of work.

And Biden himself took the, I thought you'd like that, took the opportunity to poke fun at his age with some side shade for Don Lemon.

Call me old.

I call it Pete Seasons.

You say I'm ancient.

I say I'm wise.

You say I'm over the hill.

Don Lemon would say that's a man in his prime.

Those are good jokes.

All right, last one, of course, Tucker Carlson.

Well, the truth is, we really have a record to be proud of.

Vaccinated the nation, transformed the economy,

earned historic legislative victories and midterm results, but the job isn't finished.

I mean,

it is finished for Tucker Carlson.

It was very, very good.

He did a good job.

Roy Wood was good.

The parties were good.

One of the good Biden jokes, too, was my best friend, Alexander Hamilton.

He was good.

He was very good.

I got to give him a good.

He was lively.

Can we talk about that for a second?

Women are attracted to men for three reasons.

Number three is kindness.

Number two is intellect.

And number one is resources.

But number two, the fastest way to communicate intelligence and cognitive ability is humor.

And

President Biden strategically, whoever sat him down and made him tell those jokes over and over and over and made him pronounce the tough words over and over and over.

Oh my God.

Can you just say he did a good job?

Probably got him reelected.

And I'm going to go off script here.

You know what's going to be the bigger story now?

Now that the wind has been taken out of the cognitive decline, Joe, because he was outstanding.

he was outstanding humor

humor requires to do yep humor it requires cadence it requires nuance it requires a certain type of intellect and genius that is very there are very few successful stupid comedians yeah you can be funny and stupid because you're so outrageous and weird and you have no sense of self that you're just comical but great humor you can bet david chappelle is just a really bright guy there's some real candle power there oh that's right lenny Bruce, George Carlin, these guys were clear blue flame thinkers.

He did a fantastic job.

You know what the news story is about to be?

No.

It's not going to be his age.

Don't say Hunter Biden.

No, the news story is going to be: this is the Republican nominee versus Vice President Harris because she'll be the president because this guy has a 30 or 40%.

Oh, my God.

You will never stop.

That'll be the narrative.

I'm not saying it's the right thing.

I'm saying that's what's going to happen.

You watch.

How about Trump?

Like, let's just, why don't you whack at Trump the same way?

That's all I just wanted to say.

I will, I will canvas.

Honestly, he started an insurrection and he's old and fat.

So, and he's clearly cognitively problematic.

I'm not saying what should be.

I'm saying what is.

You're about to see the Republicans basically say that the president, you are voting for the GOP nominee or you are voting for Vice President Harris because he's, you know, they'll do the actuarial table saying chances are she's going to be president.

That's going to be the new narrative from the GOP.

Well, she'd be an excellent president, let me just say.

Do you know who I met?

Who'd you meet?

At one of the parties.

Tim Daly is a fan of ours.

You know, he's an actor.

He was on Wings.

I've gotten emails from Tim.

Yes, we're going to have dinner with him and his lovely wife, Taleone.

And he was great.

Oh, my God.

What a great conversation we had.

I used to watch Wings with my mom.

Yes.

Well, I watch, I am binge watching Madam Secretary right now.

I just, I think she's wonderful and he was as smart as can be.

Like I just, you know, like he is in a lot of these roles.

And really lovely.

Just all kinds of interesting people.

Love people, love.

Pivot again, Scott.

Most importantly, who looked really scorching hot?

You know what?

I have to say, all the men looked great.

They wore really nice tuxes, really nice suits.

I thought it was,

I thought I kept noticing the men.

I was like, wow, they look really smart.

I'm going to send you pictures of me.

And they took a lot of pictures of me in the electric.

You driving an electric hummer, there's a decent chance chance it's going to start raining frogs all right but you complain about the tidy car and then i get a big car and you complain about the big car what car would you see me in uh i see you in a chevy chevette from the 80s yeah i i've driven or a prius like a really like the first prius that came out i we had that yeah i can totally see that yeah no you're definitely

i have to think about this what would be the right car or an old lexus es

you know something that's luxury but not really i don't like a luxury car i'm not a luxury car gal.

I'm going to try out the Ford 150 Electric.

They're going to let me try that out when it comes to Friday.

You and Ford, you're well, no, General Motors.

The American automobile companies love Kara Swisher.

They do, but I also am going to see the Rivian this week.

A friend of mine got, they're getting delivered suddenly.

I'm supposed to get a Rivian, but because I think the steering wheel is on the wrong side.

You were going to bring the Rivian to Britain?

No, I ordered it a couple of years ago.

I just thought it looked kind of cool, and I want to do anything that doesn't support Elon Musk.

And on the same day, I sold my Falcon X and I bought, I put in an order for a Rivian.

It was like seven years ago, it feels like.

And all I get is emails saying, oh, now it's coming in 2028 or something.

And we've increased the price.

So wait, no, we've decreased the price.

Anyways, I'm not going to, I don't see how I'm going to use a Rivian in the U.S.

So anyways.

What do you drive there?

Do you have a car?

No, I use this fantastic service called Wheelie, which is essentially kind of a high-end Uber.

And the drivers are great.

I love not having a car.

It's kind of liberating.

I mean, I miss driving a little bit, but

yeah, I don't have a car.

Well, when you come to DC, you can drive in my Hummer or my Bolt, whatever you want.

It's all yours.

Talk about Sophie's choice.

But let's get to our topics at hand.

Jeffrey Hinton, who also known as one of the godfathers of AI, quit his job at Google amidst concerns about the direction of artificial intelligence.

Hinton says he's afraid his life's work will make it hard to tell what's true anymore, but comforts himself by saying saying if he hadn't done it, someone else would have.

It's cold comfort.

The ex-Googler said he was happy with the company's use of the technology until Microsoft's launch of OpenAI, Powered Bing, cause a code red, competitive response within Google.

And ARMSWAR, this is something Tristan Harris is talking about quite a bit.

You know, this is like Oppenheimer warning about the bomb.

He's one of the early, early.

I remember him there.

What do you think of this?

This is someone with a whole lot of credibility.

talking about this.

And I think he's right.

He had a number of worries, including deep fakes and fake, what is truth.

He had power concentrated.

He had a whole bunch of things that are problematic, despite he had some positive things to say.

How do you feel about this?

People are getting a little nervous or is that just the media?

Yeah, I don't know.

I feel

it frustrates me a little bit or I'm a little bit, it reminds me or it has echoes of all these Trump cabinet officials that grow a pair once they leave.

And that is, okay, I've made millions.

My life's work is here.

And now I'm retiring or I am not working.

I want to start a competitor.

So I'm calling for a pause.

And I think we're past that.

Okay.

This guy is obviously incredibly bright and knows the technology and speaks from a position of authority.

I think suggesting a pause is semi-ridiculous.

I don't see practically how we enact a pause.

We've done it around bioweapons.

We have, I guess, a form of a pause with nuclear arms proliferation treaties or limits.

But I don't see how effectively you would pause research and the advancement of AI technology.

So what I want these individuals to do is, you're smarter than us, you know this technology better.

Let's move to the part where you start proposing solutions.

Because other than a pause, a pause just isn't realistic.

It's just not going to happen.

And if we in America weren't able to enact a pause, unless we could, because there's no way, it's not like a nuclear testing pause where you can monitor.

compliance.

You can't monitor compliance around this.

Well, yeah, that's his issue.

He said, unlike, say, nuclear war, nuclear, you can't track it easily.

Like, anyone can do it quietly.

And that's.

So, what do we do?

Well, he said, let me give you this quote he had.

He said, it's hard to see how you can prevent bad actors from using it for bad things.

He did not sign that letter because he was at Google, and now he said he would.

Because he's no longer getting health insurance from Google.

Okay, that's the, it's not the point.

This guy has sort of

his, he had a lot of concerns.

One is the internet's going to be flooded with false, let me read from the New York Times, false photos, videos, and text.

The average person will not be able to know what is true anymore.

He was also worried about AOL technologies weapon job market.

Today, chatbots like ChatGPT tend to complement human workers, but they will could replace paralegals, person assistants, translators, others who handle road tax.

It takes away the drudge work.

It might take away more than that.

Down the road, he's worried about the future versions of the technology pose a threat to humanity because often they often learn unexpected behavior from vast amounts of data.

They analyze this becomes an issue as individuals and companies allow AA systems not only to generate their own computer code, but actually run the code on their own.

He fears the day when when truly autonomous weapons, those killer robots, become reality.

And he thought it would be 30 or 40 years away, and he doesn't think that anymore.

So, you know, I don't think he thinks there's any solutions, actually.

I just don't know how helpful it is to say, I understand this better than anyone, and we're fucked.

Okay, that's not that constructive.

There's three things here.

A post-truth world, we've been incrementally moving towards that for a while.

Where if you repeat a lie long enough and you create profit incentive around an attention-based economy where novelty and misinformation and conspiracy results in more espresso pods or Nissan ads.

We've been heading that way for a while.

That involves Section 230 carve-outs, move to subscription model.

I think there are things to be done there.

The notion of job destruction, history is not on his side with respect to that.

And that is, they said the same thing about plows and the cotton gin and anything that replaced people in the fields.

The queen was very much against textile technology that replaced seamstresses.

And anytime new technology comes in in the short term, there's some job destruction.

And then over the long term, it creates more jobs.

It doesn't take a lot of imagination to think about how we're going to turn a lot of people into information warriors and come up with all sorts of new jobs here.

The thing that is really scary and should probably involve the state departments and a mutual vested interest across border is, okay, the same way we have said we're not going to go hard.

at biological weaponry here and all nations have sort of cooperated around this.

We are, as far as I know, we're not trying to come up with super viruses that might kill the whole world.

It's to say we have to cooperate around not building killer robots that are programmed to improve and get more lethal every time they storm.

You know, what happens when a thousand killer robots show up in Kyiv and figure out technology to make themselves more and more lethal and more and more vicious every day?

That, that number three, if you will, door number three, feels like everyone has a vested interest and kind of put a limit on that sooner rather than later.

But

I'm to the, okay,

I'm going to speak at a, I'm going to this, I'm speaking at this summit where

Tristan is speaking.

And I'm going to reach out to Tristan and say, help Kara and I figure out what is the narrative.

Is it a regulatory body?

Is it cross-border cooperation?

Because enough with the scary shit.

The smartest people in the world who invented these technologies and got rich off of them are all of a sudden saying, stop me before I kill again.

Okay, great.

Now what is the solution here?

Yeah, that's a very good point.

Well, we'll see.

This is going to be developing, but there's going to be more and and more in different voices.

It's just, it can't be reductive is what it is.

It's a very complex topic.

And you're right.

I think government intervention early is the reason these people are talking up the way they are.

Another thing that's happening, a little less

death of humanity, but by the time you listen to this, the Hollywood film and TV writers could be on strike.

The Writers Guild of America voted 98% in favor of striking if the industry's largest production companies don't meet their demands.

The union is demanding higher pay, saying the rise of streaming has drastically impacted the writers' bottom line.

I know this this from a lot of my friends who are writers, and

some actors are trying to be in solidarity with them.

In the short term, a strike would hit late night and current affairs shows such as SNL almost immediately.

Long term, some series could go up there.

We'd have more reality shows.

Since the last writer's strike, which kicked off in 2007, lasted 100 days and cost the LA economy $2.1 billion.

Streaming has transformed TV from, you know, 22 episodes to 8 to 12 season episodes.

Credit writers less likely to get residuals from reruns.

Everything's changed.

And AI is a concern.

The WGA is pushing to make sure AI won't undermine their working editions, residuals.

This will affect their jobs, absolutely.

I actually did this with, I was out with friends of mine, the cast of the Elwood, and I said, write a scene for these two actors.

And it was terrible, but it could get good eventually once they input a lot of the

scripts and things like that.

Well, it's important we bring all this back to me.

So about five years ago, I was running L2 and this guy showed up in my lobby and said, I'm David Worshafter.

He's like this super agent from WME.

And he said, I want to represent you.

And I said, well, first off, yes.

But second, why?

And he said, I think you're an interesting person.

We can do interesting things together.

Since then, and it's for me, it's mostly been about an excuse to every three months.

I go to LA, I hole up at the Beverly Hills Hotel.

I put on a pink robe.

I go down to the pool.

I put in a cigarette and occasionally I put on big black sunglasses and someone will walk by me and I'll yell out, Jackie, marry me.

I make you very happy, woman.

Anyways, once I enter LA airspace, all professional ability to get anything done or make a dollar goes away from me.

I have never figured out a way to make money.

And I've had all these TV shows.

And most recently, finally, finally, my agent stepped in, coordinated all this shit, spun a big story about me.

And what succession was to family-controlled media or billions was to alternative investments.

We are close the best writer to doing, the best production company to doing something on big tech.

And I'm super excited about it at a bunch of meetings, and we're literally about to kick off everything.

And then last week, I'm like, they go, well, if the writer strike doesn't happen, I'm like, let me just tell you guys, you have hooked up with the curse.

The writer strike is definitely happening and it's going to kill this project because I am not allowed to get anything done in Hollywood.

So whatever means nothing will happen in the world world of original scripted drama, that is what is going to happen here, Kara.

Okay.

Seriously.

All right.

Okay.

Let's talk about it from a non-Scott point of view.

Scott can't catch a fucking break.

I don't get it.

Everybody says the hardest thing.

When I meet with all these people, the producers, the actors, everything, the hard, they say they claim the hardest, the real like gold here that's tough to find or the uranium or rare earth material is a great writer.

And yet supposedly they're the ones, if you look at the data, they're the ones whose pay has declined the most relative to others.

So I just don't, I don't get Hollywood.

Well, I think everything's changed.

I mean, they don't get these back end things anymore.

The studios on their side are like, you know what?

We're investing for the future, but we can't make money right now.

We're dying with all these costs.

And you can see them, you know, a lot of them are public companies and you can see just how much it does cost, you know, how quickly they've got to pull their horns in.

And at the same time, they have to spend because the tech companies like Apple TV or, you know, Amazon or even Netflix can really outspend them.

And so it creates this situation where the studios have enormous costs and at the same time can dictate a lot more.

And pieces of the, they used to sort of share in the wealth and now it's much, much more confusing from their point of view.

And if you think of AI, it definitely can start to really get rid of jobs on all kinds of things.

You know, someone's going to figure out how to do certain script writing with some of this stuff.

The biggest insult, I get a draft of certain paragraphs of my newsletter every Friday, and I got really angry.

I just got garbage back from my team last week.

And the biggest insult I could come up with was, this feels like it was written by AI.

It's vanilla.

It's stupid.

It has no insight.

Every other sentence, there's something I can tell just doesn't feel right and is wrong.

I believe what AI is going to do is it's going to take the best writers and turn them into amazing writers.

Because I don't know if you've been using it.

I use it to come up with different ideas, but the secret sauce is in insight.

The secret sauce is in creativity.

The secret sauce is in vulnerability.

I get that.

I get that.

But I'm more thinking this is anything they can do to shave off costs.

And writers usually get it right in the teeth when they're doing that.

Like, and this switch from the 22 episode to the 8 to 12, 12 is a lot.

Before it was like everybody was buying, everybody was buying, everybody was buying, and lots has gotten made.

And believe me, there's never been better for a consumer to consume consume information.

There's like 10 shows I like.

I just saw 10 more.

I was like, oh, I'd like to watch that.

Oh, my list, my queue is so long now.

But, and they all look great.

They all look pretty good, like at least something I'd like to watch.

And

I'm not going to have time for it.

But now, you know, that's cutting back because of the cost.

There's too much in the system, I guess.

Yeah, but that's,

I mean, it's the, whatever you call it, the invisible hand, capitalism at work.

I got to think three, four years ago, I mean, anything got green lit, lit, which must have lifted all boats, I would think.

And I don't understand.

There's two sides of this trend.

It's great they've organized.

This appears to be a union that has real teeth.

And, you know, hopefully they'll be able to negotiate a good wage.

But there's two sides to this trade.

And these guys have invested so much in original scripted drama.

The employment here has been amazing.

I think the elephant in the room that is always present when you're talking about media is TikTok.

TikTok is going to be a greater source of original content at a fraction of the price.

It's not AI fucking up writers, it's TikTok, specifically a talent pool that is adept at the Mariana Trench.

And guess what?

Is near-free.

Yeah, that's true.

That's true.

That's been something that's plagued them.

Anyway, it's a real difficult time.

They've got a bunch of other groups about the size of the room and this and that, which it's all the technical stuff I don't understand within it, but they're certainly agitated.

All my friends who are writers are agitated.

Journalists, I don't want to say it's a golden age of journalism, but I actually find that most people who can write well have no shortage of opportunities.

Yeah.

So I'm just you're the people who you say are sweating are the people who write for you know Disney Plus or whatever.

Yeah, everywhere.

Anyway, we'll see what happens and what they ask for and if they can figure out how to, they can't define my issues.

You can't define it yet.

The business is still shaking out, but they're going to have to.

Anyway, let's get to our first big story.

JP Morgan is now the proud winner of a weekend auction to take over the ailing First Republic Bank.

Congratulations to them, I guess.

Federal regulators first took possession of the bank on Monday, a third major U.S.

bank to fail in two months before selling it to JPMorgan.

The other two were, of course, Silicon Valley Bank and Signature Bank, but First Republic was the second largest failure in history based on the size of its assets.

JP Morgan is getting about $92 billion in deposits in the deal, including $30 billion that it and other large banks had put into First Republic last month to try to save it.

The bank will also observe $173 billion in outstanding loans and $30 billion in security.

Jamie Dimon, here he is again,

was already the country's largest bank.

This makes it even bigger.

Jamie Dimon said, quote, this part of the crisis is over.

Regulators seem to be learning from previous bank failures.

They looked for a buyer before officially putting the banker into receivership.

Why don't we talk a little bit about that?

So I did not think it was going to be J.P.

Morgan.

The Biden administration has been very, very much activist as it relates to antitrust.

Basically, the DOJ and FTC went into about a 20 or 30-year slumber and it has woken up with a vengeance.

And I would argue it's probably even filed suit and tried to block mergers and acquisitions that even I think they should probably not, should probably not have been blocked.

So I was shocked.

I didn't think the Biden administration was going to let JPMorgan, who controls 16% of deposits.

And somewhere there's a regulation saying they don't want banks more than 10%.

And now both JPM, JP Morgan, and B of A are above 10%.

I think Bank of America is at 14 and JP Morgan's at 16.

This is a great deal for JP Morgan.

They basically get to give the shit back to the bank.

They get the deal financed.

I think right away they're going to get an incremental half a billion dollars in EBITDA.

They'll get a one-time on close, they'll get a one-time gain of $2.6 billion.

And they're getting, they're being given $50 billion in financing with $13 billion in losses covered.

I mean, it's it's just, this is a great deal for JP Morgan.

And it sort of begs the question.

I mean, if you look at what happened at First Republic, it went from two-thirds of their assets where more than a quarter of a million dollars are not insured.

And it went down to a quarter.

Of the assets, of the percentage of their deposit base that was less than a quarter of a million dollars, they held on to most of it.

So effectively, what you have here is in a frictionless economy with phones, anyone who has over a quarter of a million dollars goes to the bank that is too big to fail.

Because effectively, JPMorgan, it's not backed by the FDIC, they're backed by the U.S.

government because they've become too big to fail.

So I don't see any other way around.

If you want a regional banking system that is able to attract deposits and hold on to them without fear of a run of more than a quarter of a million dollars, you're either going to need to dramatically increase FDIC insurance or just take it off the table and just say

the government is going to

say, let's be honest, the government always backs deposits, but this is becoming, I mean, we have 17 banks that control 70 or 80% of deposits.

Does that mean we don't have a robust banking sector?

I don't know.

At the end of, you know, sometime in the middle of the last century, we've, I think we've shed about 70, 80% of our banks.

But this was shocking to me that JP Morgan was able to buy this bank.

Maybe it's a good thing, but be clear, this is a big win for Jamie Dimon and J.P.

100%.

The Fed, meanwhile, is taking some of the blame for the failure of Silicon Valley Bank, saying it was slow to recognize problems.

And then this report's not too, looks like the San Francisco Fed doesn't look so good.

And then too passive about regulation.

They were certainly aware of the problems.

I think there'll be new questions about banking regulation.

And when you have a big bank like this, should it be reined in?

Obviously,

they're giving him a pass.

The Biden administration is giving J.P.

Morgan a pass, essentially.

Aaron Powell, Jr.: Well, the bid was, it wasn't even who's bidding the most.

The bid was who's going to cost the least?

Who wants the least

backing from the FDIC?

I think the FDIC has 120 or 130 billion, and SVB costs them 20 billion, and this is going to cost them, I don't know, 12 or 16 billion.

So that was the bidding.

It's like, who's going to cost us less, the least to take this?

To a certain extent, the fact that JP Morgan won, you could argue, is capitalism, that they came in with the best deal for the government.

So they took it.

But they are definitely now, effectively, they have de facto FDIC insurance in the form of the U.S.

government.

Should smaller banks have the same type of backing from the government?

Because if JPM goes down, you can bet for sure.

I mean, it's like, where do you go to?

Do you go into Bitcoin or gold?

So I think it's going to raise some interesting questions about FDIC insurance.

The good news here,

let me back up.

Occasionally, when there's a scandal in an industry, I used to advise CMOs and CEOs, don't advertise.

You don't want to be on the radar screen right now.

You just don't want anyone to think about you or anyone in this industry.

If I were a regional bank right now, I would be shutting down all advertising i don't this is this is awareness is a bad thing it's like being on a flight manifest to jeffrey epstein's private island you just don't want your name in the media right now any regional bank for whatever reason even even good news that says this bank is you just don't i would i would literally be like just keep it to yourself for a while keep a really low profile until this wash is over because what the media likes to do in a in a catastrophizing equals profits environment, they want to find another name now.

You don't think, I mean, every head of every business editor is saying, Well, who's next?

Who's next?

It was SVB, and then they zeroed in right on First Republic.

Now they're now they're looking around, saying, Okay, who's next?

And it's somewhat of a self-fulfilling prophecy because you want to talk about an organization that's totally brand-driven.

It's all about brand is synonym,

brand is Latin for trust in differentiation.

And in banking, it's 90% trust.

So the moment someone starts going, this thing is vulnerable, it becomes a self-fulfilling prophecy.

Yep, 100%.

And so we'll see where it goes.

But definitely, Jamie Diamond's on.

I don't know why he'd want to be Fed chairman.

He's like the most powerful person in finance right now in a lot of ways.

It'll be interesting to see if there's any kind of political kickback for this that people will be like, you know, you could see an AOC or a whole bunch of different people on the right talking about the size of banks.

I think, and bank failures, although nobody wants a bank failure, right?

So that's what they hang over our head is like, well, you don't want them to fail.

So I'd love to understand the machinations internally in the Biden administration to let this sail through essentially.

But what people don't talk about, and because it'll be incremental small,

fees on small business, loans.

A couple of times I did venture debt for my companies and raise, there was a whole ecosystem of these Silicon Valley Bank and I think it was Co-America would follow tier one VCs around.

And if they invested 20 million in you, they'd show up and say, we'll give you 5 million in venture debt.

It was really, it was on great terms.

And you could argue, well, that's what led to this crisis.

But at the same time, it brought down the cost of capital for entrepreneurs and companies were able to grow.

You are about to see new fees.

You are about to see mortgage rates that seem especially onerous.

You are about to see, I mean, the consolidation here.

Every person who runs every division of JP Morgan is there to increase margin and growth.

And they're going to have slowly but surely the top banks.

They're just going to have more pricing power.

And consumers and small businesses and, you know, big business will continue.

You know, you're going to see fees go up.

And it's going to feel very incremental.

It's going to be very imperceptible.

Well, that's where you're going to get the pushback, right?

You know who I think is great on this issue, and I think is,

I just love listening to her, is Representative Katie Porter.

Yeah.

I just interviewed her.

Oh, did you?

Well, I'll bring her on.

I'll bring her on.

Yeah, it just was was a longer interview about her.

She wants to be

senator.

She's 20%.

Yeah.

She should wait till she's 90 and run.

Sorry.

Sorry.

Anyway, we'll see.

Let's go on a quick break.

We come back.

We'll talk about Jack Dorsey's Twitter competitor, Blue Sky, and we'll speak with a friend of Pivot, Joelle Emerson, about where all those big corporate diversity initiatives have gone in the three years since George Floyd.

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Scott, we're back.

Elon Musk says Twitter is going to let media publishers charge for articles.

Here's how he explained it in a tweet: this platform will allow publishers to charge users on a per-article basis with one click.

This enables users who would not sign up for a monthly subscription to pay a higher per-article price for when they want to read an occasional article.

This is an old idea, and of course, there's no idea if they're going to actually roll it out.

He added, should be a major win-win for both media orgs and the public.

It's not clear what the actual rules would be or how Twitter would pocket the money.

Again, he's just saying they're going to do it.

Okay, sure, it's an old idea.

I don't imagine it would save their revenue problems.

He also invited independent podcasters to post episodes on Twitter.

Scott, we're not going to do that, just so you know.

You go first, Sir Kara.

You know, you know, I've been so.

I think it's just, I don't believe he's going to get it.

Rolled out.

That's all.

Just, I don't think he's capable of rolling any products out with any effectiveness in a media environment.

I think he's great at cars.

And even then, you know, you talk to any Tuesday owners, everyone calls them clank a clank because there's a lot of like clanking going on and putting together.

So I just think,

I just think he's not going to be able to do it properly.

And media companies don't like him.

I mean, maybe they want to make money, but it seems onerous.

It seems problematic.

No one's done it right.

And more competent people haven't been able to do it.

So

I don't know.

I don't know.

And I'm not putting my podcasts on there.

Are you kidding?

Why would I give him anything without him paying me?

Doesn't it feel like they're literally like float distance?

It feels like they're flailing right now.

Flailing.

Payments, the all, the all pod or the, the, you know, the, the, I'm sorry, the all, the one app, the universal all-encompassing app.

I mean, he's just come up with a bunch of different ideas.

All old.

I think it sort of makes sense to put podcasts on there.

I bet they could drive.

Oh, the latest one.

He's taking a page from Post News.

He's saying that they're going to do micropayments for individual articles.

You know,

best of luck.

By the way, did you see him on Bill Maher?

Yes, I did.

It was quite an interesting interview.

What did you think of it?

I don't know why we're listening to Elon Musk about all these issues.

He just will talk about, you just ask him about like how to arrange your refrigerator and he has an opinion.

I just am tired of his opinions.

I don't, I don't think he's, you know, the free speech stuff.

It's so, I don't think Bill pushed back in any way.

I'm going to be on

week after next, and I'm going to tell him that to his face.

I think it was, I don't think it was a tongue bath necessarily, but it certainly wasn't.

I was like, why don't you push back on any of this?

And a lot of like, I'm for free speech, clap, clap, clap.

Good for you.

You know, it was just, it wasn't, I didn't find it illuminating.

I agree with you.

The way to describe, the way to describe that interview is what you said before.

It was giant electric hummer.

I've never seen a heterosexual man give better head to another heterosexual man.

Oh, dear.

I don't know.

Literally, Bill Maher is a hero of mine.

I think he's a truth teller.

I think he is fearless.

He did not show up for that interview.

Well, I think he's a huge fan of Musk.

So he wasn't going to put a land.

And he let him get away with a hundred things that were just, I'm going to come armed.

I'm sorry, Bill, just if you listen to this, I'm coming armed with facts about what you didn't press him on.

And, you know, a lot of things.

Oh, I'm for free speech.

I'm for this.

But part of it was like, why are we listening to this guy online?

The worst thing was it was boring.

Anyway.

Yeah.

Yeah.

It's just, he's talked too much.

He's given too many interviews and saying nothing.

And there's none of them are pressing him in any way that's fair.

Like, I don't mean just saying, why are you such an asshole lately?

Oh, that would be possibly my opening question.

But no pressing him on anything.

When he talks about, I say free speech is important, it's like, what can people say now they couldn't say before other than you accusing people of sex crimes and the n-word going up sixfold since you've taken over?

Like what?

Yeah, I just, I would have been armed with numbers, numbers, numbers, numbers.

And I actually would drill in on the business.

I'm like, we all know you don't care about, you know, people's safety.

So let's drill in on the numbers then.

Hey, let's do that.

And I'd push him on Tesla.

Like, what's going on here?

What do you think of the gunners?

And don't just say they suck.

That's not good enough.

Like, it's not good enough anymore.

You can't just get away with.

you know, stating something.

And the other thing is just he comments on everything.

Let's finish up talking about Blue Sky.

It's invite only now.

I am in it.

It looks exactly like Twitter.

Chrissy Teigen's there, AOC.

It's really filling up with sort of the regulars, essentially.

There's a lot of people there.

There's a ton, a lot of journalists.

It was an idea originated at Twitter in 2019, and former Twitter CEO Jack Dorsey is currently on the Blue Sky Board.

It looks so much like Twitter, except with fewer Titter,

fewer...

fewer features essentially.

You can post texts and messages in the central feed, 300 characters.

It's decentralized, so user data can be stored on independent servers rather than the company's main servers.

You have a lot more control over data.

It's very early, as they say, and it just essentially looks like Twitter.

And of course, Jack Dorsey used the platform to criticize Elon Musk's leadership of Twitter.

Speaking of tongue-based, he gave him one when he took it over.

And now he says it all went south.

Well, he kind of, give me a break.

I'm sorry, Jack.

I'm under no illusion this guy is our friend either, necessarily.

Didn't Jack say that Elon, he was convinced Elon was the singular solution to Twitter.

Yeah, something like that.

Well, he could have done it if he hasn't been such a choad about it.

He certainly had the talents to do it.

I mean, I think that's true.

But Blue Sky,

so with respect to Blue Sky, you know, it's not like Twitter has been remarkably innovative.

What Twitter has is it has 350 million people.

They're already there.

You already understand the operating system.

When I go on, I think post-news is better.

I think it's a more civil, pleasant experience.

It's different.

Yeah, it's different.

I like being able to pay for articles.

I just find it a a cleaner, healthier, more inspiring experience.

Just a quick note, Scott is an investor in Post.news.

I still go on Twitter because, quite frankly, everyone's there.

And there's a lot of dynamism to having that network effect.

Yeah, and fast news, fast news for sure.

So blue sky being just like Twitter is not enough.

Yeah, I wonder if everyone's going to go over there.

Are they going to stay on Twitter?

That's the thing.

Like I opened it, I used it, and I haven't gone over there since.

So I should, and I'm going to do it.

I'm like, oh, I should go over there.

But I don't know why I like would.

One thing I've been using a lot more lately is Instagram, which is really good.

It's like very pleasurable, I have to say, in comparison.

But yeah, you're right.

Trying a new one.

And Jack,

you know, they never can quite come out and criticize them.

It all went south.

It.

It all went south.

Oh, it did it or did someone?

Like, kind of thing.

That's how they tend to talk.

We'll see where it goes.

I mean, people are trying it out.

And of course, they get there.

They're like, oh, so much better.

I have to wait and see if the real like it becomes as interesting and uh but now twitter's a broken experience because i can't put comments on right it's a real broken experience um and i don't i don't want to debate i like literally get on there and several reporters were telling me i forget someone when they i said turn off your comments because all they get is a is they say something and a stream of mega invective happens right and so i was like turn off your comments they're like well that sucks then i said but then you're waiting through shit to get to regular people um Anyway,

none of them, they're all sort of broken in some fashion.

We've said this about Jack.

Jack left Twitter in much worse shape than when he came back.

That is correct.

And look, he's obviously a remarkably innovative product guy.

He's a multi-billionaire.

I think he deserves to be.

He's doing great things at Block.

But with respect to Twitter,

he should just keep his thoughts to himself.

I think so, too.

His absentee, negligent stewardship of the organization, in my view, has resulted in an opportunity for someone to come in and do tremendous damage.

And

so, okay, I don't see why he's not being advised by anybody.

No, no one in comms has said you should really comment on Elon Musk's ownership of Twitter.

No, yeah.

I mean, I think one of the things he said, another thing he said was like, well, I didn't want it to go to Wall Street financiers and hedge funds.

I'm like, it got that way because you ran it, like as if he wasn't the CEO.

That drives me crazy.

I'm like, the reason why it is the way it is, actually, Dick Costlow ran it pretty well.

Like it was on a good trajectory.

And

literally, I'm like, you are the one who like things happened here.

I was like, you were CEO.

You know, what Wall Street people would take over, you were CEO.

Like he had everything in his power.

I think he felt powerless with the board.

And at the same time, I'm like, you're also Jack Dorsey.

You certainly could have.

He was a powerless.

He was bored.

He was off making a lot more money on a payments platform.

This was golf for him.

It was evenings and weekends.

In any case, we'll see.

We'll see.

Now let's bring in our friend to Pivot.

Joel Emerson is a former civil rights attorney who advises major companies on diversity and inclusion strategies, the CEO of Paradigm Strategies, the company that offers tools to help organizations with their own DEI efforts, diversity, equity, and inclusion.

Before we get started, let me give some stats from Harvard Law School on the current state of diversity in the workplace.

Some 37% of American workforce is Asian, Black, Hispanic, or Latino.

Women make up 47% of the workplace.

I thought it would be higher.

In the S ⁇ P 100, only 28% of all executives and top leadership teams are women.

72% are men.

And of the 26% of women in the C-suite, just 5% of those leaders are women of color, according to PWC data.

All right, Joelle, thanks for coming.

So last we talked,

you and I were talking about how bad the situation was for diversity in tech, for example.

We were talking about in particular.

How is it now?

What would you say the assessment that we just read these statistics about still seems like the same?

It's so interesting to think back to when you and I spoke, because it was a couple of months before the

Harvey Weinstein allegations came out and the Me Too movement took off.

And you and I were talking about sexual harassment and we were talking about building an inclusive tech industry.

And then I think a couple of months later, really the world changed, right?

We had Me Too.

We had this escalation of conversations about women's safety in the workplace.

And then in 2020, we had the murder of George Floyd and companies across sectors sort of waking up to this idea that maybe they needed to take this conversation more seriously and invest in equity and inclusion.

And so it's been,

we've seen a dramatic shift in everything about the way that companies think about who they hire, the cultures they build.

And then in the last, you know, six months or so, as we're seeing kind of the macroeconomic trends and layoffs and all these things happening, we're sort of seeing this pendulum swing back in the other direction.

We're seeing companies that made these

broad proclamations.

We're going to have these commitments.

We're going to be an anti-racist company.

We're going to hire these big teams and build out these programs.

And now I think what we're seeing is some of those companies backsliding.

We're seeing that in

women and people from underrepresented racial and ethnic backgrounds being disproportionately represented in layoffs, DEI roles being disproportionately represented in layoffs.

So I think we're at this kind of interesting potential inflection point where we see companies making some decisions about their values.

Right.

And so why did it break down from your perspective?

Well, I think it probably has something to do with the intentions from the outset.

I think companies that were committed to building inclusive cultures pre-2020 probably still are committed to that.

Companies that had leaders in particular CEOs who saw it as their job not just to build a company, but to build a company that doesn't make the world a worse place, to build a company with cultures they can feel proud of.

Those are the types of companies we're seeing really still talking about this, still thinking about it.

But I think companies that just did kind of loud, splashy things in 2020 because they felt that they had to or they felt maybe

pressured into doing it.

I think those are the companies where the moment that that pressure isn't there or the moment that they have stronger competing pressures, right, which is is you have to obviously survive as a business,

the things that were never a priority sort of fall away.

And so that's what I think we're seeing.

Nice to meet you, Joelle.

It's nice to meet you.

A quality of opportunity, I think, you know, sometimes doesn't translate to equality of outcomes.

Do you have targets?

At what point do we

call victory and say that it's apparent there is a quality of opportunity here, even if there aren't equality of outcomes?

Because there are just certain jobs that are going to naturally probably be more attractive to one community over another.

Why do you think that is?

I mean, I think I'm not convinced that that's the case.

So I think

that may be the case.

But I think what's interesting is there's a lot of

historical data.

If you look at trends in various industries over the last 50 years, for example, we see that when women enter an industry, the

rate of pay of that industry actually declines.

So I think I hear a lot of talk that, oh, women are more attracted to particular industries or jobs.

It may just be lower wage by default.

But actually, a lot of historical trend data tells us the opposite.

Women were early computer programmers, and women have been early to a lot of industries where then when their representation grows, the industry pays less.

When their representation shrinks, the industry pays more.

So I think, you know, I'm not convinced of this idea that different people are going to be sort of naturally attracted to different types of roles.

But kind of putting that aside, I think the question of like, when is it enough?

When have we achieved success?

You know, I think that you can look at a lot of metrics right now to tell us that we're so far from that success that I don't, you know, I don't like to get hung up on that.

And I get asked the same thing by leaders all the time, by CEOs, of like, when, what are the exact right goals for us to set?

And I see companies not make any progress for years because they're having internal debates about what the exact right goals are.

And I kind of think no matter what the perfect goal is, like, should it be 50-50 gender representation?

I don't know.

But right now you have three women of 54 executives.

So we're so far off from 50-50 that we don't need to kind of like debate the nuance of that.

So I don't have a strong opinion about what the exact perfect goals are, but I think we can look at numbers.

We can look at, you know, things like graduation rates from certain programs and how far those rates are from representation in jobs.

You know, you can look at graduation rates out of business school programs, out of four-year universities.

And the gap between that, both on gender and racial and ethnic lines, and representation in leadership roles is so significant.

The other thing you can do is look within a company itself, right, and see that representation in more junior levels of roles is so starkly different than representation in leadership within those same functions.

Something's happening, right?

And that tells us that there's some kind of disparity.

It's much more equal, lower down, absolutely.

But corporate investment in DEI, as you said, blew up in 2020 following the George Floyd murder, then fell flat in 2022, according to Glassdoor.

And now with the layoffs,

they're even more affected.

DEI roles are more likely to be on the chopping block, according to one report, a 40% churn compared to 24% for non-DEI.

They're the first thing, everyone who's in it says it's the first thing to go.

Women represent about 46% of tech layoffs at the end of last year, even though they make up almost 40% of the industry.

Latino workers make up 11% of the layoffs.

They're about 10% of the industry.

These are job numbers from Rovello Labs.

But

it seemed everyone I talked to who's involved in DEI said the layoffs immediately went right to them.

Like, what can we cut?

Oh, yes, this.

Yeah, I think that's exactly right.

And I think, you know, I will say I'm not seeing that in every single organization, but I think, again, companies that decided that this was a priority for the first time in 2020 and maybe did so because they felt that they didn't necessarily have the power to push back.

I think a lot of leaders maybe did this begrudgingly even at the time.

Like they might not have been particularly passionate about this.

I'm just going to push.

I'm just going to push back on both of you.

I don't see any evidence of that.

I see opposite.

That when

on the boards I'm on, when we're talking about layoffs, we are especially sensitive to sectors of

the company or levels.

that have a disproportionate number of people of color or women who are trying to advance.

That's just not just this notion that somehow the go-to around layoffs are these communities.

It's not statistics, but it's statistics for most companies.

It may not be true at your companies, but statistically it is.

They are cutting them all over the place.

And it's not true with most of the companies that we work with either.

So I don't think this is true, obviously.

The layoffs recently have been more around the C-suite and senior level executives, which are disproportionately male and white.

So go ahead.

Joelle?

I don't know what you mean about C-suite and senior level executives.

I mean, I think this is talking about when companies are laying off like 11% of their workforce, right?

That this isn't my data, but I've read the same reports, and it seems to suggest that, you know, people from underrepresented backgrounds are more heavily impacted.

And I don't think that's

DEI roles is one thing.

I don't think that's necessarily

out of any malintent.

I think it probably has a lot to do with the roles in which those folks are represented.

Recruiting teams, for example,

tend to be disproportionately, you know, have higher representation of women.

And those teams are suffering quite a lot right now.

So what, has remote work versus return to office affected this issue?

Has that changed things?

It's so interesting.

Basically, every single leader I talk to right now, particularly CHROs, but CEOs as well, they have a plan of what they're going to do, but nobody seems to feel entirely confident in their plan.

And everyone's sort of in some different range of, you know, we're trying to get people back to the office, you know, at least a couple of days a week.

How many days?

Do they have to be the same days?

And I do think, you know, when we're looking at survey data, for example, there are some differences in what employees want when it comes to remote or hybrid or fully in office that cut along demographic lines.

And so I think it'll be interesting to see how all of these decisions as companies sort of try to figure out what the future of work looks like.

impact things like gender representation or representation across gender lines of caregivers.

People with kids seem to be less likely to want to go back to commuting, you know, maybe more than two days a week because people have made lifestyle changes that feel challenging to unwind.

So I do think there's going to be an interesting sort of interplay between representation and the choices companies make around hybrid or remote work.

And I don't necessarily think that that's bad.

I think if people have the option to pick different workplaces and companies are now drawing different lines in the sand around the types of cultures they want to create, maybe part of that's a good thing.

Some companies have decided to be remote first now, now, and maybe that's a good fit for people that wouldn't have had that option previously.

But I do think there will be an impact.

So, does it have an impact on diversity itself or not?

Or is it just?

I think it absolutely will.

I think, you know,

disproportionately, right, people that

have primary caregiving responsibilities are likely to be women.

So, I think we'll see companies that are leaning heavily into a five-day in-the-office work week might have a harder time retaining women.

We've also seen some interesting stats in survey data that people from underrepresented and racial and ethnic backgrounds found that working remotely, at least having a few days of work remote, gave some reprieve to some of the office experiences, like microaggressions and things that were distracting people from their work.

And for people that were experiencing those things a lot when they were in an office, might have some more opportunity to just like focus and get work done.

But I think it's a mixed bag, right?

Because when you're, I don't think distance really breeds the best collaboration.

So I think when you're not working with people day to day, I actually think it might be harder to get over some of those challenging things and work through them.

I think we might be more likely to make negative assumptions about our colleagues and have a harder time, obviously, building relationships.

I think also we're just going to see attrition is higher in remote workforces that don't navigate that really well.

Because if I'm not going into an office and building connections to people, you know, I just am logging into a different Zoom screen one day at a different company and the impact of that might not feel that great.

And whether that that has any sort of demographic implications, I think kind of remains to be seen.

So it feels like we've done a good job leveling up people of color and women in higher education.

As a matter of fact, women vastly now over-index in college attendance and especially college graduation.

And my understanding is kind of up until the age of 30, specifically before people have kids, we've done a pretty good job, or at least my understanding is in urban centers, women have largely closed the pay gap.

Where it appears to really fall off and women go to 77 cents on the dollar or less is when they have kids.

What is it about or do you have any thoughts?

A, do you agree with that?

And B, if that is in fact a real issue, or that's what I've seen.

I've seen that

where the labor force, I would argue the higher ed is biased against men.

The labor force is equivalent and then it becomes biased against women once they have children.

A, do you agree with that?

And B, what are the solutions for people on boards and elected officials to try and ensure?

I mean, I was just saying to CARA.

CARE is the only person I know my age still having at it.

The majority of women I know, my peer group, just, I don't want to say they gave up, but they just decided they were sick of banging their head against a wall and exited the kind of traditional professional workforce.

Is it an issue?

And if so, what can corporations and people do about it?

So I agree with what you said in part.

I don't agree that the issue only emerges when women have children.

And, you know, first of all, we see that pay disparity is much larger for women of color.

For black women, it's something like 53 cents on the dollar.

And you look at Latino women, it's Native American women.

So I think, first of all, it's important to recognize that that's- That's adjusted for profession?

That's an average.

But even if you, I think, adjust for profession, we see disparities.

And we see it even in our own work with organizations.

We see women of color kind of face the biggest barriers in hiring, in promotions across the board.

But even if we just you know, ask the question of whether for all women, women of all racial and ethnic backgrounds, the barriers emerge at the point that women have children.

We find that's not true.

There's a lot of research indicating that women have the smallest pay gap in their first job out of, let's say, we're talking about women that are going to college.

There is a pay gap, it's slight, and then it compounds year after year and job after job, because when we look at promotions, when we look at the impact of negotiation, so most research shows that there's a small pay gap starting out and it compounds over the course of people's careers.

So

I do think that these barriers start pretty early, but I absolutely agree with you that they take off for people that have children.

I think we see

very, very significant biases against women who have children.

And there's an interesting kind of body of research called the motherhood penalty.

and the fatherhood bonus, which essentially finds that when women become parents, they develop an identity that stereotypically is at odds with the identity of like the ideal worker.

Yeah, a mom.

It's it, you know, you have something else you care about.

You have something else drawing your attention.

For some reason, that same penalty doesn't happen for dads.

And in fact, when men have children, they get what's called a fatherhood bonus where they're seen as more anchored and more committed to work and all these things that make them seem like more of the ideal worker.

So I think, yes, the barrier becomes much larger.

And I think there are a lot of things organizations can do.

I think,

first of all, you know, working with leaders to address some of these biases.

I can't tell you how many leaders still make an assumption that women that have especially young kids might not want to take a particular high visibility opportunity or lean into a promotion.

I hear this all the time.

It's like, it feels like very 1960s.

I would say on a quarterly basis, I'm talking to a company where this has happened, where a woman has been looked over for an opportunity because someone assumed that she wouldn't want it given where she is in her life and with family.

So I think there's a lot to unpack and a lot.

They assume it for her.

They assume it for her.

And it's the exact opposite of what she did.

That happened to me right after I had a baby.

It was crazy.

I was the most aggressive reporter.

And they were like, a big editor said, I'm sure you'll need more time.

And I said, for what?

And they were like,

and I go,

what do I need more time for?

I literally trolled them the entire time.

And I said, it's not the baby, because I don't need more time for that.

I'll tell you if I do, but otherwise.

And I said, you would never say that.

You would never say that about yourself.

Like, you know, in terms.

It was really interesting.

First time.

Yeah, it's like this form of like benevolent sexism.

Like, I'm trying to help you by giving you more space for this thing you don't want.

I said, I don't want your fucking help.

Just give me.

I'll do my work.

It was interesting.

I was really quite a shock.

And of course, I got into an immediate fight with the person.

I have one more question.

I think you're wrong, Scott.

They grudgingly did a diversity, equity, inclusion.

These CEOs that I talked to, they were like, it was like, it was always like, oh, yeah, diversity.

You know what I mean?

It was like, and if you stack rank them in reality, it would be down at number six or seven.

It's not that they didn't care.

It's that they didn't care enough about it compared to 10 other priorities.

What is the incentive now to get them?

You can't rely on a George Floyd incident or

Harvey Weinstein or, oh, now we're going to make more, you know,

we're going to change it, make the changes.

Now we're going to, because of this, it shouldn't be based on some tragedy or some.

I think there are so many incentives.

And I think actually we might have an opportunity when there isn't some massive tragedy to sort of reorient leaders' mindsets to why they're doing this.

And it's not because you're being forced into it by

your investors or your board or even your employees.

And I think the business case for diversity is fairly well established.

But

so, you know, for example, we know that companies with disproportionate representation of women or racial and ethnic diversity and their leadership outperform companies that are in the bottom quartile for diversity.

And there's study after study, year after year.

McKinsey puts out, I think, pretty compelling data on that.

But what I find more interesting, and maybe not in this particular labor market, so we'll see.

It's how important it is to employees.

So Glassdoor did some research that found that 75% of millennials proactively look at an organization's diversity and inclusion efforts when choosing their next job.

A large majority of women look at the representation of women in leadership when choosing their next job.

72% of people in research our company Paradigm did with Harris Poll

said that they want their organization to invest in diversity and inclusion.

And then when organizations do, they see a positive impact on how people perform, how people feel.

We found recently that people are three times more engaged when they believe that their company cares about inclusion.

So I think focusing on what type of workforce are we trying to build?

Who do we want to be here?

And how do we want to empower people to succeed?

And that doesn't mean you have to make big splashy proclamations and turn all your attention to this and have every single all-hands topic be focused on this.

But I think for the leaders that I work with, I also just find that thinking about your values, do you want a workplace where people have an opportunity to succeed?

Do you want a workplace where when you look at your hiring data, you see that people are passing through your hiring funnel at statistically comparable rates, or that people are getting promoted at comparable rates, that people are being paid at comparable rates.

It's kind of like, what are your values?

How do you want your organization to look?

Do you want it to be just like magnifying and amplifying all of the biases that we know to exist in the broader world?

Or do you actually want to create a place that reflects your own values and that produces fair outcomes for people?

And I think for most leaders, that's more interesting than being bullied into it.

But

if you attempted to distill it down to an issue, assuming that people where most CEOs and most shareholders recognize the importance of diversity of thought, diversity of an employee base, that they want society to thrive, they want people of all backgrounds to have a shot.

And if

you're saying that we're a long way from that, we're a long way from that representation.

What, at the end of the day, do you think if people are kind of on the same page and largely agree it would be a good thing, what is getting in the way of it?

Is it the patriarchy?

Is it a set of norms that we are just, we have this reflex muscle memory around things?

What is the problem that we need to address here?

Exactly that, actually.

I think our systems and processes are set up

to produce the exact opposite outcomes, the opposite of equity.

And I don't think it's intentional today,

but I think the way that we hire, the way that we evaluate people, the way that we make compensation decisions, and I think often it is unintentional or inadvertent, the way that we negotiate, the way that we penalize some people for negotiating and not others, and the way that we don't even realize we're doing this when we're doing it.

So when we work with companies and we see, for example, a higher attrition rate of black engineers or of women directors, you know, if you ask each manager of that person why three of their women directors left or why two of their black engineers left, you can always come up with a reason when you're talking at an individual level.

But when we see these patterns in aggregate, that tells us that something is going on that is connecting these people who are from underrepresented backgrounds to one another.

And I think that's because we've designed systems and processes in a world that wasn't built for women to be in leadership and wasn't necessarily built for people from underrepresented racial and ethnic backgrounds to be achieving the same outcomes as white people.

And so all these systems have developed and we're still relying on them, but hoping for some different outcome.

So I think we have to start to align.

the way that we make decisions with our intentions, because I actually agree with you that most people, if they could snap their fingers and tomorrow their organization would be more diverse, they would do that.

But we can't just snap our fingers.

And so we have to think about what could we change about the way that we source talent, the way that we evaluate talent, the way that we manage people, the way that we make promotion decisions.

What things might we change that the outcomes better align with our intentions?

I would say promotion decisions is where I always see it.

I always see like.

Yeah, but by the time you get to a promotion process, right, that's like very late.

You can't just promote someone who hasn't been doing as well as their peers because they haven't been getting the opportunities or the coaching.

And so we have to, you know, and I see a lot of organizations trying to do that.

They say, we have a disparity here in promotions.

Let's fix our promotion process.

It's like, you can't promote this woman who hasn't been managing a team or, you know, leading the same kind of P ⁇ L.

You have to look earlier and give people comparable opportunities to succeed.

Can I make a suggestion?

I think it starts with boards.

I think we're tribal.

You can yell at instinct.

You can't change it.

People are more comfortable and have an easier time establishing emotional connection relationships with people that remind them of themselves.

When your boards are all white dudes, the CEO is going to be a white dude, and the people who get promoted all the way down the waterfall are going to be white dudes.

If you have a board that's all or representative of your customer base and society, the CEOs, and it all waterfalls down.

Starts at the top.

I would agree.

I would agree with that one.

Anyway, Joelle, thank you so much.

Again, Joelle

advises major companies on diversity and inclusion as the CEO of Paradigm Strategies.

I really appreciate it.

Thanks, Joelle.

Thanks for having me.

Take care.

All right, Scott, one more quick break.

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Okay, Scott, let's hear some wins and fails.

Do you have any?

Oh, wins.

I thought Joe Biden won on the thing.

I thought he looked good.

I think he needs to do that over and over and over again, like that he's with it and he's cool.

And any opportunity, you know, it has a resonance within the, I mean, look, the White House Correspondence Center is for journalists and politics, but it creates a resonance within the

ecosystem.

So I feel like that was a win.

I guess that was, you know, I think that was a pretty big win.

Fail was that mayor interview of Elon.

I thought it was terrible.

I just, I can't even tell you how much I thought it was terrible.

Not good.

So I don't have a fail.

My win is I was both

disturbs the wrong word, I guess, moved, but very inspired by, did you see the, it's gone viral, I guess, on TikTok and on Instagram.

Did you see the interview?

I think it was Jane Polly did with Michael J.

Fox.

I didn't.

I've seen clips of it and I mean to watch it.

I mean, I mean to watch it, but go ahead.

So he has full-blown Parkinson's now.

And it would be so much.

easier for him and his family to keep that part of his life hidden.

Like, I think Michael J.

Fox is a great comedian and everything, but

his life after acting is having a much more profound impact on the world because he's being very,

you know, you listen to him talk about it.

He says these things, and maybe we can even play the clip.

You've not squandered any of your capacity.

But at some point, Parkinson's going to make the call for you, isn't it?

Yeah,

he's banging the door.

I mean, I don't want to lie, it's getting harder.

It's getting harder.

It's getting tougher.

Every day he gets tougher.

But that's the way it is.

I mean, who do I see about that?

And you can tell this guy is struggling.

I mean, really enduring a lot every day.

And he's not afraid to go on television and say, this is Parkinson's.

And just as we, you know, we used to hide the cousin that was suffering from mental illness.

Yep.

Yep.

We used to not talk about mom's breast cancer.

We used to not talk about our kid, you know, being depressed and being admitted for self-harm.

And the key to solving a lot of these issues is normalizing them and seeing it and seeing people we recognize and seeing people that we admire.

And it kind of brings it home.

And I think him and

his wife

should really be commended for showing that sort of vulnerability because

I think it results in a very positive

attention, awareness, and then

more acceptance, more concern, more love for people who are enduring that.

So

I was just really moved by him.

Yeah, he's always been inspiring.

There's a great documentary.

The reason he's out recently talking is there's a great documentary on his life.

But go ahead.

Yeah, that's.

I've been looking at all these videos.

I'm thinking I'm trying to catch up to you.

You inspired me to try and finish my book.

And I'm already, so the moment I'm on my last chapter, I start thinking about my next book.

And I've been thinking a lot about masculinity.

And I've been looking at

all these videos of men that I admire.

And

just under the auspices, I'll do two more calling balls and strikes.

I pulled ProfG and I ultimately went back out in 2023 after the pandemic was over, but I pulled my Prof G pod from

Spotify because I was very disturbed by what I thought was a false equivalence on the Joe Rogan show bringing on an anti-vaxxer and then a

legitimate doctor.

I thought it was just the worst of all worlds.

And I don't think it was, I don't think it was malicious, but it upset me.

And anyways, having said that, Joe Rogan did this rant where he's basically saying, why on earth would we not give people health care?

Why on earth would we not give everyone education?

We should be taking care of our own.

This should be a primary thing, like this to strengthen our community, to strengthen our civilization.

One of the primary things is we should be taking care of each other physically.

This should be

like

above all.

right?

Education.

You shouldn't have to fucking be in debt a quarter million dollars if you get a fucking education.

Don't we want less losers?

And I think he is someone that so many young people look up to, especially young men.

I think for him

being that there's a very dangerous thing on the right where they conflate masculinity with being mean and being hard on others.

That you're a leader.

When you say, oh, you need to pull yourself up.

But he was just in a very, what I'll call

in a manner that will resonate with young men.

Like,

oh, you tell people to pull people up by your, you know, their own boots.

Well, maybe, you know, you didn't have your, your legs broken in a car accident.

I mean, you know, he just, I thought he was really powerful and

I thought he was very effective there.

And then my last one was I saw this, this clip of Michael Keaton, very basic saying, you're going to lose jobs, you're going to lose money, spend as much time as you can with your kids.

You know, I was having this conversation with Bill Hayter the other day, and he, he's, you know, was going through something.

I said, dude, trust me, hang out with your kids as much as you can, as long as you can.

You will never regret it.

You'll look back.

You're going to lose some jobs.

It's okay in the long run.

That's the thing.

And he wasn't saying it to Virtue Signal.

You could tell there was almost some pain in his voice, like he'd fucked up.

But

I thought all three of these men are sending exactly the right signal.

And these are men that young men look up to.

And I don't think we have enough of that.

I don't think we have enough of these super successful men

redefining or trying to reshape a modern form of masculinity.

Yeah, that would be a great book.

You have a lot of impact.

I'm just telling you, you have a lot of impact on Alex.

That discussion really impacted him in a very positive way, I have to say.

But what happened was, I think that effectively a lot of the issues facing young men that we don't like to talk about because there's not a lot of sympathy for them, their struggles around addiction,

their struggles.

their struggles around suicide,

their struggles around incarceration, whatever you want to call it, their struggles around mating.

We didn't want to talk about it because people felt like it was politically incorrect or that it was a zero-sum game taking away from women.

And as a result, into that void slipped the Andrew Tates of the world.

And we need to take that space.

We need to take that space back from

a much more, because quite frankly,

a lot of the left was saying that masculinity and what we want men to be is more feminine.

I don't think that's the answer either.

So anyways,

I found these three videos, especially the one on Michael J.

Fox, really inspiring.

All right, go to watch it.

I actually am going to change my ⁇ I guess it's a fail and a win.

You have to read this.

It's a profile in the Washington Post of a guy named Will Wilgerson.

He was a former True Social VP who blew the whistle, and now he's working

as a barista, essentially, or monitoring baristas at Starbucks.

He turned over 150,000 documents to the SEC investigators of all kinds of nefarious money laundering, all kinds of stuff.

And this is where he's ended up right in doing this.

And of course, he's getting attacked by the right

for doing it.

But it was just a really point.

It was by Drew Harwell, very good writer for the Washington Post.

I thought it really talked about the issues quite a bit.

And at the same time,

made you realize this guy gave up everything, essentially.

And he did believe in doing this.

And at the same time, there's another story about how Donald Trump has amplified QAnon promoting accounts nearly 500 times during his first year posting on Truth Social.

This is really, this guy sort of gave up.

Like I was thinking, what a good man for for him to have done this.

You know, and I was not someone I would agree with, I'm guessing.

Anyway, it was sort of a win and a fail at the same time.

In any case, that's a really good one.

You should write that book.

Okay.

What will you call it?

Man.

Man-up.

Man-up.

Man-up.

Yeah, man up.

Something like that.

The three-bald man, the modern man.

The modern man.

Electric Hummer.

Call it Electric Hummer.

That's a great name for a book or a band or a porn name.

Anyway, we want to hear from you.

Send us your questions about business tech or whatever's on your mind.

Go to nymag.com slash pivot to submit a question for the show or call 855-51-PIVOT.

Scott, that's the show.

We'll be back on Friday.

Scott, want to read us out?

Today's show was produced by Lara Naiman, Evan Engel, and Taylor Griffin.

Ernie Endertot engineered this episode.

Thanks also to Drew Burrows and Neil Silverio.

Make sure you subscribe to the show wherever you listen to podcasts.

Thanks for listening to Pivot from New York Magazine and Vox Media.

We'll be back later this week for another breakdown of all things tech and business care.

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