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Sagar Enjeti
We need your help to build the future of independent news media and we hope to see you@breakingpoints.com turning now to AI. Let's go and put this one up here on the screen. Very interesting story here from Notice an internal Treasury Department warning is warning about the dangers of AI. So there's a draft report that allegedly exists inside of the Treasury Department. It is set to warn the risk posed by an artificial intelligence market liking key aspects of it to dot com that upended the US economy in the early 2000s. The document, the existence and contents of which have not been previously reported, is actually a huge departure from the public tone of the administration, which is part of why it's actually important. So here's what they write. Career treasury analysts found that AI firms are more deeply entrenched in the US Economy than their dot com predecessors and pose significant risk to the entire system if financial conditions change, productivity goals are missed, or various choke points stymie growth. A downturn in the AI market would send shockwaves throughout the entire economic ecosystem. The report concludes an AI bubble popping would lead to less of an immediate crash than the US economy experienced in the early 2000s, but that the companies would cut back, investors would lose confidence, and the economy would likely grow more slowly should the industry falter. Quote stock markets, private, private credit markets, companies financing data center buildouts, cloud providers, chip manufacturers and utilities would all feel the effects. Trump administration officials have never voiced similar une in public. And a Treasury Department spokesperson dismissed the findings as, quote, unvetted and not representative of the agency's policy or views. Quote, the official position of the secretary and the U.S. treasury is that artificial intelligence will be a key driver of America's new golden age. So they're betting the farm. This is basically who's president.com? was it Clinton or Bush by that? Probably. Oh, it was Clinton.
Host/Announcer
Right.
Sagar Enjeti
So when I think about it, so it was Clinton. I guess it's a little different. Cause he was completely on the way.
Ryan Grim
Different crashes. Yeah.
Sagar Enjeti
Right.
Ryan Grim
March 2000 is really when it starts to down.
Sagar Enjeti
Yeah. But if Clinton, I guess, had a future or Al Gore or somebody would be like the future of our economy. Maybe. Probably.
Ryan Grim
I mean it was right. Like future the economy. It's interesting. The future of the economy was the Internet.
Sagar Enjeti
Right. But in 2014.
Ryan Grim
And just like with the railroads later, the future was the railroads.
Sagar Enjeti
Yeah. But 20 years later, the canals.
Ryan Grim
Railroads kind of eclipse the canals.
Sagar Enjeti
What I think is interesting is basically just the. Because it's. We've all been saying this. Everybody knows it to be true. It doesn't take a genius to figure it out. However, having a internal report here which warns about this against your public positioning. This is the type of stuff which can come back to bite you in the ass. Right. Because it's kind of like if I'm thinking back to remember the bin Laden in 2001, how Bush received that briefing in August 2001, it was like bin Laden determined to attack the United States. It was totally dismissed at the time. Routine part of the CIA briefing. But then the 911 Commission happens. If people are like, hey, oh my God, how could you have done this? Or let's say in 2008, nobody, I can guarantee you at the time of, what was it, Glass, Steagall repeal, nobody said a word, right? Nobody knew he was paying attention. They were like, yeah, whatever, rubber stamp. It is what it is. But after 08, everybody's like, how did this happen? So I think that this is an example, I think of what the future will look like. And you know, having a draft report like this, which you dismissed, I mean, it's a scandal, right? Because you're saying, wow, you guys knew that this was a problem. You didn't do anything to cap any of the problems. You had these career analysts who were warning you, this, this and this. Right now it's all gravy. I mean, let me check, you know, where, where are we at today? S and P futures? And this is pretty high. Yeah, the S and P is still up by 10% year to date, even though we had a massive, you know, Iran war horrific situation in the last year. It's up by 21%. We're a full blown bull market and it's like five years and the S&P is up 72%. Right. So that's insanity. So everybody's in, you know, it's just like the good times. But I was reading a little bitabout.com several. I think it was a year or two ago and I did not realize, you know, if you had invested at the top of dot com, the market did not reach that high again until like 2013. So 13 years of a black hole, you're like, oh my God. So I mean, America has not been through anything like that. Basically we had that and then 08 and 08. Even in terms of the recovery, it's not the recovery, I think that we want it. So the fear here, Ryan, is I think what they talk about on the back end, it's not about the AI companies going bust, it's that all the GDP spend is AI. The data center built out is AI. A lot of the big tech companies which compromise all of the S&P 500, which is everybody's retirement accounts, is all in Nvidia and Google and Meta and all of these other companies whose entire bet is on AI. I mean, Tesla is now trying to do AI. SpaceX is an AI company. It's not a rocket company. Right. You know, their biggest driver right now is like selling compute to anthropic. And then Anthropic and OpenAI alone are both going to be $2 trillion collectively when they go IPO. So all of that is just going to make up such a huge part of the economy where you're exposed no matter what, like no matter what you do, no matter what business you're in. And then that kind of capital crunch which will come and if there's a downturn, it will have serious, serious problems for everybody.
Host/Announcer
Yeah.
Ryan Grim
And I, AI is here to stay. AI is going to like, you know, for better or for worse. But the idea that there won't be some pullback.
Sagar Enjeti
Right.
Ryan Grim
At minimum that like what I would rather hear from a Treasury Secretary is like, yes, when we have these massive shifts in our economy there is always. And Zuckerberg has said this himself, he's like, yes, there will be some multi hundred billion dollar investments that will be a mistake and that will vanish.
Sagar Enjeti
Yeah. He literally said that. Yeah.
Ryan Grim
It's like, okay, fine, at least you're clear headed about how insane this is. You want to hear whether it's the railroad boom or the Internet one that you're planning for the pullback. Okay, there's going to be a pullback and here's how we're going to make sure we get a soft landing for the entire global economy. You don't want to hear, actually it's going to be fine. The number is just going to keep going up and up and up.
Sagar Enjeti
Yeah, exactly. That's where you're going.
Ryan Grim
Because everyone else it was like, why would that be the, why would be the first time in history that that is going to happen? Right.
Sagar Enjeti
I was reading, I don't, I'm not a trader, I don't know the exact, you know the exact details. But I was reading about this new financial product which Kalshi offers, which is like a highly leveraged liquid options market which offers more leverage than a traditional Wall street bank. And I was like, oh, what could go wrong? And they were like, this is the biggest growth center of our company beyond sports betting. And I was like, seems bad. You know, it's like, isn't that illegal? Nothing's illegal.
Ryan Grim
Now where's the SEC on this?
Sagar Enjeti
It's not regulated by that, it's regulated by cftc. So it's like, it's a different financial product but it's the same thing. I mean it just like is it
Ryan Grim
regulated by the CFTC or they just
Sagar Enjeti
doing it Kalshi's regulated. Well, yeah, right, exactly. Technically regulated. But if you go back to 06, nobody knew what a credit default swap was. Nobody. Everybody found out in 09 when they're like, how did this happen? Right? So there's all kinds of these products which are swimming out there, and commoditized car loans and all this debt. And who even knows the leverage that exists behind AI? We have no idea. I mean, if the Iran war had not happened, the number one economic story actually would have been all of these private credit markets. There were all of these private lines of credit which were being called in by the big banks. Nobody even knew what was going on. I believe it's still happening as of today. By the way, what's also interesting about this is the tone shift in the AI CEO. So let's put this one up here on the screen. This is C3, guys. And what they talk about here is that big tech, after. After public opinion on AI has dramatically downshifted, is that the tech CEOs, Sam Altman and Dario and Zuckerberg and Jensen are all suddenly not saying the quiet part out loud anymore. Now it's no longer AI jobs. Well, AI is going to wipe out all of your jobs. It's about how AI is going to grow your jobs. So, quote, a year ago, the message from many business leaders was that AI was going to wipe out jobs. For the past month or so, tech CEOs have been striking a more optimistic tone. In late May, Sam Alt, who has previously predicted seismic shift in the workforce, has now said, we've been roughly right on technological predictions and pretty wrong on the social and economic implications. Soon after, he told cnbc, our industry underestimated how much we're gonna be able to keep people at the center of everything. Very big difference, I think, here. And now you also have here they say, Dario, who in May of 2025 had said that there will be, you know, more who had made in 2025 that AI was gonna eliminate half of all jobs a year later, now says that companies, quote, can do the same thing with less resources and that leads to things like layoffs or they can do more with the same amount of resources. But that requires creativity. In a June essay, the executive now writes that in giving warnings of job displacement, he had wanted policymakers to have the best chance at adapting. He was not trying to be a, quote, prophet of doom, and also wrote, the possibility of enduring job loss remains so softening the fall. If this were to come on Friday,
Ryan Grim
we talked about Alex Karp's what people call it a meltdown. That's just an Alex Karp monologue. It's not a meltdown. It's just. That's how he talks on cnbc.
Sagar Enjeti
It's called autism.
Ryan Grim
There's a clear moment, though in it that is so revealing where he's so angry at Sam Altman and these others who he calls these prophets of doom, saying, you're going to get us a wealth tax. And that's what all of this is about. They feel like they have been too honest about what the implications of their technology are going to be for particularly the white collar public, which still has some political purchase in this country. And they're going to use that remaining power that they have to implement a wealth tax.
Sagar Enjeti
Exactly.
Ryan Grim
And he's like, guys, stop talking about how we're going to make everybody unemployed because that's making them upset and they're gonna come for us now, so stop. So now they're gonna lie to you and be. This is just a little agent that's going to help you out in your job. There's going to be more jobs. Don't tax our wealth.
Sagar Enjeti
Don't worry about it.
Ryan Grim
And in the UK they may move on a wealth tax. We'll see. And the UK was the first to move on a progressive income tax more than 100 years ago. And then that kicked it off around the rest of the world. And these oligarchs have very long memories. They hated the income tax when it came in hit the wealthy and they are desperately trying to avoid this wealth tax. I can't get my head around why somebody like Alice Carr. What's he worth?
Sagar Enjeti
I don't even know.
Ryan Grim
100 billion. God only knows 7.
Sagar Enjeti
I think probably 7 billion.
Ryan Grim
Let's see, like, why does he care about a wealth tax?
Sagar Enjeti
Between 12 and 16 billion.
Ryan Grim
Okay, 12 and 16 billion dollars. What's he care? A couple billion. I mean a couple 2%. Pay it back.
Sagar Enjeti
I mean, look, you're. Okay, I'm not defending.
Ryan Grim
There's nothing he wants in this world that he can't buy unless he has some demented. Well, that's probably some demented.
Sagar Enjeti
Here's the populist argument. What's that? Is it Steinbach? Was it Steinbach who said the problem with America is that every person sees themself something about like a dispossessed millionaire, Something like that. He said America will never have socialism because every American thinks that they're just a millionaire who hasn't made it. I've butchered the quote. I'm Sorry, but I believe that was a Steinbeck quote from sometime in the Great Depression. So there is an element of it where, I mean, remember, what's the book, Thomas Frank, what's the matter with Kansas? I mean, there is a genuine element of it where people are like, hey, that's not fair. These are titans of industry. These are titans of, you know, whatever. They've done all this great stuff for society. I think that might have been true even, you know, in the industrialist age where you could make an argument and Carnegie and all those people were building all these temples to their own ego with the libraries. But these guys, they don't even pretend like it's all just like, we're going to take your job and we're going to get filthy rich.
Ryan Grim
And they've said they need to maybe do a little.
Sagar Enjeti
Yeah, they're like, right.
Ryan Grim
They do a little better with this.
Sagar Enjeti
So for them, they're like, hey, cool it. But their best argument that they have is like, well, it was a billion and now it's 50 million. Soon it'll be 1 million or something like that, right? And so the average guy could be worth a million. And generally, I mean, the most conservative people in the country are actually small business owners, right? Because they're the ones who actually manage all of their own taxes. I get it. It's a, a literal nightmare having to do all of it. But part of the reason is that that block is usually because they're the most taxed people in the country because of the way that they make money. These are some of the least taxed people in the country. Generally, the way that they try to weaponize it is about innovation, et cetera. But I think if you look at the polling for how the people feel about the wealth tax, what it comes down to is they're like, look, we get it. Maybe it's unfair to tax unrealized gains, but at the end of the day, we don't give a shit. You guys are super wealthy. We don't care anymore, right? Like, we need to punish you. And I mean, when they're affecting society in the way that we are, like sometimes the problem is they argue with wealth tax in terms of like fiscal, you know, oh, it wouldn't even be going to anything for everybody else. They're like, it's purely punitive and we're fine with that, right? They're like, they're like, we don't care.
Ryan Grim
We don't care if it gets wasted.
Sagar Enjeti
They're like, we don't care if it gets wasted.
Ryan Grim
You're wasting it.
Sagar Enjeti
Yeah, we don't like you. Like, that's what they don't understand is people hate them. And here's a good example. Let's put
Ryan Grim
Steinbeck, I think the quote you were thinking of, he called Americans temporarily embarrassed capitalists.
Sagar Enjeti
That's it. That's what it was. It was something like that.
Ryan Grim
Yeah, they're like capitalists. They just don't have any capital yet.
Sagar Enjeti
Yeah, it was like he said something. It was in the Great Depression. I remember he said something.
Ryan Grim
It's like his essay, a Primer on the 30s.
Sagar Enjeti
There you go.
Ryan Grim
That's the Sagar endorsed essay.
Sagar Enjeti
I mean, you should go read it. He was a genuinely insightful guy. Let's put C4 up here on the screen. So this Griffin found this one perfect example. Like, when you're gonna do stuff like this, you got the Nashville Zoo. It is now a battleground in the data center race. So let's talk about it. So before the sun has risen, they say a club leopard, no bigger than her hands, wiggles impatiently, waiting to be fed by the Nashville Zoo's animal health director. The newborn sucks eagerly, his tiny paws paddling the air with every gulp. But now zoo officials say that a planned data center just beyond the perimeter, quote, could introduce constant noise, light and industrial activity that may disrupt the environmental conditions critical not only for the leopard breeding program, but for the more than 3,000 animals that call the zoo home. Now, this is a classic ruining the mood style debate. Yeah, you're gonna ruin the leopards. You're gonna introduce all this noise and you could. I mean, what's the argument for it? Well, this is about technological innovation. It's a zoo. It's an animal. Ultimately, it's for our kids entertainment. Right, but this is the problem that the AI CEOs have never gotten to Data center for. What? What are you doing for me? Right. If you're really wealthy, my stock is going up. Okay, that's great. Right? But for everybody else, you're like, oh, you say you're gonna replace my job. I get a bunch of AI slop of kittens turning into dancing monkeys on my phone. That's it. Like, what am I getting out of this? Right? And that's fundamentally the problem, I think. Right.
Ryan Grim
What you're getting out of it is your job getting taken.
Sagar Enjeti
Yeah, right. Well, according to them previously, except not now. Oh, we've changed our outlook. You actually flagged this. That guy you had on William Lawrence just has some polling. Let's put C6 up here on the Screen. This is a new favorability that they found. Do you have a favorable or unfavorable opinion of data centers? And in his poll he found 19% favorable, 74% unfavorable.
Ryan Grim
Yeah, man. He's in a three way Democratic primary for in a swing district which is currently represented by a Republican, this guy Tom Barrett in Michigan. The other two candidates are kind of these corporate Democrats who are afraid to say anything about the data centers. You know, they express concerns. He's like, no, shut down the data centers. Data center moratorium.
Sagar Enjeti
Right.
Ryan Grim
And as a result, according to what looks, you know, his analysis of his own polling, and I think we can all agree that it's pretty fair analysis, is that his opposition to data centers is the thing that is elevating him in the primary. He's probably going to win the primary even though he's the kind of most left wing candidate in a swing district. And it's because people are like, I don't care if you call him a socialist or he was a co founder of Sunrise Movement. I don't care if you call him an eco socialist. He's against these data centers. I'm against these data centers. And if you're a Republican too, that same poll showed that independents preferred him by 19 points over the Republican, which that's ball game in a swing district if he wins the nomination and if they don't pummel him with whatever. And it's all about the data centers. So the independents were like, I don't care if you call them a socialist. And they also polled your attitudes on the Democrats, Democratic socialism and a bunch of other things. The least unpopular was Democratic socialism. For him it was still a negative.
Sagar Enjeti
Well, I mean, take a look at Utah and this whole Kevin o' Leary situation. What just happened? I mean Fox News had to apologize. He smeared these people.
Ryan Grim
They're worried about getting sued as Chinese
Sagar Enjeti
communist activists or whatever. And it's like, really? Utah is full of a bunch of Chinese communist liberals. Utah, one of the most conservative states in the country. And this is rural Utah too. About what we're talking about. Like, are you joking, dude? Like no, that's not what this is about. And so look, I mean I just think for them, you know, you're talking about the wealth tax, AI and all of that. Everybody can see the number go up. But number go up doesn't apply as much. Right? It applies when you're worth 12 billion. 12 to 16 is a lot. It doesn't apply so much when you're, you know, let's say you, what is it? 50 something percent of people don't even have a retirement account. So the only number that matters to them that should go up is wages, which guess what hasn't gone up. The only number you see going up is gas.
Ryan Grim
That's the key point. Western economies for the last 20 years or so have been growing at about 1%. The richest top 0.1% have seen their wealth grow by way more than 1%. That means we don't have a whole lot more wealth to spread around. So as they gobble it up, there's less for everybody else. That is just unless we can figure out a way to start growing the economy at 10%. The wealthy growing their wealth at 10% gobbles our wealth.
Sagar Enjeti
It's actually more than 10%.
Ryan Grim
It's way more than 10%.
Sagar Enjeti
I just gave you the numbers. It's like 20%.
Ryan Grim
And as they get richer and richer and richer, they have to do something with that money. And what they do is they invest it in assets, stock market houses like commodities. So they're buying up everything. And the power of exponential exponential growth means they will own everything at some point in the not too distant future.
Sagar Enjeti
That's the track that we're on.
Ryan Grim
Unless we tax their wealth.
Sagar Enjeti
All right, let's get to Caroline Levitt.
Host/Announcer
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Krystal Ball
here, which means we all want to look and feel our best. A GLP1 may be right for you. Visit orderlymeds.com to learn more about which GLP1 you could be eligible for. Getting started is is fast, easy and happens virtually through telemedicine from licensed professionals. Check it out for yourself. Go to orderlymeds.com podcast. That's orderlymeds.com podcast. Taking care of yourself feels great. Compounded medications are not FDA approved. Eligibility required and determined by a licensed provider. Individual results may vary. See website for details.
Ryan Grim
Hey, it's Ryan Reynolds here from Mint Mobile. Now I was looking for fun ways to tell you that Mint's offer of unlimited Premium Wireless for $15 a month is back. So I thought it would be fun if we made $15 bills, but it
Sagar Enjeti
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Ryan Grim
So there goes my big idea for the commercial.
Sagar Enjeti
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Krystal Ball
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Sagar Enjeti
Turning now to Caroline Levitt, the White House press secretary. So she was enjoying the fourth of July festivities with Jesse Waters. Rya, who is not even wearing a suit despite the fact that he's outrageous. Yeah, it is outrageous. Zoran Lamdani can wear a suit when he's swimming in a pool. What the fuck are you doing? Right, but let me put that to the side. So Jesse Waters sitting down. They're just shooting the shit. We're here with Caroline Levitt and in that Caroline drops this nugget on Gen Z, her fellow Gen Z, how they're lazy with silver spoons in their mouth. Let's take a listen.
Krystal Ball
Begging to come here right now.
Ryan Grim
Some of these kids, and I call them kids because they're in their 20s and they've never had real jobs and they're complaining things are expensive. Yes, things are expensive. When you don't have a real job, do you think that's getting traction? Complaining?
Krystal Ball
Unfortunately, I do. Because this generation, my generation, I hate to say it, Gen Z and those younger than me have been raised with just silver spoons in their mouths, just getting everything handed to them. That's not the values this country was built on. It was built on meritocracy and hard work. Pulling up your sleeves, pulling yourself up from your bootstraps and achieving the American dream and, and we need to protect it with all we have.
Sagar Enjeti
Is it laziness?
Ryan Grim
A little bit. Is it because the professors said country's corrupt, it's evil and we just need to shake them down and hand money out?
Krystal Ball
It's laziness and it's the liberal indoctrination you bring up a great point about our education system. However, I will say a silver lining. So many parents that I talk to across the country are homeschooling, are turning to private education, are turning towards Christian schools across the country because they don't want their children being taught these communist and liberal ideas slammed down their throats. Why President Trump in our, in the White House has advocated so strongly for school choice across the country. We want kids to be taught to love our country. They should. It is the greatest country in the history of the world.
Ryan Grim
All right, I say, you know, if they misbehave, just make all these young kids join the army. Right?
Sagar Enjeti
Shape them up. I almost had to send them to Cuba.
Ryan Grim
Send them to.
Krystal Ball
Send them to Cuba. They'll want to come back real quick.
Ryan Grim
That's a good point.
Sagar Enjeti
Okay, so if you're Gen Z, you're mad about house prices, you're mad about gas prices, you're mad about McDonald's prices, drink price, whatever, whatever, weed prices probably that you people are mad about, that's one I'm not gonna fight for you on. But you're mad, you're mad. It's because you're lazy and you got a silver spoon in your mouth. Now let's put her clarification up here. She says, I am seeing a lot of bad faith actors take my comments from this interview out of context. So here's the full interview. Let me expound. The interview was about the rise of communism on the left. I was asked by Jesse Waters why so many young people are buying the false premise of free stuff being sold by communist politicians. My answer, a combination of laziness. Yes. And the liberal indoctrination that has been taking our place in our education system for far too long. These far left educators are pumping students out of garbage, convincing them that hard work and sacrifice won't pay off down the road because they want them totally reliant on the government instead. I went on to say, President Trump is a huge advocate for school choice, blah, blah, blah. I care enough about our country to tell uncomfortable truths. It's an undeniable factor. A growing number of young people in our country are falling for the lies of socialism Communism sold to them by anti American politicians who never built anything, offer no real solutions, are intent on tearing everything down that makes this country great. At the same time, it is true that many Gen Z Americans are hardworking, entrepreneurial, deeply patriotic, and it's vital we protect the American dream for them. That's why I'm honored to work for President Trump and On behalf of administration that is implementing the right policies to lower taxes, less regulation, stopping Wall street from purchasing single family homes. Trump accounts the deportation of illegal aliens who are taking our housing and jobs. There is more work to do, which is why Trump and our entire administration won't stop fighting to make life better and more affordable for young people. So here's why I think that's gonna fall very, very deaf. She explicitly said that they're lazy with silver spoons because they're bitching about affordability. And that's. Look, really, I actually think it all comes down to housing. And the more I meditate on it, the more I talk to people about it, the more radical I get actually, whenever it comes to housing and like housing solutions. And this is where they just, it's funny because they talked about it endlessly on the campaign. Inflation, inflation, inflation, inflation. Right, and inflation, because that was, it was the bedrock of the affordability conversation. Which eventually, you know, leads to people like Zoramdani, which is very effectively. Remember his early ads about the halal carts making it $8. Again, like those. That is exactly what people care about the most. And it's genuinely what just sucks all the money out of any of your disposable income. Because people keep pointing to, well, people make more money. It's like, well, things cost a lot more. And then the wage to income ratio, the wage to price ratio of housing, Compare it to 2000, 1980, 1970. I mean, it's exponential compared to where things were before. So for people who have either student debt or let's say you didn't go to college and you're looking at your upward mobility, you do not see the same path that your parents had. That's why so many people live at home with their parents. Now. That's not the American dream. It might be financially prudent. It's not the dream. No, I don't think anybody wants to wake up at age 29 saying, yeah, I live at home, you know, with mom or dad. I have no ability upward mobility. I have no ability to even foresee being able to buy a home to achieve any sort of, of independence. And then they complain about people saying, you know, falling for rent free stuff or whatever. It's like, well, in some cases, part of the reason why you may go in that more radical direction is because the middle path, which was always told that was going to be achievable for you, you know, for a fact, is not financially attainable in this moment in time, especially if you live in a Medium to high cost of living area.
Ryan Grim
It's incredible to think that Jesse Watters is this lead primetime host of the biggest kind of right wing news outlet and Levitt is the spokesperson for the President. The President of the United States. So these are effectively the two leading spokespeople for what was sold to the American public as a populist movement.
Sagar Enjeti
And not just sold. I mean, it actually worked like people under $100,000 voted for Trump.
Ryan Grim
Right?
Sagar Enjeti
Absolutely. That has never happened before with a Republican ever.
Ryan Grim
Right. So they successfully sold that to people. And if you listen to them now, it is the most bankrupt reactionary.
Sagar Enjeti
Like, yeah, this is like Mitt Romney
Ryan Grim
on steroids, just yelling at people for being lazy. Like, are you. Like, what even is this? And also just so, like, watching those two intellectual heavyweights go back and forth, like batting around these, like, these high ideas is just kind of embarrassing.
Sagar Enjeti
Did you notice that if they complain that we're gonna send them to Cuba.
Ryan Grim
No, we're gonna send them to Cuba and Iran.
Sagar Enjeti
Come on now, that's like czarist Russia. You know, you take the best, you send them to the front line. Or actually even the communists did it. Stalin did it too. It's like, oh, you complained. We're gonna send you onto the war.
Ryan Grim
I mean, also a little late on Iran. We already lost that war.
Sagar Enjeti
Yeah, right.
Ryan Grim
So how are you gonna.
Krystal Ball
How are you gonna.
Sagar Enjeti
I mean, I do think that this is important because this actually triggered a big right wing meltdown, at least like with a lot of the influencer. Because they're not stupid.
Ryan Grim
Who. I noticed they ripped Levitt personally.
Sagar Enjeti
Yes.
Ryan Grim
Because they're like, you married some like super rich guy like that. Okay, so, okay, great advice, everyone. Go out and marry some super rich guy 30 years older than you. Like, congratulations. Like, that's.
Sagar Enjeti
Nobody was.
Ryan Grim
I mean, obviously she's very talented and hard worker and like, blah, blah.
Sagar Enjeti
Nobody is judged. Nobody previously to that had been making a whole thing about her personal life. But you can't be standing on the shoulders of married wealth whenever and talk to people and say you're late. That's, you know, come on, let's all be honest here. Like, you can Google the press secretary's salary. I'm pretty sure it's like 175 grand, which here in Washington is just not that lot of money anymore. And I think that's actually what gets to it, is that even the people who work very, very hard, they. And make a lot of money. Like objectively make a lot of money in terms of the American economy, even they are struggling and it's all because of housing. And yet, Trump. I missed this. I tried to be completely offline. And yet so many people sent me this that it was one of the few things I actually saw while I was off. Here it is. Trump says he wants to drive housing prices up, not down. Let's take a listen.
Ryan Grim
There's so much talk about, oh, we're gonna drive housing prices down. I don't wanna drive housing prices down. I wanna drive housing prices up.
Sagar Enjeti
Yeah, great. Let's just bail the boomers out even more. You know, they don't have enough money. You know, we gotta pilot more on top of them. Let's just cut their property taxes. Let's make it even more unattainable.
Ryan Grim
Yeah. He's like, people will be sad if you. If their housing prices go down. I saw a chart going.
Sagar Enjeti
Housing prices going down is indicative of a healthy condition because. And again, I get it, if you bought your house, it sucks, okay? But sorry, we have a literal national crisis.
Ryan Grim
You'll be okay. You have a house.
Sagar Enjeti
Yeah, you have a house. Whereas if you look at Austin, if you look at any of the other metro areas where they permit a significant amount of housing, they were able to drop overall rents by a. That's a lot like 13, 14%. I'll give you a per. You know, one of my friends, she lives in New York City. She was posting apartment listing for her old apartment in 2021, which is now three times the price today for rent for the same place. Nothing else has been done. She's like, I paid X. And this is what it's now listing for. That's insanity. And this is the one which is actually beyond nuts and relates to AI. Let's put D4 up here on the screen in San Francisco, this was alluding to even 180 grand tax salaries are no longer enough. If you go and you. This blew me away. The median home price in San Francisco. What do you think it is, Ryan?
Ryan Grim
Oh, God.
Sagar Enjeti
The median home price. Just how's it San Francisco's median home
Ryan Grim
price, According to Red, 1.5 million.
Sagar Enjeti
1.7 million is the median home home. 1.7. Half of houses sold on million dollars is the median home price. The national median is 450,000. And if you go and you take a look, what they see is that the average apartment rent is now surpassed New York City reaching 3,800amonth. And that's not a nice apartment. So we're talking about the average apartment rent is 3,800amonth with the median price at $1.7 million. They specifically point to the AI boom. They're like, look, Uber made a lot of people wealthy, but this thing is gonna make people, like orders of magnitude more wealthy. There will be 10,000 new millionaires, multimillionaires, 10 deca millionaires. Not to mention, you know, not just trillionaires, like hundreds of billionaires like Dario and Sam Altman and all these other people. All the, you know, even a junior level executive off of these IPOs is going to net 15, 20 million. So you're talking about insane amounts of wealth in this one tiny little city, which is NIMBY to hell. This is what happens. Now, San Francisco is a very extreme example, but it is also the rest of the nation. If you take a look at the places which build the least housing, of course you see massive increases in home values. And at the same time, you have the boomers who live in those homes. Their only lobbying is to make sure that they have to pay less in property tax. They don't care. In fact, most of them lobby against building any new housing. And I am not one of these yimby insane people who's like, oh, we should just build ugly glass apartments everywhere. Like, I don't think that's family friendly or any of it. It's great if you're 22 years old, but if you're 32, like, what are we doing here? But, you know, where's the 1500 square foot single family rancher home? They don't even exist. Nobody builds it. There's no federal government program. There's no state program. If you try to build it in a dense neighborhood, God help you. The boomers, they will do everything to try and to torpedo, you know, you be, oh, what about the schools or any of that? It's like, shut up. Like, honestly, you don't even care about schools. I just read a great story in the Wall Street Journal yesterday. Boomers who are bragging about living in schools that they grew up in. So they're taking schools which have been decommissioned because the fertility rate has gone down and now converting the school into luxury apartments. And this woman who's like 65 years old said, I grew up here, it's so nice to live here. I'm like, yeah, it must be nice for you.
Ryan Grim
All right. She literally went to school there.
Sagar Enjeti
She literally went to school there. And now it's a luxury apartment for boomers because the fertility rate's gone down and because no families can afford to live there anymore that's sick or it's sickness. And guess what? I bet you should be lobbying for drop property tax. Not just, you know, that particular one enraged me.
Ryan Grim
Your property taxes go down if your home value goes down.
Sagar Enjeti
Yeah, yeah, exactly. There you go.
Ryan Grim
Think about that.
Sagar Enjeti
You could think about that. I don't know, I mean, just, it genuinely enrages me because, you know, we, you know, we meet a lot of people who do this, you know, who watch the show and all of a sudden, and this is the number one thing we always hear about.
Ryan Grim
Everybody's locked out.
Sagar Enjeti
Everybody is locked out. They're like, man, how's it? And you know, you know, when people pull in, they, you know, they profile people in this story who are making like $400,000 in San Francisco and they're like, can't afford it. Literally can't afford it. They're like, they, they applied for a $5,000 a month apartment and there were 38 people who applied the same day. Yeah, 5,000 60,000 a year in rent. Can't afford it. I mean, they're like, oh, maybe I need to move or we got to do long distance. I mean, it ruins your life. And especially with now you've got in person work mandates which are ratcheting up in tech especially, who are all lucky to have a job in the middle of AI. So they have no negotiating or bargaining power whenever it comes to a worker. So yeah, I have become extremely radical on the housing issue and watching things like that when people are either drowning in student loan debt, credit card debt with no upward mobility whenever it comes to wages and a median home price of 450k. And if you look at the median home price ratio to income compared again to 20 years ago, like you got no business telling anybody that they're lazy with the silver spoon.
Ryan Grim
Well, this is a huge crisis. So this is actually a good transition to our next segment. Let's see how the political system is responding to this existential crisis that so many people are facing. And let's get to it. Let's see what the former Senate Majority leader is doing.
Host/Announcer
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Krystal Ball
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Ryan Grim
Have you ever found yourself craving a cold snack?
Krystal Ball
Yep.
Sagar Enjeti
Montucky makes my favorite cold snack. It's a cold, snackable beer. Montucky is a light American lager from Bozeman, Montana. Go to montuckycold snacks.com snack-finder to find Montucky cold snacks and a retailer near you. And if you're looking for some Montucky merch, use important all one word for 20% off their merch store we haven't
Ryan Grim
heard much about Senator Mitch McConnell lately. Let's throw this up here. According to the Associated Press, he's continuing his recovery, but details are scarce after a lengthy hospital stay. Sagr I think the word recovery there is doing an awful lot of work because as you and I and probably our viewers understand the word recovery, it suggests that there's you're gonna get better, some physical therapy going on, you're working toward recovering your health, or some version of it that does not seem to remotely be the case. Let's put up a 2 here. So what happened is that Mitch McConnell suffered a heart attack at home on June 14th. When paramedics finally got there, they immediately began performing CPR. CPR was, you know, they continued to perform CPR on his way in. If you have a heart attack and you're at home at McConnell's age and by the time EMS gets there and they find you unresponsive and begin CPR, your brain by that point has been without oxygen for so long that the likelihood of you kind of recovering consciousness is just vanishingly low.
Sagar Enjeti
He's 84 years old.
Ryan Grim
84 years old. There's no evidence that he has regained consciousness at any point since then.
Sagar Enjeti
Here's what his spokesperson says. Senator McConnell is still working closely with staff on Senate business and Kentucky matters as he continues his recovery. However, he will not be voting this week. That was his spokesperson, David Popp, and that was actually given on July 1st. So that was six days ago as of what he said. Now the more recent one is that he is continuing his recovery. They offered no explanation. Working with stock of his condition.
Ryan Grim
Really?
Sagar Enjeti
Well, look, I mean in the old days, maybe you could take that to the bank in a post. Dianne Feinstein world. Come on. All right, we all saw it, we watched it. Who was it who leaned over and was like, just vote yes. I couldn't believe that. And she looked, look at the way that she looked.
Ryan Grim
Like she looked dead.
Sagar Enjeti
And she died a week later. It was disgraceful that they did that to her. That her staff sat around and dealt with, I mean all of it. Like it was outrageous. And the circumstances of this are nuts. Cuz this is a United States Senator, an extremely powerful person who, you know, if he's incapacitated, then his people should say so, maybe even his wife. And yet, let's put this next one up here on the screen. She is in China meeting with senior members of the CCP after his hospitalization three days after he received cpr. Elaine Chao is now currently in Beijing and met with the Chinese Vice President days after hospitalization. Chinese media shows Chao sitting across from Zhang on June 17th discussing efforts to strengthen China US relations. Remember, you'll recall if you've been watching the show for a long time. Elaine Chao is the daughter of some Taiwanese shipping billionaire who is extremely close to the Chinese Communist Party. The entire thing has always been objectively bonkers whenever it comes to his wealth or his power and her extraordinary wealth and ties to a foreign government. But I mean, who does that? Like your husband's in the hospital and you're in China. What's going on there? No explanation. The point about this, we're just talking about the housing thing. They just feel it's our business. You have no right to question it. Did you see, Remember we talked about that congressman who was missing for like three months and nobody said where he was.
Ryan Grim
His staff, Tom Keene, the New Jersey
Sagar Enjeti
guy, he said, I had depression. Yeah, you can't take three months of work, bro.
Ryan Grim
Just tell us that.
Sagar Enjeti
Just say I'm deeply depressed, I couldn't work. I mean, to be Honest with you. Like, that's outrageous. I mean, how many blue collar guys do you think are depressed and they
Ryan Grim
don't want to go?
Sagar Enjeti
They don't get three months off. Yeah, I couldn't take three months off.
Ryan Grim
No, we wouldn't know that.
Sagar Enjeti
I had a baby. I took one month off. Right. That's a much more. That's, that's a reasonable. And you know, I got. I know we own the company. I guess I could do whatever I want. I wouldn't do that.
Ryan Grim
We would just shame you every day.
Sagar Enjeti
He's depressed. He's too depressed to work. I mean, that's okay if it's true, but I don't know, I mean, should that really be tolerable? Like, maybe you should resign? Should the people of your district just have three months of no representation? And that's a crazy case, but in this particular case, it's like, so the wife offers no update, the senator offers no update. The staff apparently just thinks that we can all live in limbo for 21 days and just say, yeah, he's recovering. And we have no idea whether any of that is true. There's no proof of any path to recovery. And so look, there's all kinds of rumors that are circulating out there. Thomas Massie, let's put his tweet up here on the screen. He says, is America ready for my term limit legislation titled three strokes and you're out. I'm with ya, Thomas. I am totally with you. Three strokes, you know, a modest proposal. Just three strokes, you know, just not one, not two, but three. Three strikes and you're out. It's crazy. The entitlement. He's an 84 year old man, literally went on camera, can't speak. What are his children doing? You know, you don't say anything, your wife, your, your family, nobody says like, hey, you gotta hang it up. I remember saying this with Biden. I go, does anybody love this man? If you really love somebody, how could you let them do that? You know, out in public, it's just again, the gerontocracy, they're clinging to power. Their narcissism, how the office serves them. They are never about serving you. It's all on display now.
Ryan Grim
If McConnell is incapacitated or does die, then under Kentucky law, there would have to be a special election. They changed their rules back In, I think 20, 24 to strip the governor.
Sagar Enjeti
Right.
Ryan Grim
Because they had a Democratic governor.
Sagar Enjeti
Yes.
Ryan Grim
So they said if, if there's a vacancy, there has to be a special election. No gubernatorial appointments and so, and this was when McConnell's health was failing then, too, this was understood to be about McConnell. So if, if he is incapacitated, dead, there'd have to be a special election. And that's where Thomas Massie Massey comes back in. Because he would be able to mount a short term kind of independent campaign. You know, it's, you know, everybody running in the same field and that could draw votes away from the Republican and elect the Democrat. You could even plausibly see a world in which Massie won. Now, he'd only be in office for a couple of months. McConnell is not running for reelection. His term is up at the end of 2026 to early 2027. But if McConnell is kind of on some sort of life support and being kept alive to keep Massie out of office or from running, that is exactly what Mitch McConnell would want.
Sagar Enjeti
Oh, absolutely.
Ryan Grim
So that is. That is.
Sagar Enjeti
It is truly his dying wishes. Yeah.
Ryan Grim
To make some petty partisan move with his ailing body.
Sagar Enjeti
His dying wishes are to, I don't know, like, fund Ukraine for till the
Ryan Grim
end of time and to block Massie from.
Sagar Enjeti
Look again. You know, I don't want to besmirch an 84 year old man who is, you know, in bad health, but that's why you should have left a long time ago. Right? You made it our business, man. You are the person who made all of this our business. You could have left with dignity.
Ryan Grim
You ran for reelection.
Sagar Enjeti
You ran for reelection. You were 78 years old. That is disgraceful. Especially whenever you were already having lingering health problems and you had multiple health incidents on camera and still stayed in office. It's crazy.
Ryan Grim
So don't you want to do anything else with your life?
Sagar Enjeti
I kept thinking about that in Maine with Susan Collins, because. How old is she now? She's like 70 something.
Ryan Grim
Yeah.
Sagar Enjeti
She had previously pledged. What is. She had pledged only two terms. I'm telling you guys, this is 73. This is 73 years.
Ryan Grim
This is six more years.
Sagar Enjeti
One of the most gorgeous places in the world, in my opinion. Just my opinion. And I'm like. And she's a multi millionaire, I have to assume. Cause they all are. Retire. She gets great out of yourself. Some lobster, you know, some oysters. What else do you need? It's like you got sunshine. It's like you're in the middle of the woods. Go on a hike every single day.
Ryan Grim
Go see the world. Not on a codel.
Sagar Enjeti
Yeah, go see the world. You can even fly first class. You don't even fly a comet.
Ryan Grim
She can Fly private.
Sagar Enjeti
She's so rich. She could fly private. She could see the world and vacation every summer in Maine.
Ryan Grim
But that needs to be a lock set for psychology. Yeah, Right. And be very concerned about all his behavior.
Sagar Enjeti
What is the psychology of these people? But that's it. They're raging narcissists.
Ryan Grim
Tom Harkin, who I actually hope I'd have on the show soon, who was Iowa. Yeah. Iowa senator.
Sagar Enjeti
Yeah.
Ryan Grim
He was the leader now American hero. Well, he ran for president. Was he ever leader? I don't know.
Sagar Enjeti
I don't know. He was very.
Ryan Grim
I remember that lion of the senate. And in 2014, he's like, you know what? I want to retire and my wife and I are going to sail around the world and it costs Democrats to seat. But, you know, good for Tom Hawkins.
Sagar Enjeti
In retrospect, heroic.
Ryan Grim
Honestly, Joni Ernst is only a senator because of that decision. Or was it?
Sagar Enjeti
That's right. That's right. Because it was in the Tea Party time.
Ryan Grim
Yeah.
Sagar Enjeti
Okay. Interesting. All right. Good bro show, Ryan. The people will have another bro show tomorrow. So we will see you all then. We're about to go do our ama. So there we go.
Krystal Ball
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Sagar Enjeti
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Ryan Grim
This episode is brought to you by Bobcat. They started the compact equipment industry through grit, determination, and a whole lot of think we can't do that.
Sagar Enjeti
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Ryan Grim
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Episode Date: July 7, 2026
Episode Title: AI CEOs Panic Over Job Losses, WH Press Sec Attacks GenZ As Lazy, McConnell Still Missing After Heart Attack
This episode tackles three major stories: (1) an internal Treasury Department warning about AI’s economic risks and the shifting narrative among AI CEOs about job loss, (2) White House Press Secretary Caroline Levitt’s controversial comments on Gen Z and affordability, and (3) the political vacuum created by Senator Mitch McConnell’s severe health crisis. Krystal, Saagar, and Ryan Grim dive into the economic, social, and political ramifications of these developments, highlighting establishment failures, generational divides, and the persistent grip of America’s political gerontocracy.
[02:03 – 21:35]
Leaked Treasury Report on AI Risk:
Historical Parallels & Potential Fallout:
Financial Market Warning:
Shifting AI CEO Messaging:
Public & Political Pushback:
[23:38 – 37:34]
Caroline Levitt’s 4th of July Interview:
Hosts’ Response:
Trump’s Comments on Housing:
Housing Crisis Severity:
Public Backlash Against Out-of-Touch Elites:
[39:52 – 49:19]
Sen. McConnell’s Incapacitation:
Political Entitlement and Gerontocracy:
Implications for Kentucky and the Senate:
Krystal, Saagar, and Ryan maintain a sharp, irreverent tone—critical of political and economic elites and notably sympathetic to the frustrations of the working and middle class. Their analysis is grounded in populist outrage, skepticism toward “official” statements, and deep frustration at perceived generational and class betrayals.
On Wealth Tax and AI Panic:
“You're going to get us a wealth tax ... Stop talking about how we're going to make everybody unemployed because that's making them upset and they're gonna come for us now.” (Ryan Grim, 12:00)
On Political Gerontocracy:
“If you really love somebody, how could you let them do that... it's just again, the gerontocracy, they're clinging to power. Their narcissism, how the office serves them. They are never about serving you.” (Sagar Enjeti, 45:47)
On the American Dream's Decline:
“That's not the American dream. It might be financially prudent. It's not the dream.” (Sagar Enjeti, 28:14)
If you missed the episode, this summary gives you the arc and flavor of Breaking Points’ signature cross-ideological populist approach, combining economic, social, and political analysis with a biting, sometimes darkly comic critique of America’s power structures.