The Down the IGWEL Edition

Summary

Slate Money — "The Down the IGWEL Edition"

Episode Date: January 13, 2018
Host: Felix Salmon with Anna Szymanski and Jordan Weissmann

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Episode Overview

This week’s episode of Slate Money offers a deep-dive discussion on three major topics at the intersection of politics, technology, and society:

• President Trump’s surprise appearance at Davos and what it means politically and diplomatically;
• Huawei’s near-invisible but powerful global reach, and the complex reasons why the U.S. market resists its technology, despite its superior offerings and price;
• The growing concerns over smartphone addiction among children, activist investor pressure on Apple, and the shifting public sentiment toward big tech firms.

The tone of the discussion is quick-witted, skeptical, and irreverent, with the hosts blending personal anecdotes with global perspective.

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Key Segments & Insights

1. Trump Goes to Davos: Airs Out the IGWELs

[00:27–12:45]

Main Discussion:

• President Donald Trump will attend Davos with a sizable delegation, marking only the second time a sitting U.S. President has done so (the first was Bill Clinton in 2000).
• The panel analyzes the motives behind Trump’s visit—ranging from intra-administration politics (e.g., Mnuchin and Cohn wanting to attend but needing Trump’s cover), to actual diplomatic opportunity, to a desire to grandstand in front of the world’s elite.

Notable Quotes:

• “If Donald Trump ever went to Davos, he would completely suck the air out of every room” (Felix Salmon, 02:56)
• “He’s going to get to be the skunk at the garden party, which is kind of the role he’s most comfortable in.” (Jordan Weissmann, 06:39)
• “He only respects billionaires; he only respects money... So it seems like he’d be much more apt to want to hang out with the other plutocrats as opposed to actual world leaders.” (Anna Szymanski, 08:38)

Key Insights:

• Davos is usually a venue for lower-profile but important diplomatic interactions, and Trump may leverage these high-level but informal “IGWEL” (Informal Gathering of World Economic Leaders) meetings for private summits not possible in the U.S. or U.K.
• Security and Trump’s own preferences may keep him insulated from the broader Davos scene, likely restricting his interactions to carefully selected elites.
• The extraordinary secrecy of IGWEL meetings is noted (“I’ve never seen an IGWEL leak…”), and the effectiveness of Davos in deterring protests through harsh measures is highlighted.

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2. Huawei’s Technological Dominance and U.S. Anxiety

[12:45–28:20]

Main Discussion:

• Felix recounts his travels in New Zealand and Hong Kong, noting Huawei’s ubiquity and quality, especially with the Mate 10 smartphone.
• Despite its superior products, Huawei remains blocked from most of the U.S. market, largely due to national security concerns and lack of competitive reciprocity from China.

Notable Quotes:

• “The one thing that Huawei does better than any other telecommunications equipment manufacturer is make very good, high quality stuff, just way cheaper than anyone else.” (Felix Salmon, 14:32)
• “There are legitimate national security concerns... There is no strong wall between [Chinese companies] and the government.” (Anna Szymanski, 16:46)
• “At some point we’re just going to have to use Chinese technology because there is going to be no alternative.” (Felix Salmon, 25:51)

Key Insights:

• The AT&T–Huawei Mate 10 deal’s collapse is emblematic of the intractable market barriers for Chinese tech firms in the U.S.
• Security concerns focus on potential espionage and backdoors, with bipartisan Congressional opposition highlighted.
• Britain’s solution—allowing Huawei in but with constant national security scrutiny—is discussed as a cumbersome middle path.
• Higher U.S. telecom costs are partially attributed to the refusal to adopt Huawei’s cheaper infrastructure solutions.
• Debates ensue about the long-term economic and strategic consequences of shutting out Chinese technology, with Anna arguing China’s “Made in China 2025” policy is explicitly aimed at closing its own markets and dominating global technology supply chains.

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3. Shareholder Activism and the iPhone Addiction Panic

[28:20–38:49]

Main Discussion:

• Activist investors Jana Capital and CalSTRS wrote to Apple urging them to investigate and mitigate iPhone addiction in children.
• Discussion extends into what responsibility tech companies bear for the societal impacts of their products, and how public opinion towards big tech has soured.
• Facebook’s recent move to deprioritize clickbait and focus on “meaningful interactions” is discussed as a similar attempt at damage control.

Notable Quotes:

• “Frankly, Apple, as opposed to like Facebook or Twitter, could potentially do this [add controls] without really hurting them because they’re not as dependent on hours of engagement.” (Anna Szymanski, 31:09)
• “I feel like there has been a real sea change in the way that the general public looks at big technology companies... now they’re big evil places you shouldn’t trust.” (Felix Salmon, 33:50)

Personal Moment:

• Felix shares that deleting Twitter during a trip left him “happy and relaxed”—a rare moment of introspective tech detox. (35:58)

Key Insights:

• There is both substance and self-serving strategy to these corporate moves—e.g., Apple has less to lose by curbing usage, as opposed to engagement-dependent companies like Facebook.
• The debate about harm is most acute around children (influence on self-esteem, growth, etc.), but Felix points out adults can be just as “addicted.”
• The segment touches on the historical cycle of moral panics over new media (e.g., parental advisory stickers in music).

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4. Numbers Round: Highlights from Business and Policy

[38:53–46:34]

Key Numbers & Commentary

• 0.008: Price-earnings ratio for the Swiss National Bank, which is technically a public stock. (Felix, 38:53)
• 10: Number of states seeking to add work requirements to Medicaid—Trump administration is supportive, following a trend similar to 1990s welfare rollbacks. (Jordan, 40:41)
• 15: The year-gap in life expectancy between men in the top vs. bottom 1%—a stark measure of growing inequality. (Anna, 43:55)
• $37 billion: The accounting windfall Warren Buffett’s Berkshire Hathaway gained from the Trump tax cuts. (Felix, 45:22)

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Memorable Moments & Speaker Attribution

• On Trump’s motivation for Davos:
  “This is sort of just a giant fuck you from Gary Cohn and Mnuchin to Steve Bannon on his way out the door.”
  Jordan Weissmann [03:23]

• On IGWEL’s secrecy:
  “I’ve never seen an IGWEL leak. For those of you who... forget previous Davos episodes, it’s my favorite acronym. It stands for Informal Gathering of World Economic Leaders.”
  Felix Salmon [10:16]

• On living without Twitter:
  “I basically spent three weeks without Twitter and it felt amazing... It’s only when you get rid of it that you realize just how kind of twitchy it makes you.”
  Felix Salmon [35:59]

• On Huawei and China’s strategic ambitions:
  “In China’s Made in China 2025 plan, they explicitly lay out their plan to gain total market dominance in these advanced manufacturing and specifically talk about strategic investments to gain more access to cutting-edge technology…”
  Anna Szymanski [24:05]

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Conclusion

This episode captures the energy of a shifting global order, where politics, commerce, and technology collide. From the odd spectacle of Trump at Davos to the stealth dominance of Huawei and the rising backlash against tech’s impact on children, the hosts explore how today’s business news reflects deeper trends in global relations and societal anxiety.

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Timestamps by Topic

• Trump at Davos: 00:27–12:45
• Huawei and U.S.–China Tech Conflict: 12:45–28:20
• Phone Addiction & Activism against Big Tech: 28:20–38:49
• Numbers Round (Swiss National Bank, Medicaid, Inequality, Tax Cuts): 38:53–46:34

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Tone:
Direct, skeptical, witty, occasionally irreverent.
Best For:
Listeners seeking global perspective on business and finance, flavored with vivid anecdotes and clear-eyed skepticism about power, tech, and politics.

Transcript

[A]

The following podcast contains explicit language. Hello and welcome to Slate Money, your guide to the business and finance news of the week. I'm Felix Hammond of Fusion, joined by Anna Shymansky and Jordan Weissman.

[B]

Hey everyone.

[A]

And this week we're going to talk about three stories I don't know what to think about. I don't really have fully formed opinions on these things. Well, maybe the first one, we're going to talk about Huawei, which is this Chinese telecommunications giant and Americans don't seem to want to use their incredibly well priced products for reasons we will go into. We are going to talk about iPhones and whether the children are addicted to them and what that means for Apple, which is a large company you might have heard of. We are going to talk in the Slate plus segment about the most interesting question of the week, which is the relative merits of Manhattan's and old fashions.

[B]

Yep. Felix and I are just gonna duke.

[A]

It out, which if you don't have Slate plus, the TLDR is Jordan Weissman is wrong. But first we are going to talk about Davos. I know it's a little bit early to talk about Davos.

[B]

Yeah, we haven't gotten to our annual Davos edition yet. Usually we only talk about it once a year.

[A]

We are going to have an annual Davos edition. I have talked to Jacob Weisberg, the Slate chairman who is going to be in Davos and he is going to book out the Davos podcasting studio and we are going to talk to him live from Davos. We're going to hear all about what's been going on in Davos. But the fact fact is that we already know what he's going to say, which is that the only thing that anyone can talk about will be Trump.

[B]

Yep.

[A]

And that was probably true even before the news of this week, but it's even more true now because the quite astonishing news of the week is that Donald Trump is going to be there.

[B]

Not just going to be there, he's taking like a 15 person delegation to Davos entourage. The entire West Wing is basically heading to the mountains in Switzerland, including Steve.

[A]

Mnuchin, his Treasury secretary, who went on the record saying, I don't think it's full of globalists.

[B]

It's not a globalist hangout. Yes. You know, I am not a Mnuchin fan, but his willingness just to stare into a camera and lie is sometimes kind of amusing. Especially like bald faced lies like that.

[C]

Job requirement in this administration.

[A]

So. So I wrote two years ago that if Donald Trump ever went To Davos, he would completely suck the air out of every room that he wasn't in. He'd be this huge Davos celebrity. But that this was a completely silly thought experiment because there's no way it would ever happen. So I needed to ask myself upon saying this news, like, why on earth is he doing this?

[B]

So, okay, I have two theories personally right now. One is that, and this was kind of something I was talking over with our politics editor, Reid Piliphant, which is that this is sort of just a giant fuck you from Gary Conan Mnuchin to Steve Bannon on his way out the door. Steve Bannon was like the anti globalist heart of the Trump administration. And this Davos thing was announced like two days after Bannon was like excommunicated from Trump world over.

[A]

So I think there's some truth in this, in that it is almost certain to me that Mnuchin and Cohn and maybe a couple of other top Trump aides really did want to go to Davos. And it's quite common to see the U.S. treasury Secretary and the National Economic Advisor in Davos. But for obvious reasons, they couldn't go if Trump wasn't going. And so because there's normally someone like that in Davos, it's kind of. And because uniquely under Trump, it's basically impossible for them to go because everyone's going to be like, why is this globalist cuck going to Davos when you know, Trump stands against everything. The only way that they can have the COVID to go is if Trump goes himself. So I feel like they were pushing.

[B]

Trump, I feel like almost certainly. But then I think there's also another possible explanation which, you know, ties back to some of the things we've discussed previously during our Davos episodes, which is maybe they actually want to get some work done there. Right. Like Davos actually does provide these.

[A]

Or Kona Minutian.

[B]

Yeah, yeah. Like some. There May. This, you know, diplomacy is very hard for the Trump administration, if you've noticed. They're not the greatest at it. And this may give them some cover to go and get some quiet meetings done without having to announce a big.

[A]

Exactly. And the one beforehand, the name which really sprang to mind for me was Theresa May. And we found out this week. Another thing we found out this week was that the long awaited official visit of Donald Trump to the UK is not going to happen. He's blaming something about the embassy, which is completely insane. But the fact is it's really hard politically for Trump to visit the UK it's also pretty hard politically for, for Theresa May to visit the U.S. and so if he wants to talk to her, you know, in person, it's actually not that easy to make happen. But if they happen to just bump into each other in a hotel suite in Davos, like, there's a whole bunch of quiet, like, summit level meetings, which can happen, which would be very politically fraught to make happen otherwise.

[C]

Right. And also this gives Trump the opportunity to make the ridiculous speeches where he criticizes everything that supposedly Davos represents at the same time that many people in his administration are probably going on in having those meetings.

[A]

So he's like, yeah, the Stephen Miller types are going to love the opportunity to get him to give a full throated unilateralist American first speech in front of all the globalists. I mean, they're just going to be loving that.

[B]

I agree. This is going to be. He's going to get to be the skunk at the Garden Party, which is kind of the role he's most comfortable in. Although I will say it's going to be interesting to see how he interacts with the other gazillionaires there or the actual gazillionaires, because there's always this weird thing about Trump's desire to be loved and to have the approval of the elite. And so I'm wondering how he's. Are we going to see him trying to get Bill Gates to pay attention to him? I don't know.

[A]

So, I mean, it's an interesting question because one of the things which I've noticed about Davos over the years, the big heads of state, Germany, uk, Japan, China, US which has only to my knowledge ever happened once before. This one. There's only one time that the US President has ever gone, a sitting US President has gone to Davos, and that was Bill Clinton in 2000. And that was at the very, very end of his eight years when he was sort of like lame ducky. And he's like, I can do what I like.

[B]

Transitioning into Davos, man, that was like him coming out of his cocoon and becoming the new Clinton.

[A]

But also there were good reasons for that, historically, which was that Davos always coincided with the State of the Union. And then for various reasons, it doesn't this year. So it's logistically much more possible than it used to be. But in any case, those heads of state, almost never in my knowledge, now my knowledge is limited. There might well be, like, gatherings I don't know about, but in my knowledge, they don't actually hobnob in those billionaire parties and really take part in the sort of the broader General Davosy. They come in and they have meetings with other governments and they'll maybe have a meeting with Klaus Schwab or something. I don't see them doing much broader interacting. I don't know. It'll be interesting to see whether, you know, this is Trump's opportunity to take a meeting with Jamie Dimon.

[C]

Right. Because I think fundamentally Trump is obviously in many, many ways very different than past presidents, but partly is he only respects billionaires, he only respects money. So it seems like he would be much more apt to want to hang out with the other plutocrats as opposed to actual world leaders.

[B]

Yeah, I mean, Lord knows he doesn't like most how many European leaders this except for sort of Theresa May I even then?

[C]

Not really.

[B]

Yeah, like what he actually has any affinity for.

[A]

It's, it's hard as well, simply for security reasons.

[B]

Yeah.

[A]

Bill Clinton was famous for basically overriding his security detail and chiming around in Davos with people that the Secret Service were really not very happy for him, you know, hadn't really been cleared. And for all that there are metal detectors everywhere. I suspect that Trump's two, two aspects of Trump, one, his like general low level paranoia and two, his germ phobia are going to combine to mean that he doesn't really spend much time sort of schmoozing that he's going to want to stay within his Secret Service protective bubble.

[B]

So I have a question for you, Felix. As a experienced Davos, or how good are they at keeping leaks from coming out? Like how, how hush hush is everything, especially during these kind of mid level and behind closed doors meetings. Are we going to actually find out what the entire West Wing was there to do by the end of Davos or do you think it's all going to be kind of. It's all going to be kept quiet?

[A]

To my knowledge, I've never seen an IGWELL leak and you know, so they're pretty good at not leaking Igwell. For those of you who maybe forget previous Davos episodes or maybe we've never talked about it is my favorite acronym in Davos. It stands for informal gathering of World Economic leaders.

[B]

Oh wow.

[A]

And it's like, it's like the ultra.

[B]

Exclusive Davos down the Igwell with him. We're going to throw Jamie down diamond down the IG.

[A]

Well, you basically, you basically need to be a G7 finance minister to get into it and it's it's famously a productive and very high level meeting. And it really doesn't link that much.

[B]

Huh?

[A]

I mean, its very existence is kind of like people know that it exists, but like no one has ever sort of formally come out and said, oh yes, we went to an IGWorld meeting in Davos.

[C]

Interesting. I'm also curious how much Trump is going to be protected from potential questions he wouldn't want to have to answer or protest. Like, how good is Davos at that in terms of protecting their people?

[A]

So about, I want to say, 10 years ago, ish, a few brave souls attempted a large scale protest in Davos and they started skiing down the mountain and they got met by water cannon in like minus 20 degree weather. And since then, weirdly, there hasn't been a lot of large scale protests.

[C]

No more skiing protesters.

[B]

That's so brutal.

[C]

That seems a bit excessive.

[B]

A water cannon. Wow. I was gonna be like, oh yeah. And at the bottom of the hill there are a bunch of Swiss Guards with massive guns. But no, that's actually much, much worse. All right, cool.

[A]

So, yeah, he's not going to see much in the way of protesters. There'll be a few scattered protests, which I can guarantee you he won't see.

[B]

Trump will take this as a sign of how much everybody loves him there.

[A]

Of course, and he will absolutely not face critical questioning. He probably won't face any questioning, except for questions from Klaus Schwab, who is famously the most softball interviewer in the history of softball interviewers. So, yeah, but that could kind of.

[B]

Confound Trump, like, because if he just gives him room to hang himself, like, you know, Trump will take it. He'll take all of that rope.

[A]

So I doubt, I mean, it is entirely possible these things do happen that, that he, that a few, what's known as media leaders such as our very own Jake Weisberg, might find themselves invited into a Trump press conference. But I doubt it. Let's talk about Huawei. Yes, Speaking of security, I just got back. The reason, if I apologize to all of you, if I was a bit subdued or cranky last week, it was because I'd had no sleep and was just coming back from a. A series of extremely long plane flights starting in New Zealand and going via Hong Kong and Toronto to New York. Anyway, the thing I learned hanging out in New Zealand and Hong Kong is that everyone has a Huawei cell phone. It's unbelievably ubiquitous the minute you leave your sort of American bubble, especially if you go to the Pacific Rim. Countries, It's Huawei everywhere. And their new phone, the Mate 10, is a really amazing phone.

[B]

Like, where would it fall in the scale of phones we're familiar with here in the us?

[C]

It's essentially an iPhone equivalent.

[B]

Really.

[A]

But it's not just an iPhone equivalent. It is definitely better than the iPhone 8. And it is. There are some things it does better than an iPhone.

[C]

Yeah. It has a different type of chip, this proprietary chip that's supposed to be far better for artificial intelligence, but also for video.

[B]

Interesting. And how much?

[A]

And it costs, it costs about the same as an iPhone.

[B]

Okay. So it really is an equivalent. Okay.

[A]

But obviously, like all Chinese manufacturers, they have a range of phones, many of which are much more affordable. And the one thing that Huawei does better than any other telecommunications equipment manufacturer is make very good, high quality stuff, just way cheaper than anyone else.

[C]

Because when you have a tremendous amount of government subsidies and they will pay for all your research and development, that's a lot easier.

[A]

And it spends more on R and D than almost anyone else. It's got this huge multibillion dollar R.

[B]

And D budget, but that is subsidized, of course.

[A]

Yeah.

[C]

And they get cheap loans.

[A]

And so they have basically managed to get this dominant position not just in consumer cell phone handsets, which is the most visible thing, but in many ways more importantly in the sort of cell tower, if you want to call it that infrastructure. The 4G 5G LTE networks, which are now global, they are building that.

[C]

They are the dominant force in telecom equipment.

[B]

I was going to say, before we were coming into this week, I was not super familiar with this company, but when I started reading about them, they immediately reminded me of kind of the Nokia of old. That Nokia used to be this company that was dominant in handsets. They defined, you know, what a cell phone was in the 90s and early 2000s. At the same time, they also had played a crucial role in building out the initial cell infrastructure that we had, wireless infrastructure.

[A]

As Nokia has waned, Huawei has waxed. And what you now get, if, you know, you look at the American big cell phone companies, Verizon and T Mobile and all of those, and they are buying a lot of Nokia equipment. And the Nokia equipment is way more expensive than the Huawei equivalents and also, frankly, not as good.

[B]

Yeah.

[A]

So the interesting question is if Huawei is so cheap and so attractive, and if the people who are dealing with them say, oh my God, their customer service is amazing, anything you want, it just gets done immediately. It's so Easier than dealing with Nokia and people like that. Why is it that American companies are just not buying this equipment?

[C]

Well, two reasons. One, the political cost is just too high because there are legitimate national security concerns. Because when you're talking about these large private Chinese companies, they are, they work very closely with the government. So the idea that there is a like, you know, a strong wall between there, there just simply isn't. For example, Alibaba literally has a Chinese like police post on their campus. So again, these national security concerns are not paranoia. And then the other really major concern is that idea of not a level playing field in the tech sector that there is an argument to be made that we don't have the same opportunities to invest and bring products into China that we would potentially being allowing them to have in our markets. So we would be almost putting ourselves at a disadvantage.

[A]

Yeah, and we should say other American companies in this market. I mean what happened to Motorola? I feel like they used to do this and they don't anymore. I mean, I guess Google with its handset business.

[B]

I don't want to interrupt, but should we mention the news hook that we're talking about?

[A]

Okay, a quick, a quick background to the news hook. Here is the AT and T was all set to announce that it was going to sell the Mate 10 and that was going to be a huge, like this is going to be Huawei's huge introduction into the mainstream US market. And then at the very last minute that announcement unraveled, it didn't happen and Huawei still has no real foothold in.

[B]

The U.S. yeah, and at the same time what we're saying is that, you know, not only can they not sell their handsets, but only very, very small wireless carriers, kind of regional companies are daring to use their telecom equipment. It's like people like a company out in Northern California that doesn't really have to worry too much about geopolitics is willing to do it, but the bigger ones just know it's a no go.

[C]

Yeah. Because if you're a tiny little company, the government doesn't really care. You can fly under the radar. But there is legitimate concern that if you had some of the major carriers using a lot of this equipment that potentially hasn't been tested to see if there is any back and backdoors that the Chinese government could use potentially for national security concerns or potentially for corporate espionage. That's part of the reason that the U.S. government, both Democrats and Republicans are concerned about this.

[B]

Yeah, and I mean you have to repeat that word again. Espionage. It's spying is probably the biggest concern here. Several years ago, U.S. congress put out this report basically saying no companies should not use this technology because there are so many ways that, there are so many ways that the China's national security state could insert hardware or software into the products that would then allow them to spy. And I was looking at this report and say how much of this is just fear mongering? And it didn't look like, it didn't look like some BS piece of grand standing by Congress. It was pretty lengthy. And at the very beginning, what they say is nobody in China would even answer our questions. They would not engage us, they would not explain anything. We had to kind of go around and dig and find former executives and find other people who had experience in this, in this field. And there are just so many red flags.

[A]

And so in Britain, what they do is they allow Huawei to have operations in Britain, but then they also have like a permanent outpost of MI6 basically in or some, or the British national security state, taking everything apart as it's being manufactured and putting it back together again and sort of making sure that way that nothing gets inserted, which I think we can all agree sounds like it might probably perhaps be helpful, but is not going to, you know, something.

[C]

Might slip through and also just very inefficient.

[A]

And it's inefficient. So the thing which strikes me about all this is that the US has not only very high broadband costs, like we pay 40, 50, $60 a month for broadband Internet, whereas the rest of the world pays like 10. But it also has very high monthly cell phone costs. And so data is way more expensive in the US than it is in the rest of the world. And a large part of that is that we have much less competition, but another part of it is that we are being essentially forced to buy much more expensive equ.

[B]

Yeah, and that is the downside here. Like you're, you're balancing national security concerns against the fact that we are using more expensive and not necessarily as good equipment for our infrastructure. I don't know if there's like a satisfying answer though, right? Like how do you.

[A]

But I mean the question is like how many billions of dollars do we need to spend in terms of excess monthly cell phone bills before it's like, okay, fine, like, you know, our privacy is an illusion anyway. What exactly are we kidding ourselves?

[C]

This is. I'm going to say that there is a between the concerns we have about privacy in the United States. And if you're talking about the concerns about privacy in China. I do think this is a legitimate concern. And I also think it's important to remember again that yes, I would be totally for allowing more competition from Chinese companies if they allowed the same thing. And they don't. And I think that's something that we should consider moving forward. It doesn't make any sense to me to allow a tremendous amount of like advanced technology from China to come in if they're going to continue to shut us out.

[B]

I kind of agree with you, I think, because Felix, you're asking what's the equivalent thing that China's keeping out of their market? And I don't think you can think about it in terms of products.

[A]

There are lots certainly on the consumer level, they don't allow Facebook, they don't allow Twitter.

[B]

Exactly. And they use national security concerns essentially to keep our, what you might call our national security champions, which is kind of a bad framing for. But anyway, our.

[C]

No, the cybersecurity law that they passed means that if you are a, any type of IT company working in China, you have to buy Chinese technology and you have to store all your data about Chinese consumers on that technology so the government has access to it, which now Apple is actually doing.

[A]

So. Okay, so as a coming at this from an economic perspective, if you're a trade economist, what you would say is that if there's one country which is giving away its technology freely like China, and then there's another country which is, you know, and then that same country is refusing to allow other countries technology to be lose to be used. And the loser here ultimately is China. And that, you know, the United States by getting the best of this deal should just be using all of this amazing technology that the Chinese government is paying to develop and sort of laughing that China doesn't get to use all the American equivalent technology, it gives America an advantage if we use it. It gives America no advantage if we don't use it.

[C]

I would perhaps agree with you, except that in China's Made in China 2050 plan, they accept, explicitly lay out their plan to gain total market dominance in these advanced manufacturing and specifically talk about strategic investments to gain more access to cutting edge technology which we can also assume could be gained in other ways than just from acquisitions to then not only move up the supply chain from where they currently are, but to on source the entire supply chain so that essentially the Chinese market is closed to foreign imports except for just like commodities and raw materials and everything. You're using Chinese components to make Chinese products that is the only thing Chinese can buy and that the rest of the world will just have to use their products and they won't import anything from us except materials. Like they're. They've been fairly explicit about that. And I think that although I am a big believer in open markets and open borders, I think that this is something we have to consider as we make economic policy moving forward.

[A]

Right. And I'm just saying, like, who, who does that harm if you look at that kind of policy? Well, you think about national security.

[B]

You have to think about it in terms of national security.

[A]

Okay, well, okay, like the national security question we've talked about, economically speaking, the big harm to that policy is done to China, not to the rest of the world. The rest of the world benefits from still using Chinese technology. And I will say that, you know, China has talked about spending literally $150 billion, I think, on A.I. r&D, which is probably an order of magnitude greater than what you're seeing anywhere else in the world. At some point we're just going to have to use Chinese technology because there is going to be no alternative.

[B]

Yeah, I mean, I think you're now getting into the questions about how do countries benefit from trade. If you essentially outsource one kind of technology, where do you move on the supply chain? And traditionally it's like, okay, yeah, so we allow to deal. We allow China to do all of our manufacturing for us. We handle design. Okay, so what do we do once if we give up on designing, if we give up designing tech, we will find some other high value added thing to do. You know, I don't know what that is. I don't know where the US Economy goes if we keep just handing off lower and lower parts of.

[A]

No, that's, that's not an argument at all, Jordan.

[B]

Well, no, but that's, that's the same China's attempting to do.

[A]

No, what I'm saying. No, I feel like that's exactly wrong.

[B]

Well, they are, they're trying like that's, that's Anna's point is that their goal is to essentially close their market and be the exporter of all technology to the world.

[A]

Absolutely. They want to export a bunch of technology to the world. Yeah, totally agreed on that. Yeah, we don't really export much of value to China anyway. Totally agreed on that.

[B]

But services, yeah, we do.

[A]

But the, the big picture is that if they're creating valuable stuff and doing that all in house, as it were, and then the rest of the world gets to benefit from that stuff by Using it. That's good.

[B]

Well so then the question. Oh, sorry. Well, I was just going to say back to my point before is that we are also, I think Huawei is actually a very good example of how as they are doing that they are sort of eroding the rest of the world's ability to even compete in these markets. It seems like it's not just that they are handing it out and the rest of world saying great, we benefit. Also. Nokia has fallen behind, Lucent has fallen behind. Those companies seem to be on the wane and all of the know how in this field seems to be concentrating in China in this one company where they have successfully moved up the value chain. So I think there is some danger in saying, okay, let's accept this gift from China and then accidentally allowing that expertise to erode everywhere else in the world.

[C]

Agreed. If we were accepting their technology and this was simply a part of China liberalizing their markets and us having access to cheap good products, I think there, most people would be okay with that. The concern here is a, what can those products actually potentially allow the Chinese government to do? And then the longer term idea that if we continue to allow this without expecting anything in return, we could long term be putting ourselves at a serious disadvantage.

[A]

Okay, let's stay on cell phones. Anna, I don't understand this at all, so I'm going to have to have you explain it to me. Something, something. Children getting distracted. Something, something. Shareholder activism. Apple, something.

[C]

Yes. So Jana Capital and CalSTRS, which is the pension fund for California teachers and.

[A]

Jana Capital is, is a rapacious private sector hedge fund.

[C]

Yeah, yeah, exactly. That is far more known for the type of shareholder activism that involves like firing people. They, they wrote an open letter to Apple arguing that Apple needs to really look into iPhone addiction because it's having really negative consequences for children. They're more distracted, they have a higher rate of suicide, they're less empathetic.

[A]

And this is, and this is iPhone addiction, specifically among children.

[C]

That's mostly what they're talking about. Yes.

[A]

And is this specifically iPhone addiction or is this phone addiction?

[C]

It's phone addiction in general. But I think obviously because the iPhone is dominant in us, it makes sense that they would start with Apple and also as a publicity stunt, frankly it makes sense to start with Apple.

[A]

And what, and is, is there, I mean, they want Apple to look into it? I mean can Apple then just say okay, we've, we're looking into it and then they're mollified or is there something specific that they would like to see.

[C]

They've argued that they want there to be research and then also potentially actual changes made. Like when you set up your phone, you would put in, you know, there's a limit to how much time this phone can be online by, you know, whoever's using it if you have a child, those kind of things. But you're not wrong that this is kind of a softball letter and they don't really have to do anything.

[A]

My feeling is that what they're asking for is something that quite a lot of parents want, which is more fine, more fine grained control over what their kids can do on their phones. A lot of parents want to be like right now. They can sort of say, or they can try and say, you're allowed to use this app, you're not allowed to use that app. But I think a lot of parents want to be able to say you're just not allowed to use your phone more than X times a day or more than Y hours a day. And maybe they want to have a bit more control within apps and maybe they want to have a bit more visibility into what their kids are doing on their phones. And none of this is very easy right now. And, and the obvious way, the obvious place to fix that is in the mobile operating system. And there are only two people really making mobile operating systems and one of them is Apple. So maybe it makes sense to start with Apple and maybe Apple justice is sort of being nice to consumers thing would want to do this anyway.

[C]

Well, and I think it's not, it's not surprising that they started with Apple because frankly, Apple, as opposed to like Facebook or Twitter could potentially be do this without it really hurting them because they're not as dependent on hours of engagement as opposed to a company like Facebook where they're advertising what they can charge is entirely dependent on even engagement.

[A]

Facebook this week came out and said, we are deliberately making the decision to lose money which we would otherwise have been able to make by showing you less of the clickbait and more of the puppies shared by your friends. Because we understand that we are part of the problem.

[C]

Yeah, I actually thought this was very funny. If you read the transcript of Facebook's last earnings call, I just found it so amusing because Mark Zuckerberg kept being so earnest about how like, you know, we don't care if this costs us money. We're going to, you know, spend money to gain you have more security to improve the quality of connection. And then you get to the Q and A section and every Analyst is like, like, right. So how is this gonna affect engagement numbers? How is this gonna affect profitability?

[B]

Does Mark Zuckerberg have any other mode of communication that in just extreme earnestness, just dripping. Just dripping sincerity?

[A]

Well, I mean, I feel like this is a big move from Zuckerberg. This is the first time that he has explicitly said, I'm willing to give up revenues in the medium term in order to create a. A better product planet in the long term.

[B]

I guess part of me just wonders.

[A]

Whether he does or not.

[B]

We've kind of gone far afield. But so it seems like part of this move involves kind of demoting video because Facebook is full of all that kind of trash video content where it's just a bunch of stock images with captions underneath or whatever the heck, and some generic music playing. And. And I just, I am curious if part of the reason they're doing this is they've realized that there is not really gold in them there hills and it just actually isn't really paying off the way they hoped. Or maybe it is. I was. I don't know. But just. I'm curious how much of it is really sincere and how much of it is. This stuff wasn't necessarily the key to Facebook's future anyway because I think you.

[C]

Can charge higher ad dollars for video. I could be wrong about that. But, I mean, I don't know. I mean, seems to me that this is somewhat of a, like, earnest movement. But I also feel like, look, right now, if you look like technology companies aren't really being held accountable to essentially anything that's going on. Like their stock prices are just kind of increasing, increasing, increasing. If they start to, like, miss earnings targets because of these kind of things, I wonder then if they'll continue.

[A]

I feel like there has been a real sea change in the way that the general public looks at big technology companies. And they used to be, you know, this. The harbingers of this amazing future, and now they're this. These big evil, like, places you shouldn't trust. And Facebook is trying to, you know, we'll see whether it succeeds or not. It's trying to sort of get out ahead of that. And Apple has never really been seen as evil as Facebook, but is, I think also by the same token, it has been generally admired and loved more. There's a lot of, like, fanboys out there and people, oh, yeah, Apple's great. And so I think this is a little example of even Apple getting caught up in the general mistrust of big tech, as it should Be. And I would like it if they came out and started giving people what they wanted in terms of control over what children can do. Although I think the big irony here is that the people who are really addicted to their phones are adults. It's not children.

[C]

Yes. Although apparently the addiction is less meaningful that apparently there's actually studies to show that when children spend a tremendous amount of time on phones, it really affects their, like, self esteem, their ability to function. That doesn't happen as much with adults, at least so far.

[B]

Are you getting into the Gene Twenge thing? He has. So the Atlantic ran an article a while back. You've probably seen it. How Did Smartphones Destroy a Generation? Where she basically argued that Gen Z has been rendered emotionally crippled by their addiction to cell phones and how they don't date and don't have sex anymore and don't go to the mall and just are sort of stunted altogether. And I don't know. I mean, there's. I don't know how much stock I put in the article. There are a lot of things you can argue about.

[A]

I can say that as someone who's most assuredly not Gen Z. When I did have my really, Felix, almost three weeks hanging out in New Zealand and Hong Kong, I made the decision as I. As I took off from New York, I deleted Twitter from my phone.

[B]

Did you really?

[A]

I did.

[B]

How did that feel?

[A]

I basically spent three weeks without Twitter and it felt amazing. And it wasn't just me who felt amazing. My sister, who I was hanging out with, looked at me and said, felix, I've never seen you so happy and relaxed. And it's only when you get rid of it that you realize just how kind of twitchy it makes you.

[B]

No, I totally agree. I was recently telling a friend that I was considering a career change to something like oyster farming that I knew would not require me to be on Twitter at any time. But yeah, I mean, like, for, I think seriously though, the. I think the jury's out on exactly what the effect of these technologies are on kids. Like, you know, the. I think American Academy of Pediatrics used to have this rule about no screen time for your kids. Like, just don't let them go near anything that looks like a screen. Which is kind of weird, I guess, anything that's a screen you can touch. But they then kind of altered that in saying, well, if, you know, limit the amount of time, don't do it before bed. And if it's educational material on the screen, then it's okay. Maybe it'll help them learn math or something. So, you know, we're still trying to figure out how. How our phones are changing our brains and our children's brains. But at the same time, I do think these just basic concerns about having parental control are valid, right? I mean, we're Learning things like YouTube is actually a cesspool of horrible, you know, just content like directed at children, you know, that we, that people didn't even realize. And you know, it's coming. Parents are getting tuned into the fact that they need to be a little bit more vigilant about what their kids do online. I guess what I'm saying is it's been a while since we've had a good old fashioned think of the children style panic and maybe we're starting to enter a new one that isn't totally unmerited. Maybe it's. And it'll probably go overboard at some point, but Apple could prevent it from going overboard by maybe just making some basic concessions.

[A]

Also, can I just say we still. It is 2018 now and we still have little parental advisory lyric.

[B]

Yeah, right on song. Thanks, Tipper.

[A]

Thinking back to like Nancy Reagan or something.

[B]

No, you know the story of that, right? That's Al and Tipper Gore bought the Prince album and then they like shocked, shocked. And then they were listening to their kids and Dirty Diana came on and they were just like, you know, masturbating with a magazine and they were like, what is this?

[A]

I believe you're talking about darling Nikki.

[B]

Oh, sorry, Dirty Nicky.

[C]

Yeah, Dirty Diana is Michael Jackson.

[B]

I just combined.

[A]

Anyway, we have gone completely off topic. I think we are right. What we can do is we can take all of the weird psychic energy that we spend trying to listen to radio edits and look at parental advisory stickers and just take all of that and put it into YouTube instead. It'll be more useful.

[B]

Absolutely agree.

[A]

Numbers round. It's a numbers round. Okay, let me start with 0.008. If you're a stock market watcher, you will understand the concept of a price earnings ratio. Price earnings is just the price of a stock divided by its earnings in cheap stocks are what, like 7 to 10? And expensive stocks like 20 ish. There is a stock out there with a price to earnings ratio of 0.008 and that stock is the Swiss National Bank. Oh yes, it's awesome. Like the Swiss national bank made half a billion dollars in profits last year and has a market cap of like 150 million. Because of course, none of those profits go to shareholders. But Anyway, it's one of my. I was just like, you can buy a stock out there with one of the lowest P E ratios that it is conceivably possible.

[B]

You can buy shares in the Swiss National Bank.

[A]

You can. There are three central banks with publicly listed shares. SNB is one of them.

[B]

Is that, like, for financial nerds? Is that the equivalent of buying shares in the Green Bay Packers? If you're a football fan, it really doesn't do anything. You don't get anything out of it. But you can just be like, I own a piece of this bank.

[A]

Exactly. I mean, the New York Fed is owned by a bunch of big banks as well, and they get nothing.

[B]

Yeah, but you can't. I mean, I can't buy stock in the New York.

[A]

It's not publicly listed. It's privately held.

[B]

Yeah. So that's a little. But if you're a central banking nerd, you can get the certificate and put it on your wall.

[C]

Exactly.

[B]

Okay.

[A]

All right, Jordan, what's your number?

[B]

10. That's the number of states that had petitioned the Trump administration to let them do work requirements on Medicaid, and the Trump administration is going to go ahead and allow them to. So they're putting some restrictions. You can't force, like, pregnant women to work if you're the primary caretaker of a child. I think you also can't be forced to work in order to get Medicaid. Yeah. Primary caregiver. Like, if you're a single mom or like an aunt, for instance, like, you know, and you're taking care of a kid. It's. American families are, you know, have all sorts of different structures. But. Yeah, I mean, I don't. It's just Medicaid is not a program that people lounge around on, you know, loving their health insurance benefits.

[A]

The headline here is that in order to be eligible to receive Medicaid, you have to be working somewhere.

[B]

I mean, that's. Or it's gonna be a little bit more complicated than that, but it's the beginnings of essentially conditioning Medicaid receipt on some sort of work or community service or whatever. It's just another way to. For people, for state governments to, you know, kick people off the program to cut what they spend on it. It's reminiscent of what they did to welfare in the 90s or the beginnings of how states started chipping away at welfare in the 90s when they would do these, quote, experiments, you know, where they would bring in things like work requirements. And it's. It's just, you know, I don't know, it's gross. It's like, it's gross that you have states that are essentially saying it's, you know, if you are poor, you still need to work for people to cover your health care. I think we've. We are. Most of the country is moving in the direction of saying healthcare should be a right, and Trump is doing his best to say, no, it is not a right.

[A]

Okay. But politics to one side, what we're seeing is, I guess, a roll back. I guess my question is there was this massive expansion of Medicaid under Obama. I mean, a huge expansion. To what degree? In terms of, like, it's not gonna be huge in numbers, it's not gonna be nearly. The rollback that we're seeing is going to be very small in proportion to the expansion that we saw under the aca.

[B]

Yes, but it is. And if you look at the exceptions, they are carving out things like, okay, if you're like a single mom or something, or if you are ill, you're medically frail, I think is one of the exceptions. That's why most people don't work. If you look at why the poor don't work in America, there are surveys about this that the census takes every year. People aren't just sit twiddling their thumbs. Usually there's a good reason why they're not working. So most people out of a job are not going, like, you know, are going to fall into one of those buckets where they should be able to still get Medicaid. The problem is it's going to add all sorts of bureaucratic hurdles, and it's probably going to just discourage people from going to the program because of that. It's going to add confusion. It's well known that adding these sorts of conditions often discourage poor people from seeking benefits just because they don't exactly know whether or not they qualify. Sometimes it's. It's just unnecessary. And in the end, again, it's a philosophical issue about whether or not we are a country that thinks health care is a right or not. And.

[A]

Well, I mean, I think we know the answer.

[B]

Well, no, but we are moving towards that. And you still have these conservative states that are hanging on to this idea that, no, you have to earn the right to, you know, go see a goddamn doctor. And it's. It's offensive.

[C]

Yeah. And actually, kind of building off of that is my number, which I don't usually do domestic numbers, but this number I saw reported a number of places, and I just found it very disturbing. My number is 15. So many people have probably seen reports that the life expectancy in the US has declined again. And normally when you look at it, the decline seems so small that it's easy to be like, well, we know there's an opioid problem, but if you look at the difference between the life expectancy of a man in the top 1% or in the bottom 1%, the difference is 15 years.

[B]

Lifespan inequality is a real thing.

[A]

Right.

[C]

Like that's, I mean, that's a teenage, that's a child. I mean, like that's enormous and incredibly disturbing.

[B]

One part of that that complicates at is smoking, a big part of it. And I actually consider this a public health failure. But a huge problem in the United States is that rich people stopped smoking and poor people did not. And that has effects in terms of numbers like this lifespan. But also things like the government's medical spending. It has repercussions everywhere. And you know, if the US Took public health seriously, which we frankly do not as a country, not just our healthcare insurance system, but public health more generally, we would be fighting this harder.

[C]

Agreed. And also just to go on that, because we also know that part of this is because of the opioid addiction. And obviously when you have prime age men dying, that's going to cause they're younger, skew and bring the statistic down. But if you look at what we actually have to spend to fight the opioid addiction, it's just. It's a joke.

[B]

Yeah, it's nothing.

[A]

So let me come out with a spending number which is $37 billion. This is my favorite example of the effects of Trump's fiscal policy on, I guess the public fisc. $37 billion is, according to estimates from Deutsche bank, the amount that Berkshire Hathaway's liabilities have been reduced as a result of the Trump tax bill, which basically means the one thing that Warren Buffett cares about more than anything else in the world is his book value. Share price can fluctuate up and down for reasons totally out of his control. But the thing which is totally within his control is the book value. And he always says, judge me by my book value. Judge me by how fast it's growing. His book value went up $37 billion overnight just because of this tax bill.

[B]

He's not even a Republican. He was anti Trump.

[A]

That's where the benefits started accruing rather than obviously poor people.

[C]

Yes.

[A]

So I think that's it. I think that's it for us this week. Thank you for listening. To Slate Money. Keep those emails coming on slatemoneylate.com Many thanks to Dan Schrader. Go listen to Whistle Stop, which is hosted by a chap called John Dickerson. Apparently he has to get up very early in the morning these days to go on the telly. But notwithstanding that, every two weeks on Wednesdays, he will put out a little podcast for you fans of presidential campaign history. It's called Whistle Stop. Check it out and we will talk to you next week on Slate Money.

[B]

I knew a girl named Nikki. I guess you could say she was a sex fiend.