8-27-25 - 9am - Intel & The Government and Ketanji Brown Jackson

Episode Transcript

Speaker 1 (00:00):
Michael, just their small request, could you please try to
say besten Scott bestent, not assent, Thank you very much.

Speaker 2 (00:14):
No, I won't make any attempt to that at all
if it if it bugs you when I either purposely
or mistakenly mock somebody's name, who was I making fun
of the other day? That oh Zoe fram mom, Donny,
people get upset about that possibady that cares. I don't

(00:36):
go back. I want to finish this part about intelligence.
I think it's really important because they're at this is
kind of like the flag story. I confess that when
when I first heard that he had signed the executive order,
in fact, we had a talk back. I think at

(00:57):
the very very beginning of the show, didn't we dragging
it said that he had fallen for it too, that
it was hey, Trump had outlawed flag burning, and that
wait a minute, he can't do that, And then when
you go into what the executive order really says, it's
really a lot different. When I heard that we had

(01:18):
bought ten percent of Intel, that caused me to wait,
wait a minute, what are we doing here? Are we
going down the road to Marxism or fascism? Or are
we going to own Intel? Is that what we're going
to do now? Well, interestingly, the more I dig into
it and understand the features of the deal, there are

(01:40):
several kickers in here, and there's several restrictions in here
that caused me to go okay, now, as so bad
as I thought it was, I still, however, am concerned
because those on the left that are critical of this,
of course, they're going to be critical of everything that
Trump does. Right, so he's either gone too far he
hasn't gone far enough. In this case the left, he

(02:02):
thinks that he hasn't gone far enough. They claim that
if you're going to buy nine point nine percent of Intel,
then you ought to have a public stake in it.
You ought to use that stake to leverage to make
sure they do job creation. I guess just you just
hire people and give them do nothing, you know, know
nothing work jobs. And they went to of course, curb

(02:23):
executive paid because CEOs are just paid too much. So
all their corporate bull craft that they usually throw out,
I mean, this sounds like Elizabeth Warren, right, It sounds
like Elizabeth Warren or Bernie Sanders or alc All bitching
about corporate America which I did in the first hour,
but for an entirely different reason, they misunderstand the policy.

(02:45):
But my concern is, and my concern remains the same,
even when I tell you all the details of the agreement,
that a Democrat president might do the same thing, but
then they would take it a step further and not
have the these restrictions that we have on our shares
as taxpayers and just say to a sum company, oh,

(03:07):
you want money from us, then give us control of
your company, or you know, don't even need control. All
you need is ten percent. Because most companies you own
ten percent of you can pretty much influence exactly what
they do. So let's think about the purpose of this.
It's not to micromanage Intel. It's just to ensure that

(03:32):
we don't lose out when we put taxpayer money at risk,
because they still have if this money came from the
Chips Act. That's our baseline. The Chips Act restricts them
on using any of that money for stock buybacks, and
the Chips Act requires them that you're going to you

(03:52):
are required to use this money to expand your facilities.
So there are the grant itself. I've already had restrictions
on it. Now, the equity portion that's the grant money,
but the equity portion where we get shares sits on
top of the pre existing grant obligations. So that ensures

(04:17):
that if Intel shares go up, well, we see a
direct return well, and obviously the opposite is true. If
Intel goes down the crapper, we lose our money. Now
before you get upset about that, which we should be,
which causes me to still have some heartburn about this

(04:40):
whole deal. I get the restrictions, I understand what he's
trying to do, but I just it gets to why
are we giving private sector grants anyway? I don't think
we ought to be giving NGEO grants. I don't think
we all to be giving private sector grants. I think
we ought to be spending tax payer money on inherently
taxpayer are inherently governmental functions. Here's such something I think

(05:05):
is pretty ingenious what Trump's done. Though, if Intel ever
attempts to sell off more than half of its chip
making business, the foundry business, which is the heart of
the chip making business, we have a right to buy
an additional five percent at twenty dollars a share over
the next five years. Well, that's a deterrent. INTEL knows

(05:27):
that if they spin off or sell control of their
foundry operations, that would trigger dilution, and that would hand
even more ownership to the government, giving us even more control.
We would exceed the ten percent, and now we could
start actually doing those things that I don't want us
to be doing, and that's engaging in corporate governance. But

(05:49):
the clause does discourage Intel from undermining the very strategic
capacity that these subsidies, these grants were meant to preserve.
To put it in an other way, it is a
stick cleverly designed to keep the company aligned with our
own national security goals without government oversight. I take that

(06:12):
at face value. I think that is true, but I
still worry about what would another administration do if they
were presented the same circumstances. Could a progressive white House.
Could a Marxist white House i e. Of Biden or
an Obama white House use this to impose their own

(06:36):
ideological conditions. That's a legitimate concern. But on the other hand,
playing lawyer here, it ignores two key factors, and the
first factor is the arrangements that we're doing right now.
The arrangement that Trump's doing right now are transparent and

(06:57):
they're contractual. The alternative, the second point would be the
alternative is worse because without the equity steak that we have,
the government just hands out billions billions of dollars, no
strings attached, and it has done that countless times in
the past. I think the poster child for that is Cleindra,

(07:18):
the solar panel company. Gave them billions of dollars and
they go bankrupt. At least, at least with Trump's approach,
the taxpayers, the government actually has a tangible asset that
can be sold. Now, what I haven't figured out is

(07:39):
the the issuance of the additional stock. I don't know
whether that's common stock, whether that's a restricted stock, special stock,
whatever you want to call it that if they ended
up in bankruptcy, are we left holding the bag? Like
you know, I'm a common shareholder. I was at one

(08:01):
time a common stockholder of United Airlines. They go bankrupt,
stock becomes worthless. I was a common shareholder. In fact,
I am once again shows how stupid I am a
common shareholder of iHeartMedia. When it went bankrupt, those shares
went to zilch. They weren't worth much anyway. But they
went to Zilch. So if they were trading at eighty

(08:23):
five cents a share the day after they filed Chapter eleven, boom,
that common stock goes away. They issue new stock, And
of course I bought that stock simply because I want
to know the financials and I want to know the
company that writes my paycheck. I want to know what
they're doing corporately. So I'm an investor in this company.

(08:43):
But these arrangements with Intel, as I say, are designed
to be transparent and contractual, pass even limited no governance rights.
But the alternative is still worse because without the Equity
States stakes, we continue to hand out billions of dollars
those strings attached, as we've done in the past, slenders
the example. At least with Trump's approach, We're holding a

(09:06):
tangible asset that can be sold and can generate a
profit instead of a loss. There's no restriction on when
we sell. So if the stock suddenly, you know, does
a gigantic rebound and doubles in price, well maybe we
ought to take our profits and walk away. Then I worry.

(09:27):
See I go back and forth. I've been guilty of
this stock that I really believe in. It keeps losing, losing, losing,
and I keep thinking, I keep leaking at the fundamentals. Well, okay,
but I think if they do this, if they do that,
if they do this, if they do this, it will
at least stabilize. It never stabilize the next thing on
those it's just it's just it's just lost everything. Maybe

(09:51):
not to zero, but it's gone, you know, from ten
dollars a share to a couple of bucks a share. Well,
a future administration could act like do if they've got
some emotional attachment to the stock. But I'm not sure
that's a reason to reject a policy that, at least
in this case, looking at the entire spectrum of how
we hand out money is at least fair and more

(10:12):
accountable than what the status quo is. And again contrasts
that with Solendra five hundred million dollars in federal loans
during the Obama years and Slender collapses and taxpayers lose everything,
lost everything, private investors were shielded from that fallout. That's

(10:33):
the old model, all the risk, but none of the reward.
Trump's model at least ensures that if a company succeeds
after taking taxpayer money, the public shares and the benefit
radical I'll leave that up to you. Common sense if
we're going to hand out money, If we're going to

(10:53):
hand out money, this makes more common sense than what
we've been doing. What we've been doing the past. We
are not investing in foreign state owned enterprises. China and
Europe do that. We're not picking winners and losers arbitrarily.
We are saying that if we're going to spend money

(11:15):
on an industry, particularly a national security industry, then we
should spend it in a way that builds capacity in
this country and rewards the taxpayers. Because if Intel thrives,
the value the stock's going to increase and the treasury
can sell those shares at a profit. Now, one detail

(11:35):
I'd like to see is if we sell that a profit,
apply that to the national debt, or selfishly give me
a tax rebate. If Intel pays dividends, we'll share in
those payouts too. Well. That aligns the interests of Intel

(11:56):
with us as taxpayers think about a subsidy or government loan,
our interests are never aligned. And then I think there's
probably a deeper philosophical point capitalism at large risk and
reward go together. Private investors risk their capital, They reap

(12:22):
profits when they succeed, and they lose their investment when
the company does not succeed. They know whether you're a
sophisticated an investor or an unsophisticated investor. I would hope
you at least understand that very basic point. When the
government acts as the investor of last resort, as we

(12:43):
did in the financial crisis or in the bailouts, and
then again with the Chips Act, we assume the government
assumes the risk on behalf of the taxpayers. To deny
taxpayers a corresponding chance at a reward if it is
successful is a basic violation of capitalism. Trump's Golden Share

(13:09):
policy is an attempt to restore that balance. And just
as a footnote here, I think the other thing Trump's
doing because I don't think that the money will ever
be applied. They share the Intel stocks at a profit,
they double their profit. I don't care they triple their profit.
I don't think they'll apply it to the national debt,

(13:29):
nor do I think that we'll get a rebate on
our taxes. I think it'll be used to establish a
sovereign wealth fund. I think that's what Trump is really
after here. I don't necessarily have a problem with that.
A sovereign wealth fund that we can use in times
of emergency, or we can use in times of national

(13:50):
security problems where we really need something done or we
want to bring you know, we go through another COVID
crisis and we realize that we really do need to
invoke the Defense Production Acts. We got some money over
here where we can actually pay a company to start
producing the pharmaceuticals that we need until they can get
up and running on their own or whatever. Yeah, I'm

(14:11):
probably for that now Wall Street. You read the journal.
They're complaining that these deals create uncertainty, that foreign investors
would shy away from a company where the United States
taxpayer is an investor. But I find that to be

(14:31):
a non starter because the reality is that foreign investors
already contend with sovereign wealth funds and countries like Singapore
and Norway that already hold large corporate stakes. And just
because if they look at the details of our investment
in Intel, it's really no different than the private sector

(14:53):
getting involved. Because there are some restrictions relate to this
name about sovereign well by limiting ownership to under ten
percent by legally keeping our role as passive. They're taking
a slow, step by step, measured approach. And it's not

(15:15):
a wholesale transformation of capitalism. It's more of a pragmatic adjustment.
And it's designed and it has it has certain restrictions
in there to prevent abuse and ensure fairness. Trump said
it himself, if we're going to give you the money,
we want a piece of the action. That's the businessman

(15:36):
in Trump. You always wanted a businessman to be president.
He's acting like a businessman. Oh you went a grant,
We went a piece of the action. Washington has not
thought that way for as long as I've been alive.
It's dealt in corporate welfare, handed out corporate welfare checks

(15:57):
while getting absolutely zilch and return Slutnik and Bessent Pasdant.
Guided by Trump's instincts, they're changing that. They're actually acting
as businessmen. Also, now, what if this proved successful, you

(16:18):
could do it in other critical areas, rare earth minerals,
advanced manufacturing, AI, any number of things. Now, not every
grant or subsidy needs to be tied to equity, but
where billions of taxpayer dollars might be at stake. I
think it's irresponsible to not at least consider it. It's
an entirely different way of approaching this idea that we're
going to take taxpayer money and hand it out somebody

(16:42):
on the grand The only truth about most grants, Oh,
there's an audit here or there, but there's never really
an audit that says, did our investment, did our transfer
that money to X y Z company me? Did it
have the intended effect? Did it really create jobs and growth?

(17:06):
Did it produce more taxpayers? Did it actually have a
beneficial economic impact? Nobody asked those Mike.

Speaker 3 (17:18):
Prior to Obama agreeing to guarantee that five hundred million
dollars ow, Soleindra had shopped their business plan to every
private equity firm and every large bank in the country,
and they all turned them down. These are the same
firms that hire the best and the brightest mind set
of business schools. How arrogant was it of Obama to
think that he was smarter than all of those firms combined.

Speaker 2 (17:41):
Well, as somebody says on the text line which I
want to read, I want to skip the first part
of this text message, but do you think that Soleindra
was as you point out, every private equity firm turns
them down. Do you think that it was really designed
to succeed or was this really more of let's throw

(18:05):
up a really nice picture and try to show how
Solar is the next big thing and Obama just pours
money into it because they're Democrat donors and he doesn't
care whether it goes belly up or not. They get
their salaries, they get whatever bonuses they got from achieving

(18:29):
the or receiving the grant, and then they just let
it go into the crapper and walked away with the money. Yeah,
obviously they didn't walk away with five hundred million dollars.
But it operated the same as an NNGO. You get
the government money, you pay yourself giant salaries. You then

(18:50):
hire contractors. You don't really have a whole bunch of employees.
You have maybe ten, fifteen, or maybe even one hundred employees,
but they don't really do the work. You hire contractors
to do the work because then you can take the
grant money and flow the grant money out to the
contractors and it's all used to pay off your Democrat
buddies or for that matter, your Republican buddies money laundering.

(19:14):
But here's here's the first part of this message from
fifty eight to eleven. Michael, You're wrong on the Intel
thing at a pretty fundamental level. But I'm really here
just to address Cylindra. Well, no, wait a minute, So
I wrote Goober fifty eight eleven back and just said
I'd like to know your analysis anytime that you think

(19:37):
that I am wrong in my analysis, Michael Brown, adiheartmedia
dot com. If you can't put it in you know,
whatever the limit is in the text line. If you
can't do it there, send me an email, because I'd
like to understand why it is that you think I'm
wrong about Intel, particularly when you say at a pretty

(19:57):
fundamental level, because I think understand exactly the details of
what was put together here and what the ultimate objective
is and why they did it this way. And I
also know the risks, as I think I pointed out
the risks a Democrat administration comes along, they will want
to control the means of production. And I think that's

(20:18):
the giant risk that makes me vacillate back and forth.
And whether I could absolutely say whether or not this
is a good deal or not, I understand it, but
I got qualms about it. Interesting. Remember how I mentioned
Justice Brown the other day, Jackson Brown. You know, I

(20:42):
went back and I read the opinions because I wanted
to see just how stuntch they were, primarily because both
Gorsuch and and Kavanaugh have been out speaking to the
Federalist Society and others about this very issue, and in
a very sharply worded warning, both Gorsuch and Kavanaugh have

(21:06):
put federal judges on notice that the nation's highest court
expects federal district judges to obey their rulings without exception.
In an opinion earlier this month, which was joined by Kavanaugh,
Justice Gore Such wrote this, lower court judges may sometimes

(21:30):
disagree with this Court's decisions, but they are never free
to defy them. Wow. Now that is pointed, and that
statement underscores what is obviously a rift growing between the
Supreme Court and let's just say, certain federal judges. You

(21:53):
can decide for yourself who those judges may be. I
just I don't like the idea of talking to This
is an Obama appointee, this is a Trump appointee. This
is a Bush appointee. This is a Biden appointee. I
know it matters that we should not think of judges
in terms of who appointed them, because if the Senate's
doing their job, and if the President's doing their job

(22:15):
and nominating people, they will nominate justices who are going
to properly interpret the Constitution. I know that is a
loaded statement right there, but I just want to get
away from politicizing the court anyway. That case triggered the
rebuke involved in Trump administration's cancelation of that what was it,

(22:40):
almost a billion dollars in federal research grants, a move
that a lower court temporarily blocked. But then when that
issue got to the Supreme Court, that's when Gorsich and
Kavanaugh intervened and blasted the district judge for ignoring the
president that they had established. Again, Gorsuch quote, this is

(23:00):
the third time in a matter of weeks that the
Supreme Court has been forced to step in and correct
what it sees as judicial defiance at the center of
this controversy, which will tell you why I want to
get away from who appointed Who is a judge by

(23:22):
the name of William Young, a Reagan appointee in Massachusetts,
who's ruly accused the government of engaging in unprecedented racial discrimination. Well,
Gorsuch dismissed Judge Young's claim, reversed his decision, and reinstated

(23:42):
the administration's freeze on those grants. So it's not always
a judge appointed by Biden or Obama. Here you've got
a Reagan appointee, which means he's been on the bench
quite a while. Now, this dust up is not isolate.
There appears to be a broad struggle over judicial hierarchy,

(24:04):
executive power, and what we refer to as the court's
shadow docket, the set of unsigned emergency decisions that can
alter policy with little or virtually no explanation whatsoever. Earlier
in the year, Justice Alito he leveled a similar charge

(24:25):
against the federal judge, describing one ruling as an act
of judicial hoops. The conservative majority is consistently siding with
the Trump administration in these high stakes emergency disputes, everything
from immigration enforcement to agency authority of the executive branch,
even when executive officials had not fully complied with existing

(24:47):
lower court orders. But the justices are not speaking with
one voice when it comes to these emergency orders. Justice
Brown Jackson Cadnji Brown Jackson in the National Institutes of
Health grant case. That's where she accused the majority of
playing Calvin bald jurisprudence. I'm a big fan of Calvin

(25:09):
and Hobbes. And what she did was she invoked the
chaotic rules of the comic strip where Calvin where the
rules just change it. When Calvin's always changing the rules
so that he can win, what did Jackson wright? We
seem to have two rules, that one and this administration

(25:31):
always wins, interestingly, and I kind of go glossed over
this on Monday, just as so do may Oar descending
again in a separate immigration case, warned that the Court
was rewarding lawlessness by blessing government noncompliance, and she wrote,
this is not the first time the Court closes its eyes,

(25:53):
nor I fear will it be the last. So this
clash between that wing and the other wing of the
Supreme Court has a real practical effect. Are these emergency
rulings that are brief unsigned, they're not fully briefed. Are

(26:14):
they binding precedents? The court conservative wing says yes they are,
because we've issued an order. I happen to agree with them.
It may be an emergency order. It may be a
brief order just saying no, you can't do that, or
we reverse and remand it for further proceedings. They're unsigned,

(26:37):
there's not a full briefing, they're not oral arguments, but
nonetheless that's the court speaking. Critics see this as some
sort of concentration in judicial power, which subject to little scrutiny,
and reshaping national policy without transparency. No court's order, emergency,

(26:58):
unsigned orders all the time. Now, conservative legal voices are
demanding some sort of judicial discipline. James Burnham, he's a
former clerk for Justice Gorsuch, called defiance of these emergency
orders unprecedented and is demanding that the court quote deal

(27:20):
with it decisively. Also Carries Severino. She works for the
Judicial Crisis Network. She's pointing out the judges need to
be reminded that ignoring Supreme Court orders is just simply
not an option. Now. The Court's recent docket, if you
just look at the whole docket, it's pretty clear that
it's acting on this philosophy. Giving an example, in one case,

(27:45):
it upheld Trump's removal of the three Biden era pointees
to the Consumer Product Safety Commission, and when they did.
They cited an earlier emergency ruling on agency removals which
said that the executive branch can do this, you know,
just as again another footnote here. This claim of an

(28:08):
independent agency is on his face unconstitutional. There is no
independent agency. There is nobody in the federal government that
does not politically or legally, in one way or another,
answer to somebody else. The president is restricted by Congress.
Congress has to write the laws, but the president gets

(28:31):
to administer those laws. And if they have a fight
between them, the Supreme Court gets to arbitrate that fight. Now,
that's our three separate, equal branches of government. And you're
going to tell me that something like the Consumer Product
Safety Commission operates outside of that triangle of the three

(28:51):
branches of government and it's independent over here, and Trump
can have no control over that. I don't think so.
When Kevanaugh attended an event at Kansas City, he said,
quite clearly, we are not the policy makers. Judges must

(29:11):
understand our role in the constitutional democracy and approach cases
with discipline, humility, and fidelity to the law, not politics. Wow,
there's some fighting going on in the court. Is there
anything where there's not a fight going.

Speaker 4 (29:31):
On Good Morning from South Dakota. I wonder what Taylor
Swift's prenup looks like. And I wonder if for our
next breakup album that's going to be called it was
a travesty. Everyone have a great day.

Speaker 2 (29:45):
Oh because of Travis Kelsey. Okay, it took me a while.
I was seeing travesty and I couldn't. That's how much
little we care exactly in fact that that is. That's
more than I ever expected to spend at all on
that topic. Dragon. You know how we talked at the
very beginning of the program about facts and hypotheticals. Legal

(30:07):
questions involve so many facts in between, so you can't
really come to a conclusion. And you've heard the phrase
that you know you can you can even indict a
ham Sandwich. Well, the guy that worked for the Department
of Justice that through the sub I think it was
subway sandwich. Wasn't it that through the subway sandwich? At
one of those federal agents in DC, the grand jury

(30:30):
in d C refused to indict him. Now, I got
several thoughts on this. Number one, I think they overcharged him.
Now you may disagree. There's what like a dozen charges
or something yes, and and they were all felony charges.
I don't think you should throw anything at a law

(30:52):
enforcement officer, but throwing a sandwich, throwing up let's just
say it was a ham sandwich that they didn't indict it.
I don't think you should have been a felony. A misdemeanor, yes, uh,
maybe a misdemeanor assault and battery charge or something. Then
the other problem is you took this to a grand

(31:12):
jury in Washington, d c. Whoops, where clearly it's ninety
nine point nine Democrat and they probably all hate Trump
except they love what he's doing in terms of cleaning
up the crime. You see there are everybody in the
world is schizophrenic. We want him to clean up crime,
but we hating always cleaning up crime, and we're thankful
for that, but we're still hating. And we're not going

(31:33):
to indict the guy for throwing a sandwich at the
federal agent. It's that's an embarrassment that I think the
Department of Justice could have avoided by simply charging him
with it. Firing him, Yes, fire him, because if you
work for the Department of Justice, you shouldn't show throw
a sandwich or anything at a federal officer, and to

(31:54):
charge a misdemeanor, not a felony. You're overreaching, guys, you're overreaching.