Episode Summary
Executive Summary: Pivot centers on tech and politics: Apple’s FaceTime/privacy misstep and its clash with Facebook over app certificates, Facebook’s deeper strategic integration across WhatsApp, Instagram, and the core app, and the company’s strong earnings despite trust issues. The hosts also debate Howard Schultz’s presidential ambitions, billionaire tax avoidance at Davos, and likely 2020 political fallout around Trump, shutdowns, and a national emergency.
Main Topics: Apple’s FaceTime privacy bug and Facebook’s certificate violation (Priority: 5/5): The hosts discuss Apple’s FaceTime glitch that briefly enabled eavesdropping, then move to Apple’s punishment of Facebook for using enterprise certificates in consumer-facing ways and for collecting teen data through an app. Facebook’s power, trust deficit, and internal integration strategy (Priority: 5/5): They argue that Facebook’s real story is its backend integration of Facebook, Instagram, and WhatsApp, which may strengthen the company structurally even as it remains distrusted and politically toxic. Facebook’s business strength versus public backlash (Priority: 4/5): Despite scandals and reputational damage, they contend Facebook remains a dominant advertising platform with strong earnings and little sign of business deceleration. Howard Schultz and the risk of third-party spoilers (Priority: 4/5): Schultz’s independent presidential run is criticized as likely to split centrist/anti-Trump voters and help reelect Trump, despite his civic-minded intentions. Davos, taxes, and billionaire wealth concentration (Priority: 5/5): Rutger Bregman’s call to focus on taxes instead of philanthropy sparks a broader argument about how the tax code favors capital owners and wealthy asset holders over wage earners. Trump, shutdown politics, and the coming national-emergency fight (Priority: 4/5): The hosts predict no repeat shutdown, expect a national emergency declaration attempt over the border wall, and discuss how overexposure and fatigue may hurt Trump politically.
Key Arguments: Facebook is on a reputational "probation," so any questionable move is interpreted as malicious, but that does not necessarily reduce its business power. Apple and Facebook are engaging in a personal vendetta more than a principled policy battle; Tim Cook and Mark Zuckerberg reportedly hate each other. The most underreported tech story is Facebook’s backend integration of Instagram, WhatsApp, and Facebook, which could make the platform harder to break up. Facebook’s ad tools and market position make it a "juggernaut" and a duopoly partner with Google, with no clear evidence of business deceleration. Howard Schultz’s independent run is likely to act as a spoiler in a two-party system, similar to Ross Perot or Ralph Nader. Billionaires and capital owners often avoid taxes through capital gains treatment, borrowing against shares, and wealth transfer structures. The tax debate is more nuanced than simple anti-rich rhetoric because high-earning wage earners can already face very high effective tax rates. Trump may be politically weakened less by policy than by exhaustion and public fatigue with constant conflict and scandal.
Data Points: SoFi refinance rate: as low as 4.24% APR - Ad read describing student loan refinancing terms. SoFi member count: over 580,000 members - Ad read citing user base. SoFi refinancing volume: more than $50 billion - Ad read citing cumulative refinanced amount. Apple earnings reaction: pretty earnings; people were not thrilled - Discussion of Apple’s week amid the FaceTime privacy bug. Facebook teen data app usage: about 10% - Scott notes roughly 10% of the people in the research app were teenagers or under 18. Facebook stock move: up 13% - Scott says Facebook stock rose sharply despite scandals. Amazon Media Group advertising revenue: over a billion dollars - Scott says Amazon ads are becoming a major third player. Effective tax rate in high-tax states: between 48% and 52% - Scott’s example of high-income wage earners in New York or California. Top 1% stock ownership: 50% of the stocks - Used to argue capital gains taxation favors wealthy asset holders. Government subsidy to Amazon: $3 billion - Example of public incentives to attract Amazon. Jeff Bezos ownership stake: 16% of the company - Used to estimate how subsidies can indirectly benefit him personally. Possible personal benefit from subsidy: $500 million - Scott estimates Bezos’ indirect gain from the Amazon deal. Potential top marginal tax rate discussed: 70% - Debate over whether Democrats should advocate a higher top rate. Trump support target: anti-Trump centrist voters - Concern that Schultz could siphon votes from Democrats.
Pivotal Quotes: "I think it's actually kind of a little bit of a nothing burger." — Scott Galloway: On Apple’s FaceTime privacy bug. "The most underreported story in tech right now and the bigger deal that no one's talking about is Facebook's integration of their back end among WhatsApp, Instagram, and the core platform, Facebook." — Scott Galloway: On Facebook’s strategic consolidation across its apps. "The answer is very simple. Just stop talking about philanthropy and start talking about taxes. Taxes, taxes, taxes." — Rutger Bregman: At Davos, arguing that tax policy matters more than corporate charity.
Implications: Facebook remains a powerful ad monopoly-like force even under intense scrutiny, while regulatory pressure may shift toward antitrust and integration concerns. Schultz’s candidacy could reshape 2020 by splitting opposition votes. The tax debate is likely to intensify, especially around wealth and capital gains.
About Pivot
With great power, comes great scrutiny. Every Tuesday and Friday, journalist Kara Swisher and NYU Professor Scott Galloway offer sharp, unfiltered insights into the biggest stories in tech, business, and politics. They make bold predictions, pick winners and losers, and bicker and banter like no one else. From New York Magazine and the Vox Media Podcast Network.