Pivot · May 5, 2020

Congress weighs liability for businesses, Amazon will put its $4billion profit into its supply chain, and Anand Giridharadas on "Rich Corona; Poor Corona"

Automatic transcript of the end of the episode, from 44:17. Speakers are labeled by software and may contain errors. Highlighted passages are Scott’s predictions.

Scott Galloway · 44:17 Of Norway. Give us two or three things. If you were king and had a magic, you know, had a magic wand, what would you like to see congress pass in terms of... Kara Swisher · 44:24 He is king. Scott Galloway · 44:25 Go go ahead. Look at that hair. In terms of legislation, tax policy, gestalt in our society, what two or three things correct, course correct? Guest · 44:34 It's a great question. I I think number one, as a as a policy matter, we would... The the the time for the wealth tax is is overdue. I think the way I've seen the conversation Let's push pause Scott Galloway · 44:50 right there because I understand the notion of it. But if France tried it, and then the wealthiest man in France moves to Brussels, how do you take the most mobile capital in the world and that is rich people and then decide you're gonna tax what they believe is already theirs, so you're violating their private property rights, and not have a bunch of billionaires move to Singapore and end up with a lower tax base than we have right now. Guest · 45:08 So so so this is where I'm gonna offend your listeners in Europe. Scott Galloway · 45:12 Yep. Guest · 45:13 And and an appeal to patriotism. Yep. Which is one of the advantages we have in this country is this is kind of a place you can't not be. You're... Scott Galloway · 45:24 Come on, America. New York. Yes. It... I mean... You can't get food anywhere like you can get in the East Village. Is that what you're saying? It's worth it. It's worth it. Guest · 45:32 Take the time of the market. Right? I mean, it's 25% of global demand on a bunch of different things. Kara Swisher · 45:38 Right? So if, like, if you're Guest · 45:40 a bank who just doesn't wanna be in The United States, like, you can afford to not be in France. A lot of companies are not in France. Scott Galloway · 45:45 That's a great point. Guest · 45:45 I just don't know... I don't know a lot of ambitious global companies that are not... Don't need revenue from America. So Right. So that's one. Second, everybody wants to get into our universe. A lot of people want a lot of stuff from us. And we are very bad at actually having any leverage for that. So, I would say, Michael Bloomberg would really leave America if we took a 10% wealth tax every year, which would still be probably about half Scott Galloway · 46:12 I'm sorry. You said 10% increase. You said 10%? Guest · 46:15 Right. Which is like higher than the Bernie thing. Right? But just think about this for a second. Most of these people earn, let's say, 20% IRR every year. Right? Return on greater... Return on capital. Right? So even something higher than the Bernie tax Scott Galloway · 46:29 Right. Guest · 46:29 Would actually see them all getting maybe 10% richer a year instead of 20% richer a year. Right? That that scares them. Warrants was two or 3%. Right? So warrant would have slowed them from getting richer at 20% a year to getting richer at 17% a year. And that was horrifying to them. Yeah. So I think we have the leverage as a country to do that and not see them all run away. And if they all run away, maybe it would be better. And if it wasn't better, we can shift it. Scott Galloway · 46:55 So so it... That's a great argument. I love... And I love that you said it, and I felt some real American pride there. Because on a smaller level, if you live in Manhattan, you pay 11 to 13% incremental taxes or 11 to 13% additional tax rate versus living in Florida. But quite frankly, living in Manhattan is worth it. Living in Short Hills, New Jersey or Greenwich, Connecticut, maybe not worth it. So you're saying America is worth it. 20%... You couldn't get a wealth tax over 50 bps because if you started charging billionaires 10%, one down market, you cut their wealth in half, they will move to Singapore. Yeah. Even America isn't worth it. Guest · 47:32 Think what you're saying is America is the New York of Florida. There you go. Scott Galloway · 47:37 You go. Perfect. You know? Perfect. That's... Guest · 47:40 And I think a second thing, is not a policy thing, although there are policy fixes that would help it. I would say, particularly in this moment Right. We need a wave of young people going to public service. Going into public service every Kara Swisher · 47:54 Scott discussed that last week. Discussed the... Guest · 47:57 And now is a good time because you know what? Those jobs are secure. Scott Galloway · 48:01 Yep. That's right. They're hard to Guest · 48:02 be fired from millennials, have no security. This is gonna be... Kara Swisher · 48:05 Corona core is what Scott is calling it. Corona core. Guest · 48:07 I would say we need a massive shift in in young people going to public service as the place they go to change the world. Kara Swisher · 48:16 Alright. Speaking of change of our last question because we gotta get going. Bezos was called before congress. He wasn't compelled to do so. What do you think the legislation that was moving towards controlling some of these tech companies, antitrust, all these other things, controlling their... In the end, controlling their wealth will go from now on. You know, I had Guest · 48:36 this idea a couple of years ago, which has not has not caught on, which was, you know, creating something called the commission on American reform, which would have been to identify four or five big things we could do. And the rule for any idea was it has to have, like, 80% public support. Right? We're not even gonna look at things that are partisan. We're look at things that are just much loved on both sides. I think you can get there on a wealth tax, by the way. I think a big area where you could get there is antitrust. I don't think anybody has... You know, carries water for Facebook being a monopoly or Amazon being... People who work there. Who who else who else care? For for whom is that an important issue of principle to defend their right to be a monopoly? And Agreed. And so that's an example where I actually think if you had creative politicians and you had a sensible Republican Party instead of a white nationalist cult, you actually might be able to say, there's a there's a, you know, 30 to 40% of people in this party and a 100% of people in this party who might be able to real... Make real headway on that. And by the way, that's not socialism. Right? That's capitalism. What we have... Having massive areas of American life where there's only one company able to operate is the most Soviet thing you can possibly do. They're better Kara Swisher · 49:50 than the Soviets. They deliver on time, and you get what Scott Galloway · 49:52 you need. Yeah. But so let's just review this. So we have a wealth tax, we have national service, and we have antitrust. That seems all like a reasonable way to oxygenate the marketplace. And if you will recalibrate, I mean, a step towards tyranny is when private power co ops government instead of being a countervailing force. The economy would boom, I think, under a lot of what you're talking about, Anand. Before Anand goes, Kara, should we should point out that Anand has a new show, and it Yes. It plays on Vice Thursday nights at 10PM. Oh, wait. That's the... That's when my show plays. By the way That was... I will crush you. I will crush you. Kara Swisher · 50:29 My Oh my god, Scott. Scott Galloway · 50:30 Wow. Kara Swisher · 50:31 Anyway, it's called That was the worst show plug [Ad break] Kara Swisher · 50:35 Am gonna do... I will do a good one, Anand. Anyone, check out Anand's show, Vice TV's seat at the table. Scott Galloway · 50:41 Very good. Kara Swisher · 50:41 Airs on Wednesdays at 10PM on Eastern, and maybe check out Scott. You don't have to if you don't want to. Anyway, Anand, thank you so much Scott Galloway · 50:49 for Thanks, Anand. Your Guest · 50:50 Congratulations for having me. Appreciate it. Thank you. Congrats on yours. Kara Swisher · 50:54 Thanks. Bye. Scott, one more quick break. We'll be back with wins and fails. That was bracing from on on. [Ad break] — Predictions segment begins — Kara Swisher · 52:37 Alright, Scott. We're gonna do a quick round of wins and fails. Just go for your wins and fails. Move along. Move along. Scott Galloway · 52:44 Well, to to Anand's point, in terms of COVID nineteen being an accelerant more than a change agent, J. Crew is supposed to file for bankruptcy this morning. Actually, it probably is. We're gonna see just a raft of retail bankruptcy, which is sort of this Who else? Names. Senna. You know you know what could really surprise people, Kara? Could really surprise people? The gap. Kara Swisher · 53:04 The gap. Scott Galloway · 53:04 The gap could probably go out of business, which is is staggering to feel. You're gonna see Neiman Marcus filed last week. It's probably only a matter of time. I don't wanna be a grave dancer and send stocks down, but most of the department stores, especially retail apparel. Yeah. And there'll be a few surprises in there too that we just aren't aren't expecting. Kara Swisher · 53:21 Who else? The Gap? Who else? Scott Galloway · 53:24 These are all Kara Swisher · 53:25 mainstays of malls. Scott Galloway · 53:26 Ann Taylor. Remember that? Ann Taylor, Loft. You could see... I mean, there just could be anything... Almost Kara Swisher · 53:34 anything in that apartment's Is there anyone be immune an apple or just like an H and M or a Uniqlo immune or not? Scott Galloway · 53:39 Oh, the elephants that survive this will have more foliage. Your Sephora's, your restoration hardwares are gonna be stronger coming out of this. There'll be some big winners. There'll be some Kara Swisher · 53:50 And what makes you a winner versus a loser? Scott Galloway · 53:53 Oh gosh, we're gonna need a bigger boat. But way you could almost do an initial proxy is the percentage of sales you get from e commerce, how differentiated your product is. I mean, at high, low, either incredible value or incredible luxury, anything in the middle is gonna gonna gonna get crushed. So it's gonna be it's gonna be just fascinating. Speaking of lose... Losses, and I did... I kept quiet post our launch because I predicted that this just made no sense, it was a terrible strategy, and it was tech it was tech people playing media. Kara Swisher · 54:26 Quibi. The lawsuit. Scott Galloway · 54:28 Yeah. Quibi. Quibi's already... I said, look. I predicted Quibi was dead on arrival. And and then media a analyst clapped back at me and said that he had seen Quibi content. Yeah. I I underestimated him. Anyways, their projection was they were hoping to get 7,000,000 sign ups. They've signed up a million. I think Quibi probably gets sold in the next six months, and it'll be a it'll be a mercy killing. It'll get sold for sold for a dollar to somebody. Kara Swisher · 54:53 And also, there's a lawsuit, Paul Singer, around this around this use technology. Scott Galloway · 54:58 Key technology, around landscaping or the way you pivot pivot the Yeah. I talked to Jeff Kara Swisher · 55:04 Zuckerberg and he... I mean, sorry, Jeff Katzenberg. I'm sorry, Jeff Zuckerberg. Around it, and he was he was dismissing it as out of hand publicly. Scott Galloway · 55:13 Well, none of them... What's the CEO gonna say? It has real merit and we're in trouble? Kara Swisher · 55:17 Yeah. But he went out of his way to say they're idiots, essentially. Scott Galloway · 55:21 Yeah. But Have you... But you started watching a little bit of Quibi. Are you still watching it? Kara Swisher · 55:25 I went... The minute billions came, you know, I was watching Homeland. I I stick with the... Netflix is the one I'm really really watching a lot in terms of long form. And I know... I don't see the... I think Quibi... I would watch Quibi if I was commuting or somewhere for ten minutes. I'm nowhere for ten minutes anymore. I'm either sitting down and watching or I'm working. And so I don't there's no there's not that downtime, that commuting time, that waiting time that you have when you're in your normal life essentially. And so I suspect I would use it... I don't I don't sit down with it. And I do sit down with Netflix, and I do sit down with Comcast and things like that. Scott Galloway · 55:59 But Quibi... And I'll... My my first class, and I'll go professorial here or professor Light. Quibi violates some basic tenets of strategy right out of the gates. And that is, there's only kind of three things you need to remember, I call it the hurdles test. One, is it differentiated? Two, does anyone care about that differentiation? Is it relevant? And finally, you're fortunate enough to have a product that's differentiated and relevant, do you have assets, culture, IP, capital that makes it sustainable and you can own it? And what they had here is potentially something that was relevant. People's short attention span, short form video, But it's not differentiated. YouTube has all kinds of short form video, and it's also absolutely not sustainable. What could they do to own short quick bites? This was a strategic error. Jeffrey Katzenberg and Meg Whitman in a billion and $0.5 is... Are real assets. And instead, they found something, a a value proposition that strategically was just flaccid. This just thing made no sense strategically from the outside. Kara Swisher · 56:56 Alright. Okay. So a dollar. That's your... That's a good... Guest · 56:59 That's a... That's also a Scott Galloway · 57:00 What's your win? Did you have a win? What's your win? Kara Swisher · 57:03 Win. I cleaned my house this week. I moved into a house, and all the boxes are gone. That's my win. Scott Galloway · 57:08 Congratulations on that. Well done. Kara Swisher · 57:11 A win. I I like the Joe Biden, Elizabeth Warren thing. I thought that was interesting. I do feel a little the weather has turned, and I know it sounds crazy, but it makes me more hopeful. Scott Galloway · 57:21 That's nice. So... And and our win... Our... I think what Bezos has done here, vaccinated supply chain is just overwhelming from a business and a strategic perspective. And that's just so exciting, and it's gonna make it only that much more interesting when we break up that company, and Amazon Fulfillment becomes its own entity. That That company can end up being on its own worth one of the 10 most Kara Swisher · 57:42 powerful I make your argument all the time to people. It's a better company for everybody because there's lots of companies you can invest in. Scott Galloway · 57:48 Broken up. Kara Swisher · 57:48 Broken up. And he'll be richer than ever. He'll be a trillionaire. He'll be a trillionaire. Yep. The world's first trillionaire. Anyway, Scott, it's time to get out here. It's a very long show. Don't forget if there's a story in the news that you're curious about and wanna hear our opinion on, email us at pivot@voxmedia.com to be featured on the show. We've gotten a lot of great stuff via mail. We also be happy to respond to you on Twitter. We love Twitter. So let us know what you want us to talk about. Someone just said they wanted us to talk about education, and we shall do so. And vote for Pivot for the Webby Awards best business podcast. If you don't, we won't like you. Is that a good way? — Predictions segment ends — Scott Galloway · 58:22 Yeah. And Kara Swisher needs more awards. Kara Swisher · 58:24 You need one. You need one. I'm doing it for you, Scott. Scott Galloway · 58:27 Zero to one. There was a book on that. Zero to one. Kara Swisher · 58:31 Alright, Scott. Scott Galloway · 58:32 Today's show was produced by Rebecca Sinanis. Our executive producer is Erica Anderson. Special thanks to Drew Burrows and Rebecca Castro. If you like what you heard, please hit subscribe. Have a wonderful week. Enjoy enjoy just how beautiful it is Kara Swisher · 58:48 outside the Scott Galloway · 58:49 wonderful time to be alive, emerging into a new tomorrow, a hopeful new tomorrow. Kara Swisher · 58:55 Kara Yes. Scott Galloway · 58:56 I am thinking about you only because you're appearing on my TV show this Kara Swisher · 59:00 I've gotta go shower. Scott Galloway · 59:01 If it doesn't work, it's your fault. Kara Swisher · 59:03 Gotta go shower right now. So I gotta go. Scott Galloway · 59:05 Eel macchiage up, baby. Bring bring on the eel macchiage. Kara Swisher · 59:08 Alright. Scott, see you soon.

Didn’t happen

Resolved May 5, 2021 · 12 months after it aired

Pivot #104 · Aired May 5, 2020

Most department store chains, especially in retail apparel, will file for bankruptcy.

One year into pandemic, Main Street bankruptcies continuenbcnews.com

2 more sources

How we graded it

Counts as true if: A majority of major department store chains file for bankruptcy in the following year.

While 2020-2021 saw a wave of department store bankruptcies (JCPenney, Neiman Marcus, Stage Stores, Lord & Taylor, Stein Mart, Century 21, Belk), the largest and most prominent national chains—Macy's, Kohl's, Nordstrom, and Dillard's—avoided bankruptcy entirely by cutting costs and raising capital through other means. Since these major chains by revenue and store count represent a significant share of the 'major department store' category, a true majority of major chains did not file for bankruptcy, making Galloway's specific prediction not strictly fulfilled despite being directionally correct about industry distress.

Researched and graded by AI on Oct 13, 2026

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