Big Tech military contracts, Compass's IPO, and President Biden's $2 trillion infrastructure plan

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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 you didn't work out this morning you're complaining before we got on you know

gun show is not in town today and it presses daddy out.

I need the exercise.

I need the norepinephrine.

I need to feel young.

What is your exercise routine for the people who might want to know, not me?

I do CrossFit four times a week for the last decade, and I've worked out four times a week for the last 40 years.

It's not easy being a four on a scale of one to 10.

It takes real work.

Do you have like a coach, a CrossFit, or do you have a gang of CrossFitters?

Oh, my God.

I got a coach.

I got a community.

I got a doctor who's prescribed me testosterone.

Oh, nice.

I've got a diet that's crazy.

I am coming down there.

Do I have to do this or can I sleep late and law and eat dough?

It's wonderful.

We do it outside.

It's wonderful.

You'll like it a lot.

There's no way.

I once saw a bunch of CrossFit.

I do old man CrossFit.

Which is what?

Which is what?

It's more like Crosswimp.

I saw this bunch of Silicon Valley people in Manhattan Beach do it, and they were like dragging like pipes

full of sand

across the beach.

I found it ridiculous.

Yeah, it's it's uh I used to do it with a bunch of of uh young people, specifically lesbian firefighters and bartenders on HGA.

I could maybe do that.

I just could not compete.

I just could not compete.

So it got too intense for me.

So now I do it.

So it was feats of strength.

You couldn't keep up with the lesbians, the lesbian firefighters.

On a lot of levels.

On a lot of levels, Kara.

Toughs.

I'm being very serious here.

I, when I wrote my book on happiness, I think really the, it's, I'm very, very serious.

I struggle with anger and depression.

It's, it's, it's It's my antidepressant.

And also, the only thing I've ever found that is anything resembling a youth serum is exercise.

Yeah, you're 100%.

I try to do it, but of course, never get to do it because there's so many children.

Speaking of children, do you know I adopted my daughter this week, officially?

I don't even know what that means.

Gay people are not automatically parents, so continued.

So because of all kinds of things.

Well, it's a perversion, Carol.

It's a perversion.

If our maker had wanted two women to have a child.

All right.

When Claire was born in New York, which I wasn't aware of because you were allowed to do this in San Francisco, if you're not married at the time and we got married soon after,

you do not get on the birth certificate.

And that is not the case in San Francisco.

That wasn't the case.

And so

they literally walked in.

They're like, you can't be on the birth certificate.

It was such a shock because it was like being slapped back 20 years ago, much like what's going on in Arkansas.

And it was, but now that's fixed.

DC

granted me parentage, parentage, whatever you call it, parental.

Do you want me to be the dad?

I worked out four times a week.

We need a dad.

We're our own dad.

You want a little daddy on the birth certificate?

No, no.

We have Kara Swisher on the birth certificate.

If you give me any trouble, the lesbian firefighters will be there to help you understand this stuff.

I'll be the adopted dad.

No, no, you can't be a dad.

She's a cutie.

She is a cutie.

She's a sweetheart, too.

Anyway, that is what happened to me.

That is my happiness this week, guys.

It's total bullshit that you even have to do that.

I didn't even know what you meant.

That seems so ridiculous.

It is ridiculous.

But here we are.

It was very expensive it was onerous and you have to you know adopt your own child which is like which we we went in and had the kid with fully intention of having the kid together that's totally insane you should have seen the piles of legal documents that you set for my other kids uh

is this because

is this because of the adoption end of it or because it's two women who are the parents i do you know what it's we're not presumed even if you go into it with intent you have to be now married and it's just the whole thing is so ridiculous that straight people take for granted every day of their lives.

And so it's a really, it's an interesting situation.

And what was good, though, it was, you know, you see heartening things like the Department of Defense rolling back the trans

rules that bans that Trump put in place.

And all the DOD people were tweeting it out, which was great.

And they did all kinds of studies.

Of course, 20-plus countries have

trans people serving in their military without any problem.

And we're back to

them now, which is amazing.

It's just, it continues.

And the Arkansas thing, it just continues.

My son was shocked by that.

He was like, what?

You can't get treatment in Arkansas if they don't want to.

I was sort of like, yes.

Like, what do you want me to say?

Anyway, this is not meant to be a big giant gay rights rally, but I'm very happy about adopting it.

There is a

I think the thing that's been most, I would say, upsetting about the last

call it five years since Trump was elected was not even the policies of Trump, but that and I use use the analogy to the comedian Michelle Wolfe that we'd heard mom was an alcoholic in college, but you know, now mom is mom and she's great.

And then we're at church on Sunday and her purse bursts open and 40 mini bottles of jack come flying out.

And we go, oh my God, we're still, mom's still an alcoholic.

I think the American public has had this sort of cold comfort that if racist, homophobic people are exposed to people with different demographics, to people with different sexual orientation, that over time, everyone generally gets better.

And I think we sort of, that was very comforting,

that we have a really ugly past, but every day it gets better.

And then it feels like the last five years,

this group of people who did not want to get better kind of came out of the closet and we took a big giant step backwards.

So it's really discouraging.

It felt like the first time, I think kind of the first time America like took a giant step backwards, so to speak.

It was just weird.

Weird realizing.

They're there.

I have always said they're sitting around the edges waiting for a minute.

They're in the air.

I think a lot of us didn't realize they were there.

Oh, I do.

I'm always aware of that, especially, you know, in my case, it's anti-gay stuff, but I am constantly aware of it.

And it's just, it's, it's insidious.

And now I have to think about states that I want to go to.

I didn't used to think about it.

I did and then didn't.

And then it's crazy.

Speaking of the Army,

Microsoft won an Army contract to build custom augmented reality headsets.

$21 billion.

Microsoft now has two.

They had the one that they won from Amazon that Trump kind of pushed away from Amazon.

The device does things like overlay a map and compass and thermal imaging to show people in the dark.

It also shows the aim for a weapon.

It's sort of making video games.

And this is stuff that's been in the movies, which is interesting, but now is here.

A significant source of revenue for futuristic projects.

Amazon and Microsoft competed for contracts to provide cloud services for the military.

Microsoft won that and I think it's still in court.

Microsoft employees complain.

We didn't sign up to develop weapons, of course.

The Army argues that the technology helps the military be more accurate and prevents killing of civilians.

Anyway, it's, you know, Microsoft is staying in the defense business.

It's a big business, as you said.

There's lots of areas like healthcare, but defense certainly is an area that tech has not been as dominant in.

And of course, Elon got a

space contract over the big space people, the aerospace industry.

So

it's just more of this, more of this.

What do you think?

What do you think of this?

Well, I mean, this was staggering.

This is potentially.

I found Microsoft killing it.

Well, that's not the way you should put it.

Well, it's interesting.

So on a number of levels.

So VR, everyone's like, like, okay, VR is the ultimate application for gaming or for porn or for real estate or whatever you want to call it.

And it's like, no, it's not.

If you look at revenues, the killer app for AR is warfare.

And the fact that our military is committing up to, I mean, you realize that this contract is almost as big as the revenues of Tesla.

This contract, just the AR contract for Microsoft is now a bigger business in isolation than Pinterest, Snap, and Twitter combined.

$21 billion is real cabbage.

Yep, it really is.

And I wonder if it's one of those things where a massive investment by the government and the military, similar to DARPA or something, finally takes VR, AR kind of to a tipping point and it starts to leak down or melt into the consumer economy.

I've always been very doing some of this.

I've read various and sundry where they're playing video games when they're doing drone stuff.

And

it's already moved in this direction.

And I think more so in the future, there's going to be this sort of not just there's there's cyber warfare and then there's warfare using these augmented reality things.

And it makes sense if we have this in real life that they're going to, you know, they're going to put this into the military.

It'll be interesting to see which employees don't want to do this.

I think every tech, you know, Google got a real pushback from its employees working for the Defense Department, obviously Amazon with ICE

and stuff like that.

But these companies, this is a huge opportunity for all these companies.

Well, not only that, but they just went in response to employers complaining they didn't go to work for

a company to sell into the military.

They just basically sent out a memo that says, dear employees, grow the fuck up.

Yep.

I mean,

the U.S.,

the protections and the liberties we enjoy are directly correlated to the sacrifices and resources we provide our young men, even if you don't agree with bad wars or whatever, the notion that any company of this size isn't ultimately going to somehow, directly or indirectly,

work with the government and with our defense.

I don't know, grow up.

It sucks to be a grown-up.

Sucks for you.

True, but I think Google is not going to be able to do it.

Go to work for Ben and Jerry or Berk and Superstars.

I think Google is not going to do that pushback.

I think they got enormous pushback around a lot of stuff.

You know,

it's a management thing.

They're going to have to figure out a way to manage it or move employees who don't mind over to it.

They can't.

They're not going to be able to, these employees have power.

You know, it's not unlike

Amazon warehouse workers.

Vocal minority.

Okay.

That might be.

But they should provide for you.

You don't have have to work on it if you don't want to.

Yeah.

They should.

They're not going to make people do it.

There's no way Silicon Valley is going to do that.

I agree.

Anyway, also, it's an area you totally shifting to a different area.

Compass yesterday,

before its IPO, cut the valuation in half

before it announced it wants to go public a valuation of $7 billion instead of the original $10 billion.

That's not quite half.

So talk about this.

This is something you wanted to talk about today, but I use Compass to buy my houses, which is interesting.

But I use

regular real estate agent, not in their technological way.

But explain for the people why this, what, what this indicates.

This is Moy Inter Sante because it's sort of, I call these companies Rich Little companies.

Remember Rich Little used to impersonate people.

He was a great, he used to hurt Monty Carson.

I thought he was great.

This is SoftBank is sort of famous for pretending that a company is a tech company.

And remember, we as a tech company, you know, work as a service.

And essentially, Compass is trying to position itself as a tech company.

They are.

And it's not.

I agree with the living, breathing person, but go ahead.

Well, you could argue that it's tech-enabled, but essentially, 78% of the revenues are commissions paid out to humans called brokers.

Right.

And they've adopted a capital as a strategy strategy, and that is they're spending more money than their peer group, which, by the way, can work.

When Amazon spent more money,

had access to cheap capital, and then leveraged that incredible storytelling of Jeff Bezos.

They had cheap capital that they then made these massive investments as long as their investors would tolerate losses, which was longer than any other company in history.

But when you invest tens of billions of dollars in warehouses, the warehouses won't pick up and leave and go across the street the moment someone else offers them a higher wage, which is what brokers will brokers are some of the most talent business.

Well, and they're some of the most coin-operated people in the world.

They're basically just send me.

And what

essentially Compass has done is said to these individuals, we'll give you all of your commissions, not half, to come over here.

And they made some acquisitions.

But it's basically a roll-up strategy of traditional brokerages based on capital as a strategy strategy.

There's some tech, there's some tech, but here's- Talk about their tech, the thing they try to sell.

Like, I know that that's their big question.

I was always like, aren't you just a real estate broker?

I don't know.

It feels like a broker holding an iPad, as far as I can tell.

But

I will say this, a colleague of mine, Foster Provost at NYU Stern, is this incredibly bright data guy who's worked for the biggest telcos in the world, and he works full-time or almost full-time at Compass.

So there's clearly something there around analytics.

But here's the problem.

It's about valuation.

And then that is, if you look at Realogy,

they do about $6 billion in revenues and their market cap is $1.5 billion.

So they trade at about 0.25

times revenues.

And then there's Redfin, which does about,

excuse me, and then there's Zillow, which does about $3 billion in revenues and has a $30 billion market.

They trade at 10 times because that's generally an online real estate media company.

And also they're in iBuying now.

And it's run by an incredibly impressive.

And then selling all kinds of things off to the side.

That's right.

And so the valuation here is somewhere between 0.25 if you're a traditional of revenues or traditional real estate company and 10 times if you're a tech company.

So the S1 is trying to say, for God's sakes, we're rich little, we're tech, we're tech, we're tech.

And the reality is, I don't think the market buys it.

And they're trying to go out, even with this reduced valuation, they're trying to go out at two to three times revenues as opposed to 0.25, which is where traditional brokers go.

So I think this is, it's interesting.

Goldman Goldman is running the book, and Goldman is very good at creating demand.

So I'm remiss to make a prediction that the stock

won't do well.

But you don't think retail investors think this is like the second coming of real annoyance.

I'm going to say that.

This smells a lot like another real estate company that had entered into consensual hallucination with the marketplace around its valuation.

And that's another softbank-backed company in real estate.

We work.

Now that's changing.

Which is coming back in a better way.

Yep.

Yeah.

So, and this kind of goes, this will go to my prediction, but this feels eerily reminiscent.

reminiscent, a company pretending to be a tech company such that they can get a much higher valuation than is warranted.

And

the market has learned here.

The market is regurgitating.

It's supposed to go public this morning.

It'll price.

Goldman is the best in the world at creating institutional demand and filling the book to make sure that the IPO is successful, but they've cut the price several times.

Whereas if you look at Airbnb and these other guys, they kept raising the price range.

People know what a duck is.

Duck is a duck.

There you go.

It's a duck with an iPad.

All right.

So we're going to move on to our big story.

Like that.

That's good.

We're going to move on to our big story.

This week, Biden detailed his $2 trillion infrastructure plan.

How many zeros is that?

That's bigger than the entire federal government budget.

He calls it a once-in-a-generation investment, the largest since World War II, since we built the highway system and since the space race.

It will require 15 years of higher taxes on corporations, raising the rates from 21% to 28%.

He's giving $50 billion to boost his domestic chip industry, a big boost to electric cars.

He promised faster internet and better transit, electric charging station.

It imagines a different energy future.

Second part of the plan invests in human infrastructure, aid to the poor, paid leave, help with child care.

The plan also includes Right to Organize Act to counter right to work laws.

There's also train stuff with Amtrak wants, which they put out a fantastic map that essentially says, screw you, Christine Noam.

It totally avoids her state.

This is long overdue.

And let me just say,

I did an interview with Mariana Matsukatu, who talked about this idea of government doing these important moonshots in areas like climate change or infrastructure.

But can it ever pass?

This is big.

I think this is wonderful.

I think it's just wonderful.

We are the apex species.

The business model of our species responsible for our success is capitalism.

And the ballast and the success of capitalism is a robust middle class.

And slowly but surely, Kara, slowly but surely,

we have increased Social Security taxes and payroll taxes and individual income taxes.

And we have reduced, we have reduced corporate income taxes to the point where only one in $12 versus one in $2

of receipts from the government come from corporate taxes versus individual income taxes.

So essentially what we've said is corporations, you pay.

you pay less and individuals, you pay more.

And we continue to one of the most dangerous trends in our society where we've decided we don't like people, but we love corporations.

And what happens?

What happens?

I'm on, I was, when the tax cuts, the Trump tax cuts went through from 38 to 21 percent in 2017, I was on a board of a media company and a board of a retailer, both multi-billion dollar companies.

And all of a sudden in the board meeting, we're like, oh my gosh, what's the earnings and the cash flow surprise?

All of a sudden, it's like huge.

And it's like, well, it's the

advantageous tax cuts.

And what did we do with that money?

Did we hire more people?

Give it to rich people.

No, we used it for share buybacks or cash on our balance sheet, which does what?

It juices the stock price.

And by the way, who owns 90% of stocks by dollar volume?

The top 1%.

So all we have done, all we have done with increasing the tax liabilities of individuals as a percentage of our government.

And by the way, as a percentage of total tax receipts, individual taxes have not gone up.

We've just funded it with taxes on your daughter for when she's old enough to be a taxpayer.

We've racked up massive debt.

Mean to my daughter.

We have just transferred slowly but surely wealth, which is nothing.

Money is just a transfer of time and work.

So we have said we want the top 1% or shareholders to work less and spend more time with their families, such that the middle class and future generations can spend less time with their families.

It is criminal what's gone on here.

This is like a, it's not, you know, people, the Republicans are trying to put it off as a goodie bag, but this is the kind of big thinking, the big LBJ, Great Society, the FDR.

This is the, I kind of like it.

He didn't go, he went for broke.

Now, interestingly, Alexandria Casi-Gortez was on the things they needed even more, but this was as much as they said it was going to be, which it never is, right?

He'll get clipped back.

He's starting.

He didn't get clipped back, but he didn't back down first.

Like that was, people were, I think, surprised by the breadth of this.

Like,

go for it.

And what was really interesting was how it's going to be paid.

I think there's nobody against.

taxing corporations, even though they lobbyists, but I think it's a great populist thing for him.

It put money in lots of really interesting places.

It has an innovative element, but $50 billion to boost domestic chip industry, cars, better trains, better,

this human infrastructure, the idea of paid leave and help with child care.

We should have full child care.

That should be something we should do.

But, you know, whatever.

We hate

children and women in this country in a lot of ways.

But

this is very breathful.

You know, it'd be interesting to how you pass it, though.

How do you get this pass?

And the arguments about too much debt.

Obviously, there's there's a big climate plan in here, too.

So there's all kinds of things to like for different people.

And it's also a lot of things that people who are worried about debt and other things do not like.

Yeah, it's so again, infrastructure.

What is infrastructure?

Infrastructure is an investment in the middle class.

Because when the J-train is only running every two hours instead of every 15 minutes from Brooklyn into the city, who gets hurt?

The assistant or the secretary, and not the executive gets to take an Uber or kind of figures it out or has a driver.

So infrastructure is an investment in the middle class.

It's also an investment in brand building.

I remember the first time I went to China, I flew into the new Hong Kong airport and then I went to the Shanghai airport and I'm like, Jesus, these people take themselves very seriously.

Yeah, Singapore, of course.

And then I fly into JFK and I think, Jesus Christ, are there chickens and goats running around here?

It felt like,

okay, what happened?

Oh, my God, you're right.

What happened to us?

And the infrastructure is.

Same thing with train stations.

Like, they're making a big deal, this new New York one.

I'm like, Penn Station's been a pit my entire life.

And now they have a train station.

They're like in Yay that sort of reaches basic levels with Europe, basic, like not even as nice as Europe ones still.

Penn Station is supposed to be one of the great architectural crimes in history, especially.

It was beautiful, and then they tore it down to make this just disgusting architectural.

It's not even charming in its grossness.

Like some things that are like old and broken down are charming.

Are you talking about me again?

Are you talking about me again?

Do you know I do CrossFits?

I do CrossFits.

It's the worst place on Earth.

I'm surprised I'm not dead, having been in there 900 times.

Like, anyway.

Yeah, I'm not a big penny station fan.

I'd had a little side train rant there.

Yeah, we love it.

Anyone who's been to Europe loves trains, even though they make no economic sense whatsoever.

But look, infrastructure is an investment in the country and it's an investment in the middle class because the people who really need roads and public transportation are the middle class.

And oh my gosh, broadband.

I think a bridge too far here is they're now claiming that social programs that feel very UBI-like are infrastructure investments.

But I love this.

And the swing back to protecting and loving Americans as opposed to American corporations is long overdue.

The problem they're going to face, the problem they're going to face is they're going to have to figure out either multinational tax treaties or some sort of crazy punishment for companies that decide to do an inversion.

And that is overnight.

They say, well, we have an Amsterdam office.

We'll just make our headquarters Amsterdam because they have lower tax rates.

Because now if you add up all the taxes with this increase to 28, the average tax rate on corporations will be 33%, making it the highest of any OECD country.

Even though it'll only make up probably 10 or 11% of our total tax receipts, it'll still be an issue they have to face.

What happens when these companies decide to do these inversions?

That's still a big issue.

Yeah, we'll see.

We'll see if they do that.

You know, there's always that, we're going to go somewhere else.

We'll go.

Go ahead.

Well, the problem is some have.

I don't know.

Some have, but.

I mean, an inversion is nothing different.

They just file paperwork and say our headquarters are now in the Isle of Corporation.

Yeah, it just is not a good look for companies.

I don't know.

Well, it's an interesting question.

It's an interesting question.

You know, we'll see if these, these

pushing corporations to do things, is it really interesting that what happened with Delta and Coca-Cola suddenly in Georgia post

these voter laws passing to say, oh, we really think we hate them after not seeming to do anything before.

We don't know what goes on behind the scenes.

Tim Cook came out against it.

He did too.

They all did.

Yeah, they're all doing it.

Like, but it's post.

They should have poured some money in there during the making of it, but there was no thing to do.

Now, what's really interesting is instead of just dealing with it, the Georgia Senate is trying to clap back at Delta.

Good luck, my friends.

The problem party really doesn't want corporate money, I guess.

That's really what's going on here.

They just don't want, they want to be the party of, they want to give the corporations over to the Democrats in terms of donations and everything else.

It's really quite odd what's happening there.

We'll see what goes on.

All right, Scott, this is really, we like this plan.

Scott and Carol love this plan.

Infrastructure.

I can't believe you don't like trains.

You like trains.

No, no, I love train travel.

They're just, it's just incredibly expensive.

I mean, it's awesome.

Really, economically, the only

I'm going to get on.

As soon as I get my next vaccine, I'm going to get on an Amtrak.

The only feasible high-speed rail, really, is up the Northeastern Corridor and maybe like LA to Vegas.

And it still gross.

It still goes.

Do you know how much it costs to go from New York to DC right now on the Amtrak?

$343.

$19.

I was close.

I was close.

$19.

That's what it is.

It's incredible.

It's usually, you know,

at the least, it's $69 or $70 when you get it way in advance.

And, you know, you sit in the shitty section, although they're all shitty sections.

Amtrak.

Amtrak is literally like the brand has gotten so bad and tired.

It's almost so cute.

It's so pretty.

So it's not nice.

They're not nice trains.

Anyway, I'm sorry, Amtrak, but I ride it.

I used to ride it a lot before the pandemic, and I will continue to ride it.

But boy, you got to go.

I met my hero on Amtrak.

Who?

Marguerite Vestia.

Oh, did you?

She was knitting.

She was knitting.

And I went up to her and said, and I have a selfie, and she was very funny.

I've got what I've done with her.

She's looking good.

Let me just say, I did a Zoom thing with her recently.

She's looking good.

She wasn't knitting during the event.

What did you say to her?

I went up and I said, I'm a huge fan.

And she looked up at me and I thought some like Nordic CIA agent was going to tackle me.

And she had this huge smile.

And she stood up and I took a selfie with her.

I never do that.

Yeah.

But I think she's a gangster.

I think she's going to be a little bit more.

I'll bring her on this show.

Yeah, here we go.

Here we go yeah yeah and i'm gonna buy you that rabbit code do we have to go back to my old jokes what if you would you do if i told you i have anderson cooper to come on sway i'd feel jealous because i'm the one that's supposed to reach out to him and i'm building up to that i'm building up to sorry to tell you he's coming on sway don't even say that don't even go there seriously don't even go there if he shows up

Actually, I have Don Lemon coming on with this book.

Don Lemon.

Yeah, I'm not going to ask.

I wasn't.

I'm not going to.

Anderson is a bridge too far, though.

I certainly would love to have him on Sunday, but I won't do it.

I got you, didn't I?

I got you.

You thought for a minute because you thought I could get him, right?

Correct?

Did I get you?

You know better than to go there.

I know, but it was a good April Fools, wasn't it?

I didn't.

That's right.

It's April Fool's.

You did.

You could see your face.

Nobody can see his face, but he was like, has she betrayed me?

The final betrayal.

Who else would be a betrayal?

Anderson Cooper?

I don't know.

We've had Farid Zakari.

If you you've got Angela Merkel, she's another hero of mine.

That would be very upsetting.

Well, that might happen.

Then I'm not going to give you Angela, but I will give you Ando.

Ando is yours and forever.

You know what?

I'm emailing him today or texting him because we have each other's phone number.

And we use emojis.

We use work.

That was good.

That's so exciting.

That was good.

Scott, let's go on a quick break.

We'll come back.

We'll talk about Facebook's latest defense and Trump's failed hack.

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Scott, we're back.

We are back.

Nick Clegg, Facebook's vice.

You're still getting over my April Fool's job.

I can't think about anything else.

I'm still kind of shaking.

Come on, I would never do that to you.

I really wouldn't.

Scott, we're back.

Nick Clegg, Facebook's vice president of global affairs, published a medium post saying Facebook doesn't promote extreme content and unveiling some changes for users meanwhile trump tried a new trick to get back on the site in his post claig writes facebook systems were not designed to reward provocative comment because advertisers don't want to appear next to extreme content does this seem plausible he says the overwhelming number of things people see are about pet uh pets babies and vacations he went on about that for a little bit and also in an interview with casey newton he also argues which really makes no sense that pushing extreme content would only be a short-term strategy, a sugar rush, as he puts it, but they want to keep people coming back for 10, 20 years.

So, why would they do it?

Facebook is introducing a feed filter bar to make some of the controls like display, chronological order, more prominent and other ways to do that.

He says they're also trying to make the algorithm more transparent by allowing you to click on three dots and ask, why am I seeing this on any content, which should have been there in the friggin first place.

But anyway, so I'll get to Trump in a second.

What do you

Nick Clegg is a clever man, but goodness sake, what do you think?

So I'm going to go out on a limb here

and suggest that Nick Clegg is not being 100% forthcoming with us.

But he's charming.

Yeah, well,

he's a handsome British guy.

I think I met him

in Cannes.

But you didn't take a selfie with him like Marguerite Vestiger.

Oh, no way.

His sworn enemy, by the way.

Go ahead.

No, really.

Look, I don't, at this point, why do they do it?

I don't even understand this from a PR strategy.

I think that they should release data that shows that.

But any individual, well, any individual that has a Facebook card, the immediate assumption is you're a liar.

you're trading your reputation for money, and that

you are essentially the nemesis of the Commonwealth, and that you are the fuel and the agent of teen depression, the weaponization of our democracy, and a general lack of regard for other human beings.

Welcome to Facebook.

That's the kind of the employee handbook.

Yeah,

it was an interesting thing.

I think they're trying to pull on.

There's two things that I will give them credit, not credit for, that I agree with them, is that polarization did not start with Facebook.

There's lots of studies, and it's mixed.

It's a mixed bag on these things.

Polarization has been in existence forever.

It's the fueling of it.

It's the constant feeling of it.

And even his whole thing was like, when you go to your site and you see your friends fighting with each other or your family or this or that, that's not what's really happening.

And I'm like, well, then show the stuff, then show the stuff.

Or let independent researchers in there.

And then, of course, it's, well, we have these arguments about data, keeping data safe and this and that.

And so

they keep promising to open it up more so you can see what's happening.

But so just take our word for it, I think, is what he was trying to do here.

And nobody's taking their word for it.

I think that, I think opening up the data to independent people and not fucking with it would be a really important thing.

I do agree with him.

Why would you want

extreme content on there?

I do think it's like a pernicious kudzu, essentially.

They can't stop it.

I don't think they want it necessarily.

I think that argument that they want it is not true.

It's not good for them, but it certainly is.

And it's not good for advertisers.

But this idea, then show me that he started talking about with Casey, a bear, a mother bear.

I was like, that is not what people's experience of Facebook is if you just delve down very quickly.

So, but, and some of this stuff to let people filter things more, essentially make your own Facebook is interesting, but long overdue.

I don't know.

I don't understand it.

Why do you think you did this now?

What is the, what is the impetus?

I had trouble processing anything after you said pernicious kudzu.

No, I mean

completely.

You're still getting away from that.

That is really good.

In any case,

you wouldn't actually invite Anderson.

I just want to confront you.

Okay.

I will not invite Anderson Cooper.

Nobody believes anything Facebook says anymore.

They should, if they have data to back that up, they should release the data.

But the general rule when you become a senior executive, whether you're Campbell Brown or Nick Clegg, is like, you have had a great career building a lot of credibility.

We're going to throw, we're Donald Trump.

We're going to ruin your credibility for a long, long time, but we're going to pay you a lot of money.

And so it's worth it.

And people make that trade.

I don't, I don't, the whole argument around, this is the Jack Dorsey argument, that unfortunately the internet is bad and we just represent the internet.

And I just thought that's eerily similar to guns don't kill people, people kill people.

It does feel like that.

And it's just, you know, actually, you have made things worse.

And you're so powerful

that you you deserve uh scrutiny and by the way i just you know i mean it all adds up to just a bad place who is the new biggest uh spender on lobbying it used to be big oil it used to be big tobacco now it's big tech and what do these companies have in common generally speaking their externalities are really are really off it's going to be it's an interesting thing that they continue to they i get why they do push back but at the same time you can't have a cogent argument with him because you just don't believe him.

It's like a bad boyfriend.

You're like, no.

The solution here.

Even if they're not.

Look, there is good in Facebook.

I know a lot of people with Facebook that are really good people and I think are genuine about trying to do the right thing.

This company will never have any credibility.

This company will never be able to pivot to being a decent citizen

until two things happen.

Mark Zuckerberg and Sheryl Sandberg leave.

Cancer and lipstick on cancer roll out of there.

And people say, well, that'll never happen.

Then, okay, then Facebook will never be taken seriously for any attempt at goodwill.

I mean, enough already.

It's interesting.

That's the only thing they could do.

If shareholders really said, all right, this is an amazing business.

They're making a ton of money.

They're not going to do it.

I agree.

Meanwhile, Trump's daughter-in-law, Lara,

somewhat like Kara, but not totally opposite.

You two remind me of each other.

Wrote an interview with him on her Facebook and Instagram account.

Facebook nixed it, saying it was in the voice of Trump and was not allowed, which was interesting.

Probably virtue signaling here.

And Lara got all mad saying we're in the age of Orwell.

She's just trying to, she's such a sneaker.

She sneaks around things.

Give her credit for that, I guess, which was interesting.

And then in the interview with Case Newton, Clegg talked about what's going to happen with the Facebook decision.

They're going to have to abide by it.

They're bound by it.

If the you'll see how sophisticated it is, because Trump also broke all these rules.

So it's going to, you know, he can't can't keep break, he can't get a full, you know, a full pardon here at the same time.

The board can't give him a full pardon if he keeps breaking the rules.

So it's a, he said they, they're going to,

he said it's going to bind them, which is interesting.

So what do you think of this, the Trump situation?

Maybe it's not going to be as important to Trump going forward.

I literally think that one of the biggest tax cuts we've ever registered emotionally, and I do understand that there's some danger to this.

And even Bernie Sanders seemed concerned about a ban of Trump.

Having less Trump in our lives, and I say this as, you know, I guess a progressive, but my life's been much nicer the last eight weeks, hasn't your life?

Yes, and his people can get his stuff.

That's, by the way, if they want it, they can have Trump all day.

There's all ways to avail yourself to Trump if you really miss it.

If you can get

yourself some Trump,

this decision's coming at some point.

It'll be interesting to see what happens here.

But, you know, this idea of them sneaking around, like they, they're allowing like interviews if he did 60 minutes, but Lara is a close, they have a group that they're like, these are his promoters, like his family members, and they can't try to do a walk around.

He tried to do that after he was banned from Twitter, and Twitter shut everything down.

Like they were trying to get Dan Scavino and others tried to put his tweets up and this and that.

And they haven't really tried on Twitter because then you'll get right.

They just don't know what to do.

I don't understand all the hammering over this.

I heard about this guy who went into One Medical.

I love One Medical.

And someone asked him to put on a mask and he flipped off uh the the person and they banned him from all of one medical and i'm like okay they're allowed to do that yeah and i think that's a good move and maybe it's wrong i don't know maybe it was freedom of speech i but i don't understand they're a private company why all this handwringing and when when they decide you know we're so important that we've evolved to the point where any time we ban or don't ban someone it's a question of free speech in societal it means they're too power and they need to be regulated so i don't i just don't understand why a private company needs to all this hand-wringing to, okay, is our service, is shareholder value, is our health for the world better without these elements on our platform?

And if the answer is yes, okay, that's all they need to answer to.

I don't know.

And they certainly can do it, which is sort of goes against Nick's idea that they can't.

He didn't really cover that in this piece.

Anyway, we're going to move on and take a listener mail question.

I agree with you.

I think it'll be interesting to see.

We're going to be talking about this issue because I know it's near and dear to your heart, cancel culture, but I'm going to call it what Roxanne Gay calls it consequence culture

we'll discuss what that means on monday that was my haha it's consequence culture it's not cancel culture for fuck's sake anyway moving on let's take a listener mail question

you've got you've got i can't believe i'm gonna be a mailman you've got mail

hey karen scott first off kara congratulations on the adoption being official blessings to you and your beautiful family I'm sure y'all have seen the latest research from Gallup saying those who claim membership in a church or faith community has dropped below 50% in the USA.

As a United Methodist clergy person in Dallas, I have many questions about this, but my question for y'all is, do you see this as a rise in secularization or a general evolution from membership to subscription where people are consuming spirituality much like they do media?

If so, what does a faith thrundle look like, Scott?

How can technology benefit faith communities?

And how can I get in touch with folks at WeWork or Airbnb to discuss co-working sacred space?

I know a lot of spaces that are far too empty.

Love your show.

Thank you for writing this question.

I am not a religious person.

I grew up Catholic, but have not been inside a Catholic Church since I was confirmed, I think.

So this is an interesting question.

What do you think, Scott?

I think there's been some really fascinating stuff done online with religion over the pandemic, for example.

So I'm a rabid atheist.

Atheism is a core part of my being.

It gives me a finite nature of life and motivates me.

It's been a real positive in my life.

I'm an agnostic.

Agnostics are just

agnostics are atheists that are wimps.

Come out of the closet and say you're a fucking atheist.

I used to say that too.

I believe there's something, but I don't know which one.

It's such bullshit.

Anyways,

grow up here and come to atheism.

Anyways.

Oh, I do.

Anyways, I can't think of it.

Look, I think one of the most dangerous and disappointing things

in our country is the decline in church attendance.

I grew up, my dad's been married and divorced four times.

So I went to a variety of religious institutions growing up, Presbyterian Presbyterian church, temple.

And I think it's wonderful when people and Americans get together once every Sunday to hold hands and think about agency in something bigger than themselves, show empathy, greet their neighbor, sing together.

Physically, this is in a physical element, not just a physical.

But

I think church is wonderful.

And

I think one of the reasons we have more mass shootings, we have more depression, we have loneliness, is we have lost the connective tissue between Americans.

And one of the connective tissues traditionally in American society has been

religion.

And I don't even think of it as worship of a God.

I think of it as worship of a community.

And

the kind of central star, if you will, of the role model started with this great viewpoint of love the poor.

And it's just not a bad idea to get together every Sunday and talk about how we should love the poor.

I think a lot of these young men who ended up being mass shooters, I wonder what would have happened if they'd been.

Actually, the one guy at the Agent Spa thing, come to think of it, he had a real conflict with religion.

It's a complicated issue, but I would argue that

as a society becomes more educated and wealthier, church attendance goes down.

But we still have these huge questions.

And unfortunately, we've replaced spirituality with this fetishization of the nearest thing to mysticism and

godlike impression, and that is technology.

And

instead of church attendance, instead of worshiping Jesus,

and I'm a big fan of JC.

I think he's a wonderful man.

I do believe he existed.

I just don't buy his lineage.

The problem is we've replaced him with a man, effectively or theoretically, with a man who denied his own blood under oath to avoid child support payments when he was worth a quarter of a billion dollars.

That our new Jesus Christs are Jack Dorsey and Steve Jobs, and it's really unhealthy.

So I think I'm a huge fan.

I give money to churches.

It's actually Elon.

It's funny that you picked those two.

Elon's the news.

Elon's the new Jesus.

You might be right.

Yeah.

I think it's terrible for our society.

And I say that as someone who's 100% convinced that when I am about to die, I'm going to look into my kid's eyes and our relationship is coming to an end.

I do not believe in an afterlife.

But I think church, the decline in church attendance

signals something really unfortunate in our society.

It does.

And it plays into one of the things I've been watching an excellent series.

I mentioned it before on HBO

Into the Storm, the Q Anon documentary, which I think is fantastic.

And one of the things, there's such a sad underbelly to our world.

And again, it sort of plays into Nick Clay.

It was always there.

But boy, does the internet take it to new levels.

You know, these 8Chan and stuff like it's disgusting and really depressing.

And actually, the founder of 8Chan is the one that went that way.

It's just, it was, there was a point, there's a limit to free speech at some point.

Anyway.

We'll see.

We're not very religious, sir.

I don't know.

That is a good idea.

We think that there should be more ability for people to get together in a community of faith, whatever they have.

It's a huge issue.

We keep talking about dispersion and that is we're all,

you know, less time at work.

And the cousin, the evil cousin to dispersion is segregation.

And it's not only segregation physically, it's segregation emotionally.

And we don't interact with people when we don't see people of different demographic groups at the mall or the movie theater.

And like schools, unlike schools for K through 12.

Maybe not college as much, but K through 12.

You really do like college clean place.

Although, I think some of the people.

Where did you go to high school, Karen?

If I say it, you're going to say I'm like rich, white person.

Oh, my God, even whiter.

Did you go to Exeter or Fieldston or something?

No, I almost did, though.

Princeton Day School.

Princeton Day.

And I'm going to be giving the commencement address there this year.

Good for you.

That's nice.

That's really nice.

Yeah.

Princeton,

it's a lovely private school in Princeton, New Jersey.

It's just already a lovely town.

Private school in Princeton, New Jersey.

Okay.

Yes.

From the mean streets to Princeton, New Jersey.

Garrison.

My streets were not mean.

I am a hardworking rich person, is what I am.

All right.

Scott, one more quick break.

We'll be back for predictions.

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Okay, Scott, prediction time.

You sort of said you had a prediction and you sort of gave us a little preview, but give it to us.

Well,

I'm fascinated by the kind of the real estate tech space and

I've wanted to look more into Opendoor and Redfin and some of those guys, but I think that my prediction is is WeWork, shockingly enough, is going to overperform over the next 12 months.

And I think

Compass is going to underperform.

I think Compass really is trying to pretend to be something it isn't.

And I look through the S1 and I'm trying to understand what about these massive investments they've made because of the cheap capital are sustainable.

Because the majority of these investments have been in commissions to brokers.

And I don't see how that creates sustainable advantage.

Because they can leave, because they can go sooner.

78% of their revenues go to commissions to individuals who will literally walk across the street the same day if you say, I'm giving you 10% more in commission because like the agency business.

Yeah, and the question is, are they making investments in technology that create so much differentiation and ability to get more deal flow that the brokers say, well, I'm going to stay here.

There's some sort of ⁇ I mean, for example, Goldman Sachs could technically pay their traders a little bit less commission because they're just going to get more deal flow.

And when you show up at the Goldman Sachs, the one thing I will say about my friends who have left Goldman or Morgan Stanley or McKinsey is they don't realize how powerful a calling card that was.

And then when they start calling people and say, hey, I want to work with you.

I'm retired.

I'm just like, their calls aren't returned quite as quickly.

And I don't know if that's true.

I don't know how much enterprise value Compass is building.

So anyways, I have an excellent real estate agent.

I don't, I've never talked technology with her once.

So you have an agent at Compass.

Yes.

And if she goes, I bought my own.

If she goes to Prudential or Corporate, I'm going to go with her.

Yeah.

So I'll go with her.

So that means a lack of enterprise value.

They have been able to retain her, but at some point, will she just go to another firm?

Yeah.

And there's been no technology

that I think that I couldn't find myself on Zillow.

You know what I mean?

Like that I couldn't hit competitively.

That's what it feels like.

And so these firms trade at that point.

Good real estate agency.

So Sotheys.

And they have the best listings.

They do have good listings.

Sotheby's is a great brand.

It doesn't matter.

It's a great brand.

It's part of Realogy, and they trade at 0.25 times revenue.

So 0.25 times $3.5 billion would be a $900 million market capitalization.

And this thing was supposed to go out of $10 billion.

They've cut it to $7.

This just feels like a slow burn downwards.

But WeWork is sort of actualized back to what it's supposed to be.

I think their vision.

Look,

if you have the right guy or gal running the company, things usually work out.

And I know Sandeep Montrani, the guy who runs WeWork now, and he's a talented operator.

So, anyways,

a year from now or six months from now, compass down, we work up.

All right.

Okay, that's a good prediction.

That's an excellent prediction and a good one, too.

You're being generous.

Praise Jesus.

Let's go to church.

But any case, neither of us are very religious, but we have respect for you.

Yeah, I told you I was.

As long as they get the fuck out of gay people's way and stop trying to ruin their lives.

I told you I was an altar boy in a Catholic church for a while, right?

Really?

Yes, I was touched.

Okay.

Come on, that's good.

That's good pedophilia humor.

I'm not even going to dignify that part of the world.

I'm going to get on the phone.

I'm going now to interview Anderson Cooper.

So I'll talk to you soon.

Seriously,

you're still triggered by it.

I'm not going to talk to Google.

No, there's a part of you.

I'm talking about you that likes to hurt me.

There's a part of you.

This is April Fool's Day and it worked.

So let's just live with it.

Now I know your weak points and it has to do with Ando.

Anyway,

Scott, I want you to do, I'm going to do something nice for you since I teased you about Ando, et cetera.

I can't wait.

I literally, I can't wait for this.

I want you to plug your show, the Prof.

G Show.

It's part of the Vox Media Podcast Network now.

Tell us about it.

Tell us, give us some specifics.

Kind of more of this, minus the journalistic credibility.

No, the Prof G Show.

I've done it for a while.

We've just joined Vox.

We do a breakdown of

what I think is the most underreported story in business.

And we do office hours, which is my favorite part based on my favorite show that I used to watch with my mom, Frazier.

We do kind of a Colin show.

And then we do an algebra of happiness moment where instead of trying to jab and take advantage of people's emotions, I try to discuss them.

I'm trying to, anyways, but anyways.

Give me an example.

What moment did you have?

Let's have one right here.

What moment did I have?

Yeah, like what is the moment of happiness?

Well, I think, so I'm doing, I'm recording.

You talked about speaking at you, being the commencement speaker at your graduation I've been asked to do a lot of record a lot of videos for graduations because they're all virtual now and

and everybody gives you Everybody gives you advice in these graduation videos and the advice that we were given when I graduated from business school in the 90s was go to work for Dell or Microsoft or go to Russia which was supposed to be the land of opportunity in the 90s yeah and I said just avoid most of the advice and the only piece of advice I can give these kids that I know is absolutely true is that they will never regret at that age telling the people who've helped them get to that point that they love them and they appreciate them.

That's the only thing when I look back that I wish I'd done more of.

And I, and the little, the, the little that I did,

I'm just hugely grateful for.

Oh, you're tearing up.

Oh, how lovely.

That's just.

Because I didn't work out today because you started this fucking thing early.

Now I'm all teared up.

All right.

Thank you for tuning in.

I need to go do cross-cutting.

The profession's show is part of the Vox Media Podcast show.

It's Mondays and Thursdays.

You should listen to it.

It was an excellent show.

and it's here on the Vox Media Podcast Network.

So, more of Scott.

If you don't get enough of me, that's what we all need.

More Scott.

Must.

More Scott.

Must the dog.

Must the dog.

We'll be back on Tuesday.

Again, we'll be talking about consequence culture.

Go to nymag.com slash pivot to submit your questions for the podcast.

Don't make fun of me.

We're going to have a long debate.

I'm bringing someone in who's going to back me on this.

In any case,

it's called Consequences.

All right.

Submit your question for the podcast.

The link is also in our show notes.

Scott, read us out.

Today's show is produced by Camila Salazar.

Ernie Andretat engineered this episode.

Thanks also to Hannah Rosen and Drew Burroughs.

Make sure you subscribe to the show on Apple podcasts.

If you're an Android user, check us out on Spotify.

If you liked our show, please recommend it to a friend.

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

We'll be back next week for a breakdown of all things tech and business.

We all need a place where we can get around friends and strangers, grab hands, and express our gratitude for being a part of something bigger and recognize our blessings.

Church, church.

Applebee.