--:-- [Theme music fades out]
--:-- John Bickley: Welcome to Morning Wire. I'm John Bickley, Editor-in-Chief of the Daily Wire, and I'm here with Georgia Howe.
--:-- Georgia Howe: Thanks for waking up with us, folks.
--:-- John Bickley: Today, we've got a lot to cover. Elon Musk is pulling out of his $44 billion deal to buy Twitter, President Biden has issued an executive order on abortion, and the latest jobs numbers are out. Let's start with Twitter. Elon Musk says he's terminating the deal, but Twitter's board is fighting back.
--:-- [Sound effects: News theme music plays in the background]
--:-- Georgia Howe: That's right, John. So, let's get the latest on this story. We're joined by Daily Wire senior editor, Cabot Phillips.
--:-- Cabot Phillips: Thanks for having me on the show.
--:-- John Bickley: So, Cabot, let's start with a quick refresher on the deal. What happened, and why is Musk pulling out?
--:-- Cabot Phillips: Well, John, it all started back in April when Elon Musk confirmed that he'd be paying $44 billion to take over Twitter and make it the true home of free speech. But pretty quickly after that, things started to go downhill. Musk began publicly questioning the legitimacy of claims being made by Twitter leadership, and things came to a head on Friday when Musk announced the deal was off because Twitter has not complied with its contractual obligations.
--:-- Georgia Howe: That's right. Musk says Twitter has failed to provide him insight into the inner workings of the business, and he says he won't hand over $44 billion without some more assurances of the company's legitimacy.
--:-- Cabot Phillips: Exactly. The main issue of contention appears to be just how many bot accounts are on the platform. Twitter has publicly claimed that only 5% of their users are fake, but Musk has expressed doubt over those claims because the data they used to come up with the 5% number is private to Twitter.
--:-- John Bickley: That's a big concern, Cabot. What specifically are the concerns Musk has raised?
--:-- Cabot Phillips: Yeah, the main issue of contention appears to be just how many bot accounts are on the platform. Twitter has publicly claimed that only 5% of their users are fake, but Musk has expressed doubt over those claims because the data they used to come up with the 5% number is private to Twitter. Musk says that they're probably lying about the real number, which he thinks could be as high as 25%, and says he won't move forward until there's clear proof to the contrary.
--:-- Georgia Howe: That and a few other things Musk is also accusing Twitter of breaching their merger agreement by providing false claims about the platform to the public. He even went as far as accusing Twitter of falsifying public disclosures, which obviously would be illegal.
--:-- Cabot Phillips: That's right. He also said the company fired a number of high-ranking executives without his permission and made fundamental changes to the platform after the deal had been agreed upon. That's important because he says that would be a breach of contract.
--:-- John Bickley: That's a pretty serious accusation, Cabot. How is Twitter responding to all this?
--:-- Cabot Phillips: They're standing firm right now. They've made it clear they plan on forcing Musk to go through with the deal. They're essentially saying that he may not love what he's seeing, but that he signed on the dotted line. And if he backs out, it'll be a breach of contract in his own right.
--:-- Georgia Howe: To that point, the company says it's planning legal action against him and will file a lawsuit to try and force the deal through in court. And Musk is on the line for a billion dollars, correct?
--:-- Cabot Phillips: Right. Yeah. If he pulls out, there's a billion-dollar termination fee. So what do we expect to see in this legal battle?
--:-- John Bickley: It's going to be massive. There's no question about it. Now, typically in cases like this, you can sort of predict how the court will rule based on similar cases in the past, but that's not really possible here because there simply is no precedent for this happening with a deal this large, especially not with this type of contract.
--:-- Georgia Howe: Musk is expected to claim the company lied to him about what they were offering, which we talked about before, and there's also a good chance he'll point to the company's declining stock price as further reason for backing out.
--:-- Cabot Phillips: Keep in mind, when the deal was first announced, Twitter's stock soared to $51.70 a share, but since then, it's fallen to $36.81.
--:-- John Bickley: Does that strategy appear likely to work?
--:-- Cabot Phillips: So again, we don't really know right now because we haven't seen anything on the scale, but there are a good number of legal experts who say that Musk is going to be fighting an uphill battle, mainly because there have been so few instances of buyers being able to successfully back out at this point in a deal.
--:-- Georgia Howe: For example, Professor Zohar Goshen at Columbia Law School told the Wall Street Journal that typically for a buyer to pull out in a deal like this, the business would have had to have lost at least half its value, which is not the case here.
--:-- Cabot Phillips: Others have also pointed out that Musk's argument about Twitter not providing him enough information to answer his questions on bots may not hold up in court because the contract technically only requires Twitter to provide whatever information is reasonably required, which is obviously subjective.
--:-- John Bickley: Even if Musk does succeed in pulling out of the deal, there's still a good chance he'll have to pay that $1 billion termination fee we mentioned earlier.
--:-- Georgia Howe: So buckle up. We are in for a long, intense legal battle. It's a lot of money on the line here in the future of one of the world's biggest platforms.
--:-- Cabot Phillips: Indeed. Thanks for reporting, John.
--:-- John Bickley: Anytime, Cabot. That was Daily Wire senior editor, Cabot Phillips.
--:-- Georgia Howe: Coming up, President Biden issues an executive order on abortion. You can get this show and all of the content you love wherever you are, all on the Daily Wire app.
--:-- John Bickley: Even if you're not a Daily Wire member, you'll be the first to know what's trending with mobile notifications for the latest news. And you'll get content from all of your favorite Daily Wire shows.
--:-- Georgia Howe: Download the Daily Wire app and keep up with the facts no matter where your day takes you.
--:-- [Sound effects: News theme music plays in the background]
--:-- John Bickley: On Friday, President Biden issued an executive order aimed at providing access to abortion. Here to give us the details on that executive order is Daily Wire culture reporter, Megan Basham.
--:-- Megan Basham: Thanks for having me on the show.
--:-- John Bickley: So, Megan, I know the White House is facing a lot of pressure from Democrats to take action on abortion, but constitutionally, it seems like there's not much he can do. What does this order contain?
--:-- Megan Basham: Well, for the most part, it centers on making sure women who live in states where abortion is limited or banned can travel to states where abortion is legal to get access.
--:-- Georgia Howe: That's right. So, nine states have banned most abortions. That includes Alabama, Arkansas, Mississippi, Missouri, Oklahoma, South Dakota, Texas, West Virginia, and Wisconsin.
--:-- Megan Basham: So, those are the nine. Other states have implemented new restrictions, and around 12 more are also looking at introducing new restrictions that will significantly limit abortion in the near future.
--:-- John Bickley: Okay, so what's the Biden administration doing to help women in these situations?
--:-- Megan Basham: Well, they're promising to ensure the safety of abortion patients and providers through actions like setting up mobile clinics near the borders of states restricting abortion access.
--:-- Georgia Howe: That's right. They're also seeking to convene private pro bono lawyers to offer support to those people who may be crossing state lines to get an abortion.
--:-- Megan Basham: And they're directing Health and Human Services Secretary Javier Becerra to ensure women are able to order those FDA-approved abortion medications.
--:-- John Bickley: Okay, so what about expanding the court? We've heard that option floated before.
--:-- Megan Basham: Yes, we have. And you have to say that those calls are certainly growing. A number of prominent House Democrats, including Alexandria Ocasio-Cortez and Ilhan Omar, they are pushing the White House to make that move.
--:-- Georgia Howe: Cortez said that Democrats at least need to try. And then you have New York City Democrat Mayor Eric Adams saying this recently at a press conference. We need to balance out this court before they do more harm than what they've done thus far.
--:-- Megan Basham: So far, though, the president said that he does not agree with that outlook and he's not going to expand the court.
--:-- John Bickley: All right. Well, we'll see if he sticks with that, Megan. Thanks for reporting.
--:-- Megan Basham: Absolutely. Anytime.
--:-- Georgia Howe: That was Daily Wire culture reporter, Megan Basham.
--:-- John Bickley: According to Department of Labor data released Friday, job growth was strong last month as 372,000 more workers began receiving paychecks. The unemployment rate remained steady at 3.6%.
--:-- Georgia Howe: The jobs numbers for April and May were both revised down in the latest jobs report, but still showed solid growth. Average hourly earnings over the past year have increased, but inflation is wiping out those gains.
--:-- John Bickley: Here to break down the jobs report and what it has to say about the economy is Daily Wire reporter, Tim Pierce.
--:-- Tim Pierce: Thanks for having me on the show.
--:-- Georgia Howe: So, Tim, what does the report tell us about jobs?
--:-- Tim Pierce: So, the June jobs report showed the labor market continuing to recover after tens of millions of Americans were forced out of work over two years ago. The report was actually surprisingly good in that the number of jobs added was over 100,000 more than economists expected, though, as you noted, both April and May saw downward revisions.
--:-- John Bickley: Okay, so what's the good news and the bad news here, Tim?
--:-- Tim Pierce: Well, the good news is that the labor market is continuing to recover, but the bad news is that inflation is still a major concern. The average hourly earnings have jumped up over the past year 5.1 percent, but while that seems like good news for workers, you have to factor in that inflation over the past year has run hot at 8.6 percent.
--:-- Georgia Howe: That means that even though workers on average are seeing larger paychecks, the amount they're able to buy, especially in terms of things like groceries and gas, it's actually quite a bit less than what they could purchase a year ago.
--:-- Tim Pierce: Also, while the economy continues to gain workers, we know from other data released last week that the U.S. still has over 11 million job openings that employers can't seem to find a way to fill.
--:-- John Bickley: For reasons that aren't clear to many economists, there are still millions of people that were pushed out of the labor market at the start of the pandemic that have not yet decided to return.
--:-- Tim Pierce: And so while the labor market continues to recover, many experts are actually asking, why isn't it doing better?
--:-- Georgia Howe: Well, not much, really. Economists are still expecting the U.S. to enter a recession next year at the latest.
--:-- Tim Pierce: That red-hot inflation number we've been over is the biggest problem for the Federal Reserve, and Reserve Chairman Jay Powell has said he wants to bring that under control, even if it means driving the U.S. into a recession.
--:-- Georgia Howe: The Fed is expected to raise interest rates by another 75 basis points at its next meeting at the end of the month, which is a relatively big increase for the past few years, but that won't be nearly enough to bring inflation down.
--:-- Tim Pierce: I spoke with Kenny Polcari, founder of Case Capital Advisors, about this. Here's what he had to say.
--:-- Tim Pierce: They're going to raise by 75 in July. They're going to raise by at least 50 in September. And I would say by another 50 in December to bring us closer to 3.5% to 3.75% by the end of the year.
--:-- John Bickley: That might start to kind of dent it. But look, if we go back to 1970 and 1980, the last time this country was in this type of inflationary environment, Paul Volcker, who was then Fed chair, had a jam rate well up and above the inflation rate in order to arrest it.
--:-- Tim Pierce: My fear is that that could be the position the Fed is going to find itself in this time as well.
--:-- Georgia Howe: Well, that's certainly good information to keep in mind, Tim. Thanks for coming on.
--:-- Tim Pierce: Thanks for having me.
--:-- John Bickley: That was Daily Wire reporter, Tim Pierce.
--:-- Georgia Howe: Other stories we're tracking this week. Amid an economic crisis in Sri Lanka, in which millions of citizens have been unable to buy food, medicine, and fuel for months, thousands of protesters swarmed the president's home this weekend, demanding his resignation.
--:-- John Bickley: The U.S. Army has indefinitely suspended a retired three-star general from a consulting position, pending an investigation into a tweet. The tweet mocked a post by First Lady Jill Biden lamenting the overturning of Roe v. Wade.
--:-- Georgia Howe: In May, Virginia Governor Glenn Youngkin announced that state employees must return to work in person. Since that time, at least 300 state employees have reportedly resigned.
--:-- John Bickley: Just 2% of children under the age of 5 have received a COVID-19 vaccine since the CDC recommended it for children as young as 6 months old.
--:-- Georgia Howe: Thanks for listening to Morning Wire. We created this show to bring more balance to the national conversation. If you love our show and you stand with our mission, please consider subscribing, leaving us a five-star rating, and most importantly, sharing our podcast with a friend.
--:-- John Bickley: That's all the time we've got this morning. Thanks for waking up with us. We'll be back tomorrow with the news you need to know.
--:-- [Theme music plays]
--:-- Georgia Howe: And don't forget to download the Daily Wire app to get all of our content, including this show, wherever you are.
--:-- John Bickley: See you tomorrow.
--:-- [Theme music continues to play as the show ends]
