David Friedberg Reacts to Zohran Mamdani’s NYC Mayoral Run

little known New York State Assemblyman Zoran Mam Donnie took the internet by storm this week shocked the world beating out Andrew Cuomo for the Democratic nomination here's the poly market chart just crazy one month ago Cuomo was at 93% zoron had a 6% chance my lord what a flip a couple of things happened that led to this obviously a bunch of viral moments he's a great speaker reminds me of Vake in in that regard really good uh you know in debates and and speaking publicly started rising in the polls got a ton of endorsements from millennials Gen Z AOC endorsed him as well and uh now he is mom Donnie is the 75% favorite to beat Eric Adams but looks like Eric

Adams is going to get a shocking amount of support because people don't want a Democratic socialist who's got some really unique and colorful history of becoming the mayor of one of the greatest cities in the world my hometown he wants to have free buses doesn't sound like that big of a deal he wants to freeze rent and triple the development affordable housing city-owned government grocery stores that sounds crazy a $30 minimum wage new York's at 1650 by the way uh he wants to defund the police replace the cops with social workers in high crime areas a bunch of really wacky interesting proposals and uh you were I think on to

this early Freedberg in your predictions last year you saw this coming again if you listen to the number one podcast in the world you're going to get this information a year earlier than everybody else that's why we are the number one podcast in the world freeberg maybe you talk a little bit about your prediction last year and uh where we are right now and your reaction to this i don't know perplexing shocking is this perplexing shocking or obvious to you for me it feels like actually a little bit of a beginning of a wave that's going to continue to sweep over this country starting in cities and I think that we're at the very early stages i think we'll look back and I jokingly say

that Kla Harris is going to look like a conservative candidate pretty soon and I do think that this is a broad kind of reaction to the economic condition of the United States and I've talked a lot of people don't quite recognize and see how important the debt and the deficit is with respect to how it's ultimately going to lead to socialism as it has every single time in history when you've had a free voting democracy a representative democracy that becomes encumbered with too much debt so Nick if you'll pull up this chart it'll just show you a microcosm of it and specifically how it played out in New York and how it will continue to play

out in cities this is the total amount of student loan debt in the last 20 years the student loan debt has ballooned from 500 billion to two trillion four million college graduates per year in the United States about 40% of them have student loan debt that they leave that means that in the last 20 years 80 million people young people have graduated from college and they've accured $ 1.5 trillion of new debt and based on the percentage and the distribution that means the average debt for these individuals is sitting around $60,000 so you're a young person where do those young people go where do they live and

remember there's about 32 million of them they live in cities they don't go back to rural towns most of that population sits in cities it sits in New York sits in Los Angeles sits in Seattle sits in San Francisco sits in Portland and sit in Chicago and what we're seeing in those cities is a massive political shift people call it left but it's actually quite different than just being more traditionally left it's really a revolution against the system that brought them to this moment because the promise that we gave in America the American dream was if you will go to college you will graduate you will have income you will have stability you will

be able to buy a home and what we did is we increased the government's role in making that dream possible and in doing so we created effectively a system where we gave unrestricted access to capital which inflated the cost of education people could go to school like Zoran and major in African studies at Bowden College they could get a a loan and graduate with 200 $300,000 of debt and then never get a job the guy has not had a real job and this is the truth for 32 million young Americans they find themselves living in places where they cannot afford to pay their bills every month and they will never get out of the debt cycle that they were thrust into and believe that they were going to be

able to graduate from and excel in the world and increase they all have what is called negative capital they have debt and they will never be able to get out of that cycle so where do you turn in that moment you don't go turn to corporations to solve your problems you don't go turn to your friends and your siblings and your family they're not going to bail you out you turn to the voting booth and you hear a guy like Zoran show up and say there can be a better path forward the better path forward is the government can and should do more to help and in doing more to help we will increase government we will tax the rich we will tax the corporations we will take all of that

capital and we will redistribute it in the form of services and checks and support for all of the people that find themselves unable to take care of themselves and this becomes a tipping point when the majority of the voter base ends up in that situation where they're that deeply in need where they have negative capital and that is the situation America finds itself in today there is no easy answer and there is no easy solution out of this but I can tell you one thing for sure that in historical perspective we have seen it time and time again across dozens of countries that have embraced socialism to get out of the debt cycle that ultimately absorbs and and swallows up

the young it swallows up every family it swallows up every person in the working class with debt they're swaddled with it and they all try and get out of it by increasing government and embracing these socialist concepts and it has never ever worked more government is not the answer less government is we can get into that but if you look at the results Zoran won 61 to 39 with college educated young people voted for him old people did not as much white people voted for him because they went to college non-white people did not as much at the end of the day young collegeed educated white people elected this guy and that

is the beginning of a wave that will sweep over America and I really do worry about where this takes us so way to go dummies yeah i mean the you're correct he won amongst Asians why it's college educated and to put a finer point on it Freeberg it really isn't just college it's the cost of college increases in the cost of college degrees have outpaced the wage growth of entry-level salaries by 10x over the last 20 years you could go 300,000 400,000 not in debt but that might be what you paid for those degrees in those major cities and you don't believe in capitalism anymore and you believe that you need to tax the rich just one warning for people in these

states in these cities we saw this sax in San Francisco we saw the the the doom spiral you and I worked on the Chesodine recall and now they have Dan Lori there and things are starting to slowly turn around a bit in Los Angeles we saw this with Karen Bass they didn't vote for Rick Caruso he would have been an amazing mayor they voted for incompetence and these people are voting for incompetence and a plan that will not work because twothirds of the tax base in New York is paid for by the top 10% who are leaving people will leave they will see that Austin and Miami are fantastic cities to live in at half the price a third of the price and you get a

tax break and you can always go back to New York and California and hang out for a month and get whatever values left in those cities that hasn't been destroyed by these socialists and the incompetent people running them saxs what are your thoughts on what's happening in New York City specifically well you're right that every generation seems to need to learn this lesson for themselves because they don't study history and they they don't see that socialism always fails wherever it's tried san Francisco went through this i mean it was a doom spiral uh now I think we've turned the corner la is in the midst of going through it and a large portion of LA just burned down

because there's no water in the fire hydrants basically all the public services have been looted and New York is about to learn this for themselves so it just seems like every generation just has to learn this there's no way to teach them so I do think that that is one thing that's going on i I do agree with Freeberg that a big underlying root cause here is the student debt it's the fact that these kids have negative capital they've got no skin in the game they graduate from college with worthless degrees and massive amounts of debt that debt was not used to make their education better universities have

been using the spiraling tuitions to fund massive amounts of bureaucracy you know for DEI and woke and all sorts of stuff like that and these kids have no prospect of getting out of debt or being able to buy a home so they just have no skin in the game and so this is part of why they're they're turning against capitalism one thing we need to do by the way is we need to make the student debt dischargeable in bankruptcy is one of the it's the only kind of debt that you can't get out of through bankruptcy and if we were to make that change at least these kids would have a way out they have no skin in the game the universities have absolutely no incentive to keep prices down and create

a competitive or economic incentive for making sure that their degrees work the only group that possibly could would be true capital lenders people like banks or underwriters that are saying "Here's a loan because I expect you to be able to pay it back." There's no underwriting in student loans today there's no underwriting the student loan program the federal student loan program needs to go away because when it goes away if it goes to zero and people might say "Oh that's awful you're taking away education." What will happen is the capital markets will flood to fill that hole banks and lenders will show up and they will say "You know what we'll underwrite the loans." But they'll

underwrite it by saying good colleges get the get get loans and bad colleges don't good degrees get the loans bad degrees don't and people that are expected to pay back the loans will now get loans and all of the rest of the money that's caused everyone to end up in this debt spiral will stop and we'll be able to kind of recover from it it's ironic that a problem that is being caused by government is going to lead to socialism it's going to lead to maximum government which will then create the next spiral of problems but I agree with you i think this is very sad