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Ruthless Podcast
Trump Hammers Big Government — We Can’t Be Your Daycare + WH Science & Tech Advisor Michael Kratsios
01:13:16
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- [00:00]
Josh Holmes
And what Trump is saying is the right point in that if you are relying on the federal government to basically have your routing number to direct deposit supplements to your lifestyle, child care, every want need, housing, health care, everything else. If you think that that is the role of a federal government, you are a liberal.
- [00:25]
Comfortably Smug
The left has tried to creep in and make every aspect of your life something that the government should fund.
- [00:33]
John Ashbrook
The left is stealing from these government programs.
- [00:38]
Michael Duncan
According to a report from Senator Grassley's office, UnitedHealth Group, the nation's largest insurer, quote, appears to be gaming the Medicare Advantage system, siphoning off taxpayer money to turn a steep profit. Experts say practices like these are increasing overall Medicare spending, which in turn raises part B premiums for everyone on on Medicare. That means millions of seniors, many living on fixed incomes, are paying hundreds of dollars more each year for the Medicare they need, adding up to billions in higher costs for seniors. And that's in addition to the trillions of dollars that taxpayers have already paid. Big insurance. It's a clear example of big insurance putting profits ahead of patients, taxpayers and seniors. Learn more about how Congress needs to rein in big insurance@americansforopengoverment.com Congress must not
- [01:31]
NetChoice Representative
take away parents control over their kids personal information. The App Store Accountability act forces you to upload your child's sensitive documents like a birth certificate, and it would share that information too broadly. A calculator doesn't need to know how old your child is. A better approach puts parents in control while keeping kids safe online. Parents should decide what of their children's information is shared with an app developer. Tell Congress prioritize parents and keep them in control. There are better solutions to keep kids safe online. This is America. Parents should be in control of what's best for our children. NetChoice is dedicated to making the Internet safe for free expression and free enterprise. Learn more@netchoice.org keep app stores safe.
- [02:28]
Announcer
Ladies and gentlemen, your attention please.
- [02:32]
Comfortably Smug
Keep the faith, hold the line and own the lids.
- [02:35]
Announcer
It's time for our main event.
- [02:40]
Josh Holmes
Good Tuesday to you. Welcome back to the ruthless Friday program. I'm Josh Holmes along with Comfortably Smug and John Ashbrook. Michael Duncan out on his side assignment. It's Masters week across the country, so all is well with the world. Springtime is here and we're getting into what is gonna be some fun times beyond the world of politics. The world of politics, frankly, that's not that fun. We try to do our best to have fun with it, but it's, you know, I mean, it's just like everybody doesn't seem like they're on A game material right now.
- [03:11]
Comfortably Smug
Maybe just me.
- [03:12]
Josh Holmes
It just feels like it.
- [03:13]
Comfortably Smug
We're on our A game. They didn't need to be on theirs.
- [03:15]
Josh Holmes
Yeah. I mean, we're trying to point out, well, we're really hauling water here. I mean, we're, we're making, we're making the best of it and we appreciate all of you joining on in. We wanted to broaden the aperture a little bit in only so many weeks that you can be like Iran. What's the latest save act, what's the latest nominees? What's the latest? Obviously, a big news event at the end of last week with the departure of Attorney General Pam Bondi. I think there are many of us who saw that sort of thing coming. Clear. Clearly there was some frustration after the Epstein stuff that never really fully repaired. I don't think there's any hard feelings there in terms of the Trump administration. President said nice things about Pam. Bonnie. I think she continues to be an ally there. So it's not like it's going to be spilled milk and, you know, tell alls. But, you know, it's a, it's a significant change. Todd Blanche is now going to be the attack acting attorney general, somebody you heard here just a couple of weeks ago on the Ruthless Variety program. I encourage you to go back and take a listen to that if you want to get a flavor for what you're in for and then we'll see what happens from an appointment standpoint. You know, maybe there's somebody new. There's a lot of speculation about different people. I think Lee Zeldin was one in the first couple of articles that came out the end of last week that maybe he was in for an upgrade initially. I think he was one of the names that the president had talked about putting in the attorney general post to begin with. And he's obviously done a great job over at epa and so that could be a possibility. But there's others do. So we'll see what, what happens with all that. Clearly a little bit of shakeup going on in the administration may not be the last. You just, you just don't know. But I think the administration is seeing the same things that an awful lot of people are about. A very challenging midterm, a very dedicated Democratic Party to try to create the worst possible environment for this country. And I mean not politically, just for this country. Like their goal is to try to run us into the ground economically, national security, like, you name it. The worse that they can make things for this country the better they think it is because it improves their political standing. And I think that's how they view it.
- [05:31]
Comfortably Smug
Yep. And it's incredible that that is their stated goal. Essentially, when you see even in blue states, what they do is they're trying to bankrupt the state to pay their supporters off. That's why they don't care about the fraud. That's why you see them allowing for so long until President Trump stepped in to allow TSA to go unpaid to make travel horrible for Americans. And they said it was a direct quote. It was like, we need to make things hurt for them because they feel like they hurt the public and it'll make them want to turn on Republicans. So there's just no question there's Americans miserable. That's their thought.
- [06:06]
Josh Holmes
And unfortunately, look, they have some success because they've got a mainstream media that just refuses to cover what their ultimate agenda is, which is just throwing wrenches into everything you can possibly do. Like you state for 30 years that boy, we ought to do something about Venezuela and Iran. Trump does something about it. And they're like the first to the line to be critics of all of that. The economy, they couldn't shit talk the economy any worse if they wanted to. And of course, the economy writ large is responsive to what politicians say in public sentiment. So their goal is to try to just depress everything as much as they can to limited effect. I mean, obviously gas prices with what's going on are troubling, but the infrastructure has been late. A lot of people getting tax money back next week, a lot of people getting tax money back, which I think will factor in a little bit, and we'll see where we're at. But there's also this larger conversation that we honestly have not been able that have for a long time, in large part because I think the tenor of the last campaign, the 2024 campaign, was such a populist tenor that, like, the role of government was never really discussed in any real way. I mean, there's a massive divide. Obviously, if you are a conservative, you believe in limited government. If you're a liberal, you think government ought to run absolutely everything. And then there's shades in between of all kinds of things. But something caught my attention last week, at the end of last week that I think deserves a more fulsome explanation because of how quickly the libs jumped on it, which I didn't see as a liability at all, if you contextualize it. But it's like the kind of argument that Mitt Romney used to run away from and therefore lose the argument when he was like the nominee in 2012. And we really haven't had this argument since then. So we wanted to dig into it a little bit on Ruthless Clip 1
- [07:56]
Donald Trump (quoted)
because the United States can't take care of daycare. That has to be up to a state. We can't take care of daycare. We're a big country. We have 50 states. We have all these other people. We're fighting wars. We can't take care of daycare. You got to let a state take care of daycare and they should pay for it too. They should pay. They have to raise their taxes, but they should pay for it. And we could lower our taxes a little bit to them to make up. But we it's not not possible for us to take care of daycare, Medicaid, Medicare, all these individual things. They can do it on a state basis. You can't do it on a federal. We have to take care of one thing, military protection.
- [08:36]
Josh Holmes
So we haven't had this argument. We've not had the American people have not had anyone lay out this argument in a very long time. It's been 10 plus years since we've had this discussion at all. And the reason it caught my eye is immediately journo Glenn Thrush of the New York Times tweeted out this in graphic one where he's basically saying this is gonna be in every Dem ad, right? Like a real liability that Trump has put out there. Well it's only a liability if you have completely lost the plot about what your country is able and willing to do and as you as taxpayers are responsible for and what Trump is saying is the right point and that if you are relying on the federal government to basically have your routing number to direct deposit supplements to your lifestyle, child care, everyone need housing, health care, everything else. If you think that that is the role of a federal government, you are a liberal, you are a left wing liberal.
- [09:51]
John Ashbrook
You're voting for a Democrat anyway.
- [09:52]
Josh Holmes
You don't have any choice. You got one party that that has been the view ever since FDR about how they take care of the country. They want an expansive government of which there is very little free will to the American people and they want you reliant upon them, the federal government and a few handful of bureaucrats to decide what choices you need to make based on what divvy out to you. Right? And Trump for how great it is that he is a campaigner and he ran a flawless 2024 campaign has avoided this argument and we've been critical here on the show. I think the first ad that they ran in a primary was how he was going to protect Social Security. No changes to Social Security all the way through. Which was a little jarring to some of us who grew up in Republican politics where everyone on the conservative side sort of does math and realizes the who things going bankrupt in 2032. If you don't just exponentially grow your GDP over that period of time or you don't make some accommodations to understand that when you invented the program, the life expectancy was 25 years less than it fucking is now, right? There's just eye opening. Like people didn't live when you're 65 year old retirement, 55 year old retirement. When it's invented, people life expectancy was 67 and now it's 80. You know what I mean? Like, you got to make some adjustments in order to keep a program solvent, which we've I guess agreed on that. Like that's an imperative part of the promise that we've made American taxpayers. And of course everybody has to pay into it. So it is, it is a promise you have to keep, but it's not it. It avoided this larger fundamental question that I think is more important about the future of conservatism well beyond Trump and the future of our country, our economy and what we look like in 2030 than anything else out there. Obviously, the national security stuff has a huge impact, but our ability to fund national security or have a presence around the world somewhat relies on our own ability to govern our own mess. And we're $36 trillion in debt. You know, we went for a brief time in like 2010 where everybody was sort of concerned about that, and then it went away. Because I think a lot of people didn't understand that there are actual ramifications. Just a number. It doesn't really mean anything. People for a while were like, oh, my grandchildren's share of the national debt is X, Y and Z. What does that mean? It's not like you get a debt collector that shows up and is like, here, give me my money. It just keeps running the tap. Well, problem is, if you look at like European countries, Greece or you know, Southern Europe, Eastern bloc countries, it stagnates the economic growth altogether. The lending becomes a problem. You could go and smug, you know more about this shit than I do. But you can crash an economy the likes of which 2008 is like a thimble full of concern in comparison to the insolvency of the United States of America.
- [12:53]
Comfortably Smug
That's the thing, is it becomes essentially a spiral when you have the population, essentially. I mean, Greece is a perfect example of it, where you had so much of the citizens essentially just living off of the government's money. We had unemployment at like 50% because they didn't feel like the need to be employed if you're going to get the check at the end of the day. But I think fundamentally it's a government's job to defend the country and protect the citizens. That's why we have money go towards the military. The left has tried to creep in and make every aspect of your life something that the government should fund. And they're not doing this because they're like, oh, well, I want to make sure everyone has childcare. They're doing it because we need a government program that we can then expand and then we can build a fiefdom and a system of who am I paying? Who's going to turn out the vote for me? And look at what happened with Obamacare, which is a prime example of when the government stakes out this massive economy that used to be a free market, puts its thumb on every scale. And then that's how you get in Minnesota, the widespread fraud. That's how you get in California, the widespread fraud. Because any massive government program is an opportunity for the left to get their tendrils in there and be like, now we have a system that is just taxpayer payouts from my supporters. And this isn't about medical care. This is about reelection. This is about building my ground troops who are out there for me on election day, knocking on doors, who are out there for me, making sure I get reelected, because they know I will send pieces of this money to each of them. And it is. Here's a spoiler. And we're all seeing this is the left voted in Obamacare without a single Republican support, and it's taken no time for it to balloon costs. If you like your doctor, you can keep all those lies. It's ballooned in size, ballooned in cost. Outcomes have gotten worse. Care has gotten more expensive. And so what do you think Democrats are going to be like, boy, we were wrong about that. Let's roll this back. They'll say, no more money. This is a crisis. Our problem, we will shut down the government because we need more money. We told you health care would get cheaper. It didn't, but so we need more money for it.
- [15:32]
Josh Holmes
Yeah.
- [15:33]
John Ashbrook
You know, I think this is. This is such an important point. And. And one of the things that we know is that the playing field for political debate is constantly shifting. No two elections are exactly alike. No two debates. A debate in 2028 is very different from a debate in 2018, very different from the debate in 2008. And what we have that is different now is you were talking about how the left wants all these programs. The left is saying, oh, we're going to be the ones sticking up for all of these government programs. The left is stealing from these government programs. We talked on Friday about the. It's over $100 billion in California that they're stealing from taxpayers.
- [16:23]
Comfortably Smug
Insane.
- [16:25]
John Ashbrook
And so this is an aspect to the debate, because 10 years ago, 15 years ago, waste, fraud and abuse was just an old saw that politicians would say, I'm going to deal with it. And people will be like, yeah, we need to get rid of the fraud. We need to get rid of the fraud. Now, in Technicolor, we see that there is organized crime, stealing from the taxpayer, till in a way that I don't think anybody really has come to grips
- [16:52]
Josh Holmes
with because it's gotten too big to monitor.
- [16:54]
John Ashbrook
It has. And I think that's part of the point that Trump was making, like, that these states need to be in charge of managing this money. You can't just grow up in Florida and send a check off to the federal government. And I hope to God when they send it to Kansas or they send it to California, they're gonna use my money wisely. These states have to have some accountability. You can't just take the money and then let people steal it and let them get away with it. And so, like, I understand what Glenn is saying about Trump's quote, and the Democrats can put it into an ad, but Glenn's comment is based on 2012 politics, Trump saying that and Glenn tweeting it that they're gonna put it in an ad. Everybody's gonna be like, okay, well, I hear what he's saying, but I also see on television that Democrats and their supporters are stealing billions of dollars.
- [17:51]
Comfortably Smug
That's it. I think that has to be the cornerstone of the midterm message. And we need to see huge crackdowns on this fraud domestically. There has to be, because Americans work too hard. Every American is being robbed. When you see what has happened in Minnesota, when you see we've only scratched the surface of California, it is an ocean of theft from taxpayers, and they want more of your money, their argument is going to be, no, you don't understand. You got to give us More California is chasing their population out by trying to rob them. More, they're counting on national taxpayer money to keep them afloat, to keep the Dems getting reelected by giving out the fraud money. The argument in the midterm has to be fraud because they're gonna try to be like, no, we need more money for health care. Are you gonna let old people die? The Democrats built this system and now they want more of your money to subsidize its failures.
- [18:52]
John Ashbrook
And regular people know that Democrats pitch is based on a felonious premise. Because regular people who rel these government programs know that they're being pinched. They know that when they go to the government and they say, please help me with my Medicaid situation. Perfect example, Medicaid people are told over and over again Medicaid is going to be there for you. But yet when they go to Medicaid and they expect some sort of return on what they've been told is available, they're put on a waiting list. Meanwhile, they watch unemployment insurance sent to Romania, they watch people in Minnesota stealing from the government till over and over again. So the fundamental premise that the government is going to be there for you is not a reality in a lot of people.
- [19:42]
Josh Holmes
It just becomes a wash and fraud. And that's what it is. The people who are intended to get the programs don't get the programs at all because it's become a broken system. And the answer that the Democratic Party has provided time after time is, well, we just need more of it, which only exacerbates the problem. But there's also a more pervasive thing from my standpoint. Somebody who sort of believes in the American dream, call it old school and your ability to improve your lot in life when you have a federal government. If you are an individual who has been convinced, just because it's all around you, that your way of life is entirely dependent on a federal government, whether it's childcare, healthcare, whatever, you're never gonna do anything to move beyond that in a material way. Because what's the incentive structure, right? I mean, if you are firmly in the middle class and Democrats have succeeded in turning 2/3 of this country entirely dependent upon the government in one form or fashion, what is the incentive to start a business so you can get taxed 55%, they can still have. You end up with the same amount of money. You just worked 10 times harder to get it. And now the federal government has taken that and said, well, you owe it to all these other people to do it. Where is the innovation, what possible motivation is the next round of AI people or what is next? We've gone through incredible amounts of innovation in this country from the industrial age all the way through to today in AI, whatever is next. If you succeed in making the government the center force of where your lot in life is, you're never gonna get there.
- [21:19]
Comfortably Smug
And the thing is important is whoever becomes confirmed as the Attorney General, Job one, every morning you wake up and you go after this fraud like nothing. That should be directive number one. Start locking people up, start running up the charges, start putting people in handcuffs and marching them. Because right now Americans are seeing day after day after day, they go to work, they come back, they see their paycheck, they see how much of it's taken from them. And then they turn on YouTube and this like 20 year old kids in front of quality leering center being like, so these guys got millions of your dollars.
- [22:02]
Josh Holmes
And that's what he's talking about when he says like, we can't be your daycare. No. Because when they are your daycare, you get a leering center.
- [22:10]
Comfortably Smug
Bingo.
- [22:10]
John Ashbrook
Right. And what's Democrats response to that? Their response to it is no more money. More money, more lollies. Exactly. There is not a single Democrat out there who is saying that these government programs need to be managed better so that they actually help regular Americans. You know what Democrats are saying? Democrats are out there saying that who we really care about are the undocumented people.
- [22:32]
Josh Holmes
Yeah. As Chris Murphy said.
- [22:33]
John Ashbrook
Exactly.
- [22:34]
Comfortably Smug
Straight up.
- [22:34]
Josh Holmes
Right. And they don't. You would think for a bunch of people who pretend to care about the most vulnerable Americans, that you would be the most interested in fraud.
- [22:44]
John Ashbrook
Right.
- [22:44]
Josh Holmes
Because you can repurpose that money to get to the intended recipient if you actually care about them. They don't. News flash, they don't give a shit. It's all about buying constituencies, it's all about expanding what the federal government's footprint is. And then ultimately on the back end of it, having a stagnant country that looks an awful lot like Europe. When is the last time that like the UK has invented something that the world needs?
- [23:08]
Comfortably Smug
Yep.
- [23:09]
Josh Holmes
When's the last time that France has invented something that the world needs?
- [23:13]
John Ashbrook
I would say the crumpet and mayonnaise.
- [23:16]
Josh Holmes
But I mean for real, it just, it doesn't happen. The reason is because there's no fucking incentive structure to make it happen. You can just sit and take naps and drink champagne and live off the government. I mean, look, fuck, go up north, Canada, perfect example of that. It's not as bad as what you're seeing in Europe, but you've got the same principles that apply and they have this middling economy and they're like, oh, you know what?
- [23:40]
Comfortably Smug
We have seen that lifespans are going up to 85. That makes it more difficult. So now we'll just kill you.
- [23:45]
John Ashbrook
Yeah, it's terrible. And look what it's done to the Canadian culture. If they were more hungry, they would win a Stanley Cup. If they were more hungry, they could win the gold medal in hockey. They haven't done either of those things in a very long time.
- [23:59]
Josh Holmes
But I do think that there is some culpability here from a Republican Party in particular, a bunch of younger ambitious politicians that misread Trump. And I think a lot of people look at the rise of Donald Trump and the new coalition, the middle class coalition that he put together across this country and see it as okay, it's populist, it's basically democratic light. I got to adopt a bunch of government funding mechanisms that go into populations that I care about. I can't be a fiscal conservative. I can't be any of those things because that's what Trump, cuz he doesn't emphasize that stuff, which is absolute bullshit. You heard it out of his mouth. He's like articulating this argument that we're making perfectly. Donald Trump is a thing in and of himself. You cannot replicate Donald Trump. Donald Trump's platform is Donald Trump. You've heard it since 1982. You can go find clips of him talking about the Ayatollah. You can go find clips of him talking about trade, about immigration. He hasn't wavered an inch. It is what his viewpoint is. If you think he's unique, is a power of personality, somebody who's famous for being famous long before the Kardashians ever showed up. He is a one of one. And so if you take that and you're like, oh, I know what that agenda is, I'm going to do it. And my spin on it is that I'm going to just sort of like soften the edges and make everything a middle class focused tax the rich. Remember, they're doing the big beauty. You had so called conservatives that were out there, they were like, maybe we should increase taxes on quote unquote rich people. Which of course they're not talking about rich people. They're talking about people who file W2s, which no fucking rich person does. None. Like it's investment income only. But that's what their interpretation of Donald Trump is And so this whole argument is backsliding over the last 10 years. And I couldn't be more happy to hear Donald Trump making an honest argument to the American people because it's been way too long since anybody's had any level of honesty about the dire straits that this whole fiscal situation we find ourselves is in. And like, dude, don't take my word for it. Look at the reports on Social Security, Medicare. Just look, it's now set, what, 75% of our federal budget. It's on reoccurring. They don't vote on 75% of the taxpayer money that you send in. No allocation whatsoever. It's just auto pay. And it's happening. When I started in government, it was like 50, and it was 55, 60, 65, 70, 75. It's way beyond 2/3. It's close to now 3/4 of our budget. And like once that eclipses 100% of your GDP, you are a government state like you just are.
- [26:48]
John Ashbrook
And the unfortunate reality is the thieves figured that out before the voters came.
- [26:53]
Josh Holmes
They did, they did. And their plan was to try to pervert all of that and create this dependent system where not only voters but the bureaucrats who administer all of this were the power of it. And it makes you entirely dependent upon other people's money. And then you. Then the downstream politics of it is somebody's getting away with something. But it's never the bureaucrat or the people who are thieving the things. It's like, well, there's rich people somewhere who are living a better life and the government has allowed that. Stop allowing that. Which is.
- [27:31]
Comfortably Smug
We've seen how that's worked in history.
- [27:32]
Josh Holmes
It's the end of every civilization every time. It's the end of every civilization. It's not like we don't have absolute fact over recorded history of how these things play out. So, like, look, this is a good argument to have wanted to have it here at the top of ruthless because it's been a long time since we've had just a good ideological discussion.
- [27:50]
John Ashbrook
It's really important about what you know,
- [27:52]
Josh Holmes
why it is that you vote the way you do, you know, Anyway, coming up, bad, worse for Democrats, their base revolts against their leadership. We've been covering this for a long time, but there's some new stuff out there, including Act Blue, important article published in the New York Times last week. Maybe give you a little indication of what we've been talking about, about this gigantic small dollar donor gap that Democrats have had for a long time. Right after this,
- [28:22]
Michael Kratzios
I've worked at Coca
- [28:23]
Josh Holmes
Cola for 21 years. We're delivering Dr. Pepper from our brand
- [28:26]
John Ashbrook
new facility in Dallas, Texas.
- [28:28]
Michael Kratzios
We're really proud to still make Pepsi products in America.
- [28:31]
Comfortably Smug
You don't need a college degree to
- [28:32]
Josh Holmes
work here, but I put four kids
- [28:34]
Michael Kratzios
through college by working here.
- [28:35]
Michael Duncan
This is a great place to work with great people and great American brands.
- [28:39]
Michael Kratzios
Grocery stores, convenience stores, restaurants, they all depend on us.
- [28:44]
Comfortably Smug
We deliver great paying jobs.
- [28:45]
Josh Holmes
We deliver beverages people love.
- [28:47]
Michael Kratzios
We deliver for our community.
- [28:54]
Josh Holmes
Okay, so the New York Times published a report that they do pretty good campaign finance stuff over there. Shane Goldmacher in particular over the years, we've talked about him before, keeps an eye on this stuff. And it's bipartisan. I mean, it's like he sees an issue and he jumps on it.
- [29:12]
John Ashbrook
Legal opportunity instigator.
- [29:14]
Josh Holmes
Yeah, this one's interesting in that ActBlue may have misled Congress on vetting foreign donations its lawyers warrant. So what we have long maintained.
- [29:25]
Comfortably Smug
Don't wanna do that.
- [29:27]
Josh Holmes
Well, we have long maintained here that there is something fishy once Republicans got tech equal to where Democrats were. There's just not enough in an evenly divided country to explain multiple hundred million dollar differences in terms of donations. They're just not that much better. And the donors are just not that much more accustomed to Democratic donors to giving money.
- [29:58]
Comfortably Smug
Because for the longest time the theory was, oh, it's a cultural difference of the Democrats have conditioned their supporters over time to be like, oh, if you get mad about something, don't post on Facebook. Fire off that, you know, $5 donation. That was the whole operating theory that, oh, well, Republicans just need to make sure that our folks instead of like, you know, don't, don't say something on Facebook, chip in five bucks or something. And then you see Trump with this like small dollar monolith.
- [30:25]
Josh Holmes
And there's still this discrepancy and there's still a discrepancy. And you can see it from Democratic Senate candidates across the country that are still like 5Xing Republicans who are very similarly situated right from all infrastructure standpoint. But they have this huge lead. And so there's always been questions about ActBlue. And that is of course the small dollar online processor that rose to prominence post Bernie 2016. It became the catch all for all the Democratic candidates and that they, you know, they share the donor information and whatnot. But also interestingly, like nonprofits on the Democratic side do too. And we've done a little bit of work on that with the Arabella Advisor stuff. Where we talked about, they've got Hans Borg Wyss, a bunch of foreign nationals that support nonprofits, but they're still in the same system. And where does that money go?
- [31:17]
Announcer
Is it.
- [31:17]
Josh Holmes
Where's the fungibility in there? It's all just a bunch of questions that have never really been answered, in large part because nobody has asked. Well, this Republican Congress started asking some questions. Oh, oh, now Democrats have a problem. According to this article, the Democratic fundraising group is facing investigations from the Department of Justice and congressional Republicans. Ahead of the midterm elections in early 2025, a law firm working for ActBlue, the Democratic fundraising behemoth, delivered the organization a startling warning. The firm concluded that ActBlue's chief executive had given a potentially misleading response to a congressional Republican investigators in a 2023 letter explaining how the organization vetted donations to ensure that they were not illegally coming from foreign citizens.
- [32:06]
John Ashbrook
This is their own attorney's advice.
- [32:08]
Josh Holmes
Yeah, the letter from the. From the chief executive that's in question here. Regina Wallace Jones, said ActBlue carried out a, quote, multilayered screenings of contributions that helped root out those from overseas. In fact, the law firm found some of the steps she had described were not always followed. Oh, so here's where it gets good. Quote. This presents a substantial risk for Act Blue, unquote, The law firm Covington Burling, well known Washington, D.C. deal. I mean, that they're serious people. Over at Covington, they wrote in one of two memos expressing legal concerns. One memo raised the specter of a criminal investigation if Prosecutors believed that ActBlue had tried to conceal facts about its effort to prevent foreign contributions. Of course, that's all against the law. Right? I mean, you can't.
- [33:03]
Comfortably Smug
Yeah. Federal election law prohibits foreign citizens or people who are not permanent residents from donating directly to federal candidates or political action committees.
- [33:11]
John Ashbrook
And again, the credibility here of Covington and Burling. Just so you know, this is Eric Holder's law firm.
- [33:18]
Josh Holmes
Yeah, yeah.
- [33:19]
John Ashbrook
Right. So he was Barack Obama's Attorney General.
- [33:23]
Announcer
Yeah.
- [33:23]
Josh Holmes
It's not some partisan outfit.
- [33:26]
John Ashbrook
If they are warning ActBlue about problems, look out.
- [33:31]
Josh Holmes
Yeah, there's a serious group of folks with a whole masthead of names that you've heard of, by the way. So the memos instigated a meltdown. According to the New York Times, at the highest level of Act Blue, one of the Democratic Party's most vital financial organs, a series of top officials resigned in quick succession.
- [33:51]
Comfortably Smug
That's what rats do when the ship's going down.
- [33:53]
Josh Holmes
Oh, New York Times. Revealed that those departures last year. But in a key cause of the tumult that act blew, the legal warnings about potentially misleading Congress over vetting of foreign donations is being reported here for the first time. ActBlue is now all but declaring war on its own past lawyers. They're blaming the lawyers for this. An extraordinary turn of events at a moment when President Trump has already ordered a Justice Department investigation into the organization. Democrats are nervous that any additional upheaval at ActBlue could destabilize the party's critical fundraising apparatus ahead of the midterm elections. All levels of Democratic candidates, from incumbent presidents to school board aspirants, use ActBlue to raise campaign money from online donors.
- [34:37]
Comfortably Smug
This is what's insane. The platform has processed nearly $19 billion in contributions since its founding in 20 or 2004.
- [34:48]
Josh Holmes
Yeah, but most of it's just come lately. I mean, it was within the last 10 years, from 2004 until 2016, it was largely just sort of an afterthought. It didn't play a big role until the 2016 elections. And at nearly 23,000 candidates and groups use the site. In 2025, ActBlue said it's raised almost $1.8 billion from 52 million contributions, some of which reoccur every month. So they've got this investigation going, and we've talked about it from a congressional standpoint how important that this was, because there's just unraised questions. Like, nobody's even questioned the fact that all of this money is just sort of sloshed into Democratic campaigns over the years. And the discrepancies are so large, they're huge.
- [35:35]
John Ashbrook
You cannot, if you work in Senate campaigns, and we did, you cannot see the amount of money that Democrats are raising quarter after quarter and not be like, wait a minute, where is this coming? Something weird is happening.
- [35:51]
Comfortably Smug
Because for, again, the longest time, their excuse was like, oh, you know, well, the Democrats, we're good at technology. And, you know, I mean, the number of former Obama campaign people who made a living off of being like, oh,
- [36:04]
Josh Holmes
well, we're just so much more smart.
- [36:05]
Comfortably Smug
We created this big data, and the data was incredible, and we're just geniuses.
- [36:09]
Josh Holmes
That's exactly right. And everybody went along with that.
- [36:12]
John Ashbrook
Right. And you're willing to buy it up to a certain point. I mean, the first cycle, it's like, oh, well, people are motivated to donate. That left, they're motivated to donate because Trump's on the top of the ticket and the left wants to donate against Trump. Or Amy McGrath is running against Mitch McConnell. People are motivated to donate against the Republican Senate leader. Well, Amy McGrath is losing her primary to this guy named Charles Booker in Kentucky currently, and she's raised like five bucks.
- [36:43]
Josh Holmes
So you know what I mean? How does that work? How does that work? I thought she was like a fundraiser
- [36:51]
Comfortably Smug
comparing apples to apples. Straight up.
- [36:54]
Josh Holmes
How does that work?
- [36:55]
John Ashbrook
If you work for enough Senate, Republican Senate campaigns, you know that some candidates are more equipped to raise money than others. Some of them come from wealthy backgrounds and they have a bunch of rich friends and they call them and harangue them until they write a max out check. And they do it all the time. And then therefore, they raise a lot of money. Well, all of a sudden, and I think this is. I sort of remember this in 14, a little bit. Mostly 16.
- [37:26]
Comfortably Smug
Okay.
- [37:26]
NetChoice Representative
Yeah.
- [37:26]
Josh Holmes
Like Heidi Heitkamp is one that comes to mind.
- [37:29]
John Ashbrook
16 and 18. All of a sudden, random Democrats who nobody's ever heard of, nobody did not have a national platform or national stature, were blowing the doors off of like
- [37:42]
Josh Holmes
$20 million in a quarter.
- [37:43]
John Ashbrook
Even the richest Republican who came from the richest neighborhood in his city, calling all of his rich friends and saying, give to my campaign. These nobody Democrats are just blowing the doors off of him. And it's like, oh, well, maybe the Obama guys have some secret sauce, or maybe they're against Trump. And it's like, I don't think that adds up.
- [38:02]
Josh Holmes
It's quarter after quarter, campaign after campaign. There was no single evidence of any Democrat that wasn't fundamentally out raising their Republican counterpart in small dollar funders.
- [38:13]
John Ashbrook
Right. And if Democrats are so motivated to give, why are they not so motivated to vote? You know what I mean?
- [38:22]
Comfortably Smug
They're like in also online, on socials. You started seeing some weird things popping up over the last few years where you'd have just like amateur armchair sleuths on the Internet being like, so I'm looking through this Democrats FEC reports. The FEC report is like every federal campaign you have to file. It lists all, like, donors, their job, and the city in the state where they reside. And they were like, I found this candidate or who has a donor who has donated 1742 times for $23. Sometimes, like, and then they call the
- [39:06]
Josh Holmes
person and the person would be like, I don't know what you're talking.
- [39:07]
Michael Kratzios
You.
- [39:07]
Josh Holmes
I've told.
- [39:08]
Comfortably Smug
Yeah, be like, I've never donated a penny.
- [39:10]
Josh Holmes
Yeah, yeah. Like at scale, some of that is. Is gonna happen. And that you've got weird stuff going on because you have Literally tens of millions of donors. So like some of these one offs are like, ah, you know, I don't know if that's indicative of something happened more and more often with more and more frequency. And these, these, the scale of the discrepancy between Democratic fundraising and Republican fundraising continued to grow. And then you've got all this like constellation of nonprofits that are all on the same platform, they're all raising money in the same way. The one that always rings a bell for me that I think is like if I was looking into something, this is where I would go first. Mark Kelly, who's now like a Democratic star because he dared challenge Pete Hegseth's criticism that he didn't want. You know, Mark Kelly said soldiers shouldn't listen to their commander or whatever. Hegseth got pissed. And so now he's rose to Democratic stardom because he's challenging power. Long before that he was just the husband to Gabby Giffords, who was tragically shot, nearly killed. But her career after she had recovered was for anti gun organizations and huge nonprofits. Some of it was Bloomberg funded with like Newtown or whatever. But she was kind of the first face of this growing constituency in the mid-2010s of the liberal left that was just trying to ban guns. And it was massive. They would spend an inordinate amount of money and it became like a huge powerhouse in the Democratic side. This guy who nobody had ever heard of, who just happens to be the husband of this lady, shows up and runs for Senate for the first time and all of a sudden is raising $20 million a couple clip every quarter. How?
- [40:58]
John Ashbrook
Great question.
- [40:58]
Announcer
How?
- [41:00]
John Ashbrook
Great question.
- [41:00]
Josh Holmes
Well, it seems like some of those donor lists that they've been working on for the previous 10 years may have made their way legally or not into his hands. But it highlights the larger issue here, which is it's all built with nonprofit money in some ways. And ActBlue has got enough fungibility, evidently, according to their own lawyers, where they're not actually checking to see if campaign money is getting into the hands of campaigns that are coming from foreign donors. And so this memo, like it says here, this is what they say.
- [41:33]
Comfortably Smug
This is insane. If you see your lawyers writing this,
- [41:35]
Josh Holmes
this is not good.
- [41:36]
Comfortably Smug
That's why people resign.
- [41:37]
Josh Holmes
This is a resignation letter.
- [41:39]
Comfortably Smug
It's time for me to go.
- [41:40]
Josh Holmes
It can be alleged that ActBlue accepted and or facilitated the acceptance of foreign national contributions in to American elections won memo states. In addition, because ActBlue's staff was aware that its system was not as robust as necessary. It could be alleged that these violations were knowing and willful, a standard that both increases the penalties the FEC might seek and gives the Justice Department jurisdiction for potential criminal investigation.
- [42:13]
John Ashbrook
You don't write.
- [42:14]
Comfortably Smug
You read that memo and you're like, after a successful turn at ActBlue, I've decided to spend time with my family in a country that doesn't extradite.
- [42:27]
Josh Holmes
Couldn't be happier for the time I spent. No forwarding address.
- [42:31]
Comfortably Smug
Yeah, I mean, it's.
- [42:33]
John Ashbrook
But again, just to emphasize, this is a memo written by Democrats warning other Democrats that their policies could get them in big, big trouble. And one other observation I have. I mean, we'll see. You know, we'll be following the story closely. But it sounds like the ActBlue execs have resigned. Some of them have resigned. It sounds like the attorneys have been fired. But you know what remains on the field? You know what remains on the field? The money is still in the coffers of every single one of these candidates who are running for. For office this November. It's still spending on TV stations and digital websites. Everything. The money is still there. Everything else is out swapped in. New people managing the same amount of money.
- [43:22]
Comfortably Smug
When you bring it up like that, I also wonder, what's the incentive for MSNBC or Ms. Now? Because NBC is even like, you're too embarrassing. What's incentive for Ms. Now to be like, we've done an investigation into Democrat FEC reports, and it seems like there's a lot of overseas money. We're tracking this. When they're getting ad money from ActBlue to run these, they're like, why would we upset the golden dirt?
- [43:51]
Josh Holmes
They're downstream of the largesse, which is, you know, look, I think that's what's credible about New York Times. Are they right? Anything that's like, left of center, you have a disadvantage.
- [44:01]
Comfortably Smug
They should have advertised more in the time.
- [44:03]
Michael Kratzios
They should.
- [44:04]
Comfortably Smug
Yeah.
- [44:04]
Josh Holmes
What happened to that?
- [44:05]
Michael Kratzios
Pre budget's gotta go up.
- [44:07]
Josh Holmes
Interesting last point. You know, we talked about all those people who are like, oh, boy, I gotta get out of here.
- [44:12]
Comfortably Smug
So.
- [44:12]
Josh Holmes
Several former ActBlue officials were called to testify behind closed doors before the Republican congressional investigators. According to the people briefed on the proceedings, the former officials all have the same lawyer who is paid by ActBlue and followed his guidance to invoke the Fifth Amendment rights, not to incriminate themselves. Bro, Again, like, look, that's your right. It's a Fifth Amendment. It's your right. It doesn't mean they did Anything illegal. But it's a hell of a look,
- [44:37]
Comfortably Smug
especially when there's now evidence that the New York Times has gotten their hands on that the lawyers are like, shit's bad. I think we, I. It is with a heavy heart I announced we may have broken laws.
- [44:47]
Josh Holmes
So anyway, that's something to keep an eye on. And we raise it because we've talked about it a lot here on the Ruthless variety program and now you've seen a little bit more smoke where there could be fire.
- [44:57]
Comfortably Smug
Real quick though, what we should do is I want to show these clips real quick before we hop.
- [45:02]
Josh Holmes
Oh, 100% no. So Harry Antman's back and this cat, we love it at CNN because he occasionally tells the viewership exactly what they don't want to hear. Clip 2.
- [45:10]
Announcer
These numbers are just atrociously awful. A double A for the Democrats here. I mean, just take a look here. Congressional Dems have the right priorities. Look at this. Overall senior 74%. Nearly 3 in 4 say no. Just 25% overall say yes. You might say, okay, well at least Dems like Democrats. Not the case. Look at this. The majority of Democrats are independent Su, lean Democrats. Look at this. 55% say no. Congressional Democrats do not have the right priorities. And then you just see a minority 45% of Democrats say that congressional Democrats have the right priorities. This to me just jumps out of the screen because it screams primary challenges all over the map.
- [45:53]
John Ashbrook
Just, just to connect the last story with this story, if Democrats themselves at 55% don't think their party has the right answers, why should we believe that record breaking fundraising is legit?
- [46:09]
Comfortably Smug
Damn. Why, dude?
- [46:10]
John Ashbrook
Why? Also remember the end of 2024, they raised, you know, in three or four weeks, a billion dollars for Kamala Harris.
- [46:18]
Josh Holmes
Yeah.
- [46:18]
John Ashbrook
And she goes, she goes down in record fashion. And for months all we read were stories from Dem donors saying, I'm pissed, I'm fed up with this party. I'm never giving another dime. Now all of a sudden they're all back record fundraising when 55% don't think they're doing the right thing.
- [46:37]
Josh Holmes
It's a good point. Point. So he's not done yet. Clip 3.
- [46:40]
Blinds.com Advertiser
What's overall approval among Democrats of their leaders?
- [46:42]
Josh Holmes
Yeah.
- [46:42]
Announcer
Okay, so you know, you speak about Democrat on Democrat crime and I want to know how unusual what we're seeing right now about how Democrats feel about Democrats in Congress is. Take a look at this. This is a trend line going back through the years, midterm elections in which there's a GOP president, look at this. In 2006, Demsnet approval of congressional Democratic leaders was plus 28. You go back to the last midterm, look at that. Plus 19. Very much on the positive side, the bottom has fallen out. The bottom is falling out. Minus four points. That is Democrats. Democrats own net approval of their own congressional leaders. Even Democrats don't like their own leaders when it comes to Congress. And overall, of course, the numbers are just absolutely awful. So Democrat on Democrat crime. Absolutely, absolutely. This to me screams again, primary challenges across the map. And it screams to me, hey, when it comes to those next leadership elections, maybe something might be cooking.
- [47:40]
Josh Holmes
Oh, Chuck.
- [47:41]
Comfortably Smug
Yeah. He's like, am I on the menu, Chuck?
- [47:45]
Josh Holmes
Maybe those fellows at Ruthless had it right. You're in deep shit, buddy.
- [47:49]
John Ashbrook
Get ActBlue would like us to believe that when Chuck Schumer calls, a record breaking number of Democrats are willing to write checks.
- [47:55]
Josh Holmes
Yeah, it's just his charisma. It's how well he communicates to the voters. Yeah, no, it doesn't add up. You're right. But that's Harry Entnon giving you the facts as they see it over at cnn, which is really, really something. We come back, we got a little bit of variety for you, including a naked burglar in Virginia, which is just absolutely appalling. And then we got a Hack Madness update right after this. Okay, so Hack Madness, our signature tournament here, the Ruthless variety program, it's coming to a close and I think voting is underway to crown champions here.
- [48:27]
Comfortably Smug
That's the thing is, so we are right now, this is the final four. This is what all your votes have led to. You go to X, you go to my profile, comfortably smug on X. I'll have it pinned at the top as we speak. Voting is underway. Your final four, folks. In the liberal activist bracket, you got Don Lemon. From the way to online, you got Hasan Piker. That was a 51, 49 win over a real nail pole, Keith Olbermann.
- [48:51]
Josh Holmes
Yeah.
- [48:52]
Comfortably Smug
From the establishment division, you've got Stephen Colbert. And from the fake news division, you've got Abby Phillip.
- [48:59]
Josh Holmes
Oh, man.
- [49:00]
Comfortably Smug
So you're going to have to vote, folks. It's going to be Don Lemon versus Hasan Piker. It's going to be Stephen Colbert versus Abby Phillip. There's the bracket right there on the screen. Go there, vote. It's coming down to the wire.
- [49:12]
Josh Holmes
I love it. I love it. All right, naked burglar. Wait till you get a load of this clip 4 Then this morning, just
- [49:18]
Police Officer/Reporter
after 5:00am in the 14, 800 block of Palmerston Square in Centerville. In this new surveillance video, you can see the man now described as about 61 to 63ft tall, with a skinny build. You can see him look inside this house and attempt to open the door. But when he couldn't, he ran toward a wooded area. Police say he's wanted for four burglaries. In at least two of the previous burglaries, victims say they saw him fully naked. Major James Curry says they're using all the resources they have to find this man.
- [49:46]
Josh Holmes
It's a hell of a niche having robbed the shit out of this community, but I'm going to do it naked. He had his burglar buddies are like, hey, how many homes you hit? Like, I don't know, like, five, six homes. How about you? Yeah, four or five. But I did it naked.
- [50:04]
Comfortably Smug
I can't understand horrifying any of this. Like, you. If you're, like, breaking in a window and, like, you're opening yourself to a lot of danger. Oh, yeah, no, you don't want to be doing this. This kind of thing.
- [50:16]
Josh Holmes
But heaven forbid somebody runs and tries to catch you.
- [50:19]
Comfortably Smug
I mean, this is what you get when you've got Abigail Spamberger. You've got Jay Jones, who himself is a criminal. I mean, he said he's literally wants to kill your kids if you're a Republican. And there you go. I hope folks in Virginia are enjoying. They're getting what they voted for.
- [50:33]
John Ashbrook
You know, guys, Michael Duncan has been out on assignment here for three shows.
- [50:39]
Michael Duncan
And so what we don't know he's
- [50:41]
Comfortably Smug
between six one and six three. We don't know is that we say spending his evening.
- [50:46]
Josh Holmes
I did notice that they provided an awful lot of description about. He's six one, six three, slight build. Like, gave us a lot of couple measurements missing there, I think.
- [50:55]
Comfortably Smug
I think that's for the lineup. That's going to be unfortunate.
- [50:58]
Josh Holmes
Yeah. I mean, there's.
- [50:59]
Comfortably Smug
First off, this guy broke into your house, and you were like, what's happening here? You're calling 911. And hopefully, well, God knows, you know, the district attorney in Virginia doesn't care, but you get called in, oh, we caught the guy, but you got to do a lineup.
- [51:14]
Josh Holmes
There's at least one identifying characteristic
- [51:19]
Donald Trump (quoted)
that
- [51:19]
Josh Holmes
he has helpfully provided onlookers.
- [51:24]
John Ashbrook
He might be proud of it.
- [51:27]
Josh Holmes
Sheriff, that's the man. How can you tell?
- [51:32]
Michael Kratzios
Might be proud of it.
- [51:34]
Josh Holmes
Oh, man.
- [51:35]
Comfortably Smug
All right.
- [51:35]
Josh Holmes
So smug. I think we got an interview.
- [51:38]
Comfortably Smug
We do. This is as part of our series American Innovators. We have Michael Kratzios, who is leading the White House. Trump has said that he wants America to be the world leader in AI. Michael Kratzios, they released this administration, released the AI framework. This was a terrific interview. We did it over at Hillen Valley. This is brought to you with partnership with our friends from Build American AI. Terrific interview. Love having Michael Kratios.
- [52:07]
Michael Duncan
I want to welcome to the program the White House Director of Science and Technology, Michael Kratios. How are you?
- [52:13]
Michael Kratzios
I'm great. Thank you guys for having me.
- [52:14]
Michael Duncan
Yeah, thanks for doing it. I know this is a big event. You're rolling out this national framework for AI which is going to be so important. Let's just start right there. What do people need to know about this framework and why it is such an important thing that the Trump administration is trying to get done?
- [52:31]
Michael Kratzios
Number one, it's providing certainty to the American people and to American innovators about the way that AI is going to be regulated going forward. Right now, many of you guys may have seen that individual states are running around trying to pass their own AI legislation. And while there may be some interesting solutions there, the problem is that it creates this patchwork all across the country. And if you're an innovator and you want to build an AI company, trying to comply with 50 different set of laws is just not the right way. And for, for us, we believe that this is the first time ever that we have actually put forward a solution to this problem by creating a national framework. And in it, not only do we create that one standard, so we don't have a 50 state patchwork, but we also have lots of different provisions around child safety, around electricity prices, around creators, all the things that American people are expecting.
- [53:17]
Comfortably Smug
Yeah, I think that's one of the most key things is for so long there's been uncertainty around AI and like a doomer vision of like what AI means for them. And this framework provides tons of clarity addressing so many Americans concerns. One of the first ones is electricity. Like everyone's been told that now electricity is going to be costing like 10 times as much as you're paying. And this directly addresses that, especially with the President's Rate Protection pledge.
- [53:45]
Michael Kratzios
Exactly. So the framework calls for Congress to enshrine into law the President's ratepayer protection pledge. And if you remember, a few weeks ago, the President brought to the White House all the executives from, from the top AI and data center companies and got them to agree to either build, bring or buy their own power whenever they build a data center, essentially having them guarantee that anytime they build a data center, it will not increase electricity prices of everyday Americans. This is a huge step forward. This is what Americans expect and want. And the government can play a very critical role in helping not only get these data centers built out, but ensure that the American people are not the ones that bear the burden of this excess electricity price.
- [54:25]
Josh Holmes
Yeah.
- [54:25]
Michael Duncan
Which also empowers the private sector to go out and, and build and find the energy resources we're going to need for this AI revolution. I know that also in there is some permitting reform, which I think is going to be huge for the energy sector. Can you explain some of that?
- [54:39]
Michael Kratzios
It's so important. Under the Biden administration, there was actually a rule that said that you are not allowed to bring your own power when you build a data center.
- [54:47]
Comfortably Smug
That makes no sense.
- [54:48]
Michael Kratzios
It makes no sense. This is known as sort of behind the meter. And the President changed that and flipped around and said, look, if you are going to build a data center, you can build your own power. And in some ways, maybe that's even better because you don't put a strain on the ground itself and you're able to then yourself be able to build it even more quickly. So it benefits the companies that are trying to build a data center, and it also relieves a grid from the excess capacity that they would need to power the data center.
- [55:11]
John Ashbrook
Yeah.
- [55:12]
Comfortably Smug
And it also is, you know, contrary to belief, we're all told that AI is job destructive. That hasn't come to pass. The opposite has. Where like the number one job you want in America is an electrician, where America does not have enough electricians. And if you're an electrician, I mean, you don't need me to tell you you're doing great right now.
- [55:29]
Michael Kratzios
The reality is we are in a blue collar boom right now. We are seeing wage increases between 20 and 40% for all the blue collar jobs that support this large AI center. Sort of like infrastructure build out everything from electricians to H Vac to construction. This is a huge boon for productivity and for the wages of so many American workers.
- [55:48]
Michael Duncan
That's amazing. Lee Wolf, our producer, was just telling me before our interview that he built a web app using AI that allows him to analyze all of our episod keywords, performance on YouTube, all this sort of stuff. So, like, for your white collar workers, it also makes you more efficient in how you can analyze and research data in real time.
- [56:09]
Michael Kratzios
Absolutely. I think it's a huge unlock, particularly to small businesses. I guess you guys are experiencing firsthand but if you have an opportunity ever to talk to Administrator Lefler who runs the sba, she talks about this all the time. The impact that AI is having on so many small businesses across the country. And if you remember, the vast majority of Americans are actually employees of small businesses. And this is where you're going to see some of the biggest benefit. And all the headlines are taken by one of these mega corporations doing. But the reality is like everyday people that are trying to run their small flower shop or their small business, this can be a huge, huge boon for their productivity.
- [56:43]
Comfortably Smug
What do you feel are some of the most critical parts of this framework in making President Trump's vision of making America the capital of AI, making sure that we don't fall behind China?
- [56:54]
Michael Kratzios
Yeah, I think one's electricity we talked about, but I think another thing that we care most about and is a big part of the larger AI action plan is this question of adoption. And whenever anyone asks us, when you say you want to win the AI race, what does that mean? And our answer is always like, you need adoption. You want more people using AI around the world that's American than anything else. One of the hurdles around AI ad adoption often is around the way that families or parents interact with AI. And parents want to have certainty around the way that their children are interacting with these tools online. They want to know what their children are seeing, what they're not seeing. They want to have parental controls over the applications that their children have access to. And right now there is no national standard around that. And the framework addresses that. And it puts the control back in the parents hands and says, like, this is just a common sense solution and I have an eight month old baby. At some point they're going to be able to use a phone or a laptop and I want to be able to have the controls in front of me to be able to say, no, they're under 18, they should be doing these things and not those things. And we think that's going to be a huge boon for adoption and it's just the right thing for American families.
- [57:57]
Michael Duncan
So when you talk about adoption, you talk about the rest of the world and obviously we want our companies to succeed in the global marketplace in this tech race against China. Can you explain to me, because I hear this all the time, with all the AI companies out there building large language models, closed source and open source, do you kind of let a thousand flowers bloom here? Is that sort of how we win when it comes to the rest of the world?
- [58:20]
Michael Kratzios
It's kind of Two parts. One, to answer your question directly, yes, we have to have a vibrant closed and open source ecosystem. Right now the US is by far the most dominant in the closed source world. We have everyone from OpenAI to Google to Anthropic, all developing sort of frontier capable abilities for models. There are a few companies that are going to be announcing their open source frontier models in the next few months. One of them is Reflection. AI Jensen at his GTC conference last week said that they're going to be going into open source as well. Because at the end of the day to your question of global adoption, ultimately customers, depending on what the use case is, will want to use a particular open source or closed source model. You may have a Ferrari in your garage and a Camry in your garage. Sometimes you got to drive the Camry for the particular activity you want to do that day. And I think that's how, you know, we generally think about adoption broadly. We want the whole world to have options based on kind of what their own cost considerations are and what the use case is. If you're doing a highly sensitive workload that you want the best model possible for, like maybe you do want to pay more for the closed source, there may be other very basic things where an open source could suffice. So we just want to, you know, cover the whole field and make sure that all the options are out there for people around the world.
- [59:33]
Comfortably Smug
So on a personal level, what's the most novel or interesting use of AI that you've done that surprised you in the first place? You didn't think it was possible?
- [59:42]
Michael Kratzios
Oh, I don't know about what I've done. But I will say what I am most excited about in this role is the effort that we're doing to drive an initiative around AI for science. I fundamentally believe that artificial intelligence is going to be the greatest unlock for scientific discovery in human history. We believe that you can apply artificial intelligence to some of the world's greatest problems, everything from curing cancer to developing new materials that are going to get us to Mars. Those are the types of things that, that now can be accelerated through artificial intelligence. And the President signed an executive order just last year in order to launch something called the Genesis mission, which is our whole of government approach to actually accelerate science discovery through AI. And that's being run out of the Department of Energy. So that's where I see we're going to see a lot of breakthroughs in the next, the next few years.
- [60:27]
Michael Duncan
So in taking this framework to Capitol Hill, what are you hearing from lawmakers, their concerns, whether they're, you know, there's parts of it that excite them or how do you sort of work that process and how do we get this to implementation?
- [60:41]
Michael Kratzios
So some of the provisions that you saw in the framework are very bipartisan. There's been discussion around child safety related online activities for some time. There's been bills that have passed by large bipartisan margins in the Senate even, even in the last session. So for us, we believe that that may be kind of the locomotive that drives it. If you can find some consensus around the child safety language, which you know is going to take some effort, but we do believe it's very, very bipartisan. I think with that, you can kind of attach some of the other stuff that we're more interested in as well. The permitting stuff is actually interesting, especially as we've kind of tracked and talked to some senators and congressmen, we're seeing that permitting reform is actually kind of a bipartisan issue in some respects because there are some projects even in blue states that would benefit from permitting reform. So I do think there's a lot there. There is some cross jurisdictional issues. So Senate Commerce is probably sort of the belly button for the issue, but some of it kind of bleeds into other committees. But broadly speaking, I think we're optimistic. And when we've talked to both Senate and House leadership, we want to try to have, have something on the floor this year.
- [61:41]
Comfortably Smug
One of the things that is outlined in this framework is to educate Americans on the use of the technology. That's part of what we're trying to accomplish with the series of interviews. What do you think is the path and role that this administration can take in educating Americans?
- [61:56]
Michael Kratzios
That's a great question. Just before I came to hear this event in Hill and Valley, I was with the first lady at her event at the State Department, and she has been a huge proponent on AI and education. And we co chair the Education Task Force at the White House. And what that is essentially designed to do is to provide the necessary skills both to students, but also to teachers about how to teach artificial intelligence. We've talked about before. No matter what career you're going to enter into, you will be using AI. You could be wolf that's doing this amazing stuff with you guys. You could be in finance and you could be doing, you know, modeling the type of stuff you used to do. Everyone is going to be using this, this technology. So what's important is to expose K through 12 students to educate to AI, not to like teach them how to be great, prompt engineers, but to show them how does this technology work? Where does it work really well? Where should you maybe not use it? How, where is your sort of creative spirit can enter into the, enter into the process. So for us, we've we by the First Lady's actual sort of initiative, she was able to bring hundreds of millions of dollars of private sector and nonprofit donations to this problem. And, and that was announced I think a few months ago, where essentially like all these companies are now providing free AI education resources to students and teachers all over the country. And we think that's going to continue to grow for the next, the next few years.
- [63:15]
Michael Duncan
Well, it's amazing because when I think of AI as someone who's just a casual user of it, it's like, well, it's kind of like a search engine, right? Like I can type in something, I'm going to learn something. But the reality is there is so much more out there that AI can do to improve your life, help you with research and things like that, that people don't necessarily come. It doesn't come top of mind to them. So, like, the other side of this, you know, outside of the innovation, is also changing our whole perception from an education standpoint. I mean, this is going to change the way we educate our young people for a generation.
- [63:48]
Announcer
Right?
- [63:49]
Michael Kratzios
It is if, if you think back to the State of the Union, one of the folks that the first lady invited and the President invited State of the Union, the audience was a student who is a student at something called Alpha School. And that's the example of, if you think about like applying AI to the world of education, they're kind of in the extreme end where you do an AI only education in the morning and then do kind of like life skills in the afternoon. But it's an example of that over time, the way that all of us went to school every day, that's not, that's not how kids are going to be taught in five or 10 years. So there has to be a way for the government to be proactive in providing opportunities for these new tools, new tools to find their way into the education system. Because I think the biggest tragedy would be that, you know, the private sector is racing ahead. It's applied into work, but. But schools are still antiquated and trying to do the same thing they were doing 100 years ago.
- [64:33]
Michael Duncan
Yeah.
- [64:34]
Comfortably Smug
For regular folks at home who are listening to us, who are watching us right now, what takeaway do you want them to have from the framework that's released what assurances can they have that this administration has them in mind and their interests in mind?
- [64:47]
Michael Kratzios
Number number one, I think it protects American parents. And that's the very first section about finding a way to protect America's children and empower parents to have the tools they need to oversee what their children are doing online. The second part, it protects American families through all the ratepayer protection pledge initiatives where we want to ensure the electricity prices don't go up for Americans. Third, it protects American creators. We want creators out there to be able to create all these great things and not have necessarily AI models use outputs from their models for commercial purposes. So, you know, if someone does a spoof of you guys and then tries to make money off of it, you guys should be protected.
- [65:26]
Michael Duncan
Yeah, don't hurt us, Michael.
- [65:28]
Michael Kratzios
And the fourth thing is, you know, censorship has been a big issue in the last administration and there's a particular provision there where it says, look, the United States government cannot call on private sector companies to censor the outputs of AI models. And we want them to be true, speaking sort of objective models. And that's something that the government will only procure, truth seeking models. And the last piece of it is there are a number of provisions around how you can get American workers up, skilled for the next set of responsibilities and jobs they will have in the environment. And I think that sort of comprehensive plan is something that no one's ever done before. And I think it's something that really speaks to how holistically President Trump thinks about this issue and how important it is that we deliver real solutions to the American people.
- [66:08]
Michael Duncan
Awesome. Michael Kratzios, thank you so much for joining us. Really appreciate it.
- [66:12]
Michael Kratzios
Thank you guys for having me.
- [66:13]
Comfortably Smug
Thank you.
- [66:15]
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- [66:46]
John Ashbrook
Once again, just a terrific conversation. I mean, this guy seems to be on the cutting edge of a whole lot of things. Smug. What a great idea this whole thing is.
- [66:54]
Comfortably Smug
Yep. And the important thing is this addresses so many people's concerns. The rate protection program, taxpayers you know, American citizens, you're not going to be paying increased electrical rates. What you've been told of like, oh, your price is good, that's going to be taken care of as part of this framework. It addresses parental concerns of safety. It addresses so many concerns that people had while making sure that America dominates the field. And now the ball is in your court. Congress, let's get this done at the federal level and let's win this thing.
- [67:24]
Josh Holmes
Very well said. Great interview. I love these series. Doing a great job with with that smug thank you
- [67:33]
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- [68:01]
Josh Holmes
Remember, when you like and subscribe to the Ruthless Variety program, you leave us a comment. Give us some thoughts on today's show. We read absolutely every one of them like and subscribe and then we do that and then we'll read them back to you the very next episode. In this case, it'll be on Thursday. Check out some merch while you're there. We've got some new Titleist gear that looks pretty sweet and it always goes super fast. In fact, I don't know what inventory looks like right now. See, if you see that and you like it and you want a little something for golf season for you or someone you're close to, get on it because it's not going to be there very long. That's store. Ruthlesspodcast.com that said, fellas, I think we did it.
- [68:41]
Comfortably Smug
I think so. Absolute banger of an episode. Gentlemen, thank you so much, Michael Kratzios, and thank you to listeners. Remember, if you have not yet yet, go to the YouTube and hit that subscribe because it's more fun and video. So until next time, minions, keep the faith, hold the line and own libs. We'll see you Thursday. Stay Ruthless.