Squawk Pod – March 25, 2026

Episode Theme:
This episode centers on two headline issues at the intersection of US policy, regulation, and the tech industry: the bipartisan legislative push to rein in online prediction markets and the landmark $375M lawsuit victory against Meta by New Mexico over child safety violations. Broadly, the episode provides lively congressional debate, deep dives into legislative motivations, and frontline reactions from policymakers, rounded out with news analysis on Middle East diplomacy and domestic shutdown politics.

Main Topics & Discussion Points

1. Middle East Diplomacy “Fog”

Timestamps: 03:05–07:37

• Overview:
  Joe Kernan and Becky Quick dissected reports of US–Iran ceasefire negotiations, highlighting the challenge of discerning real diplomatic progress from political posturing.
• Market Response:
  Markets remain volatile as both US and Iranian officials make public statements that may be more about influencing public opinion and markets than about actual progress.
• Notable Insight:
  • “There's been a fog of diplomacy in Iran ... Trump’s incentive was to calm the markets with news of diplomatic success. Iran’s propaganda [is to] deny, deny, deny and keep markets roiled.” – Joe Kernan (04:08)
• Becky Quick noted:
  The negotiation landscape is complicated by uncertainty around leadership within Iran, referencing the “Revolutionary Guard” as a potential wild card.

2. DHS Funding and the ICE Controversy

Timestamps: 12:34–17:36; 24:02–33:55

• Political Standoff:
  Lawmakers still struggle to secure a deal to fund the Department of Homeland Security (DHS), with long TSA lines causing increasing public frustration. The debate centers on funding for ICE and associated immigration reforms.
• Partisan Dynamics:
  • “They pre funded ICE. So the lines that are stressing people out ... just open the agencies, for God's sake.” – Sen. Tim Kaine, relayed by Emily Wilkins (13:45)
  • Both Democrats and Republicans are using the shutdown as leverage, with Democrats pushing reforms to ICE in exchange for votes to reopen DHS.
• Legislative Perspective:
  Senators Adam Schiff (D-CA) and John Curtis (R-UT) appeared to agree on the broad need for resolution but advocated different foundational principles—Schiff focused on safeguards and police-like accountability for ICE; Curtis on pairing “rule of law” with compassion.
  • “We can have rule of law, but we can also do it with compassion. I think that's where American people are a little bit uncomfortable with some of the things they've seen.” – Sen. John Curtis (27:01)
  • “Before we fund, for example, ICE agents or Customs and Border Protection, we should insist on certain safeguards ... that they operate with the same standards we ask of a local police department.” – Sen. Adam Schiff (30:52)

3. Regulating Prediction Markets: “The Prediction Markets are Gambling Act”

Timestamps: 17:53–23:27

• Legislative Proposal:
  Senators Curtis and Schiff introduced bipartisan legislation to clarify that prediction markets (especially event contracts and political/sports-style bets) fall under state control, not federal commodity regulators, framing them as gambling.
• Key Concerns:
  • States’ rights to regulate gambling within their borders (Utah and California do not permit sports betting).
  • The possibility of insider trading and unregulated speculation, especially when prediction markets use blockchain.
  • The issue of revenue for the state versus money leaving the jurisdiction through nationalized or global prediction platforms.
• Memorable Quotes:
  • “If it acts like gambling, if it talks like gambling, it is gambling. Right. And that's been very clear where that belongs.” – Sen. John Curtis (20:06)
  • “…someone with 93% accuracy has been predicting what's been going on in the Iran war. That's highly suggestive of insider trading. And when it could be done using blockchain, there's no way to really regulate that.” – Sen. Adam Schiff (21:02)
• Skepticism of Self-Regulation:
  Both senators argued that platforms like Kalshi and Polymarket setting their own rules is insufficient—federal and state oversight is needed.

4. Meta’s $375M Child Safety Lawsuit in New Mexico

Timestamps: 36:57–42:40

• Landmark Verdict:
  New Mexico Attorney General Raul Torres described the lawsuit against Meta as a historic milestone, being the first successful state government case against a tech giant over children’s online safety.
• Legal Strategy:
  By focusing on product design features—algorithms, age verification, and encryption—rather than user content, AG Torres’ team bypassed the traditional Section 230 protection.
  • “They've been hiding behind Section 230 for over two decades ... we took a different approach in this case. Really focused in on the aspects of the product itself, the design features…” – Raul Torres (38:24)
• Company Response:
  Meta, while vowing to appeal, insists it works hard to keep people safe and cites the difficulty of moderating massive platforms.
• Next Legal Steps:
  The trial’s second phase may impose further penalties and seek court-ordered changes to Meta’s practices, focusing on “public nuisance” and injunctive relief such as age verification and platform redesign.

Notable Quotes & Memorable Moments

• Sen. John Curtis on shutdowns:
  “I've seen more shutdowns than I can count. Not a single one of them has produced the results it was intended to produce. Shutdowns are bad. We punish the wrong people. Who we should be punishing are members of Congress. Let's take our pay away until we get this done.” (32:28)
• Becky Quick on Congressional perks:
  “Delta has shut off its congressional perks program ... they've decided it's more important to focus on their staff and their customers at this point.” (15:23)
• AG Raul Torres on tech industry accountability:
  “This is a company with a lot of technological know how, with a lot of resources. And I think that the message the jury delivered is that they need to do a whole lot more to make their users safe.” (40:49)
• Sen. Adam Schiff on ICE reforms:
  “We should have a strong border, but we should also make sure that our ICE agents are operating lawfully ... that they're not racially profiling people. All of those things can be true at the same time.” (29:39)

Important Segment Timestamps

• Middle East ‘Fog of Diplomacy’ – 03:05–07:37
• DHS/ICE Shutdown Politics – 12:34–17:36; 24:02–33:55
• Prediction Market Regulation Debate – 17:53–23:27
• Meta/Child Safety Lawsuit – 36:57–42:40

Tone and Dynamics

The tone throughout was lively and direct, reflecting CNBC’s signature mix of sharp analysis and straightforward debate. Senators Curtis and Schiff exchanged pointed but respectful arguments, demonstrating rare bipartisan agreement on market regulation but significant philosophical differences on border security. Torres’ language was matter-of-fact but emphatic about industry responsibility and regulatory necessity.

Summary Takeaway

This episode offers an up-to-the-moment look at two major policy and legal fronts: taming unregulated prediction markets to preserve state control and public trust, and holding tech giants financially and operationally responsible for user safety, especially among children. Through the voices of lawmakers and frontline officials, listeners get a candid, multidimensional picture of the ongoing tug-of-war between regulation, innovation, and legislative gridlock in Washington.