From FTC to NYC with Lina Khan

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Speaker 5 Hey, everybody, welcome to the Weekly Show Podcast. My name is Jon Stewart.
I will be your host for

Speaker 5 today's program this Wednesday, November 12th. You're probably getting it on Thursday.
You're probably right now reading through the 22,000 pages of emails that Jeffrey Epstein talked about with

Speaker 5 Donald Trump. It gets deeper and darker as we speak.
But I am focused on the future. And especially the future of the great city of New York City and this great nation.

Speaker 5 And we are always delighted in those moments to talk to somebody who's got her hand in a variety of those issues. So

Speaker 5 let's get to our guest.

Speaker 5 We're very excited to have her. She's the former chair of the FTC.

Speaker 5 I'm going to say that's Federal Trade Commission. I really don't even know.
I just like to say FTC.

Speaker 5 Teaching at Columbia last week joined Zoran Mamdani's transition team, where she is also the co-chair. So please welcome Lena Khan.

Speaker 1 Great to be here.

Speaker 5 Hello.

Speaker 6 Hi.

Speaker 5 You're co-chair of the Mamdani campaign transition team.

Speaker 1 That's right.

Speaker 5 And you take over.

Speaker 5 When does the new mayor take over in New York City?

Speaker 1 He gets sworn in on January 1st, 2026.

Speaker 5 Literally drop of the ball, boom.

Speaker 1 That's right.

Speaker 5 Does it happen actually at midnight?

Speaker 1 I think there's some discretion on when he formally kind of takes the oath and gets sworn in, but I understand, you know, once that calendar changes,

Speaker 1 he gets to be mayor.

Speaker 5 Can I make the pitch? Sworn in by Seacrest. Soon as the ball drops, Mariah Carey on one side, wearing like kind of a white wool or fur snuggie, maybe on the other side, boys to men.

Speaker 5 And then he delivers it right in Times Square. I'm the new mayor.
Let's do this.

Speaker 1 Yeah, we'll share that proposal with him.

Speaker 5 By the way, thank you for referring to it as a proposal. I think that gives it a certain amount of

Speaker 5 efficiency. Now, for you, how different is,

Speaker 5 you know, your duties with a mayoral sort of transition team versus what you were doing at kind of the federal level?

Speaker 5 I don't, first of all, what are kind of the economic levers that a mayor has in a city like New York that you can affect?

Speaker 1 Yeah, it's a great question. I mean, it does look pretty different.

Speaker 1 When I was at the Federal Trade Commission, my job was squarely to enforce the antitrust and consumer protection laws at the federal level.

Speaker 1 And at the city level, you know, the economic toolkit is much broader than just antitrust and consumer protection. Broader.
Broader, yes.

Speaker 1 I mean, you have more limited impact in that your jurisdiction is New York City,

Speaker 1 but you have all sorts of tools at your disposal.

Speaker 1 And we've seen that in part through some of the proposals that Mayor-elect Mamdani ran on in terms of what he's thinking about for the rent, for childcare, for buses.

Speaker 1 And so they have agencies that look a little bit like the FTC in terms of some of the consumer protection tools, but they also have

Speaker 1 agencies that are focused on small businesses. How do we create a more level playing field for them?

Speaker 1 As well as agencies that are thinking about economic development. And do we want to do economic development in the city in a way that's very skewed towards big corporate interests?

Speaker 1 Or do we want to have, again, more of a level playing field?

Speaker 5 Oh, I'm going to say skewed towards corporate interests. I feel like what could go wrong? That sounds like it's worked for us for the past 50 years.
I don't know why.

Speaker 5 Why would we change horses now, Lena?

Speaker 1 I mean, I think New York, New York City is demanding it. You know, I think his, his win was a pretty decisive rejection of the politics of the past and a real desire to turn the page.

Speaker 5 Now, it's interesting you bring this up. So I wonder if New York City, how eccentric it is.
So you're talking about different things, you know, tax policy and things like that.

Speaker 5 Obviously, the city council and the governor of New York also have a role to play in a lot of those different areas.

Speaker 5 How much does the chief executive in New York, the mayor, affect those policies or is it lobbying those policies?

Speaker 5 Is it executive action? Does he have to get the city council on board for those types of things? What are the limits to that?

Speaker 1 Yeah, it's a great question. So there are going to be certain provisions where he's going to need to have to work closely with city council or with the governor,

Speaker 1 including relating to some of what the tax proposals could be. But there are agencies within his jurisdiction that the mayor has standalone authority to sue.

Speaker 1 So if you find corporate lawbreakers, you can use the DCWP,

Speaker 1 a department that is focused on consumer and worker protection, to take that on.

Speaker 5 Okay. That's more in line with the things that you used to do, sort of those types of enforcement actions.

Speaker 1 That's right.

Speaker 1 As well as thinking about just

Speaker 1 what are the levers within New York City that the mayor can unilaterally use to make life better for working people here.

Speaker 5 It's such an interesting dichotomy, Leon. And let's talk a little bit about the dynamic, sort of dynamics and incentives.

Speaker 5 Whenever someone comes along, and I think you're seeing this with Momdani now, who is suggesting that the balance of power is inequitable,

Speaker 5 the people that have the power say, oh, then we're going to leave.

Speaker 5 You can't do this. We're going to leave.
We're not going to make that. How do you create these policies? Because we all know sort of capital can travel, labor can't.

Speaker 5 It's sort of one of the advantages capital has, and we saw that with globalization. How does that dynamic play out in a city like New York? Every time someone talks about that more populist agenda,

Speaker 5 those that have been accruing the power and the finance say, How dare you?

Speaker 5 We're leaving.

Speaker 5 How does that affect the way that you design the incentive policies

Speaker 5 for New York City?

Speaker 1 Well, you always have to think about what might the consequences of certain policy choices be. But it's also important to look at what evidence do we have?

Speaker 1 What empirical data is there about what has happened in the past when we have increased taxes?

Speaker 1 And there have been studies showing that, you know, for example, when New Jersey raised its top income tax rate,

Speaker 1 high earners by several percent a couple of decades ago, the state's millionaire population actually increased.

Speaker 1 And similarly, there are a bunch of studies that show that that threat of capital flight is oftentimes overstated as a threat and doesn't actually materialize.

Speaker 1 I know the mayor-elect has also talked about how in his conversations, including with business owners, CEOs, they've talked about actually having a New York City where working people can afford to live here, where their employees can afford to live here, is something that would be good for their businesses in the long term, too.

Speaker 5 Right. And have they been, you know, the rhetoric in a campaign is different than the rhetoric once somebody is the victor.
How conciliatory has the sort of more vocal business?

Speaker 5 You know, I saw Bill Ackman, who is, as you know, New York's favorite billionaire. I don't know if you know that.

Speaker 5 We have quite a few and he's our favorite.

Speaker 5 But he wrote

Speaker 5 a tweet saying, you know, and he had put a lot of money up. I mean, billionaires put a lot of money up.
Michael Bloomberg put, what is it, $8 million up to try and stop Mom Donnie.

Speaker 5 So now, how conciliatory is that?

Speaker 5 How real are their threats?

Speaker 1 Yeah, I mean, look, I know feelings were in high during the campaign.

Speaker 1 I think many of them are now coming to terms with the reality and, you know, going to have to see what happens and how they choose to act.

Speaker 5 Does that even matter? Lena, I want to ask you, you know, because they do say people have fled to Florida and Texas. Does the city actually suffer in those times?

Speaker 5 It doesn't seem like millionaires leaving the city is the threat they think it is, I guess is what I'm getting at.

Speaker 1 I mean, I'd say a couple of things. Look, you always want to be mindful of what's going to happen to the tax base.

Speaker 1 But I think the question that the mayor-elect Momdani was asking was, well, working people are already fleeing New York.

Speaker 1 They're already having to leave New York because they can't afford to live here. And shouldn't we care about that too? Right.

Speaker 1 And his campaign has been explicitly to make this a place where bus drivers, janitors, security guards, teachers, right?

Speaker 1 People who are kind of keeping the day-to-day running of the city, where they have a chance as well. And I think that's the part of the conversation that we too often don't focus enough on.

Speaker 1 And that's what he's trying to solve for.

Speaker 5 I think that's a great point, Lena. And it's also when you talk about, you know, we all remember in the pandemic, there was the...

Speaker 5 the essential worker. The essential worker is what makes this city go, the teacher, the bus driver, the, you know, the sanitation.

Speaker 5 And essential workers is basically just, it seems like a phrase we use for people we don't pay enough.

Speaker 5 We think that if, well, if just call them essential, well, that, look, we're not going to pay you enough, but that's hell of a compliment. You're, you're essential, but we don't treat them as such.

Speaker 5 So, so now that he's getting in there, what are some of the policies that we can do to kind of level that out, to give the essential worker

Speaker 5 the types of economic benefits that, you know,

Speaker 5 the compliment would lend itself to.

Speaker 1 Yeah, I mean, look, he ran on talking about how we need to freeze the rent, but also need to make it easier to build more housing in New York.

Speaker 1 It's no secret that housing is just so, so expensive for people here and only getting more expensive. One of the biggest line items for families is childcare.

Speaker 1 And, you know, New York made big strides with having universal pre-K and increasingly 3K, but having that, you know, expanded is going to be something that's going to bring costs down.

Speaker 1 Beyond that, we saw at the FTC that there are all sorts of drivers of high prices for people, right?

Speaker 1 If you think about healthcare markets and why are big pharma companies able to get away with certain forms of price gouging.

Speaker 1 I spent a lot of time at the FTC talking to small businesses, including independent grocers, independent pharmacists, who increasingly are also being squeezed out of the market, not because their communities don't love them, but because they're being squeezed by a big middleman somewhere at the top.

Speaker 1 and so those are the types of dynamics that, you know, I know the mayor-elect is really interested in.

Speaker 1 I mean, he, I think in his campaign, you know, a lot of people are talking about: look, the big lesson is he focused on affordability, he was laser-focused on cost of living, and that's absolutely true.

Speaker 1 But he also displayed a real curiosity, right? He went out on the streets of New York and he asked the halal cart driver, why has chicken and rice gone from $8 to $10?

Speaker 1 Right. What have been the explicit drivers of higher costs, right? Or to go to the bodega and ask the same.

Speaker 1 And I think all too often that type of basic curiosity and an interest in learning from the people who are living these realities day to day is just not something that we see enough in our politics.

Speaker 1 It's something I tried to model at the FTC. And people would say, you know, candidly, this is the first time a bureaucrat has even taken interest in how are these markets working.

Speaker 1 The other thing I'll note about what he did was he didn't just pretend like it was some fact of nature or some inevitability that prices are higher and people getting squeezed.

Speaker 1 He said, there is a cause here. And when that cause is corporate lawbreakers or concentrated corporate interests, I'm not going to hesitate to call that out.

Speaker 1 And so I think people want, yes, a relentless focus on affordability, but they also want somebody with the courage to call that out and to actually demand accountability from the set of actors that have been profiting as people are getting squeezed.

Speaker 1 And so I think that combination of focus, but also courage is what's been so unique about him.

Speaker 5 Two points on that. One, when you talk about talking to the halal driver, it really speaks of access, right?

Speaker 5 Politicians, in my experience, don't actually have access to those people.

Speaker 5 Those are not the people they interact with. The people they interact with are lobbyists.
They're lobbyists, they're fundraisers, they're pollsters, they're consultants, but they don't actually

Speaker 5 have an interest or at least act on the interest of talking to the real people that are dealing with those prices.

Speaker 5 So I think that is a phenomenal point is to get outside of the bubble that generally surrounds the political industrial complex and get to those things.

Speaker 5 And the second part is the market drivers of prices, because I think it's it's really complex. It's not as easy as just, you know, changing a couple of the dials.

Speaker 5 So let's talk about those market drivers of like chicken and rice. You know, small businesses, and you've dealt with this, don't get the same wholesale prices that big businesses get.

Speaker 5 If you're Walmart or Costco, you're buying things from the very same distributors at a lower price. than what somebody who is just trying to run a small business does.
Would that be correct?

Speaker 1 That's right.

Speaker 1 And we would have small businesses tell us that if they walked into a Walmart or a Costco, the retail price at those stores, the price on the shelves at those stores is lower than the wholesale price a small business is getting.

Speaker 5 Lower than the wholesale price.

Speaker 1 That's right. And so there are huge disparities here.
That type of price discrimination can actually be illegal. It was something that Congress outlawed.

Speaker 1 Yeah, in something called the Robinson-Patman Act of 1936, 37. Sure, sure.

Speaker 5 I always thought, I always thought Robinson-Patman was 39.

Speaker 1 We'll have to look it up after. Fair enough.
But right after, you know,

Speaker 1 there was basically a real fear that the expansion of big chain stores was squeezing out small independent grocers, not because

Speaker 1 which it has, but it's really important to make a distinction between when big stores are actually more efficient and so can produce, you know, lower prices for that reason, versus when are they just getting lower prices because of their raw muscle and their raw bargaining power and demanding lower prices or they'll walk away.

Speaker 1 And so the law was really about preventing that type of buyer power from being weaponized, but saying, look, if it's genuinely cheaper to do business with a Walmart or a Costco on the merits, those savings can be passed along, but you can't just allow the big guys to use their sheer heft and muscle and bargaining power to demand lower prices than what independents can get.

Speaker 1 And so this is a big issue. There's actually discussion in New York about passing a state-level price discrimination law, which would again be something that city enforcers could enforce.

Speaker 1 You asked earlier, you know, what are the levers?

Speaker 1 And one of my key areas of focus on the campaign, as part of the transition, has been making sure that we actually know the full set of tools that the mayor has at his disposal.

Speaker 1 Because all too often what we've seen is that there can be a bit kind of a great forgetting of what are the authorities that government actually even has.

Speaker 1 And just because something hasn't been used in recent decades, we've kind of forgotten about it. And so we want to make sure we know all of those tools.

Speaker 1 Governor Hokul actually has recently signed some new bills into law, including one that would prevent price fixing through algorithms by landlords, prevent certain kinds of junk fees.

Speaker 1 And so we want to make sure that those new laws can be enforced vigorously too.

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Speaker 5 This is such a fascinating. So

Speaker 5 we'll get into the weeds now on sort of incentives and dynamics because it's so fascinating.

Speaker 5 What you talked about with Walmart and Costco, right? Or I threw those names and not you, but larger chains that are using their heft just to drive a better price sounds like bargaining.

Speaker 5 I'll give you five of those for $10. How about this? Give me 10 of them at a lower, give it 10 for eight.
You know, that seems like

Speaker 5 the general way that people do business. If I'm going to give you a bigger order,

Speaker 5 you're going to shave some of the, you know, per-piece costs out of it because I'm giving you a lot. That seems fair to me.
When does that fairness

Speaker 5 move into

Speaker 5 an externality? When does it start to skew markets? And how do you even make that decision as to when does it start to hurt the small businesses? And then the second part of that question is:

Speaker 5 when I look at government, I see one of its important roles as being a check on the power of corporate interest.

Speaker 5 Sort of the one branch of government that the founders never really clued in there was corporate power. And how do we check that? Are those two

Speaker 5 dynamics at odds with each other?

Speaker 5 You're trying to make sure that

Speaker 5 corporate size doesn't disadvantage small business. At the same time,

Speaker 5 you want to use government size

Speaker 5 to drive better incentives and prices for people.

Speaker 5 Does that make sense to you?

Speaker 1 Yeah, I mean, on your first question, it's absolutely true that if there are genuine cost efficiencies to be selling higher volumes to some of these big box stores, that can be reflected in lower prices.

Speaker 1 But what we sometimes hear from small businesses, you know, there are all sorts of cooperatives where basically 10 retailers will be able to band together and put in an order that matches the size of the order of one of the big box stores.

Speaker 1 And so if you're matching the size of the order, you should also get that same price, right?

Speaker 5 Sure.

Speaker 1 But they're not. Oftentimes they're not.
They're actually still being discriminated against, even when they're seeking the same volume.

Speaker 1 And that's where this discrimination comes in, when you're not treating like equally

Speaker 1 based on the price. And that's because oftentimes the big box stores are saying, not just I want a good price, but I want a lower price than what you're giving my rivals.

Speaker 1 And that's when it can slide into forms of unfair discrimination. On your second question, you're asking, are these things in tension with one another?

Speaker 1 The idea that we want government to check corporate power, but we also want the market to kind of be an area of free commerce?

Speaker 5 That is correct.

Speaker 5 That is my question. That, by the way, that is a much better framing of my question.
From now on, when you come on, I'm going to have you write the own questions.

Speaker 5 And then you're just going to ask yourself. And I'm just going to sit here and nod because that was a much smarter way of putting it.

Speaker 1 I mean, look, I think, you know,

Speaker 1 we want markets where people can get a fair shot. And part of what the government's role is, is to set the rules of what fair competition looks like.

Speaker 1 So in the same way that it's not permissible to compete by kind of burning down your rival's store, there are certain types of rules of how you can compete in other types of, you know, terms of dealing and that sort of thing.

Speaker 1 It's also really important, and I think this moment is really showcasing it starkly, how the concentration of economic power and the concentration of political power can actually work hand in hand.

Speaker 1 And so having markets that are open and fair and competitive was seen as a good in and of itself, because we didn't want economic coercion and economic tyrants oppressing people.

Speaker 1 But we also want that as a way to ensure that political tyrants, political authoritarians can't use monopolies as a tool, as a weapon.

Speaker 1 And unfortunately, over the last 10 months, we've seen how that's been working hand in hand and how much it's been consolidated.

Speaker 5 You know, we had

Speaker 5 two congresspeople on the show, DeLuzio and Ryan, were talking about the Department of Defense or Department of War, whatever it's called, and how years ago there were 50 defense contractors, now there's five.

Speaker 5 And by reducing that, you really don't have an option. And you start to see the corruption

Speaker 5 seep into it as you narrow the field of what your options are. But monopolies and competition can't be the only way.
You know, how robust do you advocate for government action?

Speaker 5 For instance, let's talk about the pharmaceutical market or the insurance company market.

Speaker 5 It's not necessarily just monopolies that cause it. It's that the industries themselves

Speaker 5 do not lend themselves to market dynamics well.

Speaker 5 Like healthcare. Healthcare just doesn't lend itself to competition.
You don't, when you get a heart attack, you don't think, you know what? Take me to the hospital 10 miles away.

Speaker 5 That's a much cheaper heart attack unit. And I'm going to get a better price on my open heart surgery when I go there.
Like people don't comparison shop.

Speaker 5 So what does government action look like in those markets where

Speaker 5 even if you gave it the most even playing field, it wouldn't function that way?

Speaker 1 I mean, people don't even know what the price is, right? You can't kind of price compare on even like a knee replacement surgery, right? I mean, there's so much opacity.

Speaker 1 And it's true. I mean, there have been so many factors across healthcare that have basically made these markets not function as real markets, right?

Speaker 1 Not having access to price, not real transparency, not real choice, just being few aspects of that.

Speaker 1 And we have seen that. with healthcare companies, they've both been consolidating, but also vertically integrating.

Speaker 1 So your health insurer is also, also, the pharmacy is also now buying up all the doctors. And so you're basically just seeing these huge conglomerates

Speaker 1 that are further, you know, just distorting even the possibility of having competition.

Speaker 1 I mean, I think there historically, there's been a whole toolbox of economic levers that the government has to shape markets.

Speaker 1 promoting more competition through antitrust and anti-monopoly is one of them. But we've also had things like public options, right?

Speaker 1 When should the government itself be a player in a market to make sure that there's

Speaker 1 a player that's not being driven by the same motives or narrow incentives as the private guys and is providing a check on them?

Speaker 1 We also have seen certain types of utility rules, price caps, non-discrimination, mandatory interoperability. These were the kinds of things we applied to the railroads, the banks, right?

Speaker 1 We long had a rule that said there has to be a separation between banking and commerce. So if you're a commercial bank in this country, you can't also be a retailer.

Speaker 5 Was that that was the Glass-Steagall? Was that the law that said you were not allowed to be a lender and an investment bank? You had to separate those.

Speaker 1 The Glass-Steagall was a parallel rule to the separation of banking and commerce, but this idea was the same. You want to prevent certain conflicts of interest.

Speaker 1 If your banks or your railroads are playing such a

Speaker 1 hugely important role in providing credit to the rest of the economy, providing transportation.

Speaker 1 You don't want their incentives to be skewed by being able to give themselves a leg up in the retail market. And so those are some types of rules.
It was interesting.

Speaker 1 You know, we even saw governor-elect Mickey Sherrill talk about price caps on utility rates.

Speaker 5 Because electricity bills in New Jersey went up 20%

Speaker 5 kind of overnight. So what about that? So we're told that if government intervenes in those markets, ones that are so clearly skewed, that that's socialism.

Speaker 5 If they intervene on behalf of the consumer into those markets or try any kind of price cap or public option, that's socialism.

Speaker 5 But when the government intervenes on behalf of those corporations, whether it be for subsidies or whether it be for allowing them to skew the markets through unfair competition or

Speaker 5 like you've seen with now we're seeing with AI, buying up all the other smaller AI firms and putting them behind a wall so that they can control them. Why has that been the distinction?

Speaker 5 And what's the reality? How many times has a government,

Speaker 5 they might say price control might not work or a public auction puts all those other industries out of business? What is the reality of it?

Speaker 5 Because I come down on the idea that government should intervene on behalf of the consumer.

Speaker 1 And just to give a very clear example here, one of the things that the last administration did was introduce something called direct file.

Speaker 1 And this was basically a place where people could file their taxes through a government-owned service.

Speaker 1 So you don't have to go to TurboTax and HR Block, which are companies that have been found breaking the law in all sorts of ways.

Speaker 1 They would advertise their services as free, free, free, but actually it would not be free for most customers.

Speaker 1 All sorts of bait and switch tactics. And they had heavily lobbied for decades to prevent the government from offering a free option in the marketplace.
The government rolled this out.

Speaker 1 There were all sorts of speculation. Oh, the government is incompetent, inept.
This thing was smooth. It worked flawlessly.
The customer reviews of it were off the charts.

Speaker 1 And this administration just shut it down.

Speaker 1 That was a public option for filing your taxes.

Speaker 1 Something everybody has to do so you don't have to dole out all of this money to these private firms that are just trying to make a quick buck and figure out how can they trick or trap you into paying more.

Speaker 1 And you know, I think there are just all sorts of opportunities for government to make markets more fair.

Speaker 1 Even the governor-elect in Virginia talked about having a public owned pharmacy benefit manager as a way to, you know, bring down some of the costs.

Speaker 1 So there's been a lot of focus on, you know, the mayor elects policies on rent, on freezing the rent or kind of public owned grocery stores.

Speaker 1 But it's been interesting to see that actually questions around price caps or public options is something that, you know, other Democrats have been running on as well.

Speaker 5 As someone who is involved in the lever, so you're looking at all the tools, right? So you look up there. You've got antitrust.
What do you think is the smarter option long-term for markets?

Speaker 5 Is it a more robust antitrust figuring out how to make competition fairer? Or is it more government intervention into the markets through that public option?

Speaker 5 If you're turning the dials, which one do you think is more crucial and more effective?

Speaker 1 I think it really depends on the markets. I think there are markets that, as you said, just don't lend themselves to vigorous competition, right?

Speaker 1 Think about telecom or railroads, just areas of infrastructure.

Speaker 1 And we saw at various points, you know, municipalities trying to roll out municipal-owned broadband because the private companies that were rolling it out didn't have the right incentives.

Speaker 1 There were certain neighborhoods they didn't want to serve. They were able to, you know, price gouge people.

Speaker 1 There are going to be markets that I think competition can get the job done if we have vigorous enforcers making sure that firms aren't using underhanded or illegal tactics to muscle out their rivals.

Speaker 1 But it really has to be a market-by-market analysis.

Speaker 1 I think healthcare is an interesting example because it's this funny combination of the government already playing a big role, but also then certain parts of the market

Speaker 1 being reliant entirely on private companies. And I think that's when you can see a lot of distortions.

Speaker 1 And there have been so many allegations of, you know, fraud by the big companies, all sorts of opacity. And so that one is really ripe for kind of shaking up.

Speaker 7 Okay, Chad, today you're gonna drive the all-electric Toyota BZ.

Speaker 4 But my electric vehicle phobia, I'm not ready, Dr. Ross.

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We're inside it. Try to take deep breaths, okay? Move the ventilated seats.
They're touching me.

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Speaker 4 Drive the car.

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Speaker 5 So let's talk about healthcare because that's a big one. And maybe this talks about the way that government inserts themselves into markets.
And maybe is that the proper way for them to do it?

Speaker 5 So you're right about healthcare. We have these, you know, healthcare costs are rising faster than inflation.

Speaker 5 You have all these people that can't afford to get insurance to even get them into the game to do that sort of thing. And then you have, you know,

Speaker 5 as we talked about, other kinds of externalities. So the government ideas, A, we've got Medicare and Medicaid, right? Those are public options, generally very popular.

Speaker 5 Obviously, Medicaid is not as much because that means that you're below a certain income level, but Medicare certainly is.

Speaker 5 But what the government decided to do is rather than to give that for everybody,

Speaker 5 they were going to just make sure that they subsidized a private insurance market.

Speaker 5 Are we seeing government when it decides to just feed middlemen subsidies with no cost controls, skewing markets not not for the better, like the ACA.

Speaker 5 I could make the argument that skews the market for the worse. It drives up premium costs.
It promises billion-dollar insurance companies a customer base forever.

Speaker 5 What's your opinion on those kinds of interventions and if that's the right way

Speaker 5 to change things?

Speaker 1 I think you're absolutely right to be thinking about what incentives did we really create through basically kind of guaranteeing these companies, you know, a customer base, through guaranteeing them certain government subsidies.

Speaker 1 Unfortunately, I do think that the reality on the ground is, yes, more people have insurance, but more people are also running GoFundMe campaigns to make sure that they're not getting crippled by medical bills, right?

Speaker 1 And so people are still paying more and more. They're going to see those health premiums skyrocket now because of what the Republicans have done.

Speaker 1 And I just wonder that if you go back to this basic question of people wondering, what is government really doing for me? Is government really making my life better?

Speaker 1 I worry that if you're just saying, okay, we're going to make sure it's easier to get insurance, that you're not being denied insurance because you have a pre-existing condition, but we're not also solving for the other drivers of high costs people

Speaker 1 have been having to ration life-saving medicine, including insulin, up until a few years ago.

Speaker 1 I mean, I would have at the FTC people come to us, tell us about family members they had lost because those family members were rationing insulin.

Speaker 5 And pharmaceuticals is a great point, Lena. Pharmaceuticals will pull all kinds of craziness to allow themselves to avoid competition, especially in terms of the narrow definitions of their patents.

Speaker 5 Would that be fair to say?

Speaker 1 That's right. I mean, look, the basic idea with a patent is if you innovate, if you bring a fresh new idea to market, there are certain rewards for that.

Speaker 1 And we reward that in part through a patent to make sure sure there's limited competition for a certain number of years. But beyond that, we're supposed to have generic entry, right?

Speaker 1 The patent protection goes away. And what we've seen from the big pharma companies is an elaborate, sophisticated web of tactics to try to extend that patent life.

Speaker 1 Sometimes they will make minor changes to the underlying drug just so they can reapply for a patent and keep generics out.

Speaker 5 To keep that, right? To keep the generic out so that they can keep the prices high and artificially so.

Speaker 1 yeah i mean at the ftc we even saw that with things like asthma inhalers which have been around for decades americans were sometimes still paying hundreds of dollars out of pocket even though asthma inhalers cost as little as seven dollars in other countries and when we looked into that we found that some of the pharma companies had been trying to list patents for things like the plastic device on the inhaler or the inhaler cap.

Speaker 1 Things that have nothing to do with it.

Speaker 5 That's the thing that you pop out before you kick it.

Speaker 1 Exactly.

Speaker 5 By the way, anytime you want to talk to an old Jewish man about inhalers, please do because I know all the parts.

Speaker 5 It's like some people, you see them put together like a rifle really fast. I can do that with inhalers, like it's nothing.

Speaker 1 Important skill to have. Thank you.

Speaker 5 But trust me.

Speaker 1 Yeah. I mean, look, when we called them out on it, three of the four companies announced that they would lower their out-of-pocket cost to just $35.

Speaker 1 And so I think there's probably a lot of this low-hanging fruit in sight where we're just seeing egregious abuse that if it's called out by kind of government officials that are willing to stand up to them uh would really bring down costs so let's all these points kind of go together in a larger thing so let's take a step back lena khan is redesigning the system

Speaker 5 of incentives so we'll redesign the system

Speaker 5 for uh when markets don't really function that well like with healthcare and utilities and broadband those kinds of things that you say the markets even even left to their own devices, we want them still to innovate, right?

Speaker 5 But they're not going to function properly

Speaker 5 on their own.

Speaker 5 How would you redesign the government's role in those? Would you advocate for always,

Speaker 5 as you said with

Speaker 5 the e-filing and that, for an always accessible public option

Speaker 5 within those markets?

Speaker 1 I think when you look at markets that are really essential for the necessities of life, I mean, those need to be the first order area of focus for the government, right?

Speaker 1 These markets where people don't have a choice, healthcare is an important one, food and agriculture is an important one, day-to-day transportation, especially in a place like New York City, where you're so reliant on infrastructure, those are the core parts of people's day-to-day infrastructure that we need to make sure they're not getting squeezed or price gouched.

Speaker 1 And so I would say that has to be the first layer of focus.

Speaker 1 And you need to figure out, are these markets where if we just take on, you know, illegal monopolistic practices, that'll be enough to make sure that companies aren't price gouging?

Speaker 1 Or do we need to have more of this public option? Do we need to have more of a rate schedule that says there's certain price caps and that sort of thing? Right.

Speaker 5 Has that ever been, tell me about that, the rate schedules, what's been the efficacy of that?

Speaker 5 Because especially when it comes to things like electricity, you know, we all talk about global warming and we've got to do better.

Speaker 5 But what I see on the horizon is AI using more water, more electricity. We're going to be squeezed on energy in a way we haven't been in decades.

Speaker 1 That's right. And people across the country are seeing their utility and their electricity bills up precisely because of these data centers that are sometimes opening up in their backyards.

Speaker 1 And a lot of that decision making, I think people are frustrated because this seems to be done by a private government of sorts, right?

Speaker 1 You basically have a small number of executives that are going to be calling the shots on what the future trajectory of AI is going to look like, even though it's guzzling up so much water, so many public resources.

Speaker 1 And the question is, who's going to be left paying for that?

Speaker 1 Is it really going to be local communities? I mean, there was a stunning moment over the last week where you had one of the top executives of an AI company note that maybe there is a big bubble here.

Speaker 1 And maybe ultimately the government's going to have to step in as a backstop, right?

Speaker 1 Basically suggesting there maybe could be a bailout, which goes back to your early question of maybe the government's already sometimes doing a form of socialism, but for wealthy interests.

Speaker 1 And should we just be more real about that?

Speaker 5 Lena,

Speaker 5 this is it. This is now we've got the roadmap because the corporations are people, but they are people that use public resources.

Speaker 5 They benefit from our water, from our energy, from our stability, from our labor. And yet, those things are not compensated for.

Speaker 5 And taxing them is then seen as their get out of jail free card. If you tax us, we will flee.

Speaker 5 But we don't ever have to acknowledge the amount of benefit that we get from the public infrastructure that has been built by tax dollars that

Speaker 5 is not ours, that is the people's, not the corporations.

Speaker 5 And when you start from that premise, doesn't this whole thing look a little bit different?

Speaker 1 I think so. And you know, what was so interesting was even the ways that we do government shutdowns,

Speaker 1 what areas of service get shut down and what areas of service are still provided is really interesting.

Speaker 1 And just to give you a small example, at the Federal Trade Commission, when the government shut down, they shut down the basic hotlines where people could report fraud, where people could report identity theft.

Speaker 1 What stayed open was the place that Wall Street could report their mergers and keep those mergers still going.

Speaker 5 Priorities, Lena.

Speaker 1 And it was really interesting.

Speaker 1 I mean, just a few days ago, before we saw the deal in the Senate, I saw a reported in the Wall Street Journal that the FAA had started telling people that their private jets might not be able to land as easily at some of the busiest airports.

Speaker 1 And it was a really interesting question: like, should private jets have been stopped on day one of the shutdown?

Speaker 8 Maybe, you know, they're exempted by

Speaker 5 the essential workers. How else would we get charcuterie? I believe charcuterie is flown to the United States purely by private jet.

Speaker 5 It's really, it's, it's a shocking.

Speaker 5 That's why the response to Momdani has been been so interesting to me. Is

Speaker 5 there is that because Mamdani and Trump, boy, I don't want to put those two things together, but here we go down that path.

Speaker 5 Both have recognized a populist frustration, but only one is cast as a radical.

Speaker 5 When Trump says, how the hell are we paying pharmaceutical subsidies and all these drugs cost us in America so much more than anywhere else? Everyone goes, yeah,

Speaker 5 that's a smart businessman. When Zoron says that, they go, come on, Stalin.
I don't want to hear it.

Speaker 5 Why is that?

Speaker 1 It's interesting. I mean, this administration has actually done things that have put government more in businesses' way than any administration in recent history.

Speaker 1 I mean, when you have this administration saying, we'll take a golden share. You want this deal to go through, sure, but the government's going to have certain rights.

Speaker 5 And that was U.S. Steel.
They had the golden share in U.S.

Speaker 1 They had the golden share in U.S. Deal.

Speaker 1 It was reported that when NVIDIA said they wanted to keep exporting their chips, Trump demanded a 15% cut of that.

Speaker 5 He got 10% of Intel for letting them keep their CEO.

Speaker 1 So we have actually expansive government intervention happening all over the place right now in ways that is unprecedented and maybe in some instances, you know, dangerous.

Speaker 1 We don't want just arbitrary whim dictating this.

Speaker 1 But it has been interesting to see that some of the usual hysterics that we see when some administrations or some elected officials talk about making markets a little bit more fair, we're not hearing as much right now from those corners.

Speaker 5 And when Trump does it, it's always done arbitrarily.

Speaker 5 And for those people, as an example, look at the companies that get exempted from the larger tariffs or the companies like NVIDIA that, you know, the 15% of the chips.

Speaker 5 All right, well, we'll let you do the chips. Well, this country's 95% small business and they don't have the access and they're not able to get exempted from those tariffs and

Speaker 5 they get hurt by that. So can you design a system like that that isn't arbitrary and does not fall

Speaker 5 as quickly to corporate lobbying? Because you've probably seen when you were making decisions, the ferocity of corporate money that came at you must have been overwhelming.

Speaker 1 Yeah, there was a lot of money trying to stop the FTC from, you know, vigorously enforcing the law.

Speaker 1 And I think this goes back to an earlier point you made, which is who is our government listening to?

Speaker 1 And one of the things about having these types of positions of power is that by default, your feedback loops, your information channels can be so skewed towards those corporate wealthy interests.

Speaker 1 And so if you do something that is upsetting them, your phone will be ringing off the hook, you'll be getting a deluge of emails.

Speaker 1 And so you really need to figure out how do I make sure my set of data points and inputs is not just reflected of one very small set of concentrated interests, but is actually hearing from people who might be benefiting from these policies, right?

Speaker 1 And I think that's what's so great about what the mayor-elect has shown is that he's interested in having a city hall where he's not just thinking about the people who can buy lobbyists or put up, buy newspaper ads, but he is thinking about the teacher and the bus driver and the security guard.

Speaker 1 And I think that's also what upsets people who've had privileged access for so long.

Speaker 1 Being told, yes, of course I'll sit down and listen to you, but it's not going to come at the expense of all these other people I serve.

Speaker 5 And what they do is there's an implied threat in that privileged access, which is if you remove our privileged access, the whole system collapses. And that gets to the second part of this.

Speaker 5 So the first part is what are smart interventions the government can make in markets that don't function appropriately or where public options should exist for things that are, you know, more essential.

Speaker 5 The second part of the equation is trust and order.

Speaker 5 And

Speaker 5 if the people don't trust that government intervention will be done competently, then they lose the ability to trust that they will be an effective bulwark against that corporate power.

Speaker 5 They'd rather throw their lot in.

Speaker 5 Because that's the thing that always surprises me when people say, I don't want the government involved in that. And you think, because the private insurance market is working so well for you.

Speaker 5 So how does the government then on the flip side,

Speaker 5 earn that trust? How do they do it so when they do a rural broadband option, they don't spend billions of dollars and get no rural broadband? Because that's been a huge issue.

Speaker 1 Look, we absolutely need to make sure government is being effective and efficient. What I saw in my time in government is that, yes, there was a bunch of red tape and unnecessary bureaucracy.

Speaker 1 It had been put there by people who wanted to handicap government, which oftentimes lines up with the interests of big business and corporate interests. I mean, just to give you a concrete example,

Speaker 1 the FTC is able to do consumer protection rules, which basically means instead of just suing companies, we can issue a rule that says fake reviews are illegal, or it's illegal to make people jump through all these hoops just to cancel a subscription.

Speaker 1 And when I got to the FTC, I said, look, there's this competition, this consumer protection rulemaking authority. Let's use it.
And people said, well, there are so many procedures.

Speaker 1 It takes five to 10 years just to finalize one rule. And so we looked at what were those procedures, and a lot of them had been put in place gratuitously.

Speaker 1 There was no requirement in the law that Congress passed to said the FTC needs to do all these things.

Speaker 1 But one of the legacies of the Reagan administration had been that they had tied up the agency and all sorts of red tape, all sorts of bureaucracy.

Speaker 1 Similarly, we see sometimes when government is thinking about how do we design policy, it's actually big business interests, corporate lobbyists that want it to be more complex, that want it to be more bureaucratic, because they're the ones that will be best positioned to navigate that bureaucracy and all of those complications.

Speaker 1 And it's actually small business that oftentimes wants just something that's simple, that's clear, they know how to follow it.

Speaker 1 And so I think we need to look back behind the curtain and figure out who are the ones that are actually pushing for government to be more handicapped and more mired in this red tape.

Speaker 5 Right. Hey, listen, the tax code isn't complicated because poor people made it that way.
It's complicated because they kept trying to dig out all kinds of, you know, ways to get around it.

Speaker 1 They want loopholes.

Speaker 5 They want loopholes and they want those.

Speaker 5 I think that point you just made about they're the ones that are best set up for the complexities is a great one because government really is at a disadvantage.

Speaker 5 We were over at the SEC and they're like, we don't have coffee, you know, and the amount of money

Speaker 5 corporate money

Speaker 5 and the recent Supreme Court decisions that have allowed more and more of a a flood of it have really put government, I think, and the American people on the back foot.

Speaker 5 We've seen corporate power increase exponentially comparatively to the power that people have. And you see the Supreme Court now

Speaker 5 neutering the government's ability to even regulate certain industries. Will it be possible? to do the kinds of simplifications you're talking about and be competent.

Speaker 5 And now we'll talk about it specifically in New York City.

Speaker 5 I think the federal government is sort of a different agency, but will Mamdani, is it reasonable to expect that some of those things that you think will make those interventions more efficient or make markets work better, will they able to withstand the money that's going to come at them?

Speaker 1 Yeah, it's a great question. I mean, look, the mayor-elect has talked about how he wants a government that is efficient and effective.

Speaker 1 And so is interested in figuring out where is there excessive red tape or bureaucracy that is hampering that.

Speaker 1 You know, it'll be interesting to see if do we see lawsuits in response to trying to make government more effective?

Speaker 1 I don't know, but it's absolutely true that the new administration will need to be absolutely ready for the type of opposition and kind of floodgates that will open by those interests that are unhappy with how he's trying to level the playing field.

Speaker 5 What do you think is going to be the biggest challenge as you're watching him put that together?

Speaker 5 Are there times do you say to him, look, we're all, you you know in the afterglow of the election but you know as what happened with john lindsay i don't know if you're familiar with lindsay in in the 70s in new york 60s and early 70s but he was again the people's mayor he was actually the last mayor to kind of walk the whole city the way that uh zoramandani did in in his election but couldn't get the trash picked up you know all cities are are want to be functional but boy if you can't make new york city function you lose the ability to do anything anything else that you want to do almost immediately.

Speaker 5 Has that, has the gravity of that,

Speaker 5 you know, sunk in on everybody on that campaign?

Speaker 1 Yes, absolutely. I mean, what you saw during the campaign, candidly, was an operation that was very effective and very disciplined, right?

Speaker 1 I mean, you don't go from being less than 1% name recognition to winning the race for New York City mayor by not being disciplined and focused.

Speaker 1 And that same level of excellence is what he expects from his administration.

Speaker 1 I think he's fully clear-eyed about the realities of there being no room for error on certain types of basic services that New Yorkers expect, wanting to make sure that the trains are going to be running smoothly on that front.

Speaker 1 And then making sure that for the big bold initiatives that he campaigned on, that he's seriously thinking about how to implement those so that those are actually a reality for people.

Speaker 5 Right. And are there people that you see with like real brass tax, just general maintenance experience in government being brought in now to lend that expertise?

Speaker 1 Yeah, I mean, I think you'll see, you know, for example, with his pick for first deputy mayor, somebody who's been in city government for decades, brings a wealth of experience, understands the intricacies of how New York City budgeting works.

Speaker 1 And so I think they're absolutely focused on wanting to bring the best talent, the best experience to bear, understanding that this is also a mayor that has a vision, that has a particular way that he wants to deliver, that he wants to turn the page in a prior era.

Speaker 1 And so you need that combination of experience, but also people willing to use that experience to pursue his agenda.

Speaker 5 Now, for you,

Speaker 5 do you plan on staying on in some capacity, or is this kind of a transition for you as well? Do you kind of lend your expertise?

Speaker 5 to helping him look at those incentives and how he can maybe liaison with, the corporate Titans that are in New York? Or do you think that there's a place there that you can serve?

Speaker 1 Look, I want to do whatever I can to help him be helpful. I am very focused on the transition, though, and just making sure that we're getting the right people in place.

Speaker 5 Look at you with that nice political

Speaker 5 game down.

Speaker 1 I guess I did spend a few years in DC. Yeah.

Speaker 1 But look,

Speaker 1 he gets sworn in on January 1st. The transition period is even shorter than what it is is for a president.
And so

Speaker 1 it's a sprint right now to make sure they're as prepared as possible on day one to get stuff done.

Speaker 1 And I'm really interested and committed to him being as successful as he can.

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Speaker 5 Are you still in contact with your friends down in Washington, D.C. and

Speaker 5 what life is like down there after now that the shutdown looks like it's about to be ending?

Speaker 1 Yeah, I mean, look, it's been a brutal.

Speaker 5 Wait, wait, wait. I was going to, for those of you at home, Lena Kahn just gave a heavy, heavy sigh.
That was a heavy sigh.

Speaker 1 Look, I think

Speaker 1 it's no secret that the big tent of the Democratic Party has, in one unified way, I think, been pretty disappointed by what we saw over the last week and still kind of digesting with the ramifications of that.

Speaker 1 So,

Speaker 1 yeah, no, I'm, you know, still in touch with various members of Congress and kind of folks on the ground trying to get stuff done.

Speaker 5 And feeling their rage. What obstacles do Democrats put in their way in terms of earning the trust from government and implementing?

Speaker 5 You talked about, you know, corporate interest, definitely tries to make things more complex. Do Democrats get in their own way by

Speaker 5 housing would be a good example. If you want to solve one issue, you have to at the same time solve all the issues.

Speaker 5 So if we want to build affordable housing, but then that housing also has to be solving global warming and it has to also be solving minority hiring and it also has to be solving our immigration issue and it also has to solve.

Speaker 5 So do we compound the difficulty of clean, efficient, competent government with

Speaker 5 if it doesn't solve all the problems at the same time, we can't do it or let's slow it down?

Speaker 1 Yeah, I mean, look, you have to design policy in a way that ultimately gets the job done. But I also think that,

Speaker 1 you know,

Speaker 1 making sure that workers are getting paid a fair wage. You could say, okay, well, that's adding something on top.

Speaker 1 But no, I mean, I think there are going to be certain core values where, yes, we want something to be built, but we're not going to say, get it built so cheaply that we're not paying people a fair wage.

Speaker 1 Right. And so I think you have to figure out kind of what are the core rules and lines that we want in place that are going to be the terms on which certain stuff is going to be built.
Absolutely.

Speaker 1 We don't want it to kind of take forever and never actually get built.

Speaker 5 Have we overdrawn those lines?

Speaker 1 I think you have to look on a case-by-case basis.

Speaker 1 I mean, I do think some of the Biden administration's initiatives have led to record levels of construction, have led to record levels of investment in ways that we weren't seeing.

Speaker 1 And I think some of those kind of complaints about, oh, that there are too many Christmas ornaments on this. It's never going to get off the ground haven't actually come to pass.

Speaker 5 Although they did, you know, you talk about the EV stations.

Speaker 5 You know, they had a a big billion dollar bill out they didn't get any real progress on the ev stations you know rural broadband i i do think it's a significant and valid criticism that two of them and and this is again this is this is the side that i want to win but the two are uh overcomplicated you know bureaucratically and uh in terms of overregulated so that things don't get off the ground and two

Speaker 5 they try to strike a a balance between market solutions by just subsidizing middlemen.

Speaker 5 Those two areas feel like where democratic solutions fall down a rabbit hole and they hurt themselves by not being efficient and competent enough.

Speaker 1 Yeah, I mean, I think sometimes there can be a tendency to want to over-optimize for efficiency at every single step in a way that actually creates more red tape.

Speaker 1 I think there can be a bias towards complexity when when designing regulation and policies in ways that is what is gumming that up and actually being more comfortable with saying, okay, we're not going to means test everything.

Speaker 1 You know, that's going to mean that there's easier access, but there's not going to be like hyper-efficient suboptimal allocation of who's getting what.

Speaker 1 I think those are the types of trade-offs that too often, yes, have kind of weighed more on the side of overcomplicating things. And I think that needs

Speaker 1 that needs more focus.

Speaker 5 What would you redesign?

Speaker 5 If you were in charge charge of coming up with these solutions would the aca be something that you

Speaker 1 you know advocate for or in a perfect world is public is really public options in those areas the way for government to prove itself along those lines well the aca was a big step forward at the time when it was passed and absolutely more people are insured more people are not getting denied for unfair reasons But I think, you know, it would strain credulity to look at our healthcare system and say, hey, everything's working great.

Speaker 1 And, you know, people are going, going, people sometimes don't go to the doctor because they worry about getting bankrupt, right? The wealthiest country on earth. I mean, that's absurd.

Speaker 5 They say 40% of people with insurance go without other things because of, I mean, the cost now,

Speaker 5 even just for insurance, I mean, I feel like this is going to reach a kind of inflection point where real fundamental change is going to have to take place.

Speaker 1 Yeah, absolutely.

Speaker 1 And I think that's going to require a fresh look of kind of how do we actually design a healthcare system where people are not worrying about going bankrupt or not skipping, you know, essential medicines or doctor's visits.

Speaker 5 Is that something you're in? Because I feel like you're

Speaker 5 particularly well suited for these types of dynamics and incentives. You seem to understand them better than, you know, almost anybody.
Is that the kind of a system that you would want to wade into?

Speaker 5 Is that something that interests you?

Speaker 1 I am generally really interested in the healthcare system. I think, you know, at the FTC, we saw all sorts of middlemen, be it these pharmacy benefit managers, these GPOs.

Speaker 1 There's just a lot of bloat across the healthcare system and kind of a lot of rents being taken and profit by all these middlemen in ways that I think we really need to take a fresh look and figure out how do we make this simpler?

Speaker 1 How do we make it less expensive? Because the current system is just not sustainable.

Speaker 5 Are you more worried about cost or innovation?

Speaker 1 In healthcare? Yeah.

Speaker 5 or in general pharmaceutical health care and in all of these things because isn't that isn't the balance that they always strike is that uh the government will stifle innovation by requiring companies to pay their fair share of taxes or enforce uh monopoly laws or any of those things they always suggest that we will all lose

Speaker 1 I mean, it is interesting because sometimes those claims are coming from companies that have spent more on stock buybacks than actually on their R ⁇ D line for the last few years.

Speaker 1 And so it's important to figure out what's really...

Speaker 5 Are you saying they might not be telling the truth?

Speaker 1 Look, we have to take seriously, you know, what are the best conditions for innovation?

Speaker 1 But historically, we have seen that if what you're interested in is kind of incremental improvements, yes, sometimes big companies are better positioned to do that.

Speaker 1 But historically, the breakthrough innovations have come from the disruptive outsiders.

Speaker 1 And so you actually need to have a market where the disruptive outsider can come in and it's not up to the existing giant to say, oh, my bottom line is threatened by this newcomer and I need to block them out.

Speaker 1 And so that's why I do think that, you know, having markets where newcomers, where small businesses, where entrepreneurs can actually enter and shake things up is so important.

Speaker 5 I want to emphasize that. point because I think that that was the most effective answer to

Speaker 5 innovation fetishes and lack of government that I've heard because it is, you'll hear that from, you know, Elon Musk.

Speaker 5 I have to get my, if you don't allow my trillion-dollar pay package, you're not going to get new people that want to build electric cars. Apparently,

Speaker 5 it's more important to protect somebody's

Speaker 5 last hundred billion dollars than to protect people's first $5,000,

Speaker 5 or we won't get the great ideas. But I think what you just said is the metrics don't bear that out.

Speaker 1 That's right. I mean, you know, historically, that's where the innovation has come from.
I mean, we saw this in the pharmaceutical industry.

Speaker 1 You know, one of the mergers that we reviewed was Santa Fe, an existing big pharma company, had a monopoly for this drug that

Speaker 1 is used by patients who have Pompeii disease.

Speaker 1 This is this really awful disease where basically your muscles degenerate and people have to kind of get, you know, regular infusions to make sure that the disease is not progressing too much.

Speaker 1 There was a new company, a fresh upstart called Maze, that came up with a drug that people could actually take orally,

Speaker 1 that they wouldn't have to go kind of get, you know, hooked up bi-weekly. And Santa Fe was trying to buy maze.

Speaker 1 And we looked at that and we said, okay, well, Santa Fe is already doing very well with their monopoly in this area.

Speaker 1 We're worried that they're trying to buy up this upstart because they don't want that threat by this new better pill that's going to be a huge benefit for these for these companies so we blocked that merger we kind of heard a lot of the same claims oh you're harming innovation what what incentive are startups gonna have to invest if they're or innovate if they're not actually able to be bought up by the big guys and a few months later maze partnered up with some other firm and it was fine because that firm didn't have a distorted interest where they would try to block this new pill from getting onto the market right and that oftentimes when they're doing this, it's about gatekeeping and who's going to be the gatekeeper.

Speaker 5 You know,

Speaker 5 CBS,

Speaker 5 Comedy Central, all that, we just got bought by Skydance, right?

Speaker 5 And they obviously have a relationship with the

Speaker 5 Trump-led

Speaker 5 people that are going to say whether or not that merger is okay. Well, now they also want to buy Warner Brothers.

Speaker 5 And the rumblings are nobody else better bid on it because nobody else is going to get the approval of the Trump administration. And so now you've got a government working in hand

Speaker 5 to monopolize.

Speaker 5 And I'd say they're doing the same with tech, with AI.

Speaker 5 The AI guys all radicalized and jumped on board now with the Trump administration because they felt like they're not going to bother with how we want to monopolize our product.

Speaker 5 And what is the danger of all that as we go through it?

Speaker 1 I mean, there's an extraordinary danger in basically allowing, you know, five to seven CEOs determine the future trajectory of these markets. And that's absolutely true.

Speaker 1 I mean, the Trump administration has basically granted amnesty for AI companies,

Speaker 1 you know, saying, look, you know, these are the American innovators. We just are going to have no rules.

Speaker 5 I think it was explicit. I think it was literally explicit in one of the bills, 10-year amnesty on that, that you couldn't regulate it.

Speaker 1 Yeah. I mean, there was an effort to basically say states couldn't regulate.
And that actually

Speaker 1 the remaining populists in the party kind of put a fight and that kind of came out.

Speaker 1 But they did put out an executive order that basically said, you know, we want zero rules effectively for AI where possible.

Speaker 1 And I mean, you know, there's going to be big harm when we think about the competition implications, but these tools are already being misused.

Speaker 1 I mean, at the FTC, we were already seeing a surge in complaints for voice cloning fraud when somebody is kind of, you know, using these tools to pretend to be somebody's grandkid and say, I'm in distress, can you wire over thousands of dollars?

Speaker 1 And so there's going to be just bread and butter fraud that these tools are enabling that, unless you have cops on the beat, people are going to lose a lot of money.

Speaker 5 And I think even, you know,

Speaker 5 on a deeper level, what the algorithm is going to do to our social construct and do to our brains. And you see, the European Union is ahead of the game and they're seen as, you know,

Speaker 5 it's almost as though free speech is being used as a shield against corporate responsibility, whereas it was really more intended for individuals and people to have the ability to speak out against their governments.

Speaker 5 It's now being used as a shield so that great harms can be brought. I mean, if I could pull a switch and social media never happened, I'd do it.
I think it's been a terrible corrosive harm.

Speaker 5 to society in general for as many, you know, different rare butterfly interest groups have been able to find each other.

Speaker 5 AI is going to supercharge that harm.

Speaker 1 Yeah, I mean, AI is turbocharging all sorts of corporate law breaking. I mean, we've seen this with algorithmic price fixing.

Speaker 1 So back in the day, if you wanted to fix the prices with your rivals, you'd all have to kind of get in a room together quietly and figure out what's the price.

Speaker 1 The new way of doing this is to say, I'm just going to hand over my prices to this algorithm and all my competitors are going to do the same.

Speaker 1 And we'll just let the algorithm decide what our prices are. And it's like algorithmic price fixing is still price fixing.
It's still illegal.

Speaker 5 I didn't do it. It was Siri.
Siri fixed the prices. I had nothing to do with this.
I think also they don't realize that algorithms are designed by the companies.

Speaker 5 So you are getting something that is not neutral. It is designed with certain outcomes.
It's designed for engagement.

Speaker 5 It's designed for all those different things that keep their products at the forefront.

Speaker 5 Is there any way that government will have the ability to stay in front of that or even has the desire to?

Speaker 1 I mean, at the very least, making sure that these algorithms and these new tools are not being used to evade existing laws that we have in place, be it on fraud, be it on price fixing, being on discrimination is important.

Speaker 1 But this is also the question of technological capability, right?

Speaker 1 At the FTC, we hired over a dozen technologists, brought people in-house to make sure we had people on our team with the sophistication and the knowledge to figure out what's going on.

Speaker 1 You know, with the with the huge decimation of agencies and kind of talent fleeing these agencies, it's going to be really difficult to, even if this administration wanted to, which they've made very clear they don't.

Speaker 1 are they going to even have the capability and expertise to figure out what's going on?

Speaker 5 Right. Yeah, boy, that's going to be a big one.
And it's also, you know, you are actually somewhat surprisingly popular with the populace on the right as well.

Speaker 5 Do they still kind of keep in touch? Do you get the occasional email from the JD Vance going like, hey, what's going on there? You know, are you still,

Speaker 5 you know, in vogue in terms of the populist right?

Speaker 1 I don't know. I mean, you have to ask them.

Speaker 5 They don't call? Josh Hawley doesn't just ring you up?

Speaker 5 I think it's a tough time to be a real populist in the republican party because everything they've done since they got power has been so pro-oligarchy that you know what at some point you have to reckon with that i've always thought that you know when they kept saying you know we're the new populist right and you're like have you told your judges because everything they do is strip worker protection strip any kind of uh protections from product like all they've done is make it harder for unions and for workers and for labor and and maybe what we're talking about is kind of that larger situation.

Speaker 5 And I know you're busy and I'll let you run. But the final thing is

Speaker 5 all this is really about rebalancing an economy that has for 50 years overly favored capital and corporate interests and crony capital. And this is just about

Speaker 5 not forcing labor to have to rebalance this by itself.

Speaker 5 The ask for labor is always, oh, if you want a better deal, you're going to have to organize. We're going to make it hard for you to organize.

Speaker 5 We're going to make it so that certain states never organize. We're going to be able to threaten you with capital loss and fleeing of areas if you try and organize.

Speaker 5 And we're going to give you no recourse. And so labor is always, they start out every basketball game in a three-foot hole.

Speaker 5 And is this really about trying to recalibrate the balance between labor and capital in America?

Speaker 1 Yes. I mean, it's, you know, we've all seen those graphs where kind of GDP has gone up and labor's share of it has, you know, gone down.
And that's a problem, right?

Speaker 1 How do we make sure we have an economy where people can, the people doing the work,

Speaker 1 the people kind of putting in the, you know, the day-to-day blood, sweat, and tears, are not having to worry about how am I going to pay rent? How am I going to put food on the table?

Speaker 1 Am I having to work two jobs, three jobs? How is this all going to work?

Speaker 1 I mean, I think just that sense of day-to-day precarity that so many people face is just, it should be intolerable in this country. And that's ultimately what, you know, the mayor-elect is about.

Speaker 1 And I think, and hope that a Democratic Party that is more interested in real economic populism would really pick up on trying to fix.

Speaker 5 Absolutely. And I think actually,

Speaker 5 as angry as I am about the shutdown and the way that they caved, I did think it was important in that it brought into stark view the precarity that you mentioned that people are facing.

Speaker 5 That for just a small moment, the smokescreen of all of Trump's lies and distractions

Speaker 5 faded out of the scene, and people really saw how tenuous life is in this country for so many millions of people.

Speaker 5 And maybe that image sticks in the brain enough that, you know, it causes the types of change that you're talking about and hope to bring in with the mayor.

Speaker 1 Yeah, I mean, I think if you have a country where some people are thinking about, when am I going to buy my third yacht?

Speaker 1 And other people are thinking about how am I going to make rent this month, you know, that type of grotesque inequality is just not sustainable.

Speaker 5 So you're saying like on the same weekend, you're cutting food stamp benefits for Americans, you shouldn't throw a Great Gatsby theme party.

Speaker 5 Is that if we wanted to, this is just obviously hypothetical, but if we wanted to deliver it.

Speaker 1 I mean, I know we have the White House is much more gilded now, so uh,

Speaker 5 it really does look like. Look, I played Caesar's Palace in the late 80s, it's got nothing on the White House now for sure.

Speaker 5 Um, Lena Khan, thank you so much for spending time with us. Uh, good luck with everything that that's going on.
I know you got your hands full down there, and uh, uh, really wishing the best for you.

Speaker 1 Thank you so much for having me.

Speaker 5 I wonder,

Speaker 5 first of all, Lena Khan is so smart, Love her. She strikes me as

Speaker 5 a kind of economic climatologist

Speaker 5 where she's looking at the various incentives and the corporate interest. A corporate front is coming through and a government cold front has to come in and cause.

Speaker 5 But if we spread it out, we'll get more rain or whatever it is that is going on.

Speaker 5 But I do wonder in the mayoral transitional campaign, because they only have, what is it, six weeks, eight weeks before they take over?

Speaker 8 Super short. Yeah, like eight weeks.

Speaker 5 I wonder how much of it is

Speaker 5 these are the levers of power that you can use on housing policy and how much it is. How many garbage trucks do we have?

Speaker 5 Do we need more garbage trucks? Like, how much, I wonder what the balance is.

Speaker 6 You can never have too many. That's what I'll tell you looking out at my street right now.

Speaker 5 Jillian Spear from Air saying

Speaker 5 her campaign, you can never have too many garbage trucks.

Speaker 8 You know, I really loved what she was saying about about when she got to the FTC and saw that so many of the procedures were not codified into law and they were actually put in by industry and really slowed down the process.

Speaker 8 And I was really excited just to

Speaker 8 maybe there will be something on the New York city level, the equivalent where she can say, you know, the processes here are really bogged down in, you know, unnecessary steps.

Speaker 8 And maybe we can streamline here. And I'm just really excited for her experience in the city.

Speaker 6 She said that. She was like, just because a tool hasn't been used in decades doesn't mean we shouldn't be using it.
And it felt very Trumpian, but in a good way.

Speaker 5 I don't think she would expect that compliment.

Speaker 5 That felt very Trumpian. I still always

Speaker 5 worry a little bit about that

Speaker 5 problem of incentives and things like that and how you fix that. And I thought it was interesting, you know, the threat.
It's always the threat.

Speaker 5 Whenever there's this idea that, you know, you can look at how power and money have been transferred from the 50% up to the, you know, the highest.

Speaker 5 And anytime you threaten to say, like, we should rebalance that, they're like, oh, then we'll just fucking leave.

Speaker 5 We'll fucking leave.

Speaker 7 Yeah.

Speaker 5 And, and that's where I'll give, again, like the Democrats can take a little bit of lesson from Trump, which is know your leverage.

Speaker 5 And if you know your leverage, maybe you can apply it in a way that ameliorates those kinds of threats. Yeah.

Speaker 6 I mean, like, I'd like to see them try. Honestly, like, I don't see it happening.
Like, New York City isn't cool because you're here.

Speaker 1 You're here because it's cool.

Speaker 6 So, like, I'd like to see you try.

Speaker 5 We all

Speaker 5 again.

Speaker 5 Jillian Spear for mayor.

Speaker 8 I think we got a good one.

Speaker 5 I'm going to hope that he can have it for now.

Speaker 5 I'm excited to see

Speaker 5 where this thing's going to be going.

Speaker 5 Oh, and by the way, congratulations.

Speaker 5 I saw the picture. They sent me a picture from the Signal Awards

Speaker 5 for you guys.

Speaker 5 Was that last night or the night before? I can't remember which one it was. It was Monday night.
Monday night. Yeah.

Speaker 5 But the little trophy is like golden earphones or something.

Speaker 8 Yes, very podcasty.

Speaker 9 Yeah, little headphones. They're so cute.

Speaker 1 Trumpified headphones.

Speaker 5 It looked really beautiful.

Speaker 5 What do we got from the listeners there, Brittany? Alrighty.

Speaker 9 If Trump were to be in the Epstein Files end, that's a very big if.

Speaker 5 I'm sorry, if,

Speaker 5 did they not look at the emails today? When did they ask this question? If

Speaker 5 he said he was going to sue, that's when you know when Trump comes out, he's like, I'm going to sue Rupert Murdoch for insinuating that it's, when was the last time you heard about that lawsuit?

Speaker 5 It's gone. It's gone.
Because he's in it.

Speaker 8 Yes.

Speaker 9 Do you think he would lose any support?

Speaker 5 No.

Speaker 8 Really? It's really hard to imagine.

Speaker 5 Do you guys, Jillian, you think he might?

Speaker 6 Yeah, I feel like if there was like, like, we already have hit the threshold where it should be disqualifying with so many things with him. It's like, I just, what else would you need to see?

Speaker 6 Like, this guy was like one of his best friends. Like, they,

Speaker 6 there's, there's photos of them together. There's videos of them together ogling at young women.
Like, we've seen what we need to see. So, I don't know what else could possibly

Speaker 6 push the needle here.

Speaker 5 I have seen more pictures of them together than with like some of my best friends. Like, they have more of a scrapbook with each other than many of uh

Speaker 9 the people that i'm great friends with so sweet but here's the thing how do the republicans spin this

Speaker 9 like how does he get

Speaker 5 how he does the way he gets at it like i've always said it's wiley coyote versus the roadrunner uh and every time we keep thinking 34 felonies that'll get him oh my god that thing he said on access hollywood and every time trump just comes in it goes meep meep

Speaker 5 and flies away and I think it's the same thing. You could have, it could be the pictures of him and

Speaker 5 illegal, sex-trafficked women from Epstein in a like forced human caterpillar

Speaker 5 or a boros, and they'd find a way to say, well, but Hunter Biden's laptop was, you know, worse and burisma and it's fake and none of it ever happened. Jillian's exactly right.

Speaker 5 Everything we need to know about it is is that it is plausible because of the relationship that they had.

Speaker 5 That wasn't his like softball buddy. Right.

Speaker 5 That was his

Speaker 5 international model buddy.

Speaker 5 That's what they did together. They weren't bingo friends.
They weren't backgammon friends. They didn't play pickleball.

Speaker 5 They played tickleball.

Speaker 5 Oh, no.

Speaker 5 Yeah, I shouldn't have.

Speaker 5 It just came to me as I was talking. As I was talking about it, it really did.

Speaker 9 How beautiful.

Speaker 8 I've thought about this thought experiment in the past, especially after Access Hollywood. Like, okay, let's think.
What could actually, and even then, I came up with nothing. So,

Speaker 5 no, that, and even that, his own family. Oh, boys, you boys.

Speaker 8 Boys will be boys.

Speaker 6 Locker room.

Speaker 5 Even when the level of boys will be boys rises to the level of felony convictions.

Speaker 5 Nobody seems to bat an eye.

Speaker 5 It's,

Speaker 5 I've never seen anything like it, but I'm telling you, that's what their relationship was steeped in. It was not a shared love of Dungeons and Dragons.
It wasn't a book club.

Speaker 5 So, yeah.

Speaker 5 All righty.

Speaker 9 We've got another one.

Speaker 5 All right. Go ahead.
Let's hear it.

Speaker 9 John, would you have Marjorie Taylor Greene on the podcast?

Speaker 5 Yeah, I have any of these people on the podcast. I want to find out if the space lasers aren't Jewish, what are they?

Speaker 5 Are they Lutheran?

Speaker 5 Are they Presbyterian?

Speaker 8 Yeah. They almost got to that on the view.
They asked about the Jewish space lasers, and I was like, oh, here it is. And then Whoopi goes, we got to go to break.

Speaker 9 I was like, no,

Speaker 5 yeah, there was one moment in that conversation where they're like, I mean, like the, you know, they kept saying the, the Russia hoax.

Speaker 5 And she's like, that's not a, or she said something like the Russian hoax. And then she was like, well, all the hoaxes, you know, the 2020 election being stolen.

Speaker 5 And they were just like, yeah, but let me ask you that, you know, they, they sort of glossed over it. But she's, she's undergoing a rebrand.

Speaker 9 Yes.

Speaker 6 And she's running for president.

Speaker 5 I was going to say, it's, it's very clearly intentional. It's actually a lot more disciplined than I thought it would.
So give her credit for that. She's become much more adept at

Speaker 5 hiding her.

Speaker 5 You know, it's like if you're watching

Speaker 5 Marjorie Taylor Greene and Nancy Mace were in a race for like

Speaker 5 lunatic of the century. And then all of a sudden, the velocity on Marjorie Taylor Greene started being like, you know, I don't know if this is going to work out if I want to be in the Senate.

Speaker 5 And Nancy Mace is like, see on the moon.

Speaker 5 And so she's, she's now leading, but it's been an interesting transformation for sure.

Speaker 8 Yeah.

Speaker 9 Next week on.

Speaker 8 Next week on.

Speaker 6 BYO Space Laser.

Speaker 5 How can they keep in touch with us with these? Twitter. I enjoy their questions.

Speaker 8 Good. Yeah.

Speaker 5 I'm happy to hear.

Speaker 8 There's more.

Speaker 9 There's a lot more.

Speaker 9 Twitter, we are a weekly show pod. Instagram, threads, TikTok, Blue Sky, We Are Weekly Show Podcast.
And you can like, subscribe, and comment on our YouTube channel, The Weekly Show with Jon Stewart.

Speaker 5 Well, fantastic. And guys, congratulations again.

Speaker 8 Congratulations to you.

Speaker 5 Well,

Speaker 5 as you guys know, I read phonetically from the screen, whatever you're tapping to me on the chat. And you guys are the one who prepare these things with

Speaker 5 the most

Speaker 5 intellectual of care and the greatest of detail. And I thank you all very much.

Speaker 5 Lead producer, Lauren Walker, producer Brittany Mimedovic, producer Jillian Spear, video editor and engineer Rob Vitola, audio editor and engineer Nicole Boyce.

Speaker 5 And our executive producers Chris McShane and Katie Gray. We'll see you guys next week.

Speaker 5 The weekly show with Jon Stewart is a comedy central podcast. It's produced by Paramount Audio and Bus Boy Productions.

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