8/11/26: China Shuts Down Billionaire, FP Defends Flock, Hidden AI Bailout

Summary

Breaking Points with Krystal and Saagar

Episode: 8/11/26: China Shuts Down Billionaire, FP Defends Flock, Hidden AI Bailout
Release Date: August 11, 2026
Hosts: Krystal Ball and Saagar Enjeti
Special Guest: David Dayen

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Episode Overview

This episode centers on three major stories:

1. China’s crackdown on billionaire Leaf Li and the offshoring of wealth
2. The controversy over "Flock" surveillance cameras in US localities
3. A potential hidden taxpayer-funded AI bubble bailout mechanism in private credit and life insurance

The hosts dissect the political, ethical, and structural consequences of these events, contrasting US and Chinese systems, exploring surveillance and policing, and analyzing the obscure risks in AI investment and insurance. The show features sharp, critical discussion with memorable commentary and a pointed interview with David Dayen from The American Prospect.

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Key Discussion Points

1. China’s Crackdown on Billionaire Leaf Li and Offshoring Wealth

Segment Start: 02:17

Main Story

• The Wall Street Journal likens Leaf Li to "China’s Charles Schwab." He built FUTU Holdings into a NASDAQ-listed powerhouse for mainland and overseas Chinese investors.
• In May, Chinese regulators levied a $271 million penalty against FUTU for unlicensed offerings to mainland clients. This led to a 30% drop in share price and tanked Li’s net worth.
• The Chinese government views unchecked billionaire capital and offshoring as a threat to the state's primacy—decisively shutting down offshore tax avoidance and control by domestic oligarchs.

Insights & Commentary

• Saagar: “You work for us, and whatever we tell you to do, when we tell you to jump, you're gonna say, how high?...They have completely shut that down any foreign flight of capital.” (04:58)
• Krystal: “You can't help but admire the lack of corruption that this, that this indicates, because you could not imagine a service that not only was run by a powerful, very wealthy person, but then is servicing all of the powerful, wealthy Americans. That our government would come in and say, oh, no, you can't do that. We're shutting this all down...” (06:40)
• The hosts draw a sharp contrast to the US system, where the billionaire and financial class can often operate unchecked due to political influence.

Notable Analysis

• China forces its graduates into STEM and tech, avoiding the “Wall Street-ification” seen in the US.
• Focus on national sovereignty and economic control is depicted as yielding stronger insulation from billionaire-driven capitalism.

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2. Corruption and Lack of Scrutiny in US Political Finance

Segment Start: 08:51

Main Story

• Saagar shares a recent story of possible corruption and lax scrutiny surrounding Trump and crypto donations.
  • Example: $100M in Trump crypto from an investor with a dubious background ("Bobby Zhao"), little vetting, and open questions of influence.
  • Pattern of secrecy, questionable donors, and transactional relationships recurring in Trump’s financial dealings.

Additional Corruption Example

• Krystal recounts the Kushner-Ivanka Albanian property scandal, revealing a history of suspect deals involving gangsters, real estate fraud, and possible money laundering.
• Krystal: “You could literally tell this story every day of the week of some utterly shameless, level, corrupt, skeezy deal. And much of it has to do with crypto...” (12:44)
• Both stories highlight the contrast between the state's grip on oligarchy in China vs. the relative impunity for the US elite.

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3. The Flock Surveillance Camera Debate

Segment Start: 19:30

Context

• Mass deployment of "Flock" license plate reading cameras in US cities for police surveillance.
• Bari Weiss’s “Free Press” recently defended the system, sparking heated pushback over privacy and error rates.

Arguments in Defense (Bari Weiss)

Segment: 20:02 – 21:25

• Flock helps solve abductions and crimes (cites 10,000 missing cases in 2025).
• Only targets “bad guys”—no threat to law-abiding citizens.
• Public backlash targets the wrong enemy.

Hosts' Counterpoints and Critique

• Sagar: “Vintage privacy arguments from, like, the war on terror era. But... are these claims even true?...LAPD audit reveals a 32.3% false positive stolen vehicle alert rate.” (21:25)
• Krystal: “It's so dishonest in her little vertical video to not talk about any of the instances of misuse that have been documented...Tell me that Flock is not interested in you unless you're a kidnapper or thief, et cetera. Tell that to the woman who was stalked by her abusive ex...” (23:57)
• Many municipalities cancelling contracts due to privacy, error rates, and abuse by law enforcement.

Memorable Segment

• Local News Example: Police in Brookfield, WI, mistakenly pull over and surround an innocent motorist—guns drawn—due to a Flock error. (26:29)
  • “How long till this gets someone killed?” – Krystal (26:29)
  • “Where do you draw the line? Because that logic will work forever. Of. Okay, well, if we just put cameras on every street...Is that worth it to you?” – Krystal (27:09)
• Public outrage: Town Facebook post about a man arrested for anti-Flock vandalism draws unanimous community support for the perpetrator. (27:08–28:15)
• Both hosts emphasize the lack of transparency, lack of regulation, and lack of democratic accountability.

Key Takeaways

• Surveillance tech is being introduced without public debate, oversight, or robust checks/protections.
• Saagar: “If you want to defend it...it needs to be taken to a ballot. A locality must vote on whether they want themselves, you know, to be surveilled all the time. They need guarantees, independent audits. And none of that's happening. That's what's so terrifying about this.” (30:27)

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4. Hidden AI Bailout Mechanism: Private Credit & Life Insurance

Guest: David Dayen from The American Prospect
Segment Start: 34:20

Main Story

• Private equity control of life insurance companies is creating a “backdoor” state taxpayer bailout risk tied to the AI bubble.
• The bulk of AI buildout debt is being funneled through private credit, often onto the books of life insurers acquired by private equity firms.
• If these insurers become insolvent due to risky AI/data center loans, state taxpayers are on the hook via automatic tax credits designed to “backstop” insurance policies.

Mechanism Explained (35:15 – 38:10)

• Unlike pre-funded deposit insurance (FDIC for banks), insurance bailouts are post-facto: solvent insurers pay for failed firm policies, then claim dollar-for-dollar tax credits from the state.
• If the AI bubble bursts and loans default, this safety net would trigger one of the largest taxpayer-funded corporate bailouts in history—without explicit congressional debate.

Notable Quotes

• David Dayen: “Private credit, which has a lot of AI related assets, make these insolvencies a bit more likely...the popping of the AI bubble could trigger this process by which state taxpayers would essentially be paying for the sins of these life insurance companies owned by private equity.” (37:00)
• Sagar: “It's almost an ingenious way—very similar to how they were able to keep the mortgage-backed security fraud going for so long and to have a built-in bailout.” (44:31)
• Krystal: “It does remind very much of the financial crisis where there were all these linkages beneath the surface, and also the ratings agencies also being asleep at the switch or compromised...” (46:53)

Risks and Lack of Oversight

• Most state regulators don’t understand or oversee these loan portfolios.
• Ratings agencies for private credit are paid by the lenders, not objective.
• During crisis, 50 separate state-level resolve efforts may be needed, an untested and potentially disastrous scenario.

Final Thoughts

• The confluence of opaque finance, regulatory gaps, and the capital intensity of AI is likened to the pre-2008 run-up, signaling systemic risk not yet recognized by the public or lawmakers.

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Notable Quotes & Moments (by Timestamp)

• Saagar: "You work for us...They have completely shut down any foreign flight of capital." (04:58)
• Krystal: "You can't help but admire the lack of corruption that this indicates...That our government would come in and say, oh, no, you can't do that. We're shutting this all down." (06:40)
• Krystal: "Tell me that Flock is not interested in you unless you're a kidnapper or thief, et cetera. Tell that to the woman who was stalked by her abusive ex..." (23:57)
• Sagar: “If you want to defend it...it needs to be taken to a ballot. A locality must vote on whether they want themselves, you know, to be surveilled all the time...” (30:27)
• David Dayen: “The popping of the AI bubble could trigger this process by which state taxpayers would essentially be paying for the sins of these life insurance companies owned by private equity.” (37:00)
• Sagar: “It's almost an ingenious way—very similar to how they were able to keep the mortgage-backed security fraud going for so long...” (44:31)
• Krystal: “It does remind very much of the financial crisis...all these linkages beneath the surface, and also the ratings agencies also being asleep at the switch or compromised...” (46:53)

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Timestamps for Major Segments

• 02:17 – China crackdown on billionaire Leaf Li & discussion of state vs. oligarchy
• 08:51 – Trump/crypto donation controversy & Kushner Albania deal scandal
• 19:30 – Flock cameras: privacy, error rates, community outrage
• 26:29 – Local news story: armed police incident due to Flock error
• 27:09 – Ethical debate: where to draw the surveillance line
• 34:20 – Interview: David Dayen on hidden AI bailout via private insurance
• 35:15–38:10 – Mechanism of the insurance-taxpayer backstop explained
• 44:31 – Lessons from financial crisis parallels

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Episode Summary

This episode highlights the growing tension between the unchecked power of global capital versus state and community interests, as exemplified by China’s authoritarian crackdown and America’s permissive, often corrupt political economy. The proliferation of surveillance technology like Flock cameras becomes a local flashpoint in a privacy-versus-safety debate, revealing the risks of private/corporate overreach without public consent or oversight. The closing discussion uncovers deeply-hidden systemic risks in the AI sector’s financing, raising the alarm for a possible silent, pre-baked bailout of tech’s next big bubble.

Krystal and Saagar take a critical, populist approach, backed by detailed reporting and clear explanations—delivering an episode filled with urgency, skepticism, and a call for more democratic engagement on every front.

Transcript

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[Sagar Enjeti]

Save 25% on the new Comfort Next Luxe for a limited time only at a Sleep Number store or sleep.

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I'm Nancy Glass, host of the Burden of Guilt Season three podcast. This is a story about a horrendous situation that destroyed two families. It's a scorched earth war that shows just how far someone will go to get what they want, Cindy said.

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Listen to season three A Burden of Guilt on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. Hey Portlandia fans Carrie Brownstein and Fred Armisen here, the dream of the 90s

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is alive in podcast form.

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We're launching Podlandia AO Rewatch, our brand new podcast where we revisit every episode of Portlandia together, breaking down sketches, going deep on our iconic characters, and pulling back the curtain on how it all got made.

[Sagar Enjeti]

And we'll also be joined by the people who helped bring it all to life, guest stars, collaborators and friends, including director Jonathan Krisel, the mayor himself, Kyle McLaughlin, legendary musician Amy Mann, and many more.

[Nancy Glass]

Kyle is going for it. Here you fully improvised not just words but a song about.

[Sagar Enjeti]

Well, I thought you were all going

[Roland Martin]

to write a song.

[Nancy Glass]

I remember you thinking that. Listen to Podlandia AO rewatch on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

[Sagar Enjeti]

Hey guys, Sagar and Krystal here.

[Krystal Ball]

Independent media just played a truly massive role in this election and we are so excited about what that means for the future of this show.

[Sagar Enjeti]

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So if that is something that's important to you, Please go to BreakingPoints.com, become a member today and you'll get access to our full shows unedited ad free and all put together for you every morning in your inbox.

[Sagar Enjeti]

We need your help to build the future of independent news media and we hope to see [e-mail] turning out of China. This story absolutely captivated me and is really making Me think a lot about their system versus ours. Let's put it up here on the screens. So in China, the headline that the Wall Street Journal writes is this billionaire becomes China's Charles Schwab quote, then Beijing crackdown. Leaf Li Futu brokerage has become a central target in the government's campaign to control the flow of Chinese money offshore. So Leaf Li said his inspiration came from Charles Schwab. Within a decade, he built a company that spanned all of China, Hong Kong, Asian markets, and the US like his American idol, Li pivoted from simple trading to managing clients wealth through mut funds and advisory services. Now Li's ambition is colliding with Chinese authority. His company, Futu holdings, has become a central target in the state's crackdown on the flow of Chinese money offshore. Authorities in May handed the NASDAQ listed Futu a $271 million penalty for offering brokerage services and mutual funds to customers in mainland China without a license. And that action included a personal fine for, for Lee. The news obviously sent their share price down 30% in a single day and now has a market cap of less than 15 billion. But the quote, the fall in the share prices knocked hundreds of millions of dollars off of Li's net worth, which is now at roughly 5.7. What they point to though generally is that this regulatory action against this company is a way for the previously China's tech elite, as they explain, were able to list their companies in Hong Kong and then mint fortunes offshore beyond the reach of Chinese authorities. What this does is they have completely shut that down any foreign flight of capital. And they said that they will continue to tax offshore trusts previously, which is a very popular tool for a lot of these Chinese investors. But the reason why that they went after this company specifically and like, kind of the story of this entire takedown is that Chinese authorities at the end of the day are like, no, you do not get to offer securities and tax advantages to a bunch of our rich people without suffering the consequences and operating, operating under a license. So before that, this guy was like a global celebrity. And the Wall Street Journal takedown really of this is like, this is the story of there's a lot of Chinese billionaires which basically were inspired to recreate many of the rapacious capitalist industries of the United States. Literally, the guy says, charles Schwab was my idol. Right? They did the same with Google, they did the same with Uber. I think it's called Didi over there. Like, you know, basically because China would ban our services, they would Just recreate them. But what the Chinese state saw is that those fundamentally were threats to the power of the state. And so while they let them grow and initially they were happy with a lot of their wealth accumulation, they eventually come to see the Jack Mas and Alibabas and this FUTU and all of these other billionaires as tools of, like, a globalist class which are fundamentally loyal to capital and to the rest of the world than to the state. And so what they've done is they've come in and cracked down dramatically and sent a message to their entire billionaire class. It's like, you work for us, and whatever we tell you to do, when we tell you to jump, you're gonna say, how high? I mean, you know, it's complicated. Like, you know, we want freedom, et cetera. But, like, how can you not admire, like, the system where you've got these filthy rich people? All they're doing is just helping, like, this company. It seems like a big part of their sell was just like, hey, if you're rich, let me get your money off into a tax haven. And they came, they're like, oh, that's not happening at all. And they just shut it down completely, and they all snap into line. That's about preserving the primacy of the state. Now, obviously theirs is an undemocratic state, but the tool and the mechanism of that is something which you can't help but admire the seriousness which they take their endeavor of sovereignty. They're like, we run shit. The government is the person ultimately that you will be accountable to. You do not get to create these private nexus of wealth which ultimately will challenge our authority. And, like, that's how it should be, in my opinion.

[Krystal Ball]

You can't help but admire the lack of corruption that this, that this indicates, because you could not imagine a service that not only was run by a powerful, very wealthy person, but then is servicing all of the powerful, wealthy Americans. That our government would come in and say, oh, no, you can't do that. We're shutting this all down. Sorry, entire billionaire class would never happen here because of our own democratic failures and the way that the oligarchy has been allowed to buy our political system and money has been equated with speech. So you look at that and you're like, wow, that's possible for you. That is wild. Regardless of whether you think it's the right policy or not. But to your point, it's not just that they were moving their money into tax havens, it's also that they were investing their money in other global companies outside of China. So you know, they were buying stocks in American AI companies. A lot of this was heavily invested in, you know, the AI American stock boom. And so this is also. No, you, you can invest, you can invest in Chinese companies here at home. That's what you are allowed to do. And we're going to actually enforce it and make sure that that is the case. They've also instituted policies in this regard, but to make sure that their top graduates are not by and large going into Wall street type financial engineering, that they are much more focused on STEM and technology. And as a result, the number of engineers that they graduate every year vastly exceeds. I mean, it's not even close. It's multiples of times more than what we graduate here in the United States. And then that also has led to, okay, now you've got the best and the brightest minds not going in to create some new exotic derivative that basically crashes the economy and exploits poor people. They're going to develop technology. And that's why China, on almost every technological frontier, development is leading us. I was just saying in humanoid robotics, they have like 98% of the market. Like we're not even competing there. The only thing we focus on is AI, where our frontier labs are a little bit, a little bit ahead of them. But even that, you ask, how long is that going to be the case? There's nothing that says that we're going to maintain that lead forever. So it's just a completely different orientation and priorities of their political system.

[Sagar Enjeti]

Yeah, listen to them. The crackdown. Yuan is meant to funnel Chinese individual investors into licensed platforms where the people can trade only on China's domestic stock exchanges. Citizens are also permitted to invest overseas, but mainly through government approved methods that return any profits in yuan. So they're like, look, sure you can invest abroad. It will be under a domestically licensed platform. The profit has to be delivered in yuan because we don't want currency problems again. What they're focused on principally is sovereignty. At the end of the day, that's what our biggest problem is here. If we have the biggest tension, and we've always had this is between the capital billionaire globalist class, which cares much more about making money than about their own citizens. That has always been our dance with democracy and with capitalism. Part of what we've seen over the last 25 years is many of these people believe of themselves as transnational entities of which their only job is to preserve shareholder value. And they don't give two shits about the American worker and the only person that that American worker can look to is their government to make sure that those people are kept in check and to make sure that some of this extraordinary profit will also have ancillary benefit to the median American beyond your 401k going up. When 50% of the country doesn't have 401k, compare it then to our system, which kind of looks like the old Chinese system. Let's put C2 up here on the screen. Here's Trump. This is the latest story from Trump. Quote, the curious case of Guren Bobby Zhao shows the ease with which investors with shady backgrounds and unknown motivations can funnel money to the President. They say Trump crypto took $100 million from a businessman with red flags. And they specifically point to this photo at the World cup where you have Zach Witkoff, who's the son of Steve Witkoff, in a private suite at the World cup with this investor, Bobby Zhao, two years earlier, apparently, quote, was a failed hardwood flooring retailer in Britain who had come under investigation for money laundering and presided over the collapse of a small crypto startup. Out of nowhere, he became one of the biggest buyers of tokens from World Liberty Financial, dropping a total of $100 million to a firm called Aqua One. Kept it quiet for months other than briefly speaking as Mr. Bobby on an audio stream on X. However, as they dig into the curious case of Zao illustrates the ease with which buyers from unknown backgrounds motivations can use the anonymity of crypto to shower Mr. Trump with money. The President's recent financial disclosure form shows he collected 1.4 billion from crypto businesses last year, the majority of it from anonymous sources. It is not even clear how closely they scrutinized his past and a money laundering investigation in England with publicly available information. As were portions of Zhao's troubled business history were public record at the time that they decided to accept his money. Now look, to be clear, like he did give the money. He did not respond to a request for comment. We don't know about pay for play. I'm not really sure why anybody gives somebody $100 million as the president of the United States for no reason, just my opinion whenever it comes to businesses. I just saw today, you know how Trump's company is selling the $100,000 a month for first access to his true social market. Moving post. They have 10 customers already, so 10 times 100,000amonth. That's a healthy little profit line that you've created there purely off of your own information and tool of power in the state. This is what China was like in the 1990s. And it's like we've seen a reverse of what that system is looking like in this dude.

[Krystal Ball]

No one knows where this money came from.

[Sagar Enjeti]

Literally.

[Krystal Ball]

He had left a rap sheet of failed businesses, was basically deported from the UK because his visa had expired. And then he had this sort of money laundering allegations hanging over his head. And they were like, no, you gotta go. He turns back up in Dubai, and suddenly, out of nowhere, and we have no idea where the money comes from. Is flush with this hundred million dollars to give to World Liberty Financial. And of course, Trump and the Suns and the Wit Coughs who are also involved in this. They don't ask a single question. Just, thank you for the money, sir. Amazing doing business with you and keeping it moving right along. And as the public, we have no idea what this man expects to get from that $100 million or whoever he is representing, whoever he is the front person for. We have no idea what strings this money is coming with. And this is just another day under the Trump regime. This sort of story. You could literally tell this story every day of the week of some utterly shameless, level, corrupt, skeezy deal. And much of it has to do with crypto in terms of the massive amount of increase in wealth, the billions that he has been able to accumulate just since coming back into power in Trump 2.0. So very extraordinary. There's another story we wanted to highlight here, which is wild. So we covered before. Dear to our hearts, Jared Kushner and Ivanka were on the yacht. You can't even tell this story without just sounding anti Semitic on a Rothschild yacht. And discovered, like they're Christopher Columbus. This island, Albanian island, that. Oh, my God. It would make Ivanka's dreams come true to develop into some sort of luxury property. And she's talking about this thing. We played the video before. Well, the people of Albania were like, no, this is our island. We don't want you there. And as part of this island deal, they are also buying. Buying property on this nearby peninsula. And now we're finding out more about the incredibly sketchy, to say the least, characters who are involved in this transaction that Kushner, quote, unquote, bought this land for from. Put this up on the screen from the Wall Street Journal. Okay? The suspected gangster causing headaches for Kushner's Albania deal. I won't go through all of the ins and outs here, but the tldr is this dude, R. Torshi, who is accused of not only being a money launderer, not only of having created forged fake documents to claim that he owns this peninsula land that the locals say he does not actually own. And this is apparently a common problem, by the way, in Albania. He also is an accused drug trafficker and human smuggler. Okay? That's who Kushner is, quote, unquote, buying this Albanian property for. So, you know, just the sketchiest, most corrupt dealings you can possibly imagine, whether it's here, whether it's in the Middle east, whether it's through crypto, whether it's through Trump and the pardon, the pardon for sale shop that he has set up in his second administration. The list goes on and on. But no surprise that you've got this kind of incredibly sketchy gangster who is deeply enmeshed in this Albanian situation, as you said.

[Sagar Enjeti]

My favorite part of the story, by the way, is what you highlighted is that one chunk of land was secured by one of Sheihu's lawyers in 07 by presenting property officials with a mistranslated Ottoman era land record. While translating from Ottoman Turkish, an archivist substituted the original owner and inserted his name instead. Court later found that is apparently how property is disputed in Albania, which is incredible. Incredible. All right, let's get to the next one.

[Podcast Host (General Announcer)]

Well, it's that time again. Backpacks, first day of school outfits, and the low key anxiety of am I even doing this right? Good Mom's Bad Choices is diving into the back to school season the way only we know how. Unfiltered, funny, and full of the moments other shows won't touch. From surviving morning drop offs to the guilt of missing the first bake sale. Iri told me that she next season she wants to join a club team that's by your house.

[Krystal Ball]

So I was like, so you want

[Podcast Host (General Announcer)]

me to pick you up from school? I'll take her by my house. But then I have to take her there and then I have to drive back, and then some days I'm here and I have to go pick you up at school and then bring you back. I was just like, hell no. This is a space where moms treat their highlight reel for the real real. Whether you're a new mom, a veteran mom, or just trying to make it to pick up on time, this season of Good Moms Bad Choices is for you. Listen to Good Moms Bad Choices from the Black Effect Podcast Network on the iHeartRadio app, Apple Podcasts, or wherever you get your podcast.

[Mangisha]

I'm Mangisha together, and I'm back with a new season of the podcast Skyline Drive. This time I'm diving into a rabbit hole of peptides, organoids, blood boys, blue zones and brain replacement. To try to understand what this longevity obsession is all about and what it really means to live forever for all of us. I learned about some rad science.

[Krystal Ball]

I can make a brain for you and then we can test what drug is the best for your brain as opposed to his brain.

[Mangisha]

Here are some hard truths.

[Sagar Enjeti]

I would expect Indians to age faster, but I did not expect it to be almost a four to five year

[Mangisha]

accident acceleration and get myself into a world of trouble.

[Podcast Host (General Announcer)]

I'd say probably start bone smashing.

[Sagar Enjeti]

That doesn't work. Make it look more defined. They say it works.

[Krystal Ball]

I don't know.

[Mangisha]

Listen to Skyline Drive how to live Forever on the iHeartRadio app, Apple Podcasts or wherever you get your podcasts.

[Podcast Host (General Announcer)]

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[Roland Martin]

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[Podcast Host (General Announcer)]

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[Roland Martin]

Those are the very people who I always say vote against their own economic interests and they complain about the very thing they're receiving.

[David Dayan]

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[Roland Martin]

I knew that the issue of transgender athletes was not going well with a lot of black men.

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[Roland Martin]

I went off, I said, this is exactly what I'm talking about. Y' all gonna scream at Chanel, but you don't want to see a black luxury. In the same vein, catch Roland Martin's daily commentary on the Black Information Network. 12 seats. Those are moving south. So if you Democrats, you don't wait till 2030, you better be hitting the ground going hard in the south now.

[Podcast Host (General Announcer)]

And download Roland Martin unfiltered on the

[Sagar Enjeti]

iHeartRadio app, Apple Podcast, or wherever you get your podcasts. Turning now to flock cameras, which in my opinion is the new data center issue. Every locality in the nation having a discussion around this privacy invasion and the ubiquity of these cameras everywhere. And they're pairing with police powers now becoming a matter of significant political controversy all the way up to the federal level. Of course, that's going to invite certain people to defend them. One of them being Bari Weiss's Free Press. Let's take a listen.

[Bari Weiss]

Do you ever feel like you're watched? That's the panic behind a new fear sweeping across America. People are freaked out about surveillance from our employers, our nanny cams and our phones watching our every move. And right now, this anxiety is being taken out with Electric saws and cans of spray paint on tools used by law enforcement to keep us all safe. The target, flock safety cameras. In upstate New York, someone cut down a flock safety camera with an electric saw. In Oakland, California, another was covered in paint. And in Idaho, someone rammed one with their truck. And in good old Florida, a man just sits in his lawn chair with the cardboard held up for the leads. Since January, roughly 23 cities have canceled their contracts, were shut off their block camera over fourth amendment. There's even an open source intelligence website, deep lock, that's finding these cameras so people know exactly where to vandalize them. Here's what's actually under attack. In 2025 alone, the system helped lolate 10,000 missing lasers. About 27 people a day, or about one every hour. Over 40% of agencies said Flock helped recover over half of the stolen vehicles in their jurisdiction. In Indiana, an infant abducted at a shopping center was found in under two hours. In Ohio, a missing girl was located in under 30 minutes. And this is the tool that people are treating like the enemy. It is fair to have concerns about how companies use and track our data, but that's not what these cameras are for. To be blunt, they're not interested in you unless you're a kidnapper, a thief, or someone who intends to do harm.

[Sagar Enjeti]

They're not interested in you unless what is it you need to comply. If you've got nothing to hide, then why do you worry? This is vintage privacy arguments from, like, the war on terror era. But this is where it actually bears investigation. It's like, okay, are these claims even true? Let's put the next one up here on the screen. And we've gone through some of this before. One in three alerts wrong. High error rates and data concerns force cities to drop flock a 32% LAPD false positive rate. And immigration data fears have pushed 82 contracts across 28 states to collapse. They say that an LAPD audit reveals that flock safety cameras produced a 32.3% false positive stolen vehicle alert rate, and at least 82 municipalities have canceled them. More than 5,000 cities now currently have flak cameras, which are scanning license plates. Again, most residents never voted for it. Thirty localities apparently just deactivated them since early 2025, and that number continues to grow. But I feel like the lapd in particular being one of the largest. What is the second largest city in the nation, being one of those who is going to come out and say, hey, purely based on business reasons, I'm not gonna put morality in the lapd. I don't think those two things to go together. They're not like worried about privacy or any of that, but. But for them it's pure business. They're like, yeah, we used it and it got a false positive rate for stolen vehicle. We've covered some of the stories here. Terrifying incidents of people being pulled over and finding themselves either held at gunpoint or others being accused of false positive or having a stolen vehicle. We covered previously the guy who drives cars for a living for dealership plates. He got surrounded by police on some sort of a false incident. And I think there's just like a bigger question. Like she talks about, oh, these companies are not interested in you, but they do have all of the data, so they are interested. And also it's not the government that has the data, it's the private company themselves. They claim that they have to abide by X, Y and Z privacy record. Is there an audit of it? Like what are the internal controls? What exactly what recourse do I have as a citizen to make sure that that is not being improperly used? And this is everywhere. She also says deflock is an organization for people to vandalize. Again, by that definition, WAZE is a terrorist tool. Because I know where every cop is on i95 that framing was so dishonest. So they're like, oh, by just knowing where it is. That in and of itself is a tool of vandalism. I'm sure cops hate it when we mark them on waze. We do it cause we don't get a speeding ticket. That doesn't make you a terrorist.

[Krystal Ball]

Right, right. Yeah, of course. And all of this has required obfuscation and hiding from people what is actually happening in their own towns. So they do see deflock as the CEO of the company who later apologized, called it a terroristic organization because it is providing people with just transparency and information about what is happening so that they can politically organize and act on it. It is so dishonest in her little vertical video to not talk about any of the instances of misuse that have been documented. I'm not even talking about the false positives where police really think they got the bad guy and then they come and we'll show you one in a minute. And create dangerous situations by the way. Not to mention this is a waste of police resources cuz they're going after the wrong person. Meanwhile the person, whoever they're trying to get is getting off scot free. I'm Talking about the 50 police officers who've been Charged with abuse of this system, using this to stalk. Tell me that Flock is not interested in you unless you're a kidnapper or thief, et cetera. Tell that to the woman who was stalked by her abusive ex, whose child was also stalked by the abusive existence, whose future partners also stock. But, I mean, so it's such incredibly dishonest and selective framing. She also uses the stats that come directly from the company. Just. This is like basically a flop camera press release that they put together for the free press. To give you another example here of a really dangerous situation because of a Flock error, this is a local news story about the wrong person being aggressively pulled over on an interstate. Cops jumping out, guns drawn, and it wasn't even the right person. Let's take a look at that. This is D4. Good morning. Yeah, quite the mix up. Brookfield police say they pulled over a car because Flock camera flagged it for connection to a Milwaukee homicide investigation. Well, it turns out quite the mix up. Not just wrong person, but also wrong car. Take a look again at that video that you see here. You can see Multiple squads on I94 in Waukesha County. Officers with guns drawn and a passenger sticking their hands out the window. Police pulled over the car after a flat. Camera flagged it again for Milwaukee homicide. But when Brookfield police called Milwaukee, Milwaukee said they no longer needed the car or the people inside, so officers let them go. That's according to Brookfield police.

[Bari Weiss]

Wow.

[Krystal Ball]

How long till this gets someone killed? I mean, if you're a normal person. It reminds me of the ice stops with, like, the, you know, unmarked vehicles where people think they're being carjacked. Like, if you're a normal person. Look, these are marked cars. So to be fair here. But you're not expecting to have this aggressive. You're on an interstate and they're pinning you in and coming out guns drawn. Most people don't know how to react in that situation. You make one wrong move, next thing you know, you've got a person who's killed. And the death on the, you know, conscience of the officers, too, by the way. All because of this stupid tech that got something wrong. It is a very disturbing situation, and I get that. There's no doubt they're helping to solve some crimes. There's no doubt about it.

[Sagar Enjeti]

You're right.

[Krystal Ball]

But you have to ask the question, where do you draw the line? Because that logic will work forever. Of. Okay, well, if we just put cameras on every street. If we just put cameras in every building. If we just put Cameras, you know, activate your phone camera in every house. Then no one could ever get away with anything. And then they'd have 100% compliance with the law. Is that worth it to you? So where are you gonna draw the line? And I think many Americans at this point are drawing the line. Before we get to flock cameras, there was a man who was arrested in West Virginia for vandalizing a flak camera. And the Facebook post about his arrest put D3B up on the screen. 29,000 plus comments, and all of them are like, oh, it couldn't have been him. He was with me. We're helping orphans. Yeah, it's couldn't have been him. He was helping me make a tank set up for some snakes. He was saving my neighbor's dog from a fire all day. Couldn't be him. Arrested for doing community service is wild. Couldn't be. He was canoeing with me that day. This is literally, I can't say 100%, but this is like 99% of the comments that were left on this post to give you a sense of how much this has disturbed the population at large.

[Sagar Enjeti]

And I think that the private angle really matters here. It's a company with no. Like, for example, their trust center says every search is recorded logs and review tools. Help agencies check usage. The thing is, though, is that the audit and review system is run by the agency using the camera. It's not by an independent party, and none of us voted for it. Like, look, I support actually, like, if we're going to have, you know, a radical reduction in petty crime, which would be my dream here in the United States, I need to make that case. We all need to buy in and be like, all right, guys, we're gonna have these camera systems everywhere. We will no longer have petty crime or any of this. But this is why I think this is a good, bad idea. You get to vote and to decide. If I lose, so be it. Right.

[Krystal Ball]

Well, and also that's important. That sort of discussion would require the people who wanted them to say, and here's gonna be the checks. Here's how we're gonna make sure that when the police department implements this, there's not gonna be abuses of police officers randomly stalking their ex girlfriends, the mother of their children or whatever. And so you would have those systems put in place instead. This is the wild, wild west. People didn't have any idea this was happening. There was no democratic accountability or a check. So now you have this, I think, increasing. I mean, I haven't seen any polling on it yet. But you were talking about how you searched this and every local news station is picking up on this. I was gonna end on that because it really is becoming this flashpoint and it ties back to the Francesca Hong thing. She's picked this up in her campaign too.

[Sagar Enjeti]

Very savvy free advice for any politician. When I was researching this story, every single, I'm talking about Wyoming flock cameras, Chicago flock camera, Texas flock camera. Every single negative headline. Everyone is about communities getting upset, vandalism, about debates. You know, local news organizations are running polls. Should we have Flock and Cheyenne or something? You know, it's small. Not small, but by our standards is small. Like this is not a national, national issue yet but it's like data centers, I can smell it. Like when there's local news, these people, they know exactly what's capturing attention, right? That's why they cover crime.

[Krystal Ball]

And they go, they live in the community,

[Sagar Enjeti]

they know what gets attention. If they're all riding up flock and it's all negative. Free advice for any politician out there. And like I said, if you want to defend it like the free press and all that are doing it needs to be taken to a ballot. A locality must vote on whether they want themselves, you know, to be surveilled all the time. They need guarantees, independent audits. And none of that's happening. That's what's so terrifying about this. And there's no. It's like opting in just because the cops like it. They get to do whatever they wanna do. Like that is the inverse of what a civilian force, we grant extraordinary control should be able to be able to do to us. So that's my last thing. We have to have a democratic actual process surrounding this. And if we come around on it then that's fine. But I don't think that that's going to play out right now. Let's get to David Dayan. He's standing by.

[Podcast Host (General Announcer)]

Well, it's that time again. Backpacks, first day of school outfits and the low key anxiety of am I even doing this right? Good mom's bad choices is diving into the back to school season the way only we know how. Unfiltered, funny and full of the moments other shows won't touch. From surviving morning drop drop offs to the guild of missing the first bake sale. Iri told me that she next season she wants to join a club team that's by your house.

[Krystal Ball]

So I was like so you want

[Podcast Host (General Announcer)]

me to pick you up from. I'll take her by my house. But then I have to take her there and then I have to drive back. And then some days I'm here and I have to go pick you up at school and then bring you the. I was just like, hell no. This is a space where moms trade the highlight reel for the real reel. Real. Whether you're a new mom, a veteran mom, or just trying to make it to pick up on time, this season of Good Mom's Bad Choices is for you. Listen to Good Mom's Bad Choices from the Black Effect Podcast Network on the iHeartRadio app, Apple Podcasts, or wherever you get your podcast. Didn't catch the latest Roland Martin unfiltered podcast?

[Roland Martin]

Here's what you missed, and the argument is, do you want to win? If you don't, don't win. You have no power.

[Podcast Host (General Announcer)]

It's real.

[Roland Martin]

Those are the very people who I always say vote against their own economic interests and they complain about the very thing they're receiving.

[David Dayan]

It's raw.

[Roland Martin]

I knew that the issue of transgender athletes was not going well with a lot of black men.

[Mangisha]

Roland Martin Unfiltered.

[Roland Martin]

I went off, I said, this is exactly what I'm talking about. Y' all gonna scream at Chanel, but you, you don't want to see a black luxury company. In the same vein, catch Roland Martin's daily commentary on the Black Information Network. 12 seats. Those are moving south. So if you Democrats, you don't wait till 2030, you better be hitting the ground going hard in the south now.

[Podcast Host (General Announcer)]

And download Roland Martin unfiltered on the

[Sagar Enjeti]

iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.

[Mangisha]

I'm manga shit together and I'm back with a new season of the podcast Skyline Drive. This time I'm diving into a rabbit hole of peptides, organoids, blood boys, blue zones, and brain replacement to try to understand what this longevity obsession is all about and what it really means to live forever for all of us. I learned about some rad science.

[Krystal Ball]

I can make a brain for you.

[Podcast Host (General Announcer)]

And then we can test what drug is the best for your brain as

[Krystal Ball]

opposed to his brain.

[Mangisha]

Here's some hard truths.

[Sagar Enjeti]

I would expect Indians to age faster, but I did not expect it to be almost a four to five year

[Mangisha]

acceleration and get myself into a world of trouble.

[Podcast Host (General Announcer)]

I'd say probably start bone smashing.

[Sagar Enjeti]

That doesn't work. Make it look more defined. They say it works.

[Krystal Ball]

I don't know.

[Mangisha]

Listen to Skyline Drive how to live Forever on the iHeartRadio app, Apple Podcasts, or wherever you go at your Podcast.

[Krystal Ball]

As you guys know, we have been closely tracking a lot of developments in the AI space, including whether or not this entire build out is a massive bubble that may end up with taxpayers funding the largest bailout in history. David Dayan of the American Prospect has identified a potential backdoor bailout mechanism that may already have been established. The headline here is the AI bailout could be baked into the AI bubble. Private credit are key owners of AI related assets. Many of their parent private equity firms own life insurers that are dumping grounds for bad loans and subject to state bailouts. American Prospects. David. Dan joins us now to explain. Welcome, sir.

[Sagar Enjeti]

Good to see you.

[David Dayan]

Hi, how are you doing?

[Krystal Ball]

Great. So just explain to people as basic as you can, the mechanism here and what your concerns are.

[David Dayan]

I mean, it's not going to be that easy, but here we go.

[Krystal Ball]

Yeah, take your time.

[David Dayan]

Yeah. Private equity over the last several years has purchased a number of life insurance firms. Some of the more famous ones are Apollo, which is a big private equity firm buying Athene. Kkr, another big PE firm, has a couple different life insurers. And these life insurers operate very differently, particularly their portfolios are very different than a normal life insurer. A lot of these private credit loans are making their way into the balance sheets of these life insurers. And this then gets tied into the way that life insurance insolvencies are resolved. So it's not through the traditional bankruptcy system. And there's good reason for that because life insurance policies are relied upon by people and families when one of their loved ones die. And the public policy does not want those to just simply go away if a life insurer becomes insolvent. So there's a lot of risk on these PE owned life insurer balance sheets in the event of an insolvency. The way it works in almost every state is that there are after the fact assessments almost like deposit insurance with the fdic, but with one key difference. In deposit insurance, the assessments are made before a company goes bankrupt. So all banks pay into this fund and when there is an insolvency, that bank, those deposits are covered by the amount of money in the fund. With life insurance, if there's an insolvency, only the surviving companies end up paying for the insolvent firm to back up those policies. However, there's sort of this bailout written into it. Those surviving firms in 44 states then can get a tax credit that is equal to 100% of the assessment that they make and therefore it's state Taxpayers who end up on the hook for these insolvent life insurance companies. The theory here is that private credit, which has a lot of AI related assets, make these insolvencies a bit more likely. And if that's the case, then essentially the popping of the AI bubble could trigger this process by which state taxpayers would essentially be paying for the sins of these life insurance companies owned by private equity.

[Sagar Enjeti]

Got it. Okay. So when we put all of this together, all of this financing, this deck of cards, we can put E2, for example, up on the screen. This was just announced yesterday. Wall street giants partnering with Nvidia on a $500 billion AI financing deal. Apollo, Blackstone, Goldman among the groups working with the chip maker to raise capital for data centers. Apparently it is one of the largest capital raises, I think, private capital raises in Wall street history. How do these two things fit together?

[David Dayan]

Well, obviously there's just a ton of money flooding into this space. And if you think about some of the events of the last few weeks, the release of more Chinese AI models that show that actually you don't need this kind of capital expansion to create functional artificial intelligence models, the extreme expense that private companies are paying for things like ChatGPT, for things like anthropic models, and then abandoning this process because the price has risen so heavily on tokens, which is the way that companies pay for AI. You put this all together and the incredible as, as I'm sure you guys have reported, the incredible backlash to data center build outs, many of these private credit loans are based in the financing of construction of data centers. And so you put all this together and there are a lot of ways where the current model of throwing hundreds of billions of dollars at capital expenditures which finance data centers, which create frontier models, could go away. Right? I mean, there are a lot of ways where that could go sour. And whether it's Wall street money from private banks or whether it's money that has been loaned through these special purpose vehicles that are tied to private credit, any way in which the data center mass capital expenditure becomes problematic could threaten any of those sources of capital. And the difference between this being a situation with banks and being a situation with private credit loans that have been dumped en masse into these life insurance company portfolios is that with banks, you'd have to put together some sort of bailout authority, you know, much like tarp in 2008 or the federal Reserve would have to engage in some action. Whereas with respect to the life insurance companies, if they go insolvent, this is just triggered because this is already the law in most states in the union.

[Krystal Ball]

Can you explain for people what private credit is and why it has ended up being such an important source of financing for the AI build out?

[David Dayan]

Private credit is essentially the credit arm of private equity. So most private equity firms now are these sort of full service entities and platforms and private credit is their lending arm. Most private credit loans are to portfolio companies of that private equity firm. That's not completely out of the woods either because a lot of private equity firms, for example, bought software companies that are threatened if the AI revolution actually goes well and these software companies are no longer needed. You know, we've had this, this software apocalypse in the markets where software companies have seen their stocks just absolutely plummet. That has led to a lot of redemptions from companies or from investors who are in private credit. The way that private credit is financed is the same way that private equity is financed. Investors, institutional investors, give money to the private equity fund. The private equity fund invests it in this case in loans. In the case of just normal private equity, the money is used along with borrowed money to buy companies. So it's just another way to engage in this financing. A lot of these loans are somewhat suspect. It's hard to value them. They have sort of bespoke credit rating agencies that are paid by the private equity firms that give them good ratings. Not a lot of people know what sort of goes into the secret sauce of these private credit loans. And certainly the national association of Insurance Commissioners, which is a state based organization of state insurance commissioners, has no idea what are in these loans. And one thing, a paper that is put out by two researchers, one from Texas, one from Yale, looked at some of the portfolio balance sheets of these private credit companies and found that specifically with respect to life insurers, whereas a normal life insurer has a pretty modest mix of mostly corporate, very blue chip corporate loans and treasuries, about 13% of a normal life insurer is in private placement, like alternative assets, private credit loans, things like that. When it's a private equity owned private life insurer, about half of those loans are in private credit and things of that nature. And so these are just much riskier debts. And it does seem that these life insurance companies, their balance sheets have become sort of dumping grounds for loans that couldn't be, you know, maybe they're not being, not performing well or they're engaged in forbearance where the, you know, the borrower doesn't have to pay right away, things of that nature. And so this has raised a lot of concern from a lot of key observers.

[Roland Martin]

Wow. Yeah.

[Sagar Enjeti]

Kind of scary, I think, hearing you talk about, because it's almost an ingenious way. Very similar to how they were able to keep the mortgage backed security fraud going for so long and to have a built in bailout. I mean, what are the signs that we should look for? I mean, are there any regulatory ability to crack down on this or is the cake just baked?

[David Dayan]

Well, I mean, that is the main issue here is that we have not seen this sort of system of life insurer insolvencies en masse in our history. Since this thing has been set up. This kind of procedure whereby the surviving firms pay for the policyholders and then they get a backdoor bailout through these tax credits. It just hasn't happened. In 2008, AIG was a major insurance company and it went basically insolvent. But because the Federal Reserve stepped in and later on Congress blessed that through the TARP program, we did not see this potential, you know, this insolvency procedure in action. So it's very untested. The people that I talk to, these people who wrote the paper, these researchers from Texas and Yale, don't think it will actually work. Because think about if at the height of the financial crisis, every state had to go undergo this process to bail out aig. Like think about how hard that would have been and at a time of extreme stress. And that's what we would see if there was sort of a macroeconomic level of stress throughout the economy and one of these life insurance companies athene or one of the others went under, you'd have to have 50 state programs to try to resolve this thing. And so it's dangerous. Obviously there's a lack of sort of regulatory juice on the part of these insurance commissioners. There's a hope that we could get more of an insight into that. And there's a number of recommendations in the paper that I write about in this story about how to do that.

[Krystal Ball]

Yeah, very important story. I really recommend people read it. I read it two or three times to make sure that I understood the dynamics here. But you know, it does remind very much of the financial crisis where there were all these linkages beneath the service, the surface, and also the ratings agencies also being asleep at the switch or compromised in a lot of regards. It has a lot of echoes for some of what went down there. David, Dan, thank you so much. Great to see you.

[Sagar Enjeti]

Thank you, David. Appreciate it.

[Krystal Ball]

Thank you guys so much for watching.

[Sagar Enjeti]

We appreciate it. It'll be a great show for everybody tomorrow. Wednesday. See you then.

[Nancy Glass]

I'm Nancy Glass, host of the Burden of Guilt Season three podcast. This is a story about a horrendous situation that destroyed two families. It's a scorched earth war that shows just how far someone will go to get what they want, cindy said.

[Krystal Ball]

I had to choose between the truth and my family, and I had to choose the truth.

[Nancy Glass]

Listen to season three, a burden of guilt on the iHeartRadio app, Apple Podcasts or wherever you get your podcasts. Hey Portlandia fans, Kerry Brownstein and Fred Armisen here.

[Sagar Enjeti]

The dream of the 90s is alive in podcast form.

[Nancy Glass]

We're launching Podlandia AO Rewatch, our brand new podcast where we revisit every episode of Portlandia together, breaking down sketches, going deep on our iconic characters, and pulling back the curtain on how it all got made.

[Sagar Enjeti]

And we'll also be joined by the people who helped bring it all to life, guest stars, collaborators and friends, including director Jonathan Krisel, the mayor himself, Kyle McLaughlin, legendary musician Amy Mann, and many more.

[Nancy Glass]

Kyle is going for it. Here you fully improvised, not just words, but a song about.

[Sagar Enjeti]

Well, I thought you were all going

[Roland Martin]

to write a song.

[Nancy Glass]

I remember you thinking that. Listen to Podlandia AO rewatch on the iHeartRadio app, Apple Podcasts or wherever you get your podcasts.

[Krystal Ball]

On Solita, we share the messy reality of traveling alone as a woman.

[Sagar Enjeti]

Your duolingo is not going to come back to you when a man is inside of you.

[Bari Weiss]

Oh no.

[Sagar Enjeti]

I'm Julie Pinero and I travel by

[Krystal Ball]

myself because it's a rare space where I can say yes without asking anyone else first.

[Sagar Enjeti]

I'm on a mission to reclaim the word Solita, trading the pity for possibility. Listen to Solita on the iHeartRadio app, Apple Podcasts or wherever you get your podcasts.

[Podcast Host (General Announcer)]

This is an iHeart podcast. Guaranteed Human.