Amazon's worker problem, Andreessen Horowitz's new website and a prediction about inflation

[Advertisement] Narrator: Nobody knows your customers better than your team, so give them the power to make standout content with Adobe Express. Brand kits make following design rules a breeze, and Adobe quality templates make it easy to create pro-looking flyers, social posts, presentations, and more. You don't have to be a designer to edit campaigns, resize ads, and translate content. Anyone can in a click. And collaboration tools put feedback right where you need it. See how you can turn your team into a content machine with Adobe Express. A quick and easy app to create on-brand content. Learn more at adobe.com/express/business.

[Advertisement] Narrator: Rinse takes your laundry and hand delivers it to your door. Expertly cleaned and folded. So you could take the time once spent folding and sorting and waiting to finally pursue a whole new version of you. Like Tea Time You. Mmm. Or this Tea Time You. Or even this Tea Time You. Said you hear about Dave? Or even tea time, tea time, tea time you. So update on Dave. It's up to you. We'll take the laundry. Rinse. It's time to be great.

Kara Swisher: Hi, everyone. This is Pivot from the Vox Media Podcast Network. I'm Kara Swisher.

Scott Galloway: And I'm Scott Galloway. How you doing, Scott?

Kara Swisher: This is a busy day. It's move day for Kara Swisher.

Scott Galloway: It's move day. Where are you moving?

Kara Swisher: I'm getting, we're buying a new house, but it's very complicated.

Scott Galloway: Low interest rates. You just outbid several middle class families. You just pulled the rug out. You went in and bid. You said, "I'm not only going to overbid by $50,000, I'm offering 10 Doja coin and 100 shares of stock in the Vox Media Group."

Kara Swisher: No, I actually said Scott Galloway will pay for it. That's how I did it. And they said, "Scott, does he have to come here?" I said, "No." And then that's how I want it. Anyway, I'm moving studios, et cetera, because of our burgeoning pivot empire. This is the day I'm doing it. I hate moving, Scott.

Scott Galloway: That's why most people love it. Most people love to move.

Kara Swisher: Honestly, I'm kind of a maximalist in my life, but on days like this, I turn into Marie Kondo. Everything must go.

Scott Galloway: Well, you know what I use for moving that helps a lot?

Kara Swisher: Movers.

Scott Galloway: Money.

Kara Swisher: Yeah, I know. I'm having them come too.

Scott Galloway: I just leave and I say, "Okay, can you make sure the change is in the same place in the new house?"

Kara Swisher: That's right. Well, I'm having movers, but I'm very particular about my things.

Scott Galloway: That's a shocker.

Kara Swisher: In any case.

Scott Galloway: Who would have guessed that? Who would have guessed? I thought you were so laid back and easy going.

Kara Swisher: No, no. Speaking of particular, the particular person who's just announced the chairman of the federal chairperson of the commission.

Scott Galloway: Elegant segue. Well played, madam.

Kara Swisher: She's very exacting. Lina Khan has been surprised that she just made the chair. I thought she was going to be the commissioner of many people. She's 32 years old, the chair of the FTC. She was an associate professor of law at Columbia Law School and previously served as counsel to the U.S. House Judiciary Committee Subcommittee on Antitrust, Commercial and Administrative Law. She was the one behind those David Cicilline hearings. I actually just interviewed David today, Representative Cicilline, who with Ken Buck is announcing all kinds of this and that against the tech industry with all these legislation finally. But what do you think of this? She made her bones writing this amazing essay on Amazon and how it should be broken up. Here she is, not 10 years later.

Scott Galloway: Well, I think it's inspiring. I think the government on a regular basis takes incredibly young, incredibly talented people and throws them in the deep end. I think we've been better off as a nation when we have, throughout history, taken incredible people and said, "Regardless of your age, we're going to give you an incredible opportunity here." I just love the fact that a London-born woman of Pakistani descent at the age of 32 is now riding. She's not only riding shotgun with Bezos on—well, he might stay in space.

Kara Swisher: She's not riding shotgun. She's opposite him.

Scott Galloway: Right. She's not on his team.

Kara Swisher: You know what I mean.

Scott Galloway: All right. Okay. You take my meaning.

Kara Swisher: Riding shotgun is what you're doing with me sometimes.

Scott Galloway: That's what I'm doing?

Kara Swisher: Yeah.

Scott Galloway: I'm not going to go through cowboy metaphors with you. Nonetheless, let's say she is his nemesis now. He's got a worthy nemesis. Although she probably doesn't see it that way. Also, people complain that Amazon doesn't advance careers as fast as it should. It absolutely advanced the career of Lina Khan.

Kara Swisher: Yeah. She basically looked at Amazon and said, "This is the definition of monopoly behavior." Her piece on the Amazon antitrust paradox was her *Catcher in the Rye*, whatever you want to call it. It took her from obscurity and created momentum that landed her as the chair of the FTC. She's known for being very hardworking, obviously very smart. I think it's nice when talent and a little bit of luck result in people getting to extraordinary places. It serves as a beacon of light and hope for a lot of people. She's got a lot ahead of her. She has a thousand people that she gets to direct. The chairman has enormous amounts of power in the FTC, even though she's got to convince other commissioners. There are five in total.

Scott Galloway: Yeah, five in total. Two Democrats, two Republicans, and the chair, who is typically whoever the president's party is.

Kara Swisher: She has to convince the other two Democratic ones, or any of the Republican ones, to go along with what she wants to do. But she has enormous sway because she can direct the investigation. She can direct the staff. It's a huge job for her to run a federal agency like this. This is about to get more funding and everything else. One of these bills that David Cicilline and Ken Buck are working on—it was interesting because they have various people attached to each of the bills, and they're all different, including Matt Gaetz is attached to one, if you can believe it, and several others. It's a really interesting time. She's in a real position of power. I would urge people to go back and read that piece she did about Amazon. One of the things that's interesting about her is that she's trying to shift the next legislation coming, which is a wholesale redo of the Antitrust Acts, which has gotten a Borkian feel after Bork made arguments about how it should be. It's legalese, but essentially it changed in terms of favoring companies via some theories that Robert Bork had in the Chicago school. She's shifting that and probably will be part of that legislation to shift it back to the Sherman Antitrust Act, or an antitrust law for the new day, which hasn't changed in a very long time. Everything else has.

Scott Galloway: The gaining factor on her work won't be her colleagues or fellow commissioners or even other lawmakers. It'll be judges. What people don't realize is the real impact or the enduring impact of any administration is the lawyers that are appointed for life. I think she will absolutely file suit. She will block mergers. She will file antitrust action. I think there'll be support in the House and the Senate. I think she'll convince two commissioners to go along with them. But I bet a lot of it is overturned in courts.

Kara Swisher: Yeah, the Supreme Court just overturned something the FTC did around the company. That's where the conservative courts are going to be her nemesis.

Scott Galloway: Ooh, nemesis. I like that.

Kara Swisher: Not only that, she's married to a cardiologist. I like to think of all the pressure those kids are going to have on them. "Why can't you be more like your father or your mother?" Talk about growing up in a household where it's easy to be an underachiever.

Scott Galloway: Right, yeah.

Kara Swisher: Anyway, I wish her well. I did a really good interview with her on *Sway*, and maybe we'll get her to come on here. I may have to invite her to Code. I was thinking of pairing her with Margrethe Vestager, who's coming. The two of them. Gangster one and gangster two.

Scott Galloway: Would that be something?

Kara Swisher: And they got to work together, too.

Scott Galloway: That's Tony and Soprano on stage.

Kara Swisher: I know. I'm thinking, what do you think?

Scott Galloway: I think that would scare the shit out of the audience, which I kind of would like to do.

Kara Swisher: You need a moderator. You need some sort of abusive monopolist to moderate the conversation.

Scott Galloway: I have Bezos right in the middle. Bring in Rupert Murdoch. Or how about a Bezos in the middle and they just take shots at him? Because he's fit, right? They can have a kind of thing.

Kara Swisher: I like it. I think they shoot up his ass with Andrew. And they say, "OK, live on TV and we're auctioning it off, you motherfucker. Let's see if we can get $29 million." And then he goes into space.

Scott Galloway: Oh, he'll be back from space by then.

Kara Swisher: Allegedly. We'll see.

Scott Galloway: He'll be back. He'll be back.

Kara Swisher: All right. So the other thing is President Biden and Vladimir Putin met in person during a historic summit in Geneva, Switzerland on Wednesday. Biden brought up concerns over human rights and cyber attacks. He was a little firmer than President Trump has been. Not a lot of licking up and down, but somewhat cooperative. I don't know what went on behind the scenes, but that was an interesting thing. We'll see where Putin lands on all his cyber attack activity that came to the fore during the Trump administration. I followed this closely. I'm interested in looking at this in terms of the moves and strategy between a long-term player and a short-term player. No one is there for longer than four or eight years as U.S. president.

Scott Galloway: Yeah. Typically a president, shocker, has an enormous ego. If you look back across all the presidents that have dealt with Putin—I think it's like five of them now—they all have a little bit of a megalomaniacal view that "I'm going to fix our relationship with Russia. He'll see I'm tough, but a good guy. I'm going to come in." Biden's the first president to say, "OK, I'm not going to do what Obama did and not give him audience." I do think that you reduce the likelihood of things escalating when you've met. There's an instinct where you go, "Hey, there's a submarine off the coast of Irkutsk and we're about to go gangster. Well, why don't I just call him first and make sure that I don't misunderstand?" There's a value to open engagement. But at the same time, he didn't say, "Well, let's try and do this and announce it. I looked into his eyes and I trusted him." Keep in mind, Russia's GDP is in between South Korea and Canada. Someone once described Russia as "Upper Volta with nuclear weapons."

Kara Swisher: Are they moving while you're doing this? I hear shit in the background. No, hold on. We're going to let her do this. She's going to grab it really quickly. Hold on. This is our baby.

Scott Galloway: I'm glad to see you're prioritizing our show.

Kara Swisher: Listen, I have a very complex life, Scott Galloway. I don't know what to tell you. I have very many children. We have peoples and I got things to do. She's going to be—no one's allowed to touch my shit. All right. She's trying. She's moving as fast as she can. You know what? I have a life. People can understand.

Scott Galloway: You have two boys. Why do you need movers?

Kara Swisher: That's right. Because my one son, as I've said, is a butcher. And the other one is hiking in the Adirondacks. So there you have it.

Scott Galloway: That's what you have. Talk about you and your white privilege.

Kara Swisher: Anyways, I hope we're recording this. Hiking in the Adirondacks is good. He's camping.

Scott Galloway: You mean glamping?

Kara Swisher: No, he's not glamping. There's no glamping going on with us. Some 19-year-old is cooking top ramen. No, no, no. He's doing really well. My other son is working all summer. He got a tattoo yesterday. I shouldn't say this, but he got a giant tattoo in New York yesterday.

Scott Galloway: Can you say that like it's a good thing?

Kara Swisher: I think it's a beautiful tattoo. I'm not discussing this with you. Listen, we're moving on to something. Go ahead, finish with Putin. I bet Putin has a tattoo.

Scott Galloway: Finish up. Look, this country, in terms of economic power, is somewhere between South Korea and Canada. The GDP is smaller than Canada, but bigger than South Korea. A glorified gas station run by the mob. So it is in Putin's best interest, strategically, to be quite frankly disruptive and cause problems. Just as any nation strategically is well served by pursuing a nuclear weapon because then someone in the West shows up and says, "We give you billions of dollars to just stop doing this." Putin's only playbook here is to be disruptive. This is a guy who's supported Assad, has incurred Western countries to kill people, has seized or annexed Crimea. This is a real nemesis, a real menace globally. If you look at flashpoints of instability around the world, there's a 50% chance it involves Putin. I think they handled this just right. They showed up and said, "OK, you have a direct dialogue, but be clear. We're not here to try and show some goodwill such that you can take advantage of that goodwill and then find out we were wrong to ever believe we should extend you any goodwill."

Kara Swisher: The cyber stuff is really the biggest issue. It's state-sponsored cyberterrorism and we have to figure out a way. What's he going to do about that?

Scott Galloway: Well, I think people underestimate the power of our NSA and our security services and our cyber force or space force. I would bet that slowly but surely we've made it pretty clear that the quo per quid here is going to be pretty ugly if you keep doing this. The fact that we were able to track down and reclaim the payment for Dark Web—I got to think that we're going to start in a very tactful, elegant, and planned out way, start turning off the light switch around certain things in Russia.

Kara Swisher: What do you mean? Attack them?

Scott Galloway: Oh, 100%. U.S. Cyber Command. I think we will pick, if we haven't already, facilities and infrastructure and turn it off and say, "By the way, that was us. And it's going to get worse if you don't put an end to this shit." This whole "we don't know what's going on" just doesn't work. I have a lot of faith in our government to be both responsive, creative, and professional at this stuff, especially this government. I actually think cyberterrorism is going to get better, not worse.

Kara Swisher: I don't know. We have a broad attack scheme. Look at all the attacks that have happened.

Scott Galloway: Your point is the land mass is just so huge.

Kara Swisher: I think that one of the things they're saying is the attack space is so vast here, and we're so interconnected in the way we conduct our digital stuff. We have so many lines of attack for someone like Putin, a thug like Putin, to come in. I think we just have to show—

Scott Galloway: You described it as our land mass is so big, which I thought was an interesting analogy.

Kara Swisher: Well, our surface area. Excuse me. Surface area of attack is large. And they don't have as much to attack, but we can certainly do a lot of things. There's sanctions, et cetera. This is the Cold War was lost by Russia. They're winning this particular war or have more opportunity for advantage. But you're right. They're not a big country.

Scott Galloway: But you know who we go after when we try and hit them hard? When we try and hit Russia hard, we go after the oligarchs. We start fucking with the wealth of the 50 wealthiest people in Russia who are all there because of Putin and have some influence back and forth. My guess is we make life uncomfortable for his buddies. The way you do that is you go after their pocketbook.

Kara Swisher: We'll see. I'm excited that I thought they handled it. I thought he handled it as well as he could have.

Scott Galloway: Good.

Kara Swisher: He got a little testy at a reporter who misasked him a question.

Scott Galloway: Good for him.

Kara Swisher: He apologized, too. It was good. So last thing, very quickly, we're going to get to our big stories. Apple officially launched a subscription service allowing users to pay for ad-free episodes and exclusive content. Meanwhile, Spotify signed another deal with one of the most downloaded podcasts, *Call Her Daddy*. Have you listened to that?

Scott Galloway: I've never listened to it.

Kara Swisher: I haven't. It's like *Dirty Girls*, essentially. The three-year agreement is reportedly worth $60 million, and the show will be exclusive to Spotify beginning July 21st. Spotify has also launched a Clubhouse competitor called Green Room. What thinks you of this, Scott Galloway?

Scott Galloway: Well, I was excited because we got $61 million. Oh, wait, $61,000 for four years. Never mind.

Kara Swisher: What, you want me to talk dirty about my whatever? I'm not even going to go there.

Scott Galloway: No one wants to. You do talk dirty.

Kara Swisher: I do, and it doesn't work. It doesn't work as much as *Call Her Daddy*.

Scott Galloway: It doesn't land. No one wants to hear a 56-year-old man with erectile dysfunction talk dirty.

Kara Swisher: Okay, all right. Moving along, what do you think? Spotify is really doubling down.

Scott Galloway: Well, one of the strategies here is to go vertical. Whether it's Facebook trying to go vertical into VR so they control the experience, whether it's Apple going into stores, whether it's Netflix and *House of Cards*, Spotify with Joe Rogan. They either have to forward integrate into hardware or forward integrate into content. They've decided that podcasting is—we predicted this last year. Podcasts are going to go for an irrational amount of money as a multiple of revenues because there's an NPS arbitrage and then attention arbitrage. If I can get a high income young person—and a lot of them listen to podcasts—if I can get 60 minutes of their attention graph or 120 minutes a week, that's worth a lot. It's also one of the few mediums where people are actually listening to advertising. The notion is every medium has eventually gone, or at least a component of its valuation, to subscription. The thing about Apple that's just so powerful is that if you want to subscribe to a podcast and they're talking about prices as low as 45 cents, their payment solution is just so elegant. It's like double click here. As opposed to if you go to Spotify and try and get a subscription with the exact same content, the exact same podcast, it takes you to a—

Kara Swisher: Friction.

Scott Galloway: That's right. It takes you—they don't own the rails. You have to go to a site outside of the app.

Kara Swisher: Yes, you do. It's very cumbersome. Whereas Apple's like—

Scott Galloway: That's what these lawsuits are about.

Kara Swisher: That's right. Owning the rails is a wonderful place to be.

Scott Galloway: The thing that gives you pause around this, and we have been hugely affected by this, is I'm obsessed. I have a desperate need for affirmation. I check our rankings every week to see what our listenership's like. All of a sudden, about two weeks ago, our listenership fell off a cliff. I'm like, "What the fuck is going on here?" I found out that we were not—I was getting a bunch of emails saying, "You're not in the app store. You didn't come up on Apple." I went there and they were right. Immediately I got mad at Vox. I'm like, "What's going on here? You guys don't get the easy stuff right." The reality is it wasn't them. It was Apple. Something about them updating iTunes or the App Store to provide this ability to subscribe has monkeyed with the ability to upload content. They're not off to a good start. Keep in mind, Apple says—and this is the scary part—we're ad-supported right now. Apple is going to start deprioritizing us because they don't make any revenue from us. They use podcasts such as ours to gain traction, to gain credibility. But slowly but surely, they're going to want to prioritize podcasts where they can take 30% the first year.

Kara Swisher: Do we have to sell to one of these people? Honestly.

Scott Galloway: We did sell to one of them. It's called Vox. Vox will probably sell us off to one of them. We're whores. We're just dumb whores. We're just having sex with a guy with not as much money. Let's be honest. If we were going to sell our dignity, we should have done it to a John that was richer.

Kara Swisher: Okay. All right. Enough with that. What's worse than being a whore?

Scott Galloway: A dumb whore.

Kara Swisher: Okay, all right. And Scott is now canceled. All right. Spotify also launched its Clubhouse competitor, Greenroom, which is interesting. That's another company that's getting aced out by all these people. We obviously have Twitter Spaces, which I use, and Spotify is doing this competitor. The Spotify artists will probably do it there versus Clubhouse. Why start a new interest graph there if your music is there and you can click into it? Everyone's disrupting everyone else, but the bigs and those who have the control certainly have more control than we do.

Scott Galloway: Can we officially—I just want to take a victory lap. We were the original haters around Clubhouse.

Kara Swisher: Yeah, we were. Refused to go on.

Scott Galloway: I want to officially say Clubhouse is dead. I think we should stop talking about it.

Kara Swisher: The concept is a useful one. We had 1,000, 1,300, 1,400 people as I'm listening to Jodi Kantor talk about the very next story. It's a useful feature for sure. It's just that it's not a separate company.

Scott Galloway: But that's exactly the right word. It's a feature, not a product.

Kara Swisher: It's not just a feature. It's a great feature.

Scott Galloway: Okay. It's a great feature, which a million other people with built-in user bases have flipped on.

Kara Swisher: Yeah. And it also got a bad brand right out of the gates.

Scott Galloway: Yeah. Yelling at your tech journalists.

Kara Swisher: Speaking of which, let's talk about that. I agree. So we've declared Clubhouse dead, although we like the technology.

Scott Galloway: Well, I love this. You realize just three or six months ago, Clubhouse was valued at $4.5 billion. It'd be very interesting to see what their next round has done.

Kara Swisher: Yeah, that'll be interesting. They'll fob themselves onto someone and pretend and take a victory lap. That's what Andreessen Horowitz does.

Scott Galloway: Do you ever—I remember literally 60, 90 days ago, you heard a ton about Clubhouse. I get emails every day. "You should really come on Clubhouse."

Kara Swisher: Yeah, it's going to be—

Scott Galloway: I never hear about it.

Kara Swisher: Yep, that's right, because it was very pandemically prompted. In any case, let's move on to that. We're going to talk about Andreessen Horowitz, which is one of the investors.

Scott Galloway: Pandemically prompted?

Kara Swisher: Prompted. Pandemically prompted.

Scott Galloway: Have you been drinking again?

Kara Swisher: I wish. I wish. All right, but first of all, we're going to move on to big stories, because I did have Jodi Kantor talk about her story and also Jason Del Rey. The *New York Times* story released an investigation of how the pandemic exposed the pitfalls of Amazon's employment system, specifically at its fulfillment center in New York City. It's JFK 8, I think it's called. Reporters interviewed nearly 200 current and former employees and reviewed company documents, legal findings, government records. Here are some highlights: Throughout the pandemic, Amazon meticulously tracked its workers—not a surprise—did not disclose information about COVID outbreaks in the warehouse, and relied on a buggy system that led to unintentional firings and benefit losses. These poor working conditions led to a failed unionization attempt we saw earlier this year in Bessemer, Alabama, in which Amazon was victorious. Workers also expressed frustration over the little opportunity for advancement, which you just talked about within the company. You just push buttons there, essentially. They have it down to a science and the use of technology to hire, monitor, manage workers. Meanwhile, Mackenzie Scott, Jeff Bezos' ex-wife, who married the science teacher now, announced she had donated $2.7 billion to 286 organizations, part of a year effort where she's given almost $8 billion. It's her third round with no strings attached donations. She wrote in her blog post that these donations are an attempt to, quote, "give away a fortune that was enabled by systems in need of change." Feels like they're talking to each other in a weird way, having a little bit back and forth. But he's taken his money, which keeps getting bigger because Amazon's doing so well, and keeps giving it away to stop him. So anyway, what do you think?

Scott Galloway: Well, as your ex-wife reminded me, it's not his money, it's her money. She doesn't get the credit she deserves as a co-founder, which I actually agree with.

Kara Swisher: Yeah.

Scott Galloway: Look, it's just so interesting to contrast the two. Bezos has showed up to those stupid auctions they have at a high school and said, "Come ride in my yellow canary Ferrari because I'm awesome and I'm famous." He does a bid and everyone goes, "Oh, Jeff, you're so successful and you're so interesting. I want to participate in the mother of all midlife crises." He says, "Okay, I'm going to give the $28 million to charity so you can come into space with me as I try and—I don't know—as I feel my prostate getting bigger and bigger and realize I can't buy life and I need to start lashing out with this stupid ego-driven shit." What does she do? She takes a hundred times that and gives it to things like legal efforts to protect—

Kara Swisher: This is just this time. It's the third round.

Scott Galloway: And gives it to fantastic people fighting for LGBTQ rights. There is one type of faux "come watch me get my hair plugs" philanthropy, and there is real giving. I think Mackenzie Scott is literally one of the most inspiring people of the last decade. I think she's a tremendous role model. Not only that, should she get out of Amazon stock? It's gone up so much that she can't give it away fast enough. She's gotten more money. Jeff Bezos' wealth has increased from $110 billion to more than $190 billion during the pandemic. She's gone from $34 to $60 billion. She can't give it away fast enough. So should she get rid of the Amazon stocks? It was sort of like the Rockefellers that did the environmental stuff later. Some people think she should just get out of all the Amazon stuff, but it's providing her with the cash needed to fight Amazon or give groups that fight Amazon. It's really interesting.

Kara Swisher: In general, your Kevlar as you get older is diversification. You don't want to have more than 20% or 30% in any one asset class.

Scott Galloway: This is a moral thing, but go ahead.

Kara Swisher: Yeah.

Scott Galloway: Well, beyond the morals, she absolutely should not sell. What she should do is give the stock away pre-tax or borrow against that stock. When you're talking about Amazon, any stock can go down, and Amazon has actually had years where it's underperformed. But if she were to sell the stock to diversify, all she would be doing is incurring a tax-ringing event and have less money to give away. She should give away stock and let them decide what to do with it.

Kara Swisher: Yeah, it's interesting because a lot of people feel she shouldn't. I kind of like the whole thing. You know what I mean?

Kara Swisher: Like a lot of people were giving MacKenzie a hard time. He's like, you made money on Facebook and now you're attacking using your money you made there to attack them. So it's kind of interesting. It's an interesting dilemma. I don't really care, honestly. Give away the money, MacKenzie. Go for it.

Scott Galloway: I mean, it could be worse. You could be on the faculty of an institution and accuse them of being morally corrupt and continuing to work there.

Kara Swisher: Yeah. Do as I say, not as I do.

Scott Galloway: Do as I say, Carol. Do as I say.

Kara Swisher: All right. But these working conditions are really... it was interesting because I thought the piece was rather fair. Also, a lot of people like working there. They like the health benefits. They like the regularity. A lot of the workers, Jodi said last night, also express that it's a better place than restaurants or fast food places, which is a totally low bar.

Scott Galloway: Right.

Kara Swisher: So it seems to me that if you're doing these tech things, being just better than restaurants and stuff is not good enough. If you want to change the world, then change. Because the last thing Jeff Bezos said in his last letter was, "We want to be the best employer on the planet." Well, he got on his way out, he says this after exploiting people, both his executives and these workers. And so, I'm not screaming. It's not exploitation in the way diamond mines are, but it's still... I hate to quote Melania Trump, but be better. Like, why aren't tech employers better than what previously existed?

Scott Galloway: You're quoting Melania Trump.

Kara Swisher: I did. "Be better." That's who said it. But they could do better. They could try harder and be better as employers. All of these tech companies, instead of saying we're slightly better than what came before us. Because it's just, to me, like a meat factory or a restaurant with a gropey manager or shitty working conditions.

Scott Galloway: Well, I want to acknowledge, as you get older, you realize how important regularity is.

Kara Swisher: No, but here's the thing, Scott. I'm being serious today. Is it going to change? Bezos said that's what he wanted for the company. He's still a big part of it, but he didn't do anything previously.

Scott Galloway: Here's the thing. No one cares, or the people who matter don't care, because the general perception of the U.S. public, incorrectly or correctly, is that Amazon pays well. It's hard work. They may monitor you, but they pay $16 an hour plus health care. And a bunch of individuals at a plant were given a choice to unionize or stick with Amazon. And two to one, they voted to stick with Amazon. And this goes to the same place. The best enemy you can have is an incompetent, feeble enemy. The middle class has had, or corporations have had, the mother of all incompetent, feeble enemies in the form of unions. So maybe unions aren't the answer.

Kara Swisher: A hundred percent.

Scott Galloway: You know who the answer is?

Kara Swisher: I apologize, I'm interrupting.

Scott Galloway: Lina Khan is the answer. Because if Lina Khan breaks up monopolies, there will be more organizations bidding for human capital and it'll bring wages up. In the 40 largest economies, if you look at union membership, it's declined by 30 to 60 percent over the last several decades. Unions have been a total failure. They're ineffective.

Kara Swisher: One of the things... The FTC needs to be the union. I'm going to interrupt you now. Jodi said that the turnover rate at Amazon... They hired 500,000 people during the pandemic. They're on the way to becoming the country's largest employer. Walmart is right now. There are two things. One, she said that they have 150% turnover. Think about that. And in fact, Jeff Bezos wants that. He thinks people get lazy over time. The second thing is they don't have an opportunity to advance from the warehouse, as opposed to Walmart, where the CEO was unloading in the grocery section. Walmart is completely opposite. People have this upward trajectory there as you do better. And at Amazon, they kind of want you to leave. He likened it to being in the Marines. You get trained and then you go, but it's even faster than that. And the one thing they did is this "no lights off" hiring, or something like that. They essentially don't do any checking and they just want to see raw talent.

Scott Galloway: But is that a bad thing? That's not necessarily... but the turnover rate is good. It means they think of them as fodder, just fodder. So I know a guy who struggled with addiction his entire life. He moved to Florida. Really struggled, in and out of rehab, never been able to hold on to anything. And he got a job at an Amazon fulfillment center. Their attitude is, we'll hire you and then we'll track you. He ended up leaving six or seven months later. He wasn't fired. He was doing really well. He ended up leaving because he doesn't have great judgment. My attitude is I like the fact that Amazon brings a lot of people in and says sink or swim. That's not to say OSHA and people shouldn't be looking at it. I'm no fan of Amazon. But I like an organization that is hiring like crazy.

Kara Swisher: I'm not sure I buy that there is an opportunity for people who prove themselves.

Scott Galloway: The thing I like about Amazon that I hate about corporate America is there's a fetishization of people with bachelor's degrees. This is a part of the economy you can enter into without a bachelor's degree. I can't believe I'm defending Amazon.

Kara Swisher: You can't go any further. You can push buttons. Is that correct? And eventually, yes. Is that true? That's the whole point. There was one spot to go up and 700 people applied. They just don't have a path at all, which is interesting. You know that going there. The other thing is, right now so much human sweat to run this company. It's crazy how many people they need. They don't really want them to move beyond their class where they are. Once they get automation in there as much as they can, including picking and packing, I think they just replace them. One of the things Jodi said, this is the last thing: they are very protected right now politically because they have so many employees. If they had more automation... and she is the one that originally wrote how tough Amazon is on their executive team, if you remember that one a couple years ago. It's like, "Pregnant? Too bad." Person with a college degree. If they could replace people, they probably would. At the same time, they're very protected by the employee base by having it. It's just bad. It was fascinating.

Scott Galloway: Look, I've always believed that capitalism gives companies the right to fire so they can hire. I think this is an example of that. What I do think we need is... I'm going to start virtue signaling here, but I love the term "fiduciary." When you go on a board, you need to decide which stakeholder you're a fiduciary for. Most people on a board immediately have this knee-jerk reaction of, "I'm here to represent shareholders." Shareholders are overrepresented on boards. I used to say, whenever I went on a board, I would state this: "I'm here to represent management." I've been management. The board is very good at showing up and heckling from the cheap seats, especially if it has VCs or hedge funds on the board. The people on the board are typically the smartest people you've ever met who don't know a thing about the actual business. I've decided over the last three years, I'm now a fiduciary for frontline workers because they have no representation.

Kara Swisher: You just totally said you like the Amazon system. They're not... I mean, I guess if you know going in.

Scott Galloway: Hold on. $16 an hour plus healthcare, day one.

Kara Swisher: But read this piece. Let me just tell you, they get fired by accident because their systems... You know how perfect Amazon is on logistics, getting a package to you. They make a lot of mistakes with their workforce.

Scott Galloway: I would bet somewhere between 10% and 30% of the American workforce, after working somewhere for a year or two in frontline work, makes less than you do on day one at Amazon.

Kara Swisher: Possible. Anyway, it's an interesting story. I urge people to read it. We'll see what happens here. I think they are protected by their workers. I think they still rely on the sweat.

Scott Galloway: The strongest union representative in the world right now is Lina Khan.

Kara Swisher: Lina Khan. All right, so we thought she's going to solve everything.

Scott Galloway: Well, no. Right now we have 50 cents on the digital dollar, e-commerce dollar going to Amazon. The bottom line is there is one place to make $16 an hour in Bessemer. If there were two places, slowly but surely people would be making $18 an hour. So the best union in the world right now is the FTC and the DOJ. Traditional unions haven't worked.

Kara Swisher: You look like a wacky union every five minutes. You do. I'm just saying they could work. I'm a member of a union.

Scott Galloway: I'm not, fascinatingly.

Kara Swisher: One of the things that's really interesting was how some of the ideas that Jeff had around workers being lazy. I thought that was kind of scary a little bit, honestly. Even if he thinks that, he shouldn't say it. But look, we're seeing a lot about this guy's character. Wouldn't you love to ride shotgun with me in my yellow Canary Ferrari on my way to get my vasectomy and hair plugs? That is how he decides to approach philanthropy.

Scott Galloway: I don't know if he has hair plugs. Did he get a hair plug?

Kara Swisher: No. He doesn't have hair plugs. It's just... human resources, once again, is a very weak area. One of the things that Jason pointed out, Jason Del Rey, was this is a company... In his last letter, Bezos said, "We have always wanted to be the Earth's most customer-centric company." It has accomplished that at the expense of everybody. Expense of the Earth, the employees, everybody. And now he added, "We're going to be the Earth's best employer and Earth's safest place to work." This customer-centricness of Jeff Bezos has everybody paying for that particular theory of his. We'll see if Andy Jassy was going to do that. I don't know.

Scott Galloway: One more thing. Amazon's founder didn't want hourly workers to stick around for long, viewing a large disgruntled workforce as a threat. Mr. Newkirk recalled, this is someone who helped him create the system, company data showed that most employees become less eager over time, he said. And Mr. Bezos believed that people were inherently lazy. What he would say is that our nature as humans is to expend as little energy as possible to get what we want or need. The conviction was embedded throughout the business from the ease of instant ordering to the pervasive use of data to get the most out of employees. Fascinating. But there's a learning here. Since "Chainsaw" Jack Welch and Milton Friedman, we have this monolithic response that the right business strategy is to focus on one constituency, and that's the consumer. At some point that comes at the expense of your suppliers, your vendors, your employees, the commonwealth, the environment. What people need to realize is, beyond the liberal wokeness of screaming for other people, it is a good business strategy to pick other constituents. Shopify is not consumer-driven. Their customer is the people they serve.

Kara Swisher: Right, their consumers are the people they serve.

Scott Galloway: Right, but they've decided if Amazon's going to be obsessed with the consumer, we're going to be obsessed with the customer, and that is the retailer.

Kara Swisher: Okay.

Scott Galloway: Better Mortgage is obsessed with treating their employees well. Their mortgage consultants make more money, and they're like, "If we can attract the best mortgage..." Goldman Sachs, I think, is employee-driven. They've said, "If we can pay our people the most, everything else will work out."

Kara Swisher: All right, okay. What are you obsessed with, Scott?

Scott Galloway: Right now? I have 100% adopted the strategy. I've been in services firms my whole life. I started a strategy firm. I've always been bought into this obsession with the consumer. I have pivoted in the last five years, and my core constituent is attracting and retaining the most talented colleagues. Everything works out. If you treat them well, if the best people don't leave, if occasionally you leave some money on the table, if you're ever accused of overpaying people... that's not a bad thing for society. If you can attract... the bottom line is if you're a successful entrepreneur, you're going to do just fine. If you can figure out a way to give people the notion that they're going to do really well if you do really well, and you're really focused on them... I'm not saying you're not focused on your end client or end consumer, but I generally believe in an information economy, the team with the best players wins. So I've been very employee driven.

Kara Swisher: I'm obsessed by snacks.

Scott Galloway: Snacks? That's your constituent?

Kara Swisher: Snacks? Yes. No, I'm obsessed by making good stuff. If I can't, I'm out. That's how I feel. That's everything. So you're product obsessed.

Scott Galloway: Product obsessed. And I don't care about anything else. If I had to pick, the quality of the product, which will lead us into our next story.

Kara Swisher: Hold on. I just want to identify you. I would describe you as a little bit of an individual contributor. I'm more a person that, my attitude is, my job is to attract really talented people and the product just gets better. I think there's a strategy around both.

Scott Galloway: Yeah.

Kara Swisher: All right. So we know we're obsessed with snacks and product and people.

Scott Galloway: Schnaps.

Kara Swisher: Schnaps. All right, Scott, we're going to have a quick break. We talked a lot. Come back. Talk about Andreessen Horowitz's new content site. Apparently they're getting into our grill, and a listener mail question.

[AD BREAK]

Kara Swisher: Okay, welcome back. Venture capital firm Andreessen Horowitz is launching a content site called, I cannot believe this, "Future." Honestly, they've already failed. I love when VCs get into my beeswax. I don't get into their beeswax. In any case, whatever, they can do whatever they want. But let me just tell you, media is hard, Mark. Media is hard. "Future" will be a space for what the firm is calling an "optimistic view of technology." Rational optimism. According to TechCrunch, the firm says future.com, which they got the URL, which means they already are out of business. Money doesn't matter here. It's not a news site, but instead will focus on future-focused informational and editorial content rather than daily tech news. Future pitch guidelines state: "We are pro, pro, pro. And we are also informed optimists, not freewheeling futurists making predictions without any skin in the game." Oh God, I hate them already. The site will also feature Andreessen Horowitz's podcast, Clubhouse Rooms, and eventually video. I can't wait to see their piece on that one, which will be interesting. I'm excited for their piece on Facebook, stuff like that. They've hired some big names and they've got someone who's a pretty decent editor running it. But the whole tone was, again as they did on Clubhouse, bash the tech press, which is just ridiculous. It just infuriates me. But whatever, whatever. Good luck. What do you think?

Scott Galloway: Yeah, what they should have said is the truth: "We're going to be pro-portfolio." What this is, just as we talk about going vertical, there's a 900-person team at Facebook manicuring Mark and Cheryl's image that calls people like you and says, "Hey, do you want to do a sit-down with Cheryl? Do you want to come to her book signing?" They hire the brightest, smartest people to try and put them in a likable light. This is going vertical. This is like, "Fuck that. Instead of calling Kara Swisher and trying to put our most likable people on stage, let's start creating our own content." They are also very explicit to say we're not a news organization because they don't want to be held responsible for fact checking or generally the truth. I think the problem here is that the people who have real influence in this environment, such as you, are going to be inclined to just roll their eyes at everything they do.

Kara Swisher: Right.

Scott Galloway: When they come out with puff pieces, they'll have some good pieces. I'm sure. And they'll have pieces that are just puff pieces on their portals. You watch, the majority of the content they're going to be optimistic about is going to be trying to legitimize and create heat around sectors where they have companies that are funded.

Kara Swisher: Yeah, I would agree. Everybody is going to throw up on it. There'll be some very good journalists who, similar to Nick Clegg or similar to Sheryl Sandberg or similar to Dara Khosrowshahi, have said, "I have built a lifetime creating reputation and credibility. Now I'm going to go shit all over it in exchange for money." I'm going to trade my journalistic credibility for money. That's what this is. This will have a difficult time, even when they write good things. A lot of people will say they're just going to have a tough time. Media is an uphill battle, much less when you come out of the gate. They want to have it both ways. They don't want to have the agony of it, and they just want to have the upside.

Scott Galloway: Peter Kafka interviewed Margit Wennmachers, who ran a pretty big PR firm and then was hired by Andreessen Horowitz and really focused on their communications and PR. I think she's a partner now. She explains why our company is bypassing journalists like me by talking to me. That's what Peter wrote in his thing. He has an interview with her.

Kara Swisher: I know her very well. They've always tried to do these get-togethers. They've had think times. I've been to a couple of them where Marc interviews a big name and they can get the big names, obviously. Suddenly Marc is interviewing Jay-Z and trust me, it was a very soft interview, or whoever it was. I don't remember it was Jay-Z. It was someone like that. It was Michael... the guy who's the agent, that famous agent. Anyway, it was very soft. So whatever, it's fine. I don't know. They don't want to call it a news site. They want to bypass journalists. First, they tried to bash them on Clubhouse and there's idiot rooms and Marc Andreessen acted like an 11-year-old who has had too much sugar. It's just complete bullshit is what it is. Now they can do their own thing. They've been doing this already through a couple of their writers. Ben Horowitz writes, they've got Benedict Evans, whatever. They've been playing in the space and I think now they're just organizing it together. So good luck. I mean, sounds good.

Scott Galloway: This is the premise: "We want to present an optimistic view of technology and the good they're doing." We have no shortage of that. We are choking on optimism and it has delayed and obfuscated and blurred our vision. The notion that we need an optimistic view... for God's sakes, everyone is masturbating to missions to Mars and photo sharing apps and all this. What we need is a more pessimistic, realistic view of technology and its limits and how it can be abused. To me, this just starts with, "Okay, you've outed yourself as you just don't get it."

Kara Swisher: Yeah. What's really interesting about this is you are angry. Let me just say, I have had lunch with all these people and they love to lecture. They just love to lecture. One of the pleasures of not living in Silicon Valley is not having to have lunch with these people anymore. Honestly, I hate to say that they don't give you any good information, by the way, except if it's to write their own book. They just pontificate at you. You have to sit there and listen because you're hoping at one point they'll give you one good scoop. One of the things is, it's just ridiculous. I tweeted, "From the people who owning everything is not enough." But I think Ben Smith has it right. We were all panicked that they were doing this. I wasn't particularly panicked. But we're not worried. Let us just say we are not worried. This is, of course, what they would do. This is, of course, what they do, because they just can't stand it that someone else has less say. Honestly, I think we've had just as big an impact by saying these things. I thought Elizabeth Spiers, who was a great writer and just a great subtext, said, "Pretty sure most tech journalists already have an optimistic view of technology, less so of the humans who run and fund tech companies and are apparently annoyed that the cheerleaders aren't cheering as loudly as they'd like." I think that kind of just says it. What do you think?

Scott Galloway: This is 100%. It's like, "Let's buy the newspaper and turn the newspaper." They're going to have some good things here. First, there'll be more jobs for journalists. I had some interaction with a woman who runs their podcasting group, and she struck me as a talented person. They'll probably do some good coverage, produce some good product. But this is simply the coal industry deciding we need to be more pro-fossil fuels. "Carbon emissions, Kara, are misunderstood." So let's hire legitimate journalists and trade in their reputation. We'll pay them more than they would at a legitimate news organization. They will trash their reputation in exchange for money. We'll put out interesting, well-produced stuff. But the bottom line is, you watch it: if all of a sudden Andreessen gets very excited about disruption in voice and healthcare, there's gonna be a lot of articles about the brave new world of tech and healthcare, ignoring whether there is anything we should be worried about. Should there be any checks and balances on this?

Kara Swisher: Yeah. They have such a fucked up view of journalism. It's so weird just because you don't like every... you don't hug them. I mean, sometimes I wonder how many of these people didn't get hugged as children. Oh my God, they call you. Do you know why a famous person called me yesterday? I told you about this. The only time famous people call me is when I write something. I wrote something about a famous Hollywood executive and his short bite video platform. He called and said, "Can I speak to you?" To his credit, we're obviously talking about Jeffrey Katzenberg.

Scott Galloway: I like him though. At least he comes to play, but go ahead.

Kara Swisher: He's impossible not to like. He's extraordinarily successful. He's very charming and he's obviously very smart. He's not mad at the press. He's just like, "It is what it is." He lives in the real world. Here's the thing. He made a really good point. I had said in my blog post that they burned, of the $1.6 billion, they burned a billion and a half because they sold the content for $100 million. The reality is they returned a half a billion because he realized that there was no product market fit and he wanted to be responsible and return as much capital to investors as possible. I want to acknowledge that oftentimes young entrepreneurs have to be a little bit delusional, but they not only crash their company, they run it into a wall and it blows up and they don't pay their payroll taxes. So he's clearly the adult in the room.

Scott Galloway: He's still... and also, he's doing so well now. He has a security startup that's killing it. No one, quite frankly, we don't even remember. These individuals are so successful that any mild ding in the public, they just say, "I need to update your thinking." It's really interesting.

Kara Swisher: I said we should have him at Code because he's working on this really interesting security startup. He's doing some very interesting things. But I just want to correct the record. He returned half a billion dollars to investors, not $100 million.

Scott Galloway: Okay.

Kara Swisher: In any case, I know Jeffrey has a... I like talking to him. At least I don't get the same anger.

Scott Galloway: Yes.

Kara Swisher: I don't get the same... and I know he's wrangled with all kinds of Hollywood reporters, et cetera. But in general, they're so sore. They're sore winners. I don't know how else to put it. A lot of people in Silicon Valley are sore winners. They should just win and shut the hell up. But they won. Okay fine. Make what you want to make. I'm so excited. I hope they get some good essays that are worthy of reading. But you know what? I'll take Ben Thompson any day of the week and twice on Sunday. That's what I... he's fair. He does great pieces. That guy's good. A lot of the Substack... I would take almost any journalist over this on any day. But you know what?

Kara Swisher: Knock yourselves out. You got lots of money. Be sore winners that you are. But the media, just do your thing. And if they don't like it and they don't give you access, well, you'll do a better job. But access is overrated. As someone who has a lot of access, it's overrated. And it makes you a little less sharp, I think. I don't mean unfair. I think fairness is important to me. But anyway, it's interesting.

Kara Swisher: Well, let's see what's going on. We'll see how they do, because money is no object. Obviously, they bought Future.com, which probably cost a billion dollars. Future.com. I'm going to buy "sore winners" and just copy all this stuff.

Scott Galloway: All these dudes should collectively pass the hat and buy Prostate.com. This is all just such a giant fucking midlife cry. "I'm rich. I'm blessed." I like Jeff's better. He's going to space. "I'm rich. I'm blessed." And I'm still going to get angry at the few people who have the gall to say my shitty startup isn't worth $4.5 billion. Oh, that Kara Swisher. Whatever.

Scott Galloway: I'm not their friend. That was the error. I'm not helping her move this weekend. That's it. And I'm starting a podcast to talk about the great new world of photo sharing pictures of your sneakers. Let's become VCs.

Kara Swisher: I think we need to become VCs. You're kind of a VC a little bit, right?

Scott Galloway: I invest a lot in small and growing companies.

Kara Swisher: I'm going to become a VC.

Scott Galloway: It's hard work.

Kara Swisher: I'm not going to become a VC. I've been offered VC positions, and I'm like, I'm incompetent to the task, which apparently a lot of people don't say. Speaking about optimism and pessimism, I'm not a good VC. I was investing in later stage companies.

Scott Galloway: Yeah.

Kara Swisher: You have to be an optimist to be a VC because literally every idea I hear, I hate. I'm like, that'll never work.

Scott Galloway: Yeah.

Kara Swisher: I don't mind the optimists. I like them.

Scott Galloway: All right, Kara, we're going to go to a Pivot listener question. We've been chit-chatting away today. We just can't get enough of each other. We're making media. Mark, take notes. We're making media, Marc Andreessen. This is how it's done.

Scott Galloway: Okay, let's pivot to a listener question. Roll tape. You've got mail.

Listener Question [Voiceover]: My name's William Ray. I'm a journalist and podcast producer in Aotearoa, New Zealand. I have two questions for you. First, more than two years after the Christchurch terror attack, the Biden administration has signed the United States up to the Christchurch Call, which was an initiative launched by Prime Minister Jacinda Ardern to tackle radical extremist content online. Do you think the United States joining this initiative is in any way meaningful or just PR? And do you think the Christchurch terror attack and the live streaming of that attack have led to any long-term change at Facebook and other social networks in terms of blocking extremist content?

Listener Question [Voiceover]: Second, how do you think the rise of remote working will impact small nations like New Zealand? Anecdotally, I've heard of a US-based tech firm hiring increasing numbers of New Zealand software developers to work remotely and offering to pay more than double the going rate in New Zealand. That's obviously great news for these developers, but it could be really bad for the New Zealand startup tech scene because it just doesn't have access to the deep pockets of US venture capital, which means it can't afford to pay Silicon Valley rates. Nga mihi nui. Thank you very much.

Kara Swisher: Ah, that guy's likable. Talk about likable. I like him. I love the New Zealand accents. Chris Liddell, who ended up working for Trump, but I like a lot, worked for Microsoft, had the same kind of thing. He should start a podcast. Charming accent in New Zealand.

Kara Swisher: Wow, there's a lot there. Let me just go from the back very quickly. I interviewed Brian Chesky and Steve Case last night for Steve's event, Rise of the Rest. One of the things they were talking about was hiring increasing numbers of software developers at different places and whether that was going to hurt the startup scene in individual spots. I thought that was an interesting point. I think that's what they're going to do because Brian was talking about how much he's a more radical remote worker now, even though they had a beautiful headquarters. And they're really pushing remote if people want to do it and letting the employees lead the way on that.

Kara Swisher: So I think that is absolutely going to happen, that a lot of these areas that are trying to create their own ecosystems locally are going to get sucked up by the Googles and Airbnbs and Facebooks of the world. So that is, I think, absolutely true. Scott, what do you think about the other stuff?

Scott Galloway: Well, on the extremist side, the stat that came out that was really frightening was that somewhere around two-thirds of people who joined an extremist group on Facebook, that extremist group was suggested to them by the Facebook algorithm. So the notion that the defense these platforms put forward is that there are a certain number of people who are just drawn to these groups and we can be responsible... well, yeah, you're actually promoting extremist groups.

Scott Galloway: He asked if the US joining meant anything and if whether these companies had changed activity. I believe when the Christchurch massacre happened, primarily Facebook said, "Okay, how do we minimize this?" They went into damage control mode. What I do think it does, though, is that it highlights. What's interesting is stuff like that happens in the US. Mass shootings happen all the time. But when it happens in New Zealand, we get freaked out because it typically doesn't happen in countries that have a saner approach to gun laws.

Scott Galloway: I do think it has an impact because it was so horrific and tech played such a weird role in it that the public becomes less sympathetic to tech and wants to see more action against tech. So I think it does impact it, but we've got to get out of this notion of waiting for the better angels of these companies to show up. They don't.

Scott Galloway: My guess is, and Kara, tell me if you think my thesis is that when Christchurch happened, Facebook didn't sit down and say, "Wow, what was our role in this? And how do we rethink our approach to business?" I think their first emergency meeting was, "How do we minimize the fallout here? How do we delay and obfuscate? How do we wallpaper over this?" It wasn't, "How do we change our product and our platform?"

Kara Swisher: Yeah, I agree. I think that it doesn't matter, but it does. Even if it's just signaling, being in this, not being in this is a problem. Being in it is not a problem. The US can really turbocharge this stuff by entering climate accords, these kinds of things. I think the Prime Minister of New Zealand, Jacinda Ardern, has been amazing about this. And I think it's okay that they're part of this. It puts pressure on companies like Facebook, especially when the US is in these things.

Kara Swisher: Lina Khan is the answer. These are all the kind of people. Putting her as chair said a lot to me about the Biden administration. Putting Tim Wu in there, putting Anne Neuberger in there, it says a lot about what their intent is, which is to push back. This series of legislative moves by David Cicilline and Ken Buck, and Amy Klobuchar and even Grassley and others in the Senate, is all signaling, but it's also movement forward. So I think it is meaningful to do these kinds of things.

Kara Swisher: Facebook will respond to pressure. That's how they're going to do it. They don't do it because they want to do it for the good of the world. Or some of them do, that's not fair. I think they will do it because they get pressure, and they will do it badly because it's hard, by the way. Information about vaccines, where it comes from, the Wuhan lab, were they right, were they wrong? They have to make these decisions that are very difficult for them. And at the same time, they do it cloddishly. So it's super complex, but I love seeing this happen. And I think it's important.

Kara Swisher: One of the things that I would love to know, I answered what Brian Chesky was saying, that they're hiring more people. And Steve was thinking that maybe that would cause them to not have as many cities growing, because his goal is to get as many cities as possible to be tech forward and great places to work. With people moving, they can work from anywhere. And it looks like tech companies are going to let them work from anywhere for at least the near-term future.

Kara Swisher: Another thing they talked about was immigration laws, bringing more people into this country. But do you think people care if a job location isn't an issue going forward? You have this belief that young people should be close to HQ. There may not be an HQ. Brian was talking about not doing this hybrid thing, which is three days a week and two days off because you don't really get time off. You come in for three weeks at a time and do intense work together, and then you all go away from each other and work remotely. What do you think?

Scott Galloway: I don't know. I'm a bit boomer on this. I think there are certain industries where you're going to want people together on a regular basis. And I don't know if that's two days a week, three days a week, or one week a month. But there is a certain entropy, I think, especially in services industries where you need to be able to just yell over the desk to somebody or pull people into a conference room. And I do think young people want to be bumping off of other people.

Scott Galloway: I tell young people, get into the office. It's what I call a Walmart store effect. Pankaj Ghemawat, a colleague at NYU, did this great research where he found that the further a retail store gets from headquarters, the lower the ROI of that store. The most profitable Walmarts are in the southeast. And then as you get away from the southeast, they become less profitable. That's fair. And I think the same is true of headquarters. But it's not going to be campuses.

Scott Galloway: Just think about it. Airbnb built a pretty series of buildings. They now down to one building. They had three in San Francisco. Microsoft, it used to be you have to be on the campus all the time. I would venture that if you take the 50 people who get the most traction at Airbnb over the next five or 10 years, who get promoted the fastest, who make the most money, 90% of them will have one thing in common. They're at HQ a lot physically. There's just no getting around it.

Scott Galloway: In corporate America and big companies, your career progress is a function of your talent, your grit, and more than anything, the relationships you're able to establish within that company. And relationships are correlated to proximity. There's no free lunch here. If you want to live in Visalia and overlook the great hills of the California foothills, there's a tradeoff here. There's no free lunch in terms of remote work.

Scott Galloway: I would advise every young person to get to HQ while they can, because when you start collecting dogs and kids, it gets harder and harder to live near work because the campuses are usually or increasingly in urban areas because they know that's where young people want to be. I think we're not going to see these big campuses like the Microsoft Global Campus going forward. MasterCard in Purchase, New York, and these big corporate campuses. Not going to happen.

Kara Swisher: Not going to happen.

Scott Galloway: All right, we're going to get back. This was a really great question. Thank you so much, William from New Zealand. One more quick break. We'll be back for predictions.

[Ad Break]

Scott Galloway: Okay, Scott, prediction. Make it quick. We've been chit-chatting away today. So something happened. I own some rental property. And when a family leaves, as long as the family's there, we don't raise the rent. If they're good tenants, we like having good tenants. But when they leave, we get a broker to say, "What's the market for this?" Most recently, last year, when someone left, they said, "Maybe the market's up a few percent or whatever." This year, we had some people move out and the broker came back and said, "You could charge 30% more."

Scott Galloway: It strikes me that inflation is on the way. And this narrative, there's always a narrative to support why the market should go higher. And everyone's supposed to sign up to the narrative, whether it's the economists, CNBC, everyone says, "Let's buy into the narrative." And the narrative goes something like this: inflation will subside because the supply chain will get worked out and there'll be more supply again and things will normalize and people will come back to work as remote schooling, people go back to school.

Scott Galloway: I think the level of inflation here across everything I see is so extraordinary that the narrative is just BS. And I think we're headed into an era of higher interest rates in the last half of the year, and we should track this. I think the economy is going to boom, GDP is going to go way up. A lot of companies have gotten in fighting shape, the consumer has money, and we're going to see the markets absolutely throw up. This is going to be me like in my fraternity pledge pinning, Kara. Throw up because of inflation.

Scott Galloway: The market, it's really interesting. Right now, everyone assumes that if the underlying economy is strong, the markets will be strong. But here's the wonderful thing about the markets: the markets have an uncanny ability to look around the corner and they're constantly asking themselves, "What's next?" So I think in the last half of the year, the underlying economy will be really strong. But I was going to say that now Joe's going to use my fraternity pledge pinning, where I drank about two or three bottles of pink champagne and it was so much fun. And then, wow, did I start throwing up.

Scott Galloway: I think in the last half of this year, the market is going to move into the latter stage of this. It's like we've had a lot of fun. The market accelerated last year despite everything.

Kara Swisher: So money in the mattress.

Scott Galloway: Money in the mattress. Yeah, well, the hard part is it's hard to time the market. And I would argue in an era like this, if you become bullish, you just lower your leverage and your exposure. But I think we're headed for... anyway, my prediction is that the markets end up lower by the end of the year, and we're going to have extreme volatility in Q3 and Q4 with some kind of four-figure drops in the Dow.

Scott Galloway: Everybody thinks that the underlying economy is going to power the Dow. I think that this inflation and higher interest rates... we like to believe that it's just episodic. I don't know. The price increases I'm seeing out there, and one in three dollars was printed since January of 2020. There's so much cash chasing fewer products right now.

Kara Swisher: Republicans will try to push the inflation situation. That's Biden's weakness there. But we'll see where it goes. I think people are feeling good. I think people are out and about. People are wanting to buy. Everywhere I've been, Washington, New York, all the cities, they're back and rocking. But we'll see. That's a very good prediction, Scott Galloway.

Scott Galloway: Vegas is on fire. Vegas is sold out right now.

Kara Swisher: The national parks, everybody's all over the place.

Scott Galloway: Let me just say. Vegas and the national parks. You never hear that in the same sentence.

Kara Swisher: I'm just saying. There was a story in the New York Times, national parks are like, people are waiting in line to get to see things. To see Old Faithful erupt?

Scott Galloway: Yeah.

Kara Swisher: Yes, I guess so. Whatever. I'm just going to go and sit on a lawn somewhere.

Scott Galloway: I'm going to Vegas.

Kara Swisher: You and I are going to Vegas. You promise me all the time.

Scott Galloway: We're going to Vegas.

Kara Swisher: I'm done. I don't even get my hopes up anymore.

Scott Galloway: We're going to become VCs and we're going to Vegas. That's what we're going to do. And we're not going to invite Marc to talk about the optimistic future.

Kara Swisher: All right. Don't forget that we're done, Scott, today. This is a long and exciting show, I think.

Scott Galloway: It was one of those.

Kara Swisher: It was one of those. Thank you for being... people will like it. We made a lot of content and the people at Andreessen Horowitz are taking notes, which they will listen to. They will do none of them because they have to be optimistic. Anyway, and we are both optimistic and pessimistic because that's what a journalist is, in case they're interested.

Kara Swisher: Don't forget, if there's a story in the news you're curious about and want to hear our opinion on, go to nymag.com slash pivot and submit a question for the show. Scott, read us out.

Scott Galloway: Today's show is produced by Rebecca Sinanis and Caroline Shagrin. Ernie Andretide engineered this episode. Thanks also to Drew Burrows. Make sure you subscribe to the show on Apple Podcasts, or if you're an Android user, check us out on Spotify, or frankly, wherever you listen to podcasts. If you liked our show, please recommend it to a friend. Thanks for listening to Pivot from Vox Media. We'll be back next week for another breakdown of all things tech and business.

[Ad Break]

Kara Swisher: What's worse than being at a water park? Moving. What you need is a big, burly, Bane-like character with a badass tattoo. Got one of those. Bring in the giant, and boom, moved in an hour. Moved in an hour. Bye.