Slate Money – "Protection Money" (May 1, 2021)

Hosts: Felix Salmon (Axios), Emily Peck, with new co-host Stacey Marie Ishmael
Episode Focus:
A lively analysis of the week's biggest business and finance stories: Big Tech’s bonkers earnings, the Apple v. Facebook privacy war, the Basecamp workplace controversy, and why used car prices are exploding.

Main Theme & Episode Overview

This episode brings on Stacey Marie Ishmael (formerly of Texas Tribune and FT Tilt) as a recurring co-host. The team dives deep into why Big Tech’s financial performance is “bonkers,” the escalating clash between Apple and Facebook over privacy, the Basecamp debacle on workplace politics, and the bizarre spike in used car prices. They also touch on privilege in tech founder culture, corporate leadership dynamics, and the pandemic's disruptive impact on supply chains.

Key Discussion Points & Insights

1. Tech Giants’ "Bonkers" Earnings (00:28–08:45)

• Tech Earnings Defy Expectations: All three hosts express awe at how Apple, Google, and Facebook’s profits are not just massive, but growing at unprecedented rates.
  • “It’s just the scale of these companies is hard to compare to anything else.” – Stacey (03:15)
• Apple’s Strategy: Apple’s revenue surge stems both from hardware (Macs up 70% yoy) and strong growth in services (up nearly 30%), pointing to successful ecosystem expansion.
  • “You don't spend as much money as they are spending on original Apple Television…without having a grander ambition for what is often called inside the company, like the ecosystem.” – Stacey (05:43)
• Pandemic Effect: The hosts agree the stay-at-home dynamic fueled purchases of devices and digital services.
  • “People were home and needed more Apple products…students needed new stuff.” – Emily (06:20)
• Apple’s Chip Shift: The new M1 chips are lauded as a game-changer both for performance and profit margins. (07:02)

2. Apple vs Facebook: Privacy, Profit, and Power (07:37–18:29)

• Core Conflict: Apple’s iOS update forces apps to request user consent for tracking, threatening Facebook’s ad model.
  • “Apple is absolutely militantly religiously committed to privacy and Facebook is absolutely militantly committed to scale.” – Stacey (09:12)
• Is Apple’s Privacy Zealotry Self-Serving?
  • Felix questions Apple’s motives: “It does feel more than a little self-serving…were it not for the 30% app store take.” (10:29)
  • Stacey explains Apple’s argument: Users trust the app store’s guarded ecosystem—and that “protection” is what the fees buy.
    • “It’s protection money.” – Felix (11:50)
• Public Attitude to Privacy: Debate over whether average users care about privacy or just retargeted ads.
  • “It’s also not clear to me that anyone cares that much about privacy.” – Emily (13:03)
  • “I think there’s like a hopelessness or a…‘I have no way of opting out.’” – Stacey (16:45)

Notable Exchange on Privacy (14:03):
Felix: “In the real world of, you know, normal people who are scrolling through their Instagram feeds, they are not sitting there going, ‘oh no, every time I like an Instagram post, I’m giving up a quantum of privacy to Mark Zuckerberg.’”

3. Basecamp: When Founders Ban “Politics” at Work (18:42–33:58)

• Background: Basecamp (makers of project management tools) banned “societal and political discussions” on internal platforms after conflict over “funny names” customer lists, many perceived as racist.
  • “What counts as political and who gets to talk about it?” – Emily (20:04)
• Founder-Centric Power: Critique of tech’s “monarchical” startup culture—founders making sweeping decisions unilaterally.
  • “He basically considers himself to be the company.” – Felix on Patreon’s CEO, tying into Basecamp’s situation (22:09)
• Privilege & Identity at Work: Discussion of how white/unprivileged founders can separate “politics” from professional life, something less possible for BIPOC employees.
  • “He can separate political in a way that a black person coming to work can’t.” – Emily (25:47)
  • Stacey: “Most people…in powerful positions…have been so far removed from the reality of being uncomfortable…that the mere fact of someone saying…‘othering other people through their names…’ makes them feel bad. And that is worse to them than the conversation about…why this is challenging.” (28:07)
• Structural Diversity Challenges: The risk of “glass cliff” hires and how middle management resistance undermines change, even with diverse leadership.
  • “Every change that they make, every suggestion that they make is received fundamentally differently, even if it would have been the exact same thing…a Jake or a Mark or a Tim or a Steve might have suggested.” – Stacey (31:15)

[Timely Epilogue Update – 47:30]

• Emily: One-third of Basecamp’s employees quit in protest after recording, proving the policy wasn’t just a Twitter controversy.

4. Used Cars Cost More Than Ever—Why? (33:58–41:17)

• Skyrocketing Prices: The team discusses data showing the median used car price essentially doubling due to pandemic-driven demand and ongoing chip shortages limiting new car supply.
  • “Used cars have gone through the roof, especially pickup trucks...Some of them are worth substantially more now than they cost when they were new.” – Felix (33:58)
• Pandemic Supply Chains: The cascading impact of pandemic “retrenchment” orders, especially for tech components, and how Tesla out-maneuvered legacy carmakers by not cutting production.
• Bike Shortages Parallel: Not just cars—bike prices and availability are also out of whack.
  • “As a person who is a committed bike commuter, experienced a version of this with bike shortages.” – Stacey (38:36)
• Revealing Supply Fragility: Residents and workers in all fields are suddenly aware of how delicate supply chains are.

5. Numbers Round & Final Thoughts (41:23–46:14)

• Felix: $80 billion – Biden’s proposed IRS funding could yield $700B in recovered taxes. “Most obvious low-hanging fruit of fiscal policy…those dollars pay for themselves ten times over.” (41:23)
• Emily: 529 – The number in Jamie Dimon’s secret Instagram handle (uncovered by journalist Ashley Feinberg).
• Stacey: 0.6% – Q1 contraction in eurozone economy, reflecting US-Europe divergence in pandemic recovery. (44:36)
  • “Just seeing the sort of divergent paths…has really surprised some people.” – Stacey (44:36)

Notable Quotes & Memorable Moments

• “It’s protection money.” – Felix (11:50)
• “Apple is absolutely militantly religiously committed to privacy, and Facebook is absolutely militantly committed to scale.” – Stacey (09:12)
• “Most people…in powerful positions…have been so far removed from the reality of being uncomfortable for such a long time that…[these discussions] feel like some kind of aggression or some kind of violence.” – Stacey (28:07)
• “Basecamp…was all over Twitter this week because…they have decided…there’s just altogether too much political discussion on this here platform.” – Felix (18:42)
• Breaking news update: “About a third of Basecamp employees accepted buyouts today after a contentious meeting about the policy.” – Emily (47:30)

Timestamps for Major Segments

• 00:28 – Introduction to Stacey Marie Ishmael
• 03:09 – Big Tech’s “bonkers” earnings
• 07:37 – Apple v. Facebook privacy war explained
• 13:03 – Do people actually care about privacy?
• 18:42 – Basecamp: Banning politics at work, controversy unpacked
• 28:07 – Privilege, power, and workplace discomfort
• 33:58 – Used cars: Why prices are at record highs
• 38:36 – Bike shortage parallel, supply chains under strain
• 41:23 – Numbers round (IRS funding, Jamie Dimon’s “finsta,” Eurozone contraction)
• 47:30 – Epilogue: One-third of Basecamp staff quits in response to policy

Conclusion

Flow & Tone:
Slate Money delivers an energetic, in-depth, and irreverent guide to the intersection of tech, culture, and business. The hosts challenge each other openly, with a mix of skepticism, humor, and real world insight, making potentially arcane topics like app store fees, supply chain logistics, and corporate politics engaging for all listeners.

For further discussion:
Episode teases a future deep dive into targeted advertising’s actual effectiveness and an exploration of why the US and European economic recoveries have diverged.