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Verdict with Ted Cruz
Trump DEI Spending Win, Cracker Barrel Pulls the Plug on Rebrand & Panama Canal at Risk by Far Reaching China Week In Review
00:28:59
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- [00:00]
A
This is an iHeart podcast. Welcome. It is Verdict with Ted Cruz, Week in Review. Ben Ferguson with you. And these are the stories you may have missed that we talked about this week. First up, the Supreme Court allowing Donald Trump to ax DEI grants. This is a big move and it can save you a lot of money. I have those details in a moment. Also, Cracker Barrel, they reverse course well pretty quickly. But was it quick enough to save the brand? We'll talk about that. And and finally, Senator Cruz is on a codell to Latin America. What he's seeing is truly unbelievable, especially in the prison system. And some news from the Panama Canal as well. It's the weekend review and it starts right now. I want to move to another big story as well, and this is one that is not going to get a lot of media attention. So I hope everyone listening will actually pay attention to this because it was a big victory from the Supreme Court allowing Donald Trump to tax millions of dollars center in funding for DEI related grants. This is huge.
- [01:07]
B
It is. So it was a 54 vote and it allowed the Trump administration to terminate $783 million worth of grants. They're grants from the National Institute of Health. And they were granted, they were canceled because of the administration's policy positions on diversity, equity and inclusion and gender ideology. And the Trump administration quite reasonably said, we're not going to give away $783 million for DEI. And these were awards that were studying all sorts of ideological objectives and in many instances were, these were awards that were granted because of the researcher's race. They made that a criterion. And listen, I gotta say, there is an important role for scientific and medical research. NIH does good work. And early in the Trump administration, I was flying from D.C. back to Houston and a woman came up to me on the plane and she said she was a cancer researcher at MD Anderson and she said she was very worried about funding getting cut. And she wanted to express that to me. And I said, listen, thank you for the work you do. MD Anderson is incredible. They do phenomenal work fighting cancer. And I said, everyone, or at least everyone with any sense agrees that we ought to be doing cancer research. And part of the reason, a big part of the reason you want to scrutinize and you want to cut out wasteful expenditures, things like funding transgender education in Guatemala, which was one of the USAID grants that the administration canceled, is so that you can spend the money where it actually should be spent. And so $783 million in NIH grants, that is not actually going to disease and curing disease and helping people who are suffering, but instead are granted based on ideology. That is an absolute waste and it is wrong. But I got to tell you, the ruling from the court was only 5, 4. It was very narrow and it had a bit of a complicated, bit of a complicated lineup. So four justices dissented. The four who dissented were Chief Justice Roberts, Justice Sotomayor, Justice Kagan and Justice Jackson. So you had the Chief justice plus the four liberals. Now you had four conservatives, Justice Thomas, Justice Alito, Justice Gorsuch and Justice Kavanaugh, who would have granted the Trump administration's request entirely. And so what happened was plaintiffs had their grants canceled. They went and filed a lawsuit in Massachusetts because of course, in this lawfare that they deliberately seek out left wing judges at extreme left wing jurisdictions. And so Massachusetts and San Francisco have been incredibly popular places for left wing attorneys general and radical groups to file lawsuits. And the district judge, what the district judge did is two things. Number one, vacated the guidance that the Trump administration had issued, saying they were not going to give funding to dei. And then secondly, the district court ordered the Trump administration give the $783 million to these grant recipients. That went up on appeal to the Court of Appeals. And the Court of Appeals agreed with the district court and, and again ordered the Trump administration give the money. Now, it went to the U.S. supreme Court and the Supreme Court, five, four said, no, you do not have to give the money. So the $783 million, the Trump administration is holding on to it. And, and the deciding vote on this was, was Justice Amy Coney Barrett, who voted with the liberals on part of the case and the conservatives on part of the case. So she voted with the conservatives on you don't have to give the money. And, and the basis for it, by the way, is, is, is what the five justices said is the lawsuit was filed in the wrong place, that the lawsuit should have been filed in the Court of Federal Claims, which is where if you have a breach of contract case against the federal government, if you have a contract and they broke it under federal law, the place to bring that case is the Court of Federal Claims. It's a specialized court that exists to adjudicate breach of contract cases against the government, they did not bring this in the Court of Federal Claims. They brought it just in an ordinary federal district court. So, five, four, the court said, wrong court. They don't have jurisdiction to decide this, so they don't have to give the money. Now, Justice Barris Barrett sided with the liberals in refusing to reverse the district courts, vacating the guidance on dei. So the guidance on DEI is currently blocked, although that lawsuit will continue, so it's not necessarily permanently blocked. And she declined to have the Supreme Court reverse that decision. And so this was, at the end of the day, this really should have been 9, 0. But I'm glad it was at least 5, 4, the right way because that means that this money doesn't have to go out the door.
- [06:26]
A
Yeah, it's certainly big that it didn't have to go out the door. Moving forward, does this also have some sort of precedent that the president will be harassed maybe a little bit less? Or do you think Democrats say we'll harass no matter what, we'll argue wherever we can, a liberal court we can find and that will at least slow him down.
- [06:42]
B
Yeah, look, the Democrats are going to keep trying and the left wing activist groups are going to keep trying. This is their next generation of lawfare. Just like before when they indicted him four times, that was an effort to use the courts to use law enforcement to stop President Trump, but also to stop the voters from re electing him. They failed in that this is now their effort and it is relentless every day of the Trump presidency. He's going to be sued. The administration is going to be sued. I will say the Supreme Court, we talked about this in an earlier podcast. It has made important steps to rein in the abuse of nationwide or so called universal injunctions. That was important and this decision is important, I will say. Justice Gorsuch, joined by Justice Kavanaugh, wrote a concurring opinion that was significant. Here's what Justice Gorsuch said. Quote, lower court decisions may sometimes disagree with this court's decision, but they are never free to defy them. In Department of Education vs. California, this court granted a stay because it found the government likely to prevail in showing that the district court lacked jurisdiction to order the government to pay grant obligations. The California decision explained that, quote, suits based on any express or implied contract with the United States do not belong in district court under the Administrative Procedure act, but in the Court of Federal Claims under the Tucker Act. Rather than follow that direction, the district court in this case permitted a suit involving materially identical grants to proceed to final judgment under the APA as support for its course. The district court invoked the, quote, persuasive authority of the dissents in California and an earlier court of appeals decision that California repudiated that was error. In casting California aside, the district court stressed that the Court there granted only interim relief pending appeal and a writ of certior or and did not issue a final judgment on the merits. True enough, but this court often addresses requests for interim relief, sometimes pending a writ of certiory, as in California. And either way, when this court issues a decision, it constitutes a precedent that commands respect in lower courts. He went on to say, quote, if the district court's failure to abide by California were a one off, perhaps it would not be worth writing to address it. But two months ago, another district court tried to compel compliance with a different order that this court had stayed. Still, another district court recently diverged from one of this court's decisions, even though the case at hand did not differ in any pertinent respect from the one this course court court had decided. So now this is the third time in a matter of weeks this court has had to intercede in a case squarely controlled by one of its precedents. All these interventions should have been unnecessary, but together they underscore a basic tenet of our judicial system. Whatever their own views, judges are duty bound to respect the hierarchy of the federal court system created by the Constitution and Congress. Look, this highlights a pattern we're seeing of lawless district judges. That is Justice Gorsuch and Kavanaugh lay out three in just three weeks that have defied the Supreme Court of the United States, said, we don't care what the court said. And you know, it was striking. Look, I'm reading from a Supreme Court opinion and some of that sounds like legalese, but. But I'll tell you, one of the most amazing things that, that Justice Gorsuch described the district court did is it said it found persuasive the dissents in the California decision. Well, a dissent by definition means you lost. You did not get the majority. The majority issues the opinion. A dissent is someone who disagrees with the opinion. And the way precedent works, the way our judicial system works, is, is a decision that it issues from the Supreme Court is a precedent that all of the district courts and all of the courts of appeals are bound to follow. So if you are citing a dissent, you are saying right on the front of it, I don't care what the majority held. I agree with the dissenters. No lower court judge has the authority to do that. That is the definition of lawlessness. And it is why these plaintiffs are seeking out radicals on the bench who they know will be lawless.
- [11:43]
A
Now, if you want to hear the rest of this conversation, you can go back and listen to the full podcast from earlier this week. Now on to story number two.
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B
Yeah, well, look, we saw an illustration of this with Cracker Barrel. Cracker Barrel is a terrific institution, particularly in the South. And their woke leadership decided that everything the company was built on, they didn't like. And in particular, they didn't like their customers. You know, their customers, they thought, were not nearly as enlightened as they should be. They were not nearly as woke as they should be. And the whole thing was very reminiscent of Bud Light. You know, Bud Light. You had a marketing executive who said, you know, the people who buy Bud Light, we don't like them. We need to have, you know, a bunch of woke transgender activists drinking our beer instead. It was reminiscent of what happened with Target where they decided to market.
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C
You.
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B
Know, to market to transgender toddlers and do it prominently. Pushing, pushing bathing suits for two year old boys to tuck their genitals, to hide them away, to pretend they're not boys. That was Target thinking, this is really what America wants. Because, you know, if you're the parent of a two year old, clearly you want your son to believe he's a daughter when he's two. This is a phenomenon of business leaders who buy into an ideology that is wildly unpopular and ultimately directly antithetical to their customers. And so Cracker Barrel had a logo, had a logo of an old guy sitting on a chair next to a giant barrel. And they decided, okay, let's get rid of the cracker, let's get rid of the barrel, let's get rid of it all. And we'll just have anodyne words because we're really embarrassed that we're for anything nostalgic, anything that is Americana. And the pushback has been phenomenal. Their stock price has tanked. Just like Bud Light, just like Target. And just today they announced, nevermind. Okay, yeah, this has not worked well. The beatings are really hurting, so we're going to stop. But it is striking that it took the reaction of the market for them to figure it out. I want to say, though, it is a great, great victory for common sense that Cracker Barrel finally gave in and said, you know what, we're going to stop being woke because we'd like to actually have one or two customers when this is all said and done.
- [14:16]
A
Yeah, I think the frustration of conservatives now voting with our dollars, and that is what ultimately this came down to. A Cracker Barrel. This was a bunch of Americans that said, okay, you despise us. You despise the, you know, who we are as a customer base. You're basically telling us you don't want us anymore. Watch this. And, and that is exactly how they got this point very quickly. And look, I also think when you have people like you and the president who are willing to speak out on this and say, you guys are being stupid, and they realize how quickly others are like, yeah, us too. Like, we're gonna, you know, we're gonna say that we think this is ridiculous, and we're starting to finally, I think, see the pendulum swing back the other way, which is really, really cool.
- [15:03]
B
I was gratified because yesterday President Trump publicly called out Cracker Barrel and said, look, you need to just go back to your old logo, like, give this up, end the rebranding and accept that you were wrong. And I'll tell you, I jumped in on Twitter. I, I retweeted him. I said, this is absolutely right. And the two of us were very vocal saying, go back to where you were. And 24 hours later, they did. So that was gratifying. It's not always that people listen. They listen to common sense. In this case, they did. And it's worth noting, it isn't just in the last week that people noticed that what Cracker Barrel was doing was nuts. Almost a year ago, November of last year, a big investor in Cracker Barrel guy named Sardar Biglari, he owns approximately 5% of the restaurant chain stock. He wrote to his fellow shareholders that the Cracker Barrel transformation was a, quote, mistake of misguided executives falling into a textbook trap of overspending on cosmetic remodeling. And he continued, the day Cracker Barrel opened, it was already old. Its theme derived from the 1920s. And he wrote, I am concerned that not only will the remodel not work, but it could actually damage the brand further. These decisions are taking us down the same path, I believe, as Ruby Tuesday, Red Lobster, TGI Fridays, and the like. Let me make my position clear. The company's $700 million remodel plan will not work. And he called in a letter to the shareholders in October 2024. The board's transformation plan, quote, obvious folly. And yet the corporate leadership ignored the shareholder owned 5% of the company, and they charged down that road anyway. And they vaporized roughly 15% of the market cap of the company because they were more interested in listening to woke marketing executives, and by the way, the entire marketing world, much of that is a scam of left wing woke people who despise their customers. And let me say, if you're in corporate America, don't listen to marketing executives that don't understand and don't like your customers. But in this instance, Cracker Barrel should have listened to its investor and not these marketing execs and it paid the price. But the good news is they finally, finally, finally listened and reversed and said, you know what, the principles we were founded on, the principles America was founded on, those principles are pretty good. We're going to get back to them.
- [17:48]
A
Yeah, it's incredible. All right, final question for you. You've got day one in the books of the codel. You're going to be down there and also doing more. We're going to be able to talk about that. Coming up on the next episode of Verdict.
- [18:02]
B
That's right. This is a multi day trip and we're traveling to two other countries throughout Latin America. And the focus is really on meeting with heads of state, meeting with leaders in each of these countries where the issues directly impact the United States, directly impact Texas. They impact our national security. They impact our economy. By the way, I had dinner tonight with the economy minister here in El Salvador. They're very focused on American investment, on energy, on technology, on pharmaceuticals, on, on creating jobs. And by the way, to give a sense of how much these changes matter, I'm going to give you two stats to wrap up with. The justice minister told me They've had over 10,000 applications for people who want to be police officers. Suddenly, people are eager to be police officers because it's making a difference, because they're making their community safe. But previously, when the gangs were running the country, they had in one year over 300 police officers murdered. Being a police officer was, was literally taking your life and your family's life in danger. Now people are lining up to be police officers because they see the difference. But here's something else. It used to be that the people of El Salvador were fleeing this country because, look, you were risking being murdered. Your kids were risking being murdered. You wanted to get out. Now we are seeing reverse migration. There are roughly 6 million Salvadorans in El Salvador. There are about 3 million Salvadorans in the United States. President Bukali told me roughly half of those Salvadorans in America, about one and a half million, have said they want to come back to El Salvador. They're seeing reverse migration because suddenly people are saying, wait, I fled my country because I was terrified for my safety and my family. Now the country's safe. I want to come back. I love, love the beach and the mountains and the people and the culture that is changing this country. And it ought to be an encouragement to any other leader, to any mayor, to anyone facing crime and challenges. When you fix these problems, it doesn't just keep people safe, which it does, but it has economic benefits. It literally transforms your community. That's inspirational. And as I said, this is the beginning of a multi day trip throughout Latin America. So in two days we'll report on the rest of the trip as before.
- [20:22]
A
If you want to hear the rest of this conversation on this topic, you can go back and download the podcast from earlier this week to hear the entire thing. I want to get back to the big story number three of the week you may have missed. All right, Senator, you're on this code in Latin America. One of the other parts of your trip involved going to the Panama Canal and seeing some different things, including a lot that deals with China. Now, it's been a big concern. Talk about that.
- [20:51]
C
Yeah. So I spent a day and a half in Panama. I flew from El Salvador to Panama and met with multiple cabinet members, the finance minister, the defense minister, the public safety minister, and the head of the Panama Canal. And I will say, number one, Panama is a beautiful country. It is a gorgeous place. And the people of Panama have a deep affinity for America. I was struck by that. They repeatedly, the government officials, the Panamanians that I visited with. There's a long history and a close affinity for the United States. The Panama Canal is amazing. So I went out on a boat and went to the outer parts of the Panama Canal and then I went to one of the locks and I saw one of the Panamax, like the super tankers coming through and then also saw a little sailboat coming through and then a kind of medium sized container ship coming through. It is amazing. It is, it is very cool. Number one, just how the Panama Canal operates. Like you see the Panamax, the supertanker, the container ship is the largest size possible to fit through the Panama Canal. It's built for that size. I mean, it is literally this massive ship that is going through these locks. And these locks have concrete on the side and it's built so the sides of the ship are within 2ft of the concrete walls on both sides. Like it's that big. And what happens? So we were on the Pacific end of the canal and a ship comes in and each of the locks has to lower the ship 27ft so it comes in into the locks. And it's interesting for the big tanker, they connect steel cables to the tanker and they have locomotives on both sides to help keep, keep the ship right in the center, you've got only two feet of clearance on both sides. So it'd be really easy for it to smack into the side of the canal. And it is in the lock. And then it takes about eight to 10 minutes for the water to drain and for it to lower 27ft. And it's lowering 27ft and it goes to the next lock and it lowers another. I believe it's 27ft, all told. It's about. I think it's 81ft that it has to rise to get to the height of the lake in the interior. And then it has to lower to get to the Atlantic Ocean and the Pacific Ocean. And both the Atlantic and Pacific are about the same distance. To lower the water 27ft takes 8 to 10 minutes. And so the water goes down and then the giant gates open. It was amazing to watch the technology. I saw the old control room. I saw the control room where the lock is being operated. The old control room. So the Panama Canal was built in 1914. The United States built it, and we lost thousands and thousands of lives building it. It's an incredible engineering marvel. So the old control room had these brass GE equipment. You saw the old ge, General Electric, Electric. They built one of the first early computers to help operate the locks. It's amazing. Now, now it's all computerized and high tech. So the. The old brass controls of each lock that gives you the water height. And it was literally. It almost looks like something Captain Nemo would have in terms of the 1914 levers and switches to operate the canal. That. That's still preserved there. When I went out on the boat, one of the things I saw, Ben, is right at the entrance, the Pacific entrance of the canal. There is a gigantic port that is owned and controlled by Communist China. And it's right there. And they have cranes. They're right there in a position. There is also. China is building a bridge, a bridge across the canal. It is a bridge for cars. They were awarded the contract to build the bridge. China is also. There's a Chinese company that is digging a tunnel under the canal for a Metro train. And so I saw. I saw where the metro was going to go. I saw the bridge being built, and it's all right there at the mouth of the canal. And I went. The purpose of my visit was to meet with the Panamanian government and say, look, China cannot have control of this canal. It is too important to the United States, to our national security, to our economic security. As you know, I'm the chairman of The Senate Commerce Committee, the Commerce Committee has jurisdiction over the Panama Canal. And so earlier this year, I chaired a hearing on the Panama Canal in the Commerce Committee. And we laid out the concerns, in particular, the concerns of China. And what I laid out to the Panamanian officials, I said, look, if, God forbid, we find ourselves in a military conflict with China, let's say next year China invades Taiwan. And President Xi has repeatedly said he wants to invade Taiwan. If he does so, there's a very real possibility that escalates into a military conflict with the United States. If China is in an active military conflict with the United States, I think the risk is unacceptable that China would try to shut down the Panama Canal, because if they shut down the Panama Canal, it massively delays our ability to move military ships from the Atlantic to the Pacific to engage with the Chinese in Taiwan, because it forces our military ships instead to go around the southern tip of South America rather than cut through the canal. And so if you're President Xi, look, you wouldn't do it in time of peace. But if they're at war, it becomes a really compelling situation to say, let's impose massive economic harm on the United States and we get enormous benefits. They're billions of dollars of revenue that comes from shipping, shipping, whether it is oil and gas through the Panama Canal or goods and containers. And shutting down the Panama Canal would be a real blow to the United States economy, but it would also be a real blow to our military because it would limit our ability to move naval ships from the Atlantic to Pacific. It would massively delay moving those ships. And so what I'm pressing Panama, I will say, when I chaired the hearing on the Panama Canal, within a week, they announced the deal to sell those two Chinese ports to an American business consortium. That deal has not gone through yet. The Chinese are slow walking it. And part of the purpose of my trip was to press the Panamanian government and say, look, you need to get the Chinese the hell out of here. Do not leave them in a position where they can shut down this canal. Because shutting down this canal would be an enormous economic and national security blow to the United States, but it would also be an enormous blow to Panama. And so part of the case I was making them is their interests and our interests are aligned. They don't want China to be in a position to shut down the canal.
- [28:44]
A
As always, thank you for listening to Verdict with Senator Ted Cruz, Ben Ferguson with you. Don't forget to download my podcast. And you can listen to my podcast every other day. You're not listening to Verdict or each day when you listen to Verdict afterwards. I'd love to have you as a listener to again the Ben Ferguson Podcast. And we will see you back here on Monday morning. This is an I heart podcast.