Mamdani on John Stewart, DSA on Fox News, and NYC's City-Run Grocery Stores | Weekly Recap

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Use code IMPACT at the link below and get 60% off an annual plan: https://incogni.com/impact Pique: 20% off at https://piquelife.com/impact Netsuite: For the first time ever you can try NetSuite Next for free. If your revenues are at least in the seven figures, go to https://NetSuite.ai/Theory https://netsuite.ai/Theory. Built for every industry. Ready for every boardroom. Mamdani sat down with Jon Stewart and made democratic socialism sound like libraries and fire departments. We break down why that framing collapses the second you look at what DSA policy actually says versus how it gets marketed. We get into the rent freeze experiment that already ran in New York, the difference between a social safety net and seizing the means of production, the perverse incentive problem, and why the people this movement celebrates should set off alarm bells. Plus the aggressive-agreement trap: where the left is right about helping workers, and where the branding hides something very different. Tom reacts to a viral Fox News interview with a national co-chair of the DSA—a clip so extreme he initially assumed it had to be a setup. Joining Tom is Drew as the two go point by point through the DSA platform laid out on air: abolishing the Senate, replacing the presidency and Supreme Court, abolishing ICE, opening borders with amnesty, defunding the Pentagon, abolishing prisons, and bringing most large corporations under government ownership. Tom argues this is communism unmasked, and explains why America's founders deliberately built a republic with checks and balances to protect citizens—even from a president they hate—drawing a stark contrast with what happens under unchecked power in places like China and Iran. The conversation then digs into the deeper engine Tom sees behind radical leftism: an ideology rooted in resentment and an "overproduction of elites"—young people loaded with debt and taught that virtue means finding how you're oppressed. Drew pushes the economic angle hard, arguing that a generation locked out of the capitalism ladder, priced out of housing, and drowning in household debt has little reason to defend a system that isn't working for them. Together they wrestle with inflation, minimum wage, NIMBYism, and whether you can defuse the ideological bomb without first fixing the economy. A candid, combative breakdown of one of the most consequential political fault lines in America. Tom takes on Mayor Mamdani's plan to launch five city-owned grocery stores in New York—a $70 million, taxpayer-funded endeavor promising a core basket of goods at 30% below retail. Joining Tom is Drew, who pushes back and presses on the specifics as the two work through why running a grocery store is one of the hardest businesses on earth, operating on razor-thin 1 to 3% margins. Tom walks through the economics step by step: even zeroing out rent, taxes, and profit, a 30% discount on core goods leaves an unavoidable gap—one the taxpayer has to close. He explains how artificially low prices distort the market, put upward pressure on surrounding stores, and threaten to drive local bodegas out of business (who are already suing). Drawing on his own experience selling into Walmart with Quest, Tom lays out the "kingmaker" dynamic and the Vlasic Pickle cautionary tale to show how a state-backed buyer would inevitably bully distributors and suppliers down the chain until someone—often the lowest-paid worker or farmer—absorbs the loss. He points to real-world failures in Baldwin, Florida; Erie, Kansas; and a questionable case in Atlanta, and connects it all to the DSA's July program calling for food, energy, medicine, and transportation to be run "not for profit." The core question Tom leaves you with: what are the odds a government bureaucrat runs a grocery store better than Walmart? His answer is blunt—zero. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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• 1:07Speaker 01

  I'm Donnie, I'm Jon Stewart. I'm curious about your take with this. I watched the whole interview and your setup was interesting, so I'm curious.

• 1:14Speaker 00

  How does he embarrass himself?

• 1:15Speaker 01

  No, because I was like, the conversation followed logic, and I feel like this is a very good... I feel like me and you had this conversation a couple of months ago, but we'll hear it from the horse's mouth.

• 1:24Speaker 02

  If you go back to some of the Democrats that we most admire, FDR, LaGuardia, you will see a lot of democratic socialist principles in their vision. And if you think about a lot of what we've come to accept as just the facts of life across our country, a lot of it is also still driven by democratic socialist principles.

• 1:43Speaker 00

  Lies.

• 1:44Speaker 02

  Now, if today you and I were to introduce the idea of a building that lends out books for free, we would be slandered in the same way that so many new ideas are slandered today, and yet that's the library. And the same thing with the fire department, the same thing with public schools. And it's to say that a lot of politics has been a debate about who deserves what. And I would prefer a politics that debates how we can deliver that to everyone.

• 2:09Speaker 00

  What's that, motherfucker? What is the that? He is a Maoist. Let us be abundantly clear. We're going to do more deep dives on the DSA in their own words. This guy is a fucking liar. He is misrepresenting the actual truth. And because of that, he's going to put a slick veneer on something that is truly about control. First of all, he is straw manning the opposite side. And so for that, fuck him. The reality is that why do people like the fire department? Because it's dope to have public good where the fire department of old was like, you got paid for how many fires you put out. And so when you create that incentive, one, you've got an incentive to start a fire that you can get put out so you can get paid. If you don't think that kind of thing happens, first of all, just read history. And then, second, look at what happened.

• 2:53Speaker 00

  I think it was in India, they were trying to get rid of king cobras. So they offered people, we'll pay you this much for bringing in a dead cobra. So people started actually raising cobras and creating breeding farms, killing them and then bringing them in to get the money for it. People looked at that and said, oh, we create a weird perverse incentive. So if he thinks he's arguing against Michael Malice and somebody that wants everything to be anarchy, again, as Michael Malice describes it, maybe. Maybe Malice would recognize himself in the picture that he's painting. I certainly do not. No fan of America and the, let's call it the founding fathers' vision of American capitalism, is arguing for having no government assistance. Okay, so we're going to have the government. But when he says these are DSA principles, that is bullshit.

• 3:38Speaker 00

  Mao represents DSA principles, which is, we are going to make shit free. The people that are making money are evil. And I quote, the most likely person to be the 2028 candidate on the Democrat's side said, there is no way to generate a billion dollars in revenue. I can't remember if she's saying revenue or wealth, but either way, there's no way to generate a billion dollars without doing something illegal. Fuck right off.

• 4:02Speaker 01

  Unethical.

• 4:03Speaker 00

  Unethical, perfect. So literally fuck you. That is absolutely nonsensical. Not only is it possible, I have fucking done it. So I don't even want to hear that you're doing something unethical. That is bullshit. Now, if you want to point to what you think I have done that's unethical, I'll happily go to battle on that. This is when you talk about the absurd, like, magic trick that he's trying to pull around saying that a library is exactly the DSA. No, it's not. Look at what Mao did. Mao said, hey, everybody, we're going to do things our way. We're going to get rid of the four olds. We're going to move into a brave new future. I want you all to plant the crops at this time because I know best,

• 4:47Speaker 00

  just like they're trying to do with rent freezes. You guys are doing bad things in the way that you're trying to charge for rent. It shouldn't be that expensive. I know better than you, so this is what you're going to charge for your rent, not understanding the knock-on effects that it's going to have. That is very different than people going, you know what I think would be dope? If we created a place where really driven young people, or old people, whoever the fuck, want to come in and get educated. So we want our people to be educated to high heaven. And we want to create access to that knowledge for free. That's the dopest shit ever. And now people can go learn. And if you're asking me if I would be willing to pay tax dollars to make sure that, for instance, kids have access to the internet, yes.

• 5:30Speaker 00

  If you want to know if I would put tax dollars to make sure that kids have access to AI, yes. So there are things for sure to make sure that the next generation is educated. Would I put money towards making sure that the fire department isn't, like, there aren't six fire departments competing for that house fire? Yes, of course. Like, it's just, it's a better world. It's more stable foundation. If you're asking me, am I willing to do things that are going to break the engine of prosperity? This is where he is either dumb or evil. Either one is completely disqualifying. And if Jon Stewart actually can't see the difference between freezing someone's rent, which has already been tried, remember, this experiment has been run, and it ended up in the most horrific conditions in New York. It wasn't even like this was run somewhere else.

• 6:15Speaker 00

  It's actually done in fucking New York. So you can't have the cost of running something be unclamped and the cost to charge for that thing clamped. It's completely nonsensical. From cause and effect first principles, it is completely nonsensical. Now, he can say it with a smile. He can say it in ways that feel great, but he cannot map it from cause and effect. He can't do it. And that's why at the end of his speech, he just starts saying that, or he'll talk a lot about workers and dignity, or he'll say the city deserves better. What the fuck does that mean? Dude, I've seen people, in my mindset days, one of the things that ended up driving me fucking crazy was people take obesity for a second.

• 6:57Speaker 00

  So I would say, you're fat because you eat things that are going to make you fat. Plain and simple. It's, you don't have a genetic disease. It's not that. You're just eating dumb shit. There were no obese people in Auschwitz. Why? Because ultimately, this comes down to caloric deficit. So you may not be willing to do the things you need to do to get lean. Fine, cool, go enjoy the ice cream. I don't have any moral compunctions with it whatsoever. But if you're trying to map how we ended up here, it is a very simple, you must do these things if you want to get lean. You may not want to do them, and that's fine. If a city isn't willing to do the things it needs to do to be prosperous, it will not be prosperous. It does not matter if the city feels that it is entitled to eat the ice cream. If you eat ice cream, you get fat. If you eat too much of it, let's be very clear.

• 7:41Speaker 00

  On that, what the fuck does deserve have to do with it? And when I would be doing mindset with people and I would say, hey, I want to help, they would fucking come to me and they would say, hey, I have this problem. Help me overcome it. Cool. I want to see you succeed. Here's what you have to do. And then they would actually say, they would actually say, and I quote, I deserve this ice cream. What am I supposed to do with that? What do you mean? Economies have an engine of prosperity. The reason it's right to think of it as an engine is because engines require physics. There's no magic to an internal combustion engine. You align things in a certain way, you put certain inputs in, you get certain outputs. If you fail to do that, you break the engine of prosperity, and it doesn't work. And it does not provide the very thing that allows you to tax and do all this stuff for free.

• 8:26Speaker 00

  Remember, the core problem, the core problem is, no one will work for free. The second you show me how people can work for free, then we can have the utopia. But if you can't get people to work for free, you have to use force. Mao tried it, Stalin tried it, Lenin tried it, Pol Pot tried it. It just ends in death, a lot of death, because you have to go kill those people or starve them to death. That's also a fun one that has been done by Mao. And these guys modeled themselves after Mao. Hassan Piker dressed up like Mao to give a speech.

• 8:57Speaker 01

  Can we, okay, right. Really quick.

• 9:00Speaker 00

  Yep.

• 9:00Speaker 01

  If he would have been like, free libraries, fire department, that is a social service policy, you would have had no beef. The fact that he's leaving that democratic socialist policy, DSA policies.

• 9:13Speaker 00

  The fact that he's trying to smuggle in something that is absolutely a lie.

• 9:19Speaker 01

  DSA.

• 9:19Speaker 00

  Under, yes. The DSA policies are not social safety nets.

• 9:24Speaker 01

  Okay.

• 9:24Speaker 00

  The DSA policies are, um, we are going to take over the means of production. We want to abolish the Senate so that everything can be done by pure, who has more people. Literally breaking all of the things that work in a democracy. They will do that to gain power and then they will clamp down on people. As they say, you can vote communism in, you can't vote it out. The first thing they do is then they say, we don't need elections anymore. We, we can't have anybody fuck this thing up. And so now that we've got it, we fought so hard to get here. We've got to abolish all these other things and just make that, those checks and balances impossible. Boys and girls, you need only look at the direction of travel. These guys tell on themselves every fucking day by who they celebrate.

• 10:06Speaker 00

  They are Marxist Leninists. Watch how that has played out in reality. It's fucking crazy. So this is one of those things where the, the person is telling you, I, I'm going to use different people who are far worse, or sorry, um, far much less worse, but have a way worse reputation to explain to you what's happening. So, um, they go, okay, my, my hero is, um, Ted Bundy.

• 10:34Speaker 00

  And I'm opening a women's shelter and it's called the, the Bundy Women's Shelter. And, you know, when people look back, few people have done more for women's rights than Ted Bundy. And then you want to cut to the, the shot from, uh, of Leonardo DiCaprio snapping his fingers and pointing, whistling and pointing at the screen. You're like, hold on, Ted Bundy was a fucking serial killer. So, and he killed women. What, what, what? What are you talking about? So for you to celebrate Lenin, Marx, uh, Stalin, Mao, dude, they are mass murderers that, that, they are unrivaled, except by Genghis Khan. They are unrivaled in human history. What are you talking about?

• 11:18Speaker 00

  How, how are people not freaking out? If they said, our hero is Hitler, people would have the right response. Hitler was not as effective at killing people as the people they celebrate. And so I'm just like, dude, this is too weird. This is too weird. In fact, I'm gonna, I'm gonna strip all the emotion out of my voice for a second. Because when I hear things like this, and it's a thing that happens right in people's faces. And I'm like, why didn't anybody point this out? So let me point it out. Cause I'm like, the, the rebuttals are always just emotional. Let me give it to you completely unemotional.

• 11:57Speaker 00

  The DSA admires Mao, the DSA admires Stalin, the DSA admires of their own admission Lenin. The DSA admires Marx.

• 12:11Speaker 00

  They have an oppressed versus oppressor lens. No matter what words come out of their mouth, that is their lens. There is the oppressor and oppressed in every relationship. And we always fight for the oppressed and we are always opposed to the oppressor. So then you just have to ask, okay, who's the oppressed and who's the oppressor? In, if you just take America writ large, America is the oppressor. And, um, they will say the marginalized are the oppressed. They tried race for a long time. Now they're moving it to class. And so they just talk about the working man. Remember the working man never starts these revolts. It is always overproduced elites.

• 12:55Speaker 00

  The reason overproduced elites gravitate towards Marxism is it is a religion, is the right way to think about it. It is a religion masquerading as an economic philosophy that is built on resentment. So even take Steve Keen, who really believes that Marx is one of, if not the, I think he'll go all the way to the greatest economic mind ever. Even he admits, but he had a philosophical conclusion he wanted to reach. And he ended up betraying himself and pushing this thing that reached a political outcome. But if you back up a few steps, right up to where he inserts his philosophy, he actually understood the economy better than most people, at least the economy of that time.

• 13:41Speaker 00

  Okay. So now you have this religion that didn't stop at the economy, that went to philosophy, that was embraced and deployed by the biggest mass murderers to ever exist, only rivaled by Genghis Khan. I'll always put that caveat. So people know, I'm literally looking through all of human history because of the far left march through the institutions. Meaning, as they say, history is written by the winner. Curriculum is written by the professors. If all of your professors think Marx is great, if all of your professors think Lenin is great, if all of your professors think Mao is great, then kids that come up through that institution will think all those same things.

• 14:24Speaker 00

  And so even though Mao killed at least, nobody estimates less than 45 million. Some people will push it all the way up to 80 or a hundred million, but let's just stick with the low estimate. Mao killed at least 45 million people himself. All of World War II only killed like 56 million. Hitler himself killed way, way, way less than that. And so Mao alone, forget Lenin, forget Stalin, Mao alone killed 45 million people. So they celebrate him and it doesn't trigger any alarm bells. And that's the part where I'm like, guys, think of it as a test. Mao ran a test for us and he said, I want to see what happens when you, uh, take this Marxist belief system

• 15:09Speaker 00

  and you deploy it at scale. Lenin did the same thing for us. It kills relentlessly. Pol Pot tries it. It kills relentlessly for the reasons that I've said. That you end up having to do it by force because you break the engine of prosperity. So you break the engine of prosperity, everybody's life starts getting worse. They're able to afford less. There are fewer things on the grocery store shelves. In the case of the Bronx, when rent freezes were tried back in the seventies, uh, people were just burning the buildings down. So eventually people go, this isn't working. And at that point, you can't just say, oh yeah, you're right. Why? Because you'll lose power. And this was a game of resentment and power acquisition from the beginning. That's why Marx spills over into philosophy instead of just sticking with the economics.

• 15:52Speaker 00

  So now you have a religion of resentment that becomes a way to acquire power. Once you acquire power to maintain it, when the economic system doesn't work, you can't win people over because you've made their lives better. You've made their lives worse materially, measurably, obviously, repeatably. You've made it worse. So they'll rebel. So your only option, if you want to retain power, which was your goal in the first place, is to start killing them. Now remember Mao, while his people were starving to death by the tens of millions, was exporting grain. Why was he doing that? So that he could live in a mansion and make sure that he always had food. I don't know, read the books about him. This is not me making this up. I, I'm giving you like, this is just top layer, greatest hits.

• 16:34Speaker 00

  Like the dude had his own, he sent his own son to die. Um, he left his wife, didn't tell her he was leaving, left her in an area that he knew the military was about to come and obliterate. So she died. I mean, the, the shit that this guy's done is, is fucking insane. He's one of the most evil human beings ever to live. And you have Mamdani, who is very good at smiling, who is very good at propagandizing and speaking as if he's coming from a place of love.

• 17:05Speaker 00

  The DSA is not social safety net. The DSA is Marxism. Marxism is what we just talked about. It is a philosophy of resentment, masquerading as an economic principle that doesn't work. It's been tried. So that's where the pushback needs to be extraordinary. We need to be very intellectually robust and muscular in our absolute unrelenting and ever repeating takedown of these ideas. They are sinister and they are being masqueraded.

• 17:42Speaker 00

  Through something that they aren't likening marks to the library is the craziest shit I've ever heard in my life likening solving the perverse incentives that would arise if you try to use capitalism for firefighting and saying as if the other side is saying, no, no, no, we want a perfectly free economy embedded inside of anarchy isn't real. I don't know who you're arguing with. It certainly isn't any respected and vocal proponent of America and capitalism because nobody is saying that. And so the level of absurdity,

• 18:26Speaker 00

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• 19:54Speaker 00

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  60% off an annual plan. Try it risk free for 30 days. That's incogni.com/impact and use code IMPACT. Consequential. Because if America tries to solve its very real problems by adopting a murderous strategy, that would be the biggest catastrophe any of us could face. If on the other hand, we get honest about the way the engine of prosperity works, we go point at the actual nuts and bolts, like the real, this is the exact thing that's wrong with the carburetor. And if you adjust it in this way, it will start working again. If we do

• 21:14Speaker 00

  that, then we've got a chance of getting on the other side of this. But lies and emotional appeals, I will not tolerate them. I will not stand for it.

• 21:22Speaker 01

  They also talked into that interview about how they need different names for things because they think as soon as you say socialism, people are getting like triggered and they're going back to

• 21:29Speaker 00

  As soon as you say socialism, people realize what you're actually about. That's 100% true. If Ted Bundy starts renaming rape or murder, it's still the fucking thing that we absolutely despise. And so just because people now know rape and murder is terrible, if you're still going to penetrate somebody against their will, I don't care what the fuck you call it. Rape by any other name is just as evil in the same way that arose by any other name is just as sweet. So the absurdity of that is fucking sinister. Like that is somebody trying to obfuscate. They're on to us. They understand this is bad and I'm not going to be able to pull a fast one on them. So I need to rebrand it. Fuck you.

• 22:11Speaker 01

  Yeah, but I also think that nuance doesn't exist and chat's gonna call me a communist and that's cool. But I also think that there is a spectrum to this and we have to stop acting like we live in a totally capitalistic free market society in America right now.

• 22:22Speaker 00

  Agreed.

• 22:22Speaker 01

  We live in capitalism light. And I think that the move now is now zero capitalism, as in like zero sugar Coca-Cola, not like zero capitalism. You know, I think we're on that spectrum of like classic capitalism, diet capitalism, zero capitalism. Then we're starting to get to socialists and then we're starting to get to these other like entities. And while him saying specifically, the library is a democratic socialist principle, I get everything you're saying that monologue is well maintained. The DSA is crazy. Like I said in the past, I went down that rabbit hole. I agree. No pushback. However, I don't want to lose the force for the treason to say that there are social programs that can be implemented today that can help workers directly. There are social programs that can help people. So

• 23:04Speaker 00

  Aggressive agreement.

• 23:05Speaker 01

  A lot of times when we just play the, he said this socialism, we're just painting it with a broad brush and we're losing, we're using, we're losing, excuse me, the nuance of the things that can be beneficial. I don't want to say that the DSA did this beneficial thing, but I also don't want to say that

• 23:21Speaker 00

  I want to keep beating this drum. Here, here is what's happening. Let's say that a woman just got abused. You and I both agree that woman needs to get help and we need to do anything we can, whether we know her or not, to facilitate her getting help. But I'm not going to send her to Ted Bundy's clinic for women. The absurdity of that, I don't care what he calls it. It is, he has said what his principles are. And he has said, we're going to further traumatize the woman as soon as she gets here. So I'm, guys, how are, I read the brochure. Sure, the brochure says nice things, but their charter

• 24:05Speaker 00

  says what they're actually about. And so the charter and the marketing message are very different. You can go right now and find DSA members who actually say, we're going to have one real policy and then we're going to tell our candidates to say something else. They, they say that. So we know it's happening. We know it's part of their policy. You can read, they put out their new policy. It is, it is basically, I haven't done the go through yet, but we'll probably end up covering this. But somebody's done a one for one read with Mao's policies and the DSA policies. And they're like, these are basically the same thing, using different words. So I would not at all be surprised because everything that I've read about the DSA tells me that that is true. Hearing Hassan,

• 24:47Speaker 00

  who's like their biggest mouthpiece, and they have defended him time and time again. He has said before on camera, I pulled it a couple of weeks ago, but we didn't get to it. He said on camera that Mao is one of the greatest leaders in history. Bro, that's so crazy. So we like, think about how the immune system reacted to the way that Kanye was talking about Hitler. Yeah, good. That's, that's a good reaction. But we don't have anything like that for Hassan or anybody else going to bat for Mao. It's the craziest shit ever. So anyway, no matter what words they use, it doesn't matter. We both agree that woman needs help. So we need to go, okay, what does a woman who's been traumatized

• 25:32Speaker 00

  actually need? Not, this is not a choice between no help or Ted Bundy. This is a question of, we can just rule Ted Bundy out. That's, that's, that's anti what we need to do. So now just forget about that. That's not going to happen. That's worse. That's infinite trauma. That is murder. That's literally. So set that all aside. Now look at, okay, what are we actually going to do? What is actually going to help somebody? And that game needs to be engaged with. It's precisely why this show exists. I talk about this endlessly in terms of what we need to do to actually help workers. But I would just like to remind

• 26:11Speaker 00

  America, the DSA hates workers. The DSA hates the working class. Facts. I'll show it over and over and over and over and over and over. But that's just a factual statement. Now they're going to say the opposite. But just like Ted Bundy hates women, no matter what he tells you, the DSA hates workers.

• 26:34Speaker 00

  We're hitting pause for a moment, but there's plenty more ahead. So don't go anywhere.

• 26:40Speaker 00

  Thanks for sticking around. Let's get right back into the action.

• 26:44Speaker 01

  Now, DSA, in their own words, they sat down with Fox News. I feel like Fox News set them up because I don't know why this person is saying it so boldly with this.

• 26:51Speaker 00

  This is the co-chair of the DSA. Honestly, for a second, when I watched it, so I watched it side unseen, just let me hear what she has to say. I thought that this was a false flag because I'm almost certain, I can't prove it, but I'm almost certain that Fox has had people on in masks before to talk about different topics, like opposite sides of the topic. I could be being totally sucked into propaganda here, but I have seen people showing this guy that admittedly looks like the same guy under the mask, taking different sides of issues. And so I'm like, this has to be that. This has to be a false flag. Fox is trolling. There's no way this is real, because the things that she's saying are so insane that I was like, it's not possible.

• 27:33Speaker 00

  And so I looked her up. She's the co-chair, national co-chair of the DSA. This is insane.

• 27:40Speaker 01

  National co-chair, socialist with Presbyterian characteristics is how she acknowledges herself. Now, let's get back to her actual interview where she sat down with, I don't know who she sat down with.

• 27:50Speaker 00

  This lady from Fox News.

• 27:51Speaker 03

  So we're going to put up on the screen a few of the things that are part of your platform, and I want to ask you, just give me sort of a true or false on these. Abolish the Senate. True. Okay. Replace the presidency and Supreme Court as we now know them. Yep. Abolish ICE.

• 28:09Speaker 03

  Absolutely. Abolish borders and give amnesty to anyone currently in the US illegally.

• 28:16Speaker 03

  As a long-term plan, yep. Defund the Pentagon.

• 28:21Speaker 03

  Absolutely. Abolish prisons, at least in large part.

• 28:26Speaker 03

  Yeah, again, that is part of a long-term program, yeah. Okay, so no prisons. Government or public ownership of most large corporations. Yeah, absolutely.

• 28:36Speaker 01

  Yeah, absolutely.

• 28:37Speaker 00

  That is just straight up communism. This is so wild. Do you know how authoritarian you have to be to do all of those things? Like, this is completely unmasked. This is the DSA without their mask off, telling you exactly what world they are trying to build. Now, keep in mind, they talk very specifically about giving their candidates different messaging than they actually hold as a platform. And so you're going to see candidates like Mom Donnie talk as if, no, no, no, like, oh, why are you guys scared? This is, oh, ha, ha, ha, this is all being blown out of proportion, when in reality, this is actually what they're trying to do. Now, when you start looking at, oh, wait a second, why do they want to do

• 29:20Speaker 00

  this? So the Senate, if you don't understand what the point of the Senate is, then that might not seem like a big deal. Yeah, why don't we just have Congress? Like, that would be way better. It's simple. It represents the people. It's all based on how many of the country's people are in your state. That's your power. You're just representing the people. Okay, remember, America was founded on one driving core principle, that power corrupts. And if you understand that you both need a government and must fear that the government is prone to tyranny, that the government itself will become tyrannical over time, and you must protect yourself from it. They did not make a republic on accident. They made it very much on purpose to have checks and balances to keep any one person from coming into office,

• 30:04Speaker 00

  and then just absolutely wreaking havoc. Now, if you absolutely hate Trump, you need to be very grateful for the founders who were designed, or designed a government to protect you from things like that. Now, take the Senate specifically. The way that the Senate works is every state, no matter how big, no matter how small, they get two representatives. The reason that you do that is even though you might have a state that has a much smaller population, it allows the minority to fight back against a majority that would otherwise tyrannize them because they have more power. The weirdest thing in the world is that every government must become very muscular so that they can defend themselves against enemies foreign and domestic, and at

• 30:46Speaker 00

  the same time, they need to check themselves so that they don't become the very monster that they're trying to fight back against. And this is like, when I hear people go to bat for China, I'm just like, what are we talking about? You have a government there where the second Xi has a bad idea, he can just completely drive the country off a cliff, and anybody that goes against him is just shot and killed. Okay, we saw this play out in Iran. Somewhere between a couple thousand on up to 50,000, depending on whose numbers you believe, were just killed in the street. Now, imagine for a second, that Trump, when he took over DC and he had the National Guard in there, imagine that to get control of it, he killed 2,500 people, which I don't think anybody disputes that number out of Iran.

• 31:29Speaker 00

  Now imagine, he killed 50,000 people. How freaked out would people be? But that's exactly what happens when you don't have checks and balances. The DSA wants to get rid of your checks and balances. So they don't want the minority to be able to speak up for itself because they believe that they're right. They believe that they have the right way that everything should be done. They are power hungry. They want power. You cannot understand radical leftists throughout history. Forget our people on the left. You can't understand radical leftists throughout history without understanding that this is a ideology based in resentment, and they want power. It's not that they hate the police, it's that they want to be the police. It's not that they hate the government, they want to be

• 32:11Speaker 00

  the government. They want to be the people that are in power. Once you understand that, now you're going to understand the things that they put forward and the ways that they move. They have to get rid of the Senate so that they can, you get rid of borders, remember she just said it, you get rid of borders, you give amnesty and citizenship to all of the people that immigrate into the country. You know that they're going to want free things from the government, and so you get them in, you get rid of the Senate so the minority can't fight back. You've now got majority population because you got rid of your borders and you made everybody citizens. And now, it just comes down to what state has the most people. Cities tend to be the most left-leaning and be the most populous. And so now, they're

• 32:53Speaker 00

  going to then run those cities with rent freezes and handouts. And just as a reminder, 47% of the US government right now goes to entitlements, goes to programs where we're giving people stuff. As a reminder, in the last 10 years, the US budget has nearly doubled. So we are bringing in people from all around the world. We are giving them access to government programs. We are experiencing the largest workforce reduction in American history. So more people are saying, nah, I just want the government to take care of me, citizen or not. And so that is the goal of the left. Make the government bigger and bigger and bigger. Strip out the minority's ability to protect itself. Get rid of the borders,

• 33:37Speaker 00

  get rid of law enforcement, and you create a situation where everybody ends up having to rely on a government that is completely delusional about how you make things safe, how you make things prosperous. And so we will end up, if we continue down this road, we will end up in the exact same place. That place is like Cuba have ended up. China under Mao ended up. Russia, the USSR under the communist regime. It is so crazy that, A, they don't understand the economy at all, B, that they are so blinded by their own resentment that they cannot or will not see that this will be completely destructive to all the

• 34:21Speaker 00

  things that ended up pulling people out of poverty the world over, not just in America. This is a massive threat. This, in terms of, you want to talk about things that we have to protect ourselves against, this one's massive, massive.

• 34:36Speaker 01

  And to your point, I want to kind of double down because unlike the Muslim year thing where it's a 10-year to 30-year problem, and we have to figure out when it would actually come to a head, the DSA has one of few primaries. They do have cultural energy. They are increasing in political power. Now, there's only, I think, two people in the Senate that are actually card-carrying DSA members. There's about 10 that have just won primaries. We'll see if they eventually end up in the Senate and House as well. So it is one of those things that they start with one, then it leads to two, and then eventually.

• 35:05Speaker 00

  Yeah, and this is the same thing that I'm trying to get people to be thoughtful of with radical Islam, is it starts small and it becomes big. And I will also, like, if people need to understand how this playbook goes, it goes like this. The US did it to the Native Americans. England has done it to many places that they colonized. Muslims have done it historically into Europe. They've done it in Africa, which was Christian at one point, North Africa. They did it in the Middle East. So keep in mind, the Jews end up doing it in Israel. So, you know, if you want to ask yourself, well, is there a historical precedent for this working? The answer is yes. So that's where I'm just like, boys

• 35:48Speaker 00

  and girls, it may be small now, but you've got to play this stuff out. If you want that ideology to take over, hey, fair enough. But the thing about the DSA that I really want people to understand, this is not a couple primaries. The couple primaries are the bamboo shoots finally breaking the surface. So that's the stage we are at with radical leftist ideology. It has been working its way through the education system, through the judiciary system for so long now, that we're finally just becoming aware of it. But the problem is that it's been growing literally for decades on decades on decades. This is not something that people should be taking lightly. The only thing that I hold to with a bit of hope is that right now, unless this is propaganda, the Democrat Party is having a very hard time

• 36:32Speaker 00

  getting funded. And so they just had to borrow against their own real estate in order to raise, I think, 10 or 15 million dollars in debt. Compared to the Republicans that have like 120 plus million dollars. So my hope is that the everyday Democrat liberal is not succumbing to the far left ideology that will break everything that has brought us prosperity.

• 36:57Speaker 01

  With political movements, oftentimes they get the most. I think the reason I keep banging the same drum is we talk about institutions. We talk about professors, but the last time we had a scourge of communism in the seventies and eighties, that's when the American dream, uh, marketing campaign from the mortgage companies ramped up. We had a bunch of people who got into houses and as soon as you buy a house, as soon as you have to pay a mortgage, there's studies that show you automatically care about your neighbors. You start voting in more local political, um, elections. You contribute more to local schools. It physically gives you a buy into the territory which you step in. So it's one of those things where right now we have a bunch of young people who have no access to get on the capitalism ladder because they're either working a, they can't even get a mall job because now we have grown 40, 50, 60 year olds.

• 37:41Speaker 01

  I was at Universal, um, last week and I was perplexed by how many like grown adults work at Universal like, and this is no shade to them, everybody, life is hard, I get it. But when I was growing up, amusement parks was a 16 year, a 16 to 21 year old job. And now you have people 40 with kids working at Universal. So when you have people who are been grinding and toiling for their life and they can't get off, they can't get a ladder, they don't have a buy into capitalism. They don't care about capitalism. It's not working for them. They have nothing. So as much as we could say, we need to change the schools, we need to change the books, we need to change all these institutions. It's one of those things where until they have the buy in, until I'm, until I'm at the poker table and I have chips and I'm, I'm, I'm actually looking at my cards, I'm just like, ooh, the guy with the more money, he needs to give to the other guy or that guy's, I'm just a commentator, I'm not participating.

• 38:24Speaker 01

  It's very easy to say Michael Jordan sucks or LeBron is the best. Until you hold a basketball and do what they do, you can't really talk about, you can't really have a different set of perspective on how they impact the game. So I just think we were gonna talk about this a lot. The more that the wealth inequality grows, the more that people are feeling behind on their bills, the more that private debt, not private equity, like private household debt, the more credit cards that get maxed, the more people are like, well, if we kill capitalism, I don't have to worry about paying my rent anymore. And they're just gonna start creating fantasies of a world that doesn't exist because they can't participate in the world that they're currently a part of.

• 38:56Speaker 00

  Agreed. True. Preach. Say it.

• 38:59Speaker 01

  Um, Knox 3125, America goes in and bombs sanctions Venezuela and Cuba. Venezuelans and Cubans migrate to America seeking a better life. The right, close the borders, cause and effect. That was their proposal.

• 39:11Speaker 00

  Sure, they're picking it up very late in the game. Let's talk about Venezuela going in, uh, booting out American companies, nationalizing everything, impoverishing their nation at a faster rate than virtually any nation in history has ever been impoverished. The part that people miss is that when leftist ideology takes place and everything that Drew just said is right, but it's the cure, it's not the disease. Leftist ideology is born out of resentment. It is born out of an overproduction of elites. Go back and look at the French revolution, go back and look at Marx. The whole problem is you try to get the workers to rise up and the workers don't rise up because they aren't filled with resentment. They are busy trying to raise their families, trying to work, trying to get things done, creating and making things. What ends up happening is you get to the point where you tell every kid that they need to go and be a part of the elite class, they need to go get an education.

• 39:56Speaker 00

  And so they go in and you get this surplus of people that take, in a modern context now, they take on an absolute metric shit ton of debt and they come out and they can't get a job that pays well enough to deal with their debt. And while they were in the education system, they were told over and over and over that this is an oppressed oppressor narrative. That's how the world works. The world is entirely about power. That's all that matters. And so everybody starts going, oh, wait a second, the oppressed are the good people? Then I need to figure out how I'm oppressed. And you'll get people that actually stand up and read like I'm the intersection of all these eight different things, like it, that shit is wild. But if you've been told that that's the only way to be a good, just person, which everybody is going to want to believe that they are a good and just person, then they're going

• 40:37Speaker 00

  to find if the dominant paradigm in education is that, hey, you better figure out how you've been oppressed, they're gonna come out wanting to say, well, shit, I'm a victim of the whole US fucking government. I'm a victim of capitalism. You gotta tear all this down. I'm a victim too, man. Regardless of the fact that my family's wealthy, like I come out of this and, and look, dude, Mom Donnie grew up fucking wealthy. Mom Donnie grew up in Uganda. Kids, do you know the story of Uganda? You think Israel is out of pocket? Ugandans, uh, Indians living in Uganda represent, I think 1% of the population and they control something like 60% of the economic dollars. That's Mom Donnie. Okay, that's what he comes out of, but still finds a way to be fucking oppressed? That shit is wild, man.

• 41:20Speaker 00

  When you tell people the only way to be good and just is to be oppressed, well, if I wasn't oppressed economically, then I've gotta be oppressed some other way. It is crazy. We are up against that. They are being taught that. They come out with that mentality. So yes, they then come out of that and they're in a position where they're gonna struggle in the economy because we're doing dumb shit, by the way, uh, doing things like increasing the minimum wage, throwing that into the trees so that people can't get a basic job as a teenager. Because as you raise the cost of that early entry labor, you start asking yourself, am I gonna give it to the person that doesn't know anything about what they're doing? Or am I gonna give it to the older guy that is gonna be a little bit wiser, uh, more emotionally mature?

• 42:00Speaker 00

  You also get into the inflation of it all where you make it such that inflation is running away, and I'll just really point at COVID here, you make asinine decisions to lock everybody down. And then on top of that, you pump way more money into the economy, even like people that wanted money pumped in the economy were like, hey, this is a lot, like a lot, a lot. And you put it in without creating more goods because everybody's locked up. So you've got fewer goods being chased by more dollars. You get 30% inflation that never comes back down and NIMBYism around housing. You've got the government wanting to get bigger and bigger and bigger. And how does a bureaucrat make their existence justifiable? They say we need more regulations.

• 42:42Speaker 00

  And so now you've got, not only have we told this stupid story about your house should be your biggest investment, for reasons I've explained ad nauseam, it's the only asset that people understand intuitively, but hey, just buy into that and things are gonna get better, which allows us to go over here and print money until the end of time because hey, you were supposed to get a house, not thinking through the fact that, well, that works for the people that have a house, but now you can't build a bunch of houses because if you do that, you're gonna either hold the value flat of the people that dig it in or lower the value. And so there are derangements everywhere you look. But if we try to say that having people come up through the system being told, you better find out how you're a victim and that if the easy way to be a victim is to have a race that isn't white and you're white, well, then you're gonna find something and capitalism

• 43:27Speaker 00

  becomes the easy thing. Well, I'm a victim of capitalism. And so now you get all the fucking overeducated white kids banging the drum as hard as anybody else about we have this problem. You, you have to defuse that bomb at the same time that you fix the economy. Nobody is paying attention and nobody who's being sincere will say that I don't talk about the economy. I talk about the economy non fucking stop. So it is, uh, the thing that I spend the vast majority of my time on, making sure that I can explain this to people and figure out for myself exactly to the fucking depths, bowels of the economy, exactly how this works, uh, so I can't be bamboozled. But man, you cannot solve just one of those problems because you will see the same loop play over and over and over if people are taught to make sure that they figure out

• 44:12Speaker 00

  in what way they are a victim. Taking a short break, but there's more Impact Theory after. Stay tuned. Let's talk about how much you're paying to stay safe online. Count it up. A VPN, a password manager, something to block ads and trackers? The service scrub your data off of broker lists, a tool to flag scam emails. That's five, five subscriptions, apps, logins, and most people still have gaps. That's the problem Surfshark solves. It's not a VPN. It's an all in one security suite, one tool that protects your connection, your personal info and your devices all at the same time.

• 44:52Speaker 00

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• 45:20Speaker 00

  Thanks for staying tuned. Now, let's get back to it.

• 45:24Speaker 01

  Everybody's favorite socialist, Mamdani, has announced plans for city-owned grocery stores. I know that there's a bunch of different speculation and things like that. They're starting one store right now. The goal is to have five by 2029. It's gonna start in the Bronx. I'm gonna say 2027 is the first year.

• 45:41Speaker 01

  I don't know if you wanna like jump right into it, or if you wanna kinda set the scene first.

• 45:45Speaker 00

  I'm happy to just skinny dip into this motherfucker. You could literally punch me in the head in the middle of the night, wake me up and say, "Talk about what's going on with Mamdani, the DSA in New York." And I would happily do it. Mamdani and the DSA are absolutely determined to achieve affordability, but they're gonna do it by emptying the grocery store shelves. Nothing costs money when there's nothing to buy. Unless, of course, you're a taxpayer. At that point, keep in mind that roughly across the US, I don't know if this holds exactly in New York City specifically, but across the US roughly 50% of people don't pay taxes. So for them, that's of little concern. They just want the lower prices. And so the distortions are going to begin.

• 46:28Speaker 00

  People don't understand the mechanisms of how a grocery store works. They certainly don't understand that running a grocery store is one of the notoriously most difficult things to run. It's like restaurants. It's just very thin margins, very hard to do. Now, what exactly is the DSA trying to do? You guys almost certainly know by now Mamdani is launching five state-run grocery stores. He's now put a bill on it, so it's gonna be a $70 million endeavor that are going to be paid by taxpayers. Mamdani has announced the five municipal stores will sell a core basket of goods. So all produce, all meat, seafood, dairy, I think there's like 20-odd staples. And he's gonna sell them all at 30% below retail. The way that the mechanism is gonna work is they're gonna recalculate the price every month for those goods, and then those prices will hold for the month,

• 47:13Speaker 00

  regardless of intra-month savings or swings, excuse me. So if something is changing within the prices in the middle of the month, it doesn't matter. Once they set it for the month, that's gonna hold. The city is gonna cover, for each of the stores, gonna cover rent, property taxes, and the actual build-out to get going. And then, of course, they're going to have to decide whether they're going to actually keep funding to buy things at a loss, which is almost certainly what's going to happen, or if they're going to let the store shelves get empty. Now, I think because the costs are from an incentive structure likely to just skyrocket. When you think about what a price signal is, is it tells you how to distribute rare goods. If you have a limit of something, the way that you figure out where those things go is by who's willing to pay the price.

• 47:58Speaker 00

  So the government is either going to say, "Well, we're only willing to pay this much for that core basket of goods," in which case, other stores are likely to bid for those items because they don't wanna hemorrhage people in their stores. So they either let their store shelves go empty, or they bid up. And so that's how there's gonna be this upward price pressure on all the things that the state-run stores are trying to artificially hold low. You get that upward pressure, and now both of those groups have to say, "Okay, well, do I just let my store shelves be empty, or do I lower my margins?" Now, the government stores have the ability to reach into the taxpayers' pocket and just say, "Okay, well, this is costing more than we thought. Originally, we thought it was gonna be 70 million." Think about the high-speed rail in California. Just because they say 70 million doesn't mean that that ends up being the price that they actually pay.

• 48:43Speaker 00

  So they are going to be forced to make that decision. So as the prices fluctuate, they'll have to make that decision. If they continue to expand and create more stores, and ask the taxpayer to foot the bill of increasing prices to make sure that the items are stocked on the shelves, then you can expect the surrounding stores to go out of business, which is causing a lot of drama. There are now... The government is being sued because the local bodegas around the state-run stores are saying, "This is gonna put us out of business. This is crazy." So we'll see how that part of this plays out. Now, the bad news is that in reality, you're going to have to deal with the fact that grocery stores run on extraordinarily tight margins. So we're talking 1% to 3%, and that's without the taxpayer as sugar daddy.

• 49:27Speaker 00

  Even if you zero out profit and say, "Well, the store doesn't need to turn a profit because it's backed by the state," even if you zero out rent, even if you zero out taxes, you're still not gonna be anywhere near the 30% on those core goods. So ultimately, the gap is gonna be the thing that the taxpayer has to close. Some people are looking at it and saying, "Well, it's good that they're going to run this test." And by the way, this is a test we've run before. But they're gonna have to run this test so that they can see that state-run anything isn't something that's going to work. And by showing people firsthand, by letting them run that test in these very small ways, people will be able to see what actually happens. The thing that frustrates me to no end about this is that we've already run tests just like this elsewhere. So in Baldwin, Florida, they opened a city-owned store in 2019.

• 50:12Speaker 00

  They lost $61,000 in year one, and then they lost $178,000. Ended up closing in 2024. In Erie, Kansas, they bought a state-run grocery store. It was the only grocery store in the area, if I'm not mistaken. So you would think, if anybody's gonna be able to make this work, they don't even have competition, that's gonna be driving those prices up. But the mayor needed $50 a month per customer. He only got 14. The city ended up leasing it out, and now it's scheduled to close. There is one in Atlanta that's claiming to be working well, but I would need to do a deep dive on that to see if it really is or not, because you can hide a lot of sins when you have taxpayer dollars behind you. But they are claiming that they're gonna be opening a second location soon.

• 50:56Speaker 00

  But ultimately, no store can escape the reality of needing to turn a profit or receive tax dollars to cover the shortage. And when you've got profit-run grocery stores that can't stay in business, you're in real trouble. And the question I want everybody to ask is very simple. What are the odds that a government bureaucrat is going to run a grocery store more profitably than Walmart? I don't need you to believe it's gonna run it more profitably than the local bodega. It's possible the local bodega is being run by a moron, and that's why they're locked into one local store. They haven't quite figured it out, so they're always just scraping by. But the odds that a government bureaucrat can outperform Walmart is zero. Not unlikely. It is zero. The reasons are very complicated, but they have to do with the way that the human mind works,

• 51:39Speaker 00

  which is if I'm really, really good at something, I expect to be compensated for that thing. And by the way, I can aggregate power as I go in and negotiate. And so when I'm running something profitably and have a strong price signal and have extraordinary talent at running my business and knowing exactly how to get by on those margins, and build something where I can raise debt through the public markets, all of a sudden, you have an advantage that the government is never going to be able to have. The government is just going to paper over all the problems. They're going to be undisciplined because they have an endless supply, roughly, of taxpayer dollars. And so it becomes a very different ballgame that creates very different outcomes, which we have seen play out over and over and over and over and over. Now, the thing that I really wanna wake people up to

• 52:22Speaker 00

  is that you don't have to go far to figure out what the DSA's real mission is. Just read the DSA program that was released on July 14th. "Food, energy, medicine, and transportation, according to them, should not be for-profit businesses." Now, this is one where Drew, please, if there are people in the comments that are all for this, then we need to go into what I've been alluding to briefly here. This idea of price signal, what it does, profit, human psychology, why people work as hard as they do, what they need in order to pull that off. We can show China and exactly how they've run this experiment and proven this is true, including all the things they do, taxpayer fund, and what that does, and what that looks like, and how you have to keep that going.

• 53:04Speaker 00

  When you have the DSA saying that they want those things that I just listed to be common goods, you run into a problem where you end up with a whole bunch of public ownership of the largest corporations and essential industries, which means that taxpayers end up paying for unprofitable businesses. Now, you get what are called zombie companies if all you do is make loans too cheap. Now imagine, and this is a whole thing in Japan. We can talk all about the Japanese zombie companies and how one of the big fears everybody has about them raising their rates is you were gonna see a rash of companies filing for bankruptcy because they were never profitable companies to begin with. Now, keep in mind, they couldn't lean on the taxpayer, and they still got themselves into zombie status, meaning that they don't make enough to run their business

• 53:47Speaker 00

  without constantly bringing on this extraordinarily cheap debt. Meaning, the public does not care about the things they make enough for them in their current state to actually stay viable. It's what's known as being default dead. So a zombie company is default dead. Once the cheap debt goes away, the company is going to die. When you have state-run entities, they are also likely to be default dead. Without the taxpayer dollars, they are simply going to go out of business. That means you have something that is poorly designed. It has an extraordinary leak in it. And you make that leak very difficult to detect by stealing, in my words, from the taxpayers and just constantly putting enough new money into the system that you can't notice that it's actually a default-dead organization.

• 54:32Speaker 00

  And by the way, the DSA wants to go way beyond that. If you haven't already, watch the appearance of the DSA co-chair on Fox News. This is crazy. Drew is right. Every Republican is gonna play this as a midterm ad. I legitimately thought we were being trolled. I thought that Meghan Romer was for sure a plant, that she was not actually part of the DSA. But she is. Cannot believe that's true. But she talked openly about wanting to abolish the Senate, abolish ICE, abolish borders, abolish prisons. Absolute insanity. The real question people should be asking themselves is, okay, they're weaponizing something very real. So the DSA is weaponizing the fact that things have become unaffordable. What's the reason that they give you that things are unaffordable? Billionaires and people that run corporations are greedy. Cool. That's their stance.

• 55:16Speaker 00

  Now, what's the reality? COVID drove... Prices up by thirty percent. How did covid knowingly do that? Meaning, how do we know that it was covid? We know it was covid for two reasons. One, we printed money like there was no tomorrow. You can just look at the M two money supply. It goes in an almost vertical line, straight up. It's pure insanity. And they did it in a way that was likely to be spent, which means it's going to be maximally inflationary because those dollars are now going to be chasing the goods that are out there. Cool, that was already bad enough. But on top of that, they shut the global economy down by killing supply chains. So now you actually have fewer goods being chased by more dollars. It is the perfect nightmare. And now, on the other side of that,

• 56:00Speaker 00

  because of the way that increases in cost work, it's always like all these different little pieces. Everybody raises their prices. And so people don't just then lower their prices. So once the prices go up, you're basically setting a new normal. And barring some sort of catastrophe, those numbers aren't going to come down. Prices went up, they should have known they were never going to come back down. And so you put yourself in a position where workers, workers must be empowered. Okay, real wages have to go up. If if we want out of the current unaffordability, the only thing politicians should be talking about is, how do we get prices down? And how do we empower workers to get wages up? That's it, housing, we'll set that aside for now. But if you look at those two things, state-run grocery stores do not address either of those.

• 56:46Speaker 00

  So all you're doing is creating scarcity. So you're gonna have a hard time just keeping your shelf stock. We've seen this over and over and over and over. That's gonna be the way that this game plays out. It isn't addressing the underlying cause. It is like you have a brain tumor. And instead of going, hey, we should probably get treatment for the brain tumor, they're just giving more and more Tylenol. That shit is crazy. So you might be able to mask the symptoms, but you're still going to die of the brain tumor. And that is the solution that they're putting forward.

• 57:19Speaker 01

  Somebody said in the chat, how are we talking, saying that communism doesn't work, but China is our biggest threat? What are they doing right that we are not, are missing by trying to implement these policies locally?

• 57:30Speaker 00

  They're not doing communism. China's not a communist country, no matter what they tell you. So they may call themselves the Chinese Communist Party, but they are not communist. Let's say that we just go, cool. Tom, show me how the DSA, doing a Chinese model, isn't gonna be better for us. And what I will say there is, there's no universe in which I want to put myself in a position where we are living under authoritarian rule, where you have, according to reports, a million people in concentration camps. Okay, please don't lose sight of that one. That you have some of your most successful business people, they get disappeared for making a comment right before Jack Ma Alibaba did its IPO.

• 58:14Speaker 00

  He complained about the way the banking system was working. They kidnapped him and reeducated him for a few months and then released him back into the world with a totally new attitude. Now, if you guys want the government kidnapping people and all of that, then we just live in very different universes. And what I want you to do is run the scenario where you hate the person in power as much as you hate Trump. And now Trump is the one, or the Trump-like figure is the one getting to disappear people in the middle of the night. Because I know you're imagining it, that you love the person, you like what they're doing. That, to me, is one of the biggest, most important differences between the Chinese model and the American model. America is predicated on freedom, and China is predicated on authoritarian rule.

• 58:56Speaker 01

  All right, this is from one of the DSA consult, one of the Mamdani's consultants. So for those that don't know, the New York City is running a RFP right now, request for proposal, for people to run this store. This will not be city-owned, operated. And this was some stuff from the RFP that the consultant posted. The stores will be run as a public service, not for a, not as a for-profit. The typical profit margin, one to three percent, will be folded into consumer savings. I want to highlight this because this is profit margin, not gross margin. I think some people are conflating the two. The stores will be operated by a private sector expert, either a supermarket chain, a grocery cooperative, a nonprofit operator, a retail services cooperative, or a wholesaler with a retail arm. The stores will not be operated by the city. A core basket of pantry items will be discounted at thirty percent to market prices.

• 59:40Speaker 01

  This thirty percent typically covers the gross margin, operating costs such as labor, utilities, G and A, etc. While rent and taxes will be covered by the city. The subsidies will be calculated through item-level discounts multiplied by unit volume sold, the same way promotional discounts are calculated for grocers by their trade partners. This is a straightforward calculus for experienced operators. The subsidies are approved through the city budget, just like public transport, transit, libraries, sanitation stores, etc. That was crazy. The stores will not be food pigs or pantries selling donations or leftover food waste downstream from producers. They'll be offering the freshest, best-quality products. Good food should be a public service. The store employees will be paid living wages and have significant labor protections. Their stores will have a mix of, will sell a mix of branded items, private labels, and locally grown products geared to the specific communities

• 1:00:25Speaker 01

  and market they serve. Lastly, the stores will be thoughtfully designed, laid out and merchandised out so that cash-strapped New Yorkers have a premium shopping experience.

• 1:00:34Speaker 00

  Okay, so what in that felt important to read?

• 1:00:38Speaker 01

  The actual breakdown of how everything was specified.

• 1:00:41Speaker 00

  So why? What does that tell us that we didn't already get?

• 1:00:46Speaker 01

  That it's not operated by the city. I think that that's important, that the thirty percent is a discounted retail price.

• 1:00:51Speaker 00

  But out of curiosity, so given that economics works on physics, the only thing that this says is, hey, we're gonna try to bring somebody in that even with this thirty percent discount is somehow going to be able to run the store in like an ahistoric fashion.

• 1:01:08Speaker 01

  Your first claim was that, well, who can run a store better? A Walmart person or a government official? You're right, a Walmart person would. So that's why they're trying to get a Walmart exec or a private service expert, or somebody who was in that grocery operator arm, or somebody who's been in this space to come and take over the grocery store.

• 1:01:25Speaker 00

  Yeah, but if you go to Walmart and you say you have to take a thirty percent bath on some of the most important, like core basket of goods.

• 1:01:35Speaker 01

  The thirty percent bath, though, I think is, that's the part that I think we're conflating because that typically covers like the gross margin. And that's why he said it's a specific pantry of items. So there's a thousand items on there.

• 1:01:45Speaker 00

  I feel like we're saying words that don't actually mean anything.

• 1:01:50Speaker 01

  Okay.

• 1:01:50Speaker 00

  So if you have one store that has to sell the core basket of goods that people come into the store for at a thirty percent, even gross margin discount, people that don't have to do that are already at one to three percent margins. That means with all the discounts and all of that, assuming that the basket of goods that we read off is gonna make up, I mean, Jesus, sixty percent of the store sales? It's gonna be a lot. So unless they're gonna make up money on lottery tickets and fucking cigarettes, these guys are in a position where the primary goods, which is why they're discounting them, the primary goods, they come in at what any operator is gonna tell you is, I, I'm not gonna be able to make that work. It's, it's way too big of a discount. Even with all the like gimmies that you're giving me,

• 1:02:35Speaker 00

  it's nowhere near the thirty percent on the, and I'm making up the sixty percent number. It could be more than that. But off of those goods, that's not going to be enough because we're already gonna be, if I could charge the normal price, I would already be at one to three percent margins, profit margins. So now that number is gonna go down. Anybody that can operate on a one to three percent margin is already like, that's gangster level. So now the question becomes, when you put that kind of headwind against them and say, okay, the thing that you would usually use to actually achieve your one to three percent margins, you can't. Not only are you not gonna be able to achieve your one to three percent margin, I'm gonna put you underwater. And you might be underwater by fifteen percent.

• 1:03:16Speaker 01

  I mean, but the largest budget item on any small business, any household budget expense is usually rent taxes. So they're not having to pay rent. They're not having to cover the taxes.

• 1:03:26Speaker 00

  That's patently false. So the, the largest cost is always and forever going to be the cost of goods. The cost of goods and your employees. Like, those are your two big costs, mahusively. Now, when you start like filling a grocery store is going to be far more expensive than the rent. So when you start looking at like, they're losing money every time they sell. So now, the more successful the store is in sales, the deeper the hole becomes. So now it's like, you get back to, I've got to clear the shelves because I'm in a position where I lose money every time somebody buys fish, whatever. It was one of the many things, or produce. I am losing money. So now, the only way these operators, this is why I'm saying, none of that matters. The only thing that matters is,

• 1:04:11Speaker 00

  who is paying for the gap? And the gap is being paid for by the taxpayer. If I'm in a position where the store actually loses money every time they sell one of those goods, now we're underwater. So unless you show me something that says, no, no, no. What, like here, if I'm going to work with the DSA and I'm gonna say, listen, I'll tell you exactly how to make this work. It's gonna be absolutely atrocious for the taxpayer. And long-term, it will be terrible for the five boroughs. But you're gonna be able to message this to the public and it's gonna look great. So you're going to bully all of your distributors. And you're gonna go to them and say, listen, we're in the business of putting all the other bodegas out of business. So we're starting with five. This is ultimately gonna be a hundred percent. You fuck me now at your own peril.

• 1:04:55Speaker 00

  So you are going to give me the best prices, period, end of story. And I'm gonna give you a guaranteed buyer. So your margins can either go up with me over time and I'm gonna have the taxpayer cover it, or they can go down and I'm going to pick the distributor that gives me the deals that I need. And by the way, you're gonna go negotiate with the suppliers and you're gonna let them know the same thing. They can have a guaranteed buyer in the state or they can fuck off and I'm going to cock-block them at every possible opportunity. I'm gonna fly people into wherever we're getting our fucking bananas and shit. And I'm gonna start negotiating with those guys directly as the state, backed by the taxpayer. That's how you pull this off.

• 1:05:35Speaker 00

  It ends up being absolutely god awful for everyone involved because the state now has the power to make sure that everybody along the way is losing money. I remember there's a story about Walmart putting Vlasic Pickle out of business. Now, this could be apocryphal, but it certainly illustrates what ends up happening. So Walmart, and I know this from selling into Walmart, Walmart has margin expectations as the state will have. So let me tell you how Walmart pulls this off. They go and everybody that comes into them, they say, listen, we've got the power because we're so big. They are what they refer to as a kingmaker. So if we put your product on our shelves, we just made your brand. So you're going to give us a deal better than anybody ever of all time. Guess what Quest did that made me so fantastically wealthy?

• 1:06:18Speaker 00

  For over a year, we told retailers like Walmart to fuck off. We weren't going to give them the margin because we had so much consumer demand for our product, we could just say no until the margins were good enough for us to be able to survive. Okay, go back to Vlasic Pickle. So Walmart says, hey, we're going to put you on our shelves. We're the place you want to be. And the margins were so tight, something happened again, this could be apocryphal, but something happened in the supply chain for like the cost of their lids. And by the cost of their lids going up by 5% or whatever, Vlasic Pickle, which had been around for over 100 years, goes out of business. Now, does Walmart give a shit that Vlasic Pickle went out of business? No, fuck them. They just move on to the next one. But if you want to understand why all of a sudden people start importing cheap labor,

• 1:07:01Speaker 00

  they do it because you've got a company, in this case, the state, driving your ability to charge a living wage for your employees' time and your product down, down, down, down, down, because they're just trying to make sure that a New Yorker can walk into the grocery store and get shit cheap. But you've got to fuck somebody in that chain. You can make it seem like the cost of this stuff is just going away. It is not going away. These things operate on physics. There is a cost for the labor to fucking pick the plantain. Somebody has to ship the plantain, the cost of the oil, all of that is going to go into this whole chain. And for them to make that, because remember, this is 30%. So prices are rising out here.

• 1:07:45Speaker 00

  That 30% becomes a taxpayer burden that gets big in terms of nominal fucking dollars. So now they're on this constant hamster wheel. So they're very quickly going to realize, fuck, I've got to control my prices because otherwise the bill to the taxpayer, it just becomes too obvious. And the way that they will do that, they will bully the fuck out of everybody in that supply chain, or they're going to go out of business. But like, it is, if I were evil, I would just go sit down with them and be like, kids, you gotta fucking throw your weight around. And so you want to get as, you want to get the DSA fucking in as many places as you can, get as many state-run grocery stores as you can, and now we're going to do collective bargaining and we're going to fucking wrench all these guys down. And now all of a sudden, some plantain grower in South America is like, used to be living

• 1:08:30Speaker 00

  on a dollar a month, now he's living on 50 cents a month. And so this shit operates on physics. The only way to make this stuff go away is innovation. That's it. You find some way to get more for what you do. Can be in logistics, look at Amazon, absolutely incredible what they've given the world. You can hate them all you want, but holy shit, unbelievable efficiencies that they've gotten from a logistical standpoint. So when you have somebody innovating, you can start driving prices down. The government is not incentivized to innovate because they have no price pressure. They don't have to be profitable. They don't get to keep their house based on whether or not they run the grocery store successfully. They get to keep their house based on whether they get taxpayer dollars.

• 1:09:14Speaker 00

  So this, this one is wild to me. People need to show me where in that chain is the government going to find these additional efficiencies. They're not. They're going to either take from the taxpayer or fucking coordinate and bully. That's it. Those are your options. Let's talk about a pattern that is guaranteed to be killing your progress. You know what you need to do. You need consistent nutrition. We all do. You need vitamins, probiotics, greens. We all know that we should be doing more of it. When your morning gets chaotic, you skip it. When you travel, you skip it. When your routine breaks, everything tends to break and that inconsistency compounds against you every single day. AG1 is designed to solve the execution problem. One scoop, eight ounces of water, and you're done.

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