Pivot · Jun 11, 2021

Billionaires and the tax code, Facebook smartwatch and a listener mail question on children's screen time

Automatic transcript of the end of the episode, from 41:01. Speakers are labeled by software and may contain errors. Highlighted passages are Scott’s predictions.

Scott Galloway · 41:01 One of the most stressful moments in my life and one of the most frightening things I've ever encountered is slowly but surely, my youngest suffered from device addiction. And about two, three months when it was homeschooling, and he was on his iPad all day, and then on video games, and it just rewired his brain. And one day we just noticed even his voice was different. And he had to be near a device that would And give him some sort of when he was off the devices, he was a different person. And it just like, it's like when did this happen? And it was the first real look into addiction I had ever experienced. And then when it's when you're kids, it's really jarring. And so the problem is, as is how they socialize with their friends now The communications. And and it... You say, well, just don't let them on their devices. And I'm like, anyone who says that doesn't have kids. Yeah. They need to talk to their friends. Yeah. This is how they talk to their friends. So what we do is we just... We limit it by time, and we just say, alright. During the week... There used to be no devices during the week. That became impossible. Now we try to limit it to an hour during during the day. And then on weekends, we let them play in the morning. But there is something really... Especially, I think, with the young male brain. I think it's... It actually rewires the male brain. I think with young women, it's it's... Or girls, it's more like what you're talking about. And that as we put these nuclear weapons of destruction of self esteem, you know, boys bully verbally and physically, girls bully relationally. And then you put social media, and they are really brutal. I mean, they can be very mean to each other. But these companies haven't taken responsibility, and I would like to see our school does not allow devices Kara Swisher · 42:51 Yes. Our school does too. They have a little they have a thing they put them in when they come in. Scott Galloway · 42:56 Little Just talk about your permanent record. The other issue you talked about and is I think this cancel culture not cancel culture. This I think this the latest, whether it was Reuters or Conde Nast deciding to punish people ten years after a mistake they made when they were literally minors. They were younger than 18. I think we have to start that zeitgeist bullshit from our society. I think you get to etch a sketch your history before the age of 18 for your professional life. And I think if you said something stupid on social media when you're 17, I just don't think it should be allowed to haunt you. Kara Swisher · 43:27 Agreed. Agreed on that. Except if it's egregious. There is egregious. There is some egregious people. Scott Galloway · 43:32 Well, some minors are tried as adults when they start killing people. Yes. We have enough nuance to say if someone says something stupid or off collar when they're 17, they shouldn't be fired when they're 28. Kara Swisher · 43:41 Agreed. And I think you take that into account in some ways. I mean, my... I had an issue with a video at my son's school and he was... He didn't do the video, but he was in it. And, you know, I... We made him apologize to the girls. It was a very anti girl thing that the... One of the teams did that he was on and they he was there in the background laughing. And, again, we... He got up and apologized to the girls in a in a public setting. He did this himself. He's a really good kid. And... But still, it was... I was... It was cringe inducing, like, oh, what... Why why don't you leave? Like... But of course, you know, social pressure and things like that, it's really hard. Or maybe you didn't know it was being taped or whatever. In any case, it's... You're gonna... Any parent is gonna deal with this issue over and over again. And especially as they get older in a much more sexualized way, you know, trading... The trading of pics happens. I'm sorry to tell you, Scott, but there's gonna be that. It's gonna happen. And so so that's you have to really pay attention. At the same time, you don't wanna be sort of this, let me have your phone, you can't use it because it does does hinder them in so many ways, especially with online. Because a lot of, like... By the way, all their classes are online and their assignments, they're all their assignments and, you know, nobody... Everyone operates in an online environment at that school, at least for assignments and homework and turning it in and writing it up. I am just gonna be so relieved next year when everything's in person. And by the way, Clara is going to school too. But it's I'm just gonna be so relieved when everything's in person. I can't even... Think it's been a big experiment in crappy education this... During the pandemic. Scott Galloway · 45:15 But there's... I'm I'm sort of... I mean, another thing you have to contend with is that I think that there's something, and I have two boys, so I think about boys a lot. I think there is an advantage and there's something to their aggressive, rebellious exploration where they don't get caught. Now they get caught on everything. Now everything, give me your phone, give me your password, and you see everything they've done the last twenty four hours. I don't know if that's good either. When I their mom has Kara Swisher · 45:46 don't do that. I don't Scott Galloway · 45:46 do that. Well, that's the thing. When their mom says this... Hears about something at school or hears about something off color with one of the kids and says, alright. Everyone's fine. I'm like, I think they need some room and some privacy to screw up. Mhmm. And if I look at the, you know, the shit I got into, first off, when my mom left at eight in the morning, we didn't see each other till 10:00 at night. I mean, just, kids are so over programmed and so over that there's a difference between guardrails and concierge and bulldozer parenting where they don't learn, you know, it's that Jonathan Haidt notion, we use so many sanitary napkins on their life, they don't develop their own immunities. It's a tough balance. These companies, keep in mind, these companies are not concerned with their children. They want to addict Kara Swisher · 46:29 that Scott Galloway · 46:29 is certainly. They want to addict them. These devices are purposely and these social media platforms are purposely addicted... Addictive. I think you can get involved in your school. I'm really thankful our school does a really good job. The only thing we seem to be able to do is to put a time clock on it. But I'm not exaggerating. When we go in to the den and we ask our youngest to get off of Minecraft or whatever he's playing, it's literally like telling someone to stop smoking crack. Yeah. He looks... I mean, he literally looks at me like, Namibia self, kill father and sleep tonight. It's just... It's Kara Swisher · 47:01 just too far. Scott Galloway · 47:02 Yeah. Oh, I don't know. Kara Swisher · 47:04 Mean haven't. I agree with you. I agree. It's really... It's addictive. There's no question. And one of... You know, we believe that kids should make mistakes, and, obviously, you know, Scott Galloway always makes mistakes and we're right here publicly, and we love Scott Galloway · 47:14 Going to space. You're lucky. Kara Swisher · 47:18 Anyway, that's a great question, Leland. I I... If I had to name... I guess I guess Roblox, I suppose, I had to name a company. There's several others that try really hard. And and and by the way, pick and choose what they're watching on television too. That's what I do. That's that's the one great thing about streaming now is you can really pick and choose and you don't have to be part of an endless, you know, vomit... Vomiting up of ads and stuff like that for kids. — Predictions segment begins — Scott Galloway · 47:43 So by the way, just just a quick footnote on space. Yeah. These guys are tempting disaster. Oh. Every really terrible decision usually involves in the corporate world involves ego, and these guys competing against each other. And this is where capitalism meets space exploration. There'll be some externalities. And that is you now have three megalomaniacs. And that's probably not true of Richard Branson, but three three people who explicitly or implicitly are putting pressure on their organizations to get them into space. And I'm telling you, Kara. Space travel is expensive and really dangerous. Kara Swisher · 48:19 Yeah. Scott Galloway · 48:20 They are Kara Swisher · 48:20 Is this Scott Galloway · 48:20 your prediction? Tempting they are tempting disaster. It's just... It'll be really... I don't know. The whole thing, quite frankly, and I'm I'm more anxious. Get old. The whole thing makes me nervous because I think that there's now individuals nobody wants to let down, and they've announced with either press that they are gonna go into space. This is the space travel. And by the way, might be worth it. I had a a kid who works with me say, I think it's wonderful that billionaires are spending money on exploring space and opening new worlds, and I'm like, that's a nice optimistic view. Yeah. It'll come at a cost, and the cost will be more than money. It is dangerous, expensive workspace travel. Kara Swisher · 48:58 Alright. Scott, one more quick break. We'll be back for predictions. [Ad break] Kara Swisher · 50:01 Okay, Scott. You just sort of predicted something with space travel that Jet Blaze is gonna blow up. I believe that's what you're just saying, or one of them is gonna... There's... Odds are. Maybe, maybe not. Maybe they'll come back safely or not come back at all and stay there and live and enjoy themselves up in space. But what is your prediction besides that dire prediction? Scott Galloway · 50:21 I think we're gonna see I think we are going to see an examination of the difference between income and wealth. We're gonna hear a lot more about what it means to be wealthy and what is your role as a citizen. And I think it's gonna be an interesting conversation. And I don't know if it's gonna be a wealth tax. I think most likely they'll go after trusts. I think real estate taxes are probably a lot of those loopholes are gonna be closed. But we have hit... I really... I'm very encouraged. I think a lot of immunities are kicking in. And people have said, you know, enough is enough. And I think COVID nineteen has really laid barest a lot of those lot of those externalities. But we're probably going to see some sort of AMT introduced where it's So AMT, Kara Swisher · 51:03 explain how that would work. Scott Galloway · 51:04 Well, it's an alternative minimum tax. It says, Okay, if reported $10,000,000 in income or wealth whatever it is, and you ended up paying less than x percent, we want you to pay at least x. And Yeah. I mean, that's what the the AMT, basically, new g seven intra sovereign or the the international tax treaty is basically saying these guys are going to have an AMT of 15%. And that is they've got to pay at least 15% on their profits. And no matter what tax deductions or gymnastics or low tax domain they manage to get into, the minimum is going to be 15%. And I think that's the beginning. I think we're about to see a lot more of that. And what happens is, I mean, to a certain extent, it's sort of the bad LBO of America. An LBO is people show up, layer a company with debt, take Kara Swisher · 51:53 That out is a leverage buyout. But go ahead. Scott Galloway · 51:55 Leverage buyout, and then take out a bunch of payments or dividends to themselves or lever it up more and get take all their money out and then say to the company, alright. Best of luck to you. And if things work, you know, we want even more money back. There's been sort of an LBO of America, and that is we've issued incredible debt. It's like, our debt has skyrocketed. Our government spending really hasn't gone up that much as a percentage of GDP until the last year. Mhmm. Taxes on on the middle class and the lower income have actually not gone up, they've stayed flat. What's changed is that we've decided to lower taxes as a percentage of GDP on the wealthy. I think that That must end. I think that's changing. And so anyways, I think this G7 tax treaty is going to there's going to be different forms of it that come into America. And I think there's going to be some sort of AMT on the top 1%. — Predictions segment ends — Kara Swisher · 52:45 Certainly put a lot of energy into Elizabeth Warren and all those who are calling for this, for sure. 100%. And there's more to come. They they only did five really of the people. I'm gonna make a prediction, Scott. Scott Galloway · 52:56 Go for it. Kara Swisher · 52:57 So I just noticed nobody really knows Carolyn Everson, who has been working at Facebook forever, very close to Sheryl Sandberg, is leaving the company after a long time. I mean, I'm assuming she's just retiring, and she's got a lot of money and everything else. I think it's gonna be a hot summer for Facebook, and I would see some other major executives there leaving. There's a book coming out by Shira Franklin, Cecilia Kang of the New York Times called An Inside Facebook's Battle for Domination. I think there are some things in here that are not gonna be good for many executives there. So I I haven't read it. I haven't seen it, but I I am hearing a lot. They're very worried at Facebook internally about it. Scott Galloway · 53:35 They're worried about the book? Kara Swisher · 53:36 Yes. And so we'll see, we'll see. I just think, you know, when saw Carolyn leaving, I was like, that's interesting. I think there's gonna be a lot of people front loading this situation. Scott Galloway · 53:46 Why wouldn't she go be, I would think it's, I've met her once. She struck me as a very talented executive. She is. Yeah. Why wouldn't she go be the CEO of TikTok or something? Kara Swisher · 53:55 I don't know. Maybe she is. I don't know. Yeah. She is a very competent executive. She's been their ad chief for a long time. Anyway, I just... I don't know. I just feel like there's gonna be quite a few departures and a a real turnover there. I think at some point, it's so wearying and exhausting and especially there's gonna be a drumbeat around this book. It just... This isn't gonna stop for them. And so at some point, these executives are like, that's... I've had enough or something like that. Or maybe I should get it or I don't want this to be what I have to say at dinner parties or I don't know. I just... I don't have a feeling. That's my feeling. Scott Galloway · 54:25 That's your feeling? Kara Swisher · 54:25 That's my feeling. That's my feeling. I just... I didn't get a lot of attention, Carolyn Levy, and she's a very important executive, also someone who's been very close to Sheryl Sandberg in the past. They're they're very good friends. Anyway, don't forget if there's a story in the news that you're curious about and wanna hear our opinion on, go to nymag.com/pivot and submit a question for the show. Leland, your question was excellent. Scott Galloway · 54:47 I was. Kara Swisher · 54:47 Love all the excellent questions we get. Scott, read us out and try not to cross a line. Okay? Try. Scott Galloway · 54:53 Today's show was produced by Rebecca Sinanis. By the way, this is the third take of the credits because the dog is feeling salty, and I did an NC 17 read on the first one, and everyone's saying no. So here we go. Ernie engineered this episode. Thanks also to Jubaros. Yeah. We thank him every week. Snooze. Make sure you're subscribed to the show on Apple Podcasts. If you're an Android user, check us out on Spotify or, frankly, wherever you listen to podcasts. If you like this show, please recommend it to a friend. Thanks for listening to Pivot from Box Media. We'll be back next week for another breakdown of all things tech and business. Kara, have a great weekend. Kara Swisher · 55:23 Thank you, Scott. [Ad break]