SPEAKER_00: Jake, you have a really long nose here. Thank you. On your, on your left. This one here, this side. Yeah. Okay. Well, that was like, you see it, Nick. You see it. See that you can see it. Take care of it. Every show. We have this issue. Every show.
SPEAKER_00: He's got all this, like I'm getting old man hairs. I feel
SPEAKER_01: like sex. You got to get a grooming tool. I am tired of
SPEAKER_00: treasure on team for what he does. Get a lawnmower landscape
SPEAKER_02: makes one. I'm going to get it. Yeah. Just look in the mirror,
SPEAKER_01: bro. You come over on the way to Parker Freeburg and help me landscape. You're not coming to poker. Don't come to poker. If I
SPEAKER_00: manscape, can I come to poker?
SPEAKER_02: Okay. So J Cal, you're going to be a participant today. The world's greatest moderator is taking a week off to allow his voice to recoup, to recover, to heal. So he can come back blaring with his usual mid sentence interruptions and excellent moderating tactics. Next week, we with his fog horn
SPEAKER_03: leg horn moderation, we are gonna, we are gonna miss you at
SPEAKER_02: the moderation. Welcome to the top 20 sacks. You're welcome.
SPEAKER_01: Welcome to the top 20 podcasts in the world. Okay. Well, hold
SPEAKER_03: on. Who should be thinking whom? I mean, you've been doing this for 10 years. I walked in here off the street all of a sudden we're top 20. Yeah, let me explain something to you. Number one blog in the world. I created with my guys in gadget. Okay.
SPEAKER_01: Top five magazine in the world. Then I do a podcast with you three idiots and all of a sudden I dropped down to top 20 in this medium. So drop, what are you talking about? Yeah,
SPEAKER_03: exactly. I drop. This has been AB tested. No, I mean, this
SPEAKER_01: weekend, sort of is a new, but look at twist ratings compared
SPEAKER_03: to ours. This weekend. Startups is about startups. It is a
SPEAKER_01: niche audience by design and it's the number one startup podcast in the world. That's what you wanted this show to be.
SPEAKER_03: I didn't. This show is about all topics. All topics. Every
SPEAKER_03: time we try to talk politics, you're like, it's too much politics. Sacks. I think you're talking about free bird. I think
SPEAKER_01: you're talking about free bird. Let's focus on narrow
SPEAKER_03: legalistic tech issues. True. We had this discussion sacks and I
SPEAKER_01: said, we should always do the top story of the week. Even if it's politics. And now you're taking credit for my insight
SPEAKER_03: about McLaughlin group. I saw you on some pod. Who was it? I
SPEAKER_01: absolutely designed this pod around McLaughlin. The fact that you didn't design on McLaughlin group. I'm the one who said McLaughlin group. Okay. It's possible for two people to have
SPEAKER_01: the same idea. Sacks. We both grew up on McLaughlin group. That's why we're both can tankers assholes. Moderator
SPEAKER_02: intervention. Cut it out. No one is individually responsible for this podcast. It was Tim Ferriss. Yeah. Tim Ferriss. Here's what happened. So I was on YouTube and um, you know, I'm
SPEAKER_03: not going to watch some two hour like podcast with J Cal, of course, but for some reason, for some reason, Tim Ferriss clip, let me just act. He clipped 10 minutes of J Cal and
SPEAKER_03: the video is called the origin of the all in podcast. I can't stand what he does. Here we go. I can't stand what he does that.
SPEAKER_02: Yeah. So I'm like, okay, well, I got to watch this partnership agreement. He said, here's the party line and J Cal will not stick with it. We're going to recreate this. I got to see
SPEAKER_03: this alternative reality that Jake is trying to create about the origin of the podcast. I wrote I wrote in our legal
SPEAKER_00: history. Yes. And I changed the origin story that you signed up to. Are you saying you change the origin story remains the
SPEAKER_01: same? No, it doesn't. You call me after CMBS. The origin story
SPEAKER_03: that he told Tim Ferriss, which is like a 10 minute story of how he created the whole thing. The concept was is it's based on McLaughlin group, which I'm the one who concept is obviously by default. How I moderate the program is by my design. Yes.
SPEAKER_01: You didn't come up with this concept. You're sure grin. Of
SPEAKER_01: course I did. No, of course I did not design my moderation. Who's the first one who said we should record us having
SPEAKER_03: conversations at the poker table? No, that idea came from
SPEAKER_03: him, right? That's why it's called the all in pod. No, I
SPEAKER_01: came up with the name wall in number one. Number two was his idea to tape a pod because he came out of CVC. Anyway, who cares the pods here? It's successful. Why do you keep
SPEAKER_02: going on podcast telling everyone that you're the mastermind of the all in pod? People are saying you Jake, how the game other podcasters I'll explain to you. Other
SPEAKER_01: podcasters are in awe of my ability to moderate you three malcontents. You did not have the idea for the foursome based
SPEAKER_03: on McLaughlin group that happened that happened spontaneously as a result of the fact that no freeburg was I think the first guest I was the second guest then we did the four of us together. Okay, that was not your moderation. It was a jam session that worked out. That's
SPEAKER_02: it. Okay, fine. The way the way I moderate this is of note to
SPEAKER_01: the world's greatest podcasters. They want to know Jake out. How do you take three misanthropic malcontents and make them actually palatable to the world and I say you know what because I am the world's greatest moderator and someone like Tim Ferriss wants to know excuse me. Excuse me. What
SPEAKER_00: makes me a misanthropic malcontent? Exactly. Just your behavior and worldview. What is it? What is it? Describe that
SPEAKER_01: what's my behavior and what is my worldview? Your absolute
SPEAKER_01: contempt for humanity. You're warning over everybody. No you're amazing. I'm it's a joke. It's called a joke. It's called a joke. Oh now you set him off Jake. You really that
SPEAKER_02: that hurt. You should apologize. It's called a joke. I
SPEAKER_01: think you guys are wonderful. I think you guys are wonderful.
SPEAKER_00: I mean I may be misanthropic but malcontent. I'm not no
SPEAKER_01: Saxon freeburg are the malcontents for sure. I'm not content. I'm pretty damn happy. You're happy. The last
SPEAKER_01: descriptor. Anybody who knows you would ascribe to freeburg was happy. No, I would say no. I think he's happy. He's
SPEAKER_00: anxious, but he's happy. Yeah. He's anxious but happy. Did you
SPEAKER_01: see the roast? That was not a happy man. That was tearing you up. That was funny. Yeah. That was a part of him. Yeah. That
SPEAKER_00: was venting. He was. Yeah. That was rage. It was pure rage. No.
SPEAKER_03: I think I think when we were tries to be funny, it comes out kind of mean. Yeah. Maybe that's just a little bit of rage.
SPEAKER_02: The only person that sets me off into making me unhappy is you Jake. I mean the four of us could go to therapy or we could
SPEAKER_01: keep recording this podcast every week, which is cheaper. I think it's cheaper for us to just regret the pod. You know
SPEAKER_00: what I for one am thankful to whoever gave you whatever sickness you have that causes you to not be able to talk this week. Okay. Great. You're talking a lot for a guy who
SPEAKER_02: can't talk. Let's cut it out. Okay. You're coming at me. I'm
SPEAKER_00: nice to me while we're talking about all kinds of random stuff. The number two thing that I see in the what's happening tab on Twitter right now is how Ron DeSantis is getting blasted for banning AP African American studies because he thinks it falls under the stop woke act. That's this the headlines. It's going absolutely nuclear on Twitter right now. Here's some of the quotes shocking Ron DeSantis has banned all caps the teaching of AP African American studies in Florida. Florida has gone from don't say gay to don't say black next tweet claiming it violates the stop woke act and has no educational value. Florida Governor Ron DeSantis has banned AP African American studies from schools.
SPEAKER_03: Let me make a prediction right now. This will all redound to his advantage. The the same people who said that he was death Santas for basically not instituting COVID lockdowns. He was proven correct. Then they said that this bill that prohibited the teaching of gender fluidity to five year olds. They try to claim that was a don't say gay bill. 70% of Florida supports that that redounded to his advantage. I don't know the story behind this particular course, but if the question is whether CRT is going to be funded by the state and he's preventing that again, I think it'll be a 70% popular issue. So let's just wait and see how this plays out. Fair
SPEAKER_00: enough. I just want to claim that my spread trade may be it's tough to be the leader in the Republican nomination process in January of 2022. It's starting. Yeah, I agree. It's tough to be the front runner. It's tough to be the front runner in either party, but I'd say the bigger threat
SPEAKER_03: to the Santas is there's a new poll where Trump came out on top. So Trump's still his biggest threat. Yeah. So unfortunately, Jay Cal may be right that the Republicans may do something stupid here and nominate a candidate who's I think less electable than to Santas. I actually don't take
SPEAKER_00: any joy in it. I actually I think Nikki Haley is going to come out of nowhere and win this thing. Well, it's possible
SPEAKER_01: I you know II really would like to see some non political non career politicians run for office. The Bloomberg you know sort of category. It feels like these career politicians are just really really bad at executing scumbags. You know you know who likes Nikki Haley who Democrats Democrats you guys
SPEAKER_03: why why do we like her? I mean she's polarizing. She's
SPEAKER_02: polarizing. No she's a safe establishment Republican who
SPEAKER_03: basically is not going to put up any fierce resistance to what the Davos crowd wants to do. I don't think that's true.
SPEAKER_00: I think she was pretty she's not going to win the Republican nomination. I don't think she cares about Davos people to save her life. I think that she is a moderate reasonable person who had to govern in a southern state and got everybody on board. That's that's pretty crazy. She's a pro life person
SPEAKER_00: who negotiated a twenty week support for abortion in 2014. So this is a person that knows how to get stuff done. South Carolina happens to be the state that's actually at the leading edge of climate transition. She's had more jobs and more money come in into a southern red state of people and companies willing to build for climate change than any other state in the country. So you like her? I don't know. She's just she's so I just think that she's actually like normal and sane and not an idiot. Would you vote for her? Absolutely. Over Biden? Absolutely. Absolutely.
SPEAKER_02: Interesting. 100%. Yeah. Look if you're really willing to
SPEAKER_03: vote for her, then that's interesting. Absolutely. I
SPEAKER_00: would. She's you know she's young. Her parents had a small business. She was a small business person. It's tough to be a winner at all of those levels and she managed to do it. I mean how do you as a brown woman get elected to governor of South Carolina and do a lot of really good stuff? That's kind of tough. Yeah. So I don't know. I think she deserves a close look and she's the only one that didn't kowtow to Trump. She was able to play the game manipulate him get him to be on her side and then still told him to go pounce in. That's pretty cool. Well, a lot of a lot of governors managed
SPEAKER_03: to do that. I don't know. I'm saying I'm saying she got she
SPEAKER_00: she went to the United Nations. She did what she needed to do there. That's an important role at that time. Actually Nikki
SPEAKER_03: Haley expressly has said she will not run if Trump runs so she's kowtowed to Trump too. She wanted to be his VP right
SPEAKER_01: like she was trying to shank pants right. That was her plan.
SPEAKER_03: Maybe it's a smart strategy, but she said she will not run against Trump. The main alternative to Trump in the Republican Party is to Santas and then I'd say the number three in the Republican Party after Trump and to Santas Glenn Youngkin right now. Huh based on what metrics based on
SPEAKER_03: interest in the party and you know I've talked to people and I think the polling will eventually reflect this. He's very talented. Jake out you talk about appealing to independence. He was able to win a blue state. Remember Virginia went for Biden by ten points and Young was able to win that state. If you're ever listening to him campaign, he's a very talented campaigner. I think Young is very very
SPEAKER_00: talented. Don't get me wrong and I think that he would be an extremely credible candidate for president. Here's the thing that Young will get destroyed on is he's literally not been in the job for but for a few you know 18 months, so he hasn't done anything and I think that if it does boil down now, it may not matter right because look Obama was a senator for two years or whatever right so it may not matter, but to the extent that Republicans demand some bonafides, I think that you'll see Trump and DeSantis attack young can more viciously in a presidential primary than they attack Haley on that dimension of you have no experience and it'll be hard for him to back it up. Just one final point you know if you have to steal man the other side, that's what they would say. Final point we got we gotta get started final point.
SPEAKER_03: Virginia has this wonky one term term limit on governor. So you know he's got no choice but to make a play in 2024 because he's going to be turned out anyway. Okay. Jake Cal as a
SPEAKER_02: lifelong independent who's only ever voted Democrat which of these Republican Democrats are Republican to be clear is so
SPEAKER_01: which of these candidates would you vote for Republican one
SPEAKER_03: time when he was twelve? Yeah. No, I voted three times like
SPEAKER_02: Nikki Haley. You like Glenn Youngkin three times. I voted Republican. I would like somebody who's younger and
SPEAKER_01: actually I've been quite influenced by your framing of a person who can control the budget and reduce spending because I didn't think it's kind of the most existential risk we have right now. so I might be moving to more of a single issue vote for this presidential election. I love that issue. I love that about you, which is I just think like we we have to have somebody younger who is not going to bankrupt the company and the more these candidates talk about social issues and not economic ones. I think it's a tell that they're not the right person for the job. That's where I'm personally at is like this country has a serious financial existential crisis on its hands and we have to get off social issues and we have to get on to financial points. So I assume then you support the Republicans in this
SPEAKER_03: looming budget showdown. I actually do. Yes, I do think we
SPEAKER_01: should hold the line on spending. So you support the
SPEAKER_03: Republicans voting no on raising the debt ceiling. Yeah, I
SPEAKER_01: actually do. I think we should start pumping the brakes on spending and I do think the tea party. Now that doesn't mean I
SPEAKER_01: like those candidates are kind of whack jobs actually, but you think George Santos is a whack job. Listen, it's the whack
SPEAKER_01: pack. The Republican Party has turned into some crazy Howard Stern whack pack. Sax is appalled by it. He just can't some elements of both parties look that way. Would you ever
SPEAKER_00: invite to Santos to your house? Who would you invite? Okay? Actually, I have a real question. Are you kidding me? Who would you be willing to host a dinner for? It's not a fundraising dinner, but just invite to the house. You can pick between two people. Oh no. Alexander Ocasio-Cortez or George Campos. Who would you pick? Who do you pick? I'd
SPEAKER_03: rather probably meet and talk to AOC. Of course, because it would be interesting. Do I want to fundraise for her or no? But
SPEAKER_00: no, no, no. I'm not asking fundraising. Who just let in
SPEAKER_01: the door front door unlock the front door for unlock the front door of the mausoleum. But what would you do to George? Would
SPEAKER_00: you not even return the email if he said, David, I'm in town. I wouldn't let him in the house for dinner. Don't let him in the house. I wouldn't want to deal with him. Yeah. He might.
SPEAKER_03: He might steal the silverware or something. It's so crazy. I
SPEAKER_02: mean, it's so nuts. Listen. Hold on. Hold on. Hold on. We gotta get started. As your moderator. I'm going to try and keep us on track. Good luck. Yeah. No. Look. It's it's an energetic day. I appreciate. I appreciate my co-hosts and their enthusiasm for all the recognition for supporting the
SPEAKER_03: Republicans in this budget showdown. I mean, I'm like blown away by this. I think it's great. I think it's great.
SPEAKER_02: as you guys know just to restate. It's my number one concern on earth today. Yeah. And I I think that the importance of this topic really needs to kind of rise above politics of all the things you said. Freeburg in the last like
SPEAKER_01: 6 months on this program. It's the one thing that stuck with me and it's one thing that has like actually now I realize is the most important thing for this country is fiscal responsibility, austerity measures and looking at how we're spending money and looking at immigration and looking at economic velocity and employment and competing on the world stage with a solid balance sheet is the balance sheet is how you compete. The balance sheet is how you compete. I think it rises above social issues and it rises
SPEAKER_02: above climate change. You cannot address climate change or social issues or infrastructure or unemployment unless we have the ability to operate as a country over the long term and have the ability to have the continuing credit of the United States dollar and that's why I think it's so important. Freeburg. I'm dealing this with startups I
SPEAKER_01: have right now and I tell them the balance sheet is how you compete. If your balance sheet is flipped upside down and you're going to be out of business in 9 months, you're not competing with these two other companies in your sector. You have to have a strong balance sheet. Take the austerity measures, make the cuts and then compete with a strong balance sheet. It's just so obvious this country's balance sheet is getting flipped upside down and we are going to have so many. Yeah, very complex second and third order effects with the interest payments. If you value
SPEAKER_00: austerity, if you value austerity, if you look back in history and you actually ask of the prime ministers or presidents of various countries, particularly first world countries that have actually had an impact in implementing austerity. You know what the unifying thing that I can say is women do a much better job than men. Okay. You want austerity? You're better off with with Margaret Thatcher. Margaret Thatcher would then with a dude AK Nikki Haley. I'm totally okay. I think I think it's a
SPEAKER_02: it's a very hard position to be in as a politician because you have to position your objective as one of taking things away and the primary way to get elected in a democracy just like in junior high when you run for president of the junior high class is I'm going to make the vending machines free. You get elected and when you run in politics, you always promise your constituents what they're going to get that they don't have today and that's the model for getting elected. Whatever the issue is of the day, whatever the issue is a decade, whatever it's all about what I'm going to give you that you don't have today and so to flip that conversation around we all have to sacrifice together for the long term viability of our economic prosperity. We need to do we need to give up the following things that is a very hard platform to run on when someone on the other side of the podium on the other side of the stage is saying I'm going to give you these ten things and it's very hard to get elected and that's why democracies ultimately eat themselves and I forgot who said it but ultimately all democracies end up realizing they can vote themselves all the money and then you have this big cycle. That's the thing. The Republicans did the most
SPEAKER_01: brilliant thing ever recently. They moved from stop the steal to stop the spend. This is a genius thing they stumbled into. Nobody wants to hear them talking about the election being stolen. That's complete nonsense, but stop the spend. We all understand that everybody is seeing it in their own personal balance sheets. They're seeing it in their companies. They're seeing it in their families. They're seeing it with their mortgage payment. They're looking at their you know college tuition bills. They're looking at their car payments going from 400 to 700 dollars and they're seeing what variable interest does. We have variable interest debt. This stuff is going to skyrocket whether it's Elon's payments for Twitter or your payments for your mortgage or our country's payments for our debt. We have to stop the spend. You're talking about the effective interest rates. Yeah,
SPEAKER_02: but guys let's just continue the conversation and talk a little bit about this World Economic Forum gathering that that took place in Davos. I know you guys wanted to talk about it this week. Can I just applaud J. Cal's intellectual
SPEAKER_03: honesty? I'm like blown away right now. Well, because he's
SPEAKER_02: sick. Okay. So look no it's because I'm not moderating when I'm moderating. I'm always trying to get the best out of you
SPEAKER_01: sex. The budget conversation is an important one as it relates
SPEAKER_02: also to the global economy and growth. So Davos took place you know over this past week just so everyone knows and I remember you know working at Google 2004. I remember like how exciting it was for the executives to kind of start to transition into the Davos stage. It became this moment where you're kind of finally on the world stage. It's an exciting moment for CEOs, for world leaders, for global economists to get together, talk about the state of the global economy, where the world is headed, what we can and should be doing about it. And Davos is also this this place of pride and prestige for being invited and being a part of the party. The global elite party as some people are now calling it. And that's what I think is the important conversation is that the World Economic Forum gathering in Davos has recently been cast as this gathering of the global elites. Those who are trying to take control and run the world as they see fit and Sax I'd love your point of view on how that transition has happened because one of the important ways that the Davos gathering has been cast in the World Economic Forum has been cast is in the negative light of being globalists and globalism has had a really important role in driving global economic growth and prosperity and it has had these adverse effects in the US as we've seen with wealth inequality, loss of jobs, offshoring, gutting of industries and so on. I think that there's a really important way that Davos has been politicized, but the risk of that is significant because if we do lean into this globalist notion and say it's all about elites trying to take control of our world and we all become isolationists that countries around the world can suffer deeply from the economic consequences of that shift. So maybe Sax you can kick this off and especially in light of our conversation today about the need for economic growth and the reduction of global debt to support you know a more prosperous world in the future. This idea that right now we're talking about Davos and the World Economic Forum as a gathering of global elites and maybe Sax you can kind of give us the history and the point of view on how that position has come about. Well,
SPEAKER_03: it's a meeting of of global business and government leaders so they are the elites. I mean you add them all together and they do control a substantial portion of the world economy and most of the you know nations with the biggest economies. So there's no question these are some of the most important people in the world. The bunch of the articles coming out of Davos reported the somber mood and tone of the conference. The level of anxiety and worry was very high and I think that for a brief moment, it looked like these people were staring in the mirror and realizing that their management of the global economy over the last couple of decades has been a bit of a disaster. I mean you do have ruinous deficits and debts piling up in the US and across the world. Something like 350% debt to GDP globally. So we've talked about that. You've got this war in Ukraine that I and many people around the world think was easily avoidable and was a diplomatic failure. You're coming off of 2 years of badly botched COVID mismanagement where the governments of the world pursued a horrible policy on COVID and made everything worse. You've got decades of energy policy promoted by the World Economic Forum where they want to get people off fossil fuels and natural gas and get them on to less dense less reliable energy, including promoting things like organic farming in Sri Lanka, which we talked about on the show caused their economy to collapse. You've got the World Economic Forum promoting ideas like you're going to own nothing in the year 2030 and you're going to be eating insects because no one should be eating meat. So you've got these like wacky extreme, you know, environmentalist ideas and anti capitalist anti property ideas coming out of Davos. So I think the whole thing has been a bit of a disaster and for a brief moment, it looked like these people again were self reflecting on their role in creating these disasters, but of course the tone quickly shifted to blaming disinformation on social media as the root cause of all these problems as opposed to their decades of decision making running, you know, the leading nations of the world and the leading companies of the world and I think that the blame is properly put not on social media, but on these leaders for making you know bad decisions. Do you believe in the benefits
SPEAKER_02: of global trade where countries trade with one another and shift the sourcing of supply and labor to the cheaper source so that the buyer can benefit from having things at a lower price and ultimately the global economy grows as kind of being beneficial to the US over the last 30 years or net negative because we talked you know about the the obvious consequences of global trade where we've had industries gutted in the United States and now we're trying to onshore them again and build redundancy and so on, but that's becoming very expensive and ultimately leads to the inflation of goods and services and so as you look at kind of the the positive agenda of the World Economic Forum over the last 30 years being about improving global trade and global relations to enable global trade. Are you an anti globalist and you know, do you start to see yourself falling more in that camp as you see and hear more of what comes out of Davos and from these organizations like them? Well, look all economic prosperity
SPEAKER_03: comes from trade. If we didn't have trade, then we would all be subsistence farmers and hunters and gatherers. So we basically specialize in something and then create an over abundance of that and trade it for the rest of our necessities. The issue is that trade not only creates prosperity, it creates dependencies because you're dependent on the people you're trading with and also it has distributional effects in terms of geopolitical consequences. So. Trade with China has created some prosperity, but it's also hollowed out the American manufacturing sector while also making China very rich, which is basically turn China into a major geopolitical competitor for the United States. So I'm not like a free trade fanatic. I mean I understand the ways that trade creates wealth, but I think it can also create these downsides that have to be managed and the fact of the matter is that this unfettered free trade ideology contained the seeds of its own destruction because all the visionist powers who are seeking to revise the US led global order. They were basically enriched and built up by the very free trade ideology that neoliberals were promoting. So this neoliberal world order has kind of created the seeds of its own destruction. I think that it would have been much smarter for us 2 decades ago to be much more restrained in the China trade and to not throw open our markets to Chinese products. We basically gave them MFN status. This is back in the early 2000s and it was a bipartisan project and a bipartisan decision, but the result of that has been the rapid rise of China at the expense of our manufacturing sectors and to the benefit of our consumer class right. I
SPEAKER_02: mean we do have $600 iPhones because of it and we do have cheap TVs and there has been a consumer market that's demanded these low priced goods to live a better life right like so.
SPEAKER_03: Yeah, but so so everyone gets cheap goods at Target, but in exchange for that we now have a real peer competitor to the United States, which is capable of disrupting. Let's say our primacy in East Asia and you know it's creating a much more challenging world. So look II can understand the reasons why people bought into this 2 decades ago, but I think that if we had it to do all over again, I think most people would recognize that we should not have given China permanent MFN status and we should have been more temperate in our willingness to throw up in our markets to these countries. Chamath, do you think that the World Economic Forum has kind
SPEAKER_02: of transitioned into this kind of neoliberal organization now that's promoting these neoliberal beliefs that aren't really tied to the original construct of enabling and supporting global trade and supporting the global economy and creating more prosperity and security around the world? I
SPEAKER_00: think it appeals to the insecure overachiever elite.
SPEAKER_02: Yeah, you know nobody building anything really gives a ****
SPEAKER_00: about Davos. Nobody is thinking what's going on. Nobody even knows when it happens right. So who cares about it? People who like status and went to fancy schools and wants to feel like they're in the club and that's how they've made it is going to this place, which underneath is a membership organization where people pay based on the number of people that get to go. So is it really that important? Substantively no, but overachieving surplus elites in the West really value the signal that it represents to other overachieving surplus elites in the West. So that's what Davos is. That's what the Allen and Company Conference has become. A lot of these things started off much pure than what they are today, but these are all membership driven revenue generating efforts. In 30 or 40 years, the All-In Summit will probably become that too. It's just the nature of things. So I wouldn't spend so much time focused on a group of people getting together. The funniest thing about Davos that I saw was Zero Hedge, which said that the amount of prostitution is at record levels in Davos. And so it just kind of boils down to what it is, which is like any other conference. It just happens to be with more security guards and less security guards. And the same stupid stuff happens at Davos. It happens in Vegas at Name Your Conference, CES. It's just a different kind of attendee. So I think the bigger thing is that we are learning that the world tends to have these policy perspectives that swing in a pendulum and the problem with the pendulum is that it is at extremes. And Sachs is right. We went from an extreme where we were very closed off and we were essentially subsistence farmers. All of us were. And then the pendulum has essentially peaked probably in the mid teens of this decade or of this century where we realized too much globalization actually hollows out local economies. So we need to find the equilibrium point and that inherently has more inflation that inherently has higher prices and that inherently has slower progress but more consistent progress that benefits more people. And this is what is so ideologically disruptive to again surplus elites because they need the $600 iPhone. The idea that they can't upgrade every year drives them into such a tizzy that they need to export all the jobs. Whereas a $1000 iPhone or $1500 iPhone may just mean that your upgrade cycle is two years and just ask yourself how many times have you upgraded as soon as the phone came out to realize, man, this phone is actually worse than the previous version and it probably could have just waited. And there's a lot of work that actually goes into building these things to actually make them better. So all you're doing is you're giving up optionality. You're allowing your brothers and sisters to struggle to basically feed the profit motives of one company. That in hindsight doesn't need to happen. So there's an equilibrium and I think that these next few decades will be about finding it. We have decided, it's categorical, that that level of globalization that we have had, this unitary singular monocultural way of thinking about things is over. And David's right, it's because that system has created too many threats to the hegemony that brought us there. Jake, do you that's a good thing, I think in general. It'll be more prosperity for more people, but it'll be slower and it will create points of friction that are represented in inflation and higher prices. Right, that's right. So as Jake, as you know,
SPEAKER_02: Chamath points out, like if you're upgrading every two years instead of one year, your economy doesn't grow as fast. You have less spending. Yeah. If the price of things go up, you have inflation. The net cost of de-globalization is higher prices and lower economic growth. That's just fundamental kind of macroeconomics. No, that's not true. That's not true
SPEAKER_00: because the de-globalization in an individual economy will actually create GDP because you'll have to rebuild the things that you used to import. That's right. Yeah. And over a
SPEAKER_02: period of time, theoretically, you could catch up and accelerate. But Jake, how like when you weigh this conversation about Davos and globalization and US security against the one we just had, which is why I wanted to talk about this. We're running into a debt crisis. We have limited spending capacity. We have a significant amount of investment needed. If we are going to cut global trade ties that we've depended on historically and start to build redundancy, can we afford this as a country? Can the West afford this given the economic slowdowns and inflation right now? And you know, how do we balance kind of these conversations against our domestic challenges economically?
SPEAKER_01: Davos has a pretty serious PR problem. They have dubbed themselves like essentially a self-appointed Illuminati for the rest of us and that they're going to set some global agenda. I think this year's agenda was like finding the future or defining the future. Nobody asked these people to be in charge. And if you look at what's happened in the world, the chaos of COVID, and you look at what's happened in terms of energy policy in Europe, and then this obsession with social issues and being told, you know, these farmers, these truckers, you're bad people, you're not woke, whatever it is. I think the public looks at Davos as the manifestation of these global elites who are lording over them some master plan, whether it's real or not, that they're not part of and that doesn't take them into consideration and that takes into consideration only their profits. And when you actually peel it back, as Chamath correctly pointed out, Davos is a huge grift. They recruited me to be part of their world leaders 15 years ago after I sold my second company and I met Claus, the guy who runs it at some New York Four Seasons event and then I got the bill. And to be a world leader was 40 fucking thousand dollars. And I
SPEAKER_01: was like, what a global future leader. I don't know what that means. But I'm not giving you $40,000. You had to pay? You had to pay to be a global future leader. And you didn't have to pay for a $6,000 Ted ticket at the time. This was 40 large. And I just thought, you know, this is not for me. And I think people would much rather see some resiliency in the supply chain. And they would rather see the origins of COVID and why we spent two years in a lockdown. And was that a cover up of the United States funding gain of research? You
SPEAKER_00:
SPEAKER_01: know, being done in Wuhan like, and why are we shutting down nuclear power plants? And what exactly is the energy policy in Germany, people are looking at incompetent elites, going to Davos, having a big party, and then setting an agenda for them that they don't understand or want. And I think this is where, you know, the the the contempt for Davos is peaking this year. And it should if you're being invited to Davos, and other people are not being invited, and they don't have a seat at the table in a voice at the table, you can tell that all the journalists there are on an access journalism pass. What does that mean access journalism, they get to come there, and they get to hang out with elites, if and only if their coverage fits a certain profile. And if you find me the top 10 most critical anti globalization journalists in the world, I can guarantee you that they don't have credentials. I think it's like a bankrupt organization that should just be shut down. And the people who are going there are involved. No, I think it's culturally bankrupt. You guys have so much
SPEAKER_02: disdain. It's interesting. No, I do. I think it's not what the
SPEAKER_01: world wants right now. The world wants transparency. And the world wants ownership of all the screw ups. You know, from COVID. Yeah, to energy policy. We want ownership of those issues. Not a bunch of elites drinking champagne. I'd rather spend a
SPEAKER_00: week with entrepreneurs or frankly spend a week with my kids or Frank. Yeah, and a week playing poker with my friend. Of course, let's do it. They're they're like umpteen things that are above the list. So it's kind of like let them get together. I think it's fine for them to get together, they should do it. I just think that if you're not there, I would not weigh these things so heavily because it speaks more to your own insecurity than it does to their actual influence on things. Yeah, the term elite is an interesting one. You
SPEAKER_02: could companies need a CEO to run the company. It's not run by 10,000 employees. And governments need a president to oversee the government. And I think the idea that some small number of people that are in charge getting together is now being cast as an elite gathering. And elitism in itself is the failure is I don't think it's an elite gathering. I think
SPEAKER_00: it's very important to get this nuance rights. It's a gathering of elites. And that's very different than an elite gathering. And elite gathering is when like Michael Jordan and LeBron James and Steph Curry get together and work on their basketball game. That's an elite gathering. A gathering of elites is what's happening in Davos. That's a fair point. But they
SPEAKER_02: are the presidents of their companies and the presidents of their countries. So I would differentiate between the
SPEAKER_03: people who are merely attending or paying the $40,000. Probably a bunch of hangers on. It's not 250 by the way, $250,000. Yeah,
SPEAKER_03: anyone willing to pay that is like, you know, totally an insecure, you know, surplus elite. By the way, I just got
SPEAKER_02: back from Davos. Oh, you did? Okay, well, congratulations.
SPEAKER_03: Looks good on you, though. Your own money or your LPS money? No,
SPEAKER_02: I didn't go to Davos. One person that went to Davos that spent their own money. It's like probably not right. Exactly. So
SPEAKER_03: then there's the hangers on your spending $250,000 to feel important. But then there's the people who are invited who probably don't spend any money, who are basically speaking, right. And you got to say that the group of people who are speaking at Davos individually and collectively are quite influential. They are the leaders of countries and and fortune 500 companies. Sure, but you can agree that they
SPEAKER_00: literally don't say anything that's noteworthy because they're not allowed to. They're not saying anything that's that
SPEAKER_03: different of what they would say the previous week or the following week. So but it's a forum. It's a platform for
SPEAKER_02: getting. Yeah, it's a for to get together. Look, in terms of the
SPEAKER_03: critique of it, you asked how far back does this go? It's this is not like a new thing. The the term Davos man was coined back in 2004 by a Harvard professor named Sam Huntington, who wrote a book called Clash of Civilizations. He's the professor of international relations at Harvard. And he coined the term Davos man to refer to a globalist who quote had little need for national loyalty who viewed national boundaries as obstacles that are thankfully vanishing. That's how Huntington defined Davos man and there's been a reaction to these Davos men that's been growing for a couple of decades. I mean, obviously the election of Trump was a reaction to that. Brexit was a huge reaction to that and I think that the resistance to the imposition of their again, their globalist policies, which I guess you could define this believing in this like borderless world, you know, economically and politically. I think that's been receding in favor of more nationalist leaders who want to promote their own country's interests. And I think that that trend is going to continue. Well, Chamath, let's let's transition
SPEAKER_02: this to the broader question that I think we got into it a couple episodes ago on how can we afford this transition if there is this mounting kind of trend against globalization, this mounting de-globalization movement and effort, particularly in the US. And again, as Sax pointed out, global debt to GDP is something like 300 to 350 percent, depending on how you count. And we're running into a debt ceiling here in the US. I guess the question is how do we afford to build the infrastructure redundancy and make the investments at home to replace global trade? Can we afford to do it? And how's this going to play out as we run into this debt ceiling vote? I don't think that's the right
SPEAKER_00: question. I think it's the inverse of that question. How can we afford not to? With the amount of discontent and the amount of economic strain that people feel, if you want to really quell populism, you're going to have to create economic vibrancy at home. When people are making money and they find purpose, they're less agitated. They're not storming the Capitol. They're not electing fringe candidates. They're not doing domestic terrorism. They're just going to work and building a life, right? We know that. So how can we afford not to? How can we afford not to like bring back jobs to the heartland of America? So the reality that I have, and I think a lot of people have, is that this debt to GDP thing is a bit of an intellectual red herring. And the reason is people talk about this thing constantly in these absolute terms with no historical precedent that relates well to our current moment. There is no magic number at which thing this experiment that's called America fails. So I think that you have to be a little bit more intellectually honest and say that at best it's a relative problem. And it's relative to the countries that have already established dominance, of which there are eight or nine, and then the emerging economies, and then thinking about what critical things will they bring to the table in 15 or 20 years from now? And in that context, I think that people will him and Ha, but ultimately they'll capitulate. They will raise the debt ceiling and they'll continue to fund this transition away from globalism. And I think that's the argument that we'll get the Republicans over the line because it's going to bring a lot of spending and stimulus and jobs to frankly, a lot of red states that would otherwise kind of continue to wither and die on the vine. I think here's my biggest concern.
SPEAKER_02: We're either trying to walk a tightrope or there's no tight rope to walk. And if we make these investments and they're not economically viable investments, it's a path to ruin. And what I mean by that is if we're building factories, manufacturing facilities, infrastructure that relies on yesteryear's technology and systems of production and global and kind of economic systems. And there are alternatives that are competing on a global stage that are better, more productive, more advanced than we lose. And we've made an investment in a negative ROI way. But hold on a second. Can I ask you a question? Yeah. See when you say
SPEAKER_00: that though, you're making a very basic assumption, which I think you can question, which is you are underpinning that on fundamental economics that can change if we choose to. For example, let's take like natural resources, okay? Every time you do a plan, the industry, and I define the industry as every for-profit company and Wall Street and the debt markets, they refuse to underwrite this thing at a higher cost of capital. They use a whack of six or seven or eight and they will fight tooth and nail to use the smallest discount rate possible because it allows them to capture more of the profit dollars. But if you actually had a realistic whack of like 10%
SPEAKER_00: on an on a massive infrastructure project, guess what? You're actually pretty equivalent to a government. And in fact, in many cases, the government becomes cheaper. So I think the thing that is worth debating, and I'd like your reaction to this, it's not that what you're saying. It's we refuse to change the guardrails on our profit making ability. And if you extended the window, if you change the discount rate, if you said PES can be different, you would have a very different economic justification for what you just said, it completely changes 100 basis points changes everything you're saying by 10s of years. One way to describe that, yeah,
SPEAKER_02: is another way to reframe what you just said, is that the useful lifespan of an investment isn't 40 years or 50 years, but it may be 12 years. And if you if you recast the investment decision as this has to be a 12 year return, instead of allowing it to be modeled as a 40 year return, then you start to really filter out a lot of the nonsense. And you can actually see real payback, it doesn't make sense to spend 100 billion dollars on a train to take people from LA to Fresno, or whatever craziness the California high speed rail program has turned into, it was originally like a billion dollars to go from LA to San Francisco, there was economic justification to get payback on 100 billion dollars or whatever it's ballooned into, the whole system should be shut down. So I guess there's a from a policy perspective and accountability framing that's missing, but also bringing in the time horizon on which we need to get paid back for these things. My point was that in China, and I've made this point many times, but I just think it's a really important one that'll play out over the next couple of years. They're building 450 nuclear power plants, they're going to get the cost of industrial power below five cents or four cents a kilowatt hour, and they're electrifying all their factories. As they do that, it's no longer a unit of human labor that's needed to produce goods. It's a unit of electricity. And if they're driving down the cost of electricity, and all products can be made using electricity, you have a huge economic advantage. It's not
SPEAKER_00: the cure all that you think that is, even if you have free energy, you have to think about the inputs and the thing that China but no, sorry, I'm not talking about energy. I'm just
SPEAKER_02: saying a general framing like, no, I understand. My point being like the investments we should be making, or where is the puck headed? Not where has the puck been? No, no. So I just
SPEAKER_00: wanted to comment on where the puck is heading. Even if energy is zero in China, you have to think about inputs, meaning factories make things with inputs. And if you look, for example, in natural resources, the inputs by and large don't exist in China. And so all I'm saying is that all of these inputs, whether again, you can take natural resources that proliferate massively in the United States, it turns out that India is utterly, utterly, utterly poorly addressed in a geographical survey perspective. And we're finding that India's raw resources are off the charts. Okay, there's certain places in Africa, tons of stuff in Indonesia and Australia, all of those things may not have to go to China because there are subsidies, or there are equivalently cheaper decisions that governments can make, so that they choose not to send it. And all of a sudden, all of that spending doesn't matter as much because the Australian government makes a trade off that says, you know what, I'd rather have these jobs here, and I'm willing to have a longer payback cycle for these jobs to be here, then instead of ship it to China. And they tell the Australian citizens, I'm sorry, guys, but you're going to have to replace your car every seven years as opposed to every five. I hope you're okay with that, but that'll mean full employment, and it'll prevent fringe candidates and populism. And let's go forward. Where do you
SPEAKER_02: invest? I am investing a lot of money in those places that
SPEAKER_00: control the natural resources that are poorly understood, meaning there are places like India where our geological survey capacity is relatively naive. And it turns out that in critical parts of the energy supply chain or other places, they can play a huge role. And the Indian government's cost of capital has an element, they're sophisticated enough to add an element to the formula that accounts for full employment. If I build it in this state, and if I try to get this many jobs created, the full circle feedback of that allows me to actually transfer price it into the Indian market at this price, which is cheaper than anything that China can do. Even at zero energy. That's the kind of sophisticated decision making that is emerging because of this de-globalization trend, and it's happening everywhere. So the Indians are doing it, the Germans are doing it, and then the US is doing it. And then on top of that, what they're doing in terms of game theory, which I think is even more sophisticated is they're not letting China be alone, they're actually now slowing China down. Because China turns out actually needs inputs from these western economies, and they're like, we're just not going to give them to you anymore. So do the best you can. For example, in semiconductors, the Dutch, the Germans, the Americans, we've now essentially embargoed all of our most sophisticated equipment from ever getting in there. That will increase even with zero energy, the cost of what comes out of there. And that will balance the playing field so that the Germans, the Dutch, the Americans can bring other partners in at a different cost of capital to make it economically neutral and net parity. And the reason they'll do it is to create jobs for Americans, or the Dutch or for the Germans. Okay, I think the
SPEAKER_01: most Yeah, go ahead. I just I think the most important thing here isn't like energy. I don't think it's infrastructure. I don't think it's natural resources, at least for America. It's entrepreneurs. And that's what it's always been for this country. And it's immigration is the silver bullet here. And inspiration and the freedom that this country has for entrepreneurs and founders to pursue a vision to start a company. That's why we've won so big historically, is the combination of immigration and the inspiration that these entrepreneurs do on a global basis to get more entrepreneurs to come to this country, to go to Stanford to start companies. And that's why China is now losing. They cribbed this incredible formula we had of letting Jack Ma do Alibaba and then they decided to for whatever, you know, insecure or stupid reason or pragmatic reason to consolidate power. And that's what will push the world forward and make our country thrive. We have to fix immigration, we have to keep letting entrepreneurs define the future because the government can do so much they can underwrite a couple of chip factories here or there. Sure, we could put money into nuclear or fission or fusion, whatever the next technology is, but you need a singular person who wants to make it their life's mission, who wants to have their sense of pride and innovation push the world forward. And those people are rare. And we are in a competition globally, that we are not focused on that we need to get refocused on to recruit the greatest minds in the world who want to change the world to do it on American soil. I do not disagree with you, J. Cal. I think, you know,
SPEAKER_02: to my earlier comment about how do we walk the tightrope of the debt burden, the de-globalization and populism movements, and the challenges and opportunities ahead, it has to come through innovation. I think that's how you have to invent a new tightrope, basically. I think the
SPEAKER_01: challenge, though, is, Freeberg, that it takes a recognition that there are singular individuals in the world, one in a million, one in 10 million, one in 100,000, whatever it is, who can just drive an entire economy forward, whether it's Gates with Microsoft or Steve Jobs with Apple, there are singular individuals who come to this country, bam, bam, Brogan with the tunneling company. Nice, Paul. Nobody knows what
SPEAKER_01: you're talking about, except for me. There are people who will push these things forward and take risk. And we have to recognize that it's a small number of individuals who are individuals backed by a large amount of capital that create massive jobs and great prosperity. It's an uncomfortable conversation for people to realize that it might just be a couple of dozen people a year immigrating to this country that changed the fate of this country. Yeah,
SPEAKER_03: that's fair. Why do you need to allow 3 million migrants to stream across the southern border every year? Because you
SPEAKER_01: don't know which one it's going to be. That's why. Really?
SPEAKER_03: You don't. That's that's your immigration policy is open border. So that one is I said recruitment. That's how you
SPEAKER_01: are. So you're you're you're reading your explain that it's a great question. Sex. There are there are two things to look at here. There is a dramatic change. So let me finish my sentence. No, I'm just gonna ask you to just verify as you
SPEAKER_00: say, it's your Are you saying that the PhD student that starts Google is streaming across the border or actually applying for? No, absolutely not. To go to college here, parse it for
SPEAKER_01: you. There's immigration and then there's recruitment. And if we frame this process with those two different words, there
SPEAKER_01: are people who are yes, immigrating streaming across the border, however you want to frame it. Sax. I don't look at it in a political way. And then there's recruiting the most elite talent in the world. We can do both of these things. One of them, you know, helps farmers have people to work the fields to have people take entry level jobs to work in the industry. We should bring in two or 3 million of those people per year. We should make it legal and we should celebrate it because we have so many of those positions open that Americans don't want to take. We should then also in parallel and without confusing the issue for political reasons recruit people to come to our universities and when they graduate have their citizenship stapled to that diploma and not let them leave the company country and let them start recruiting companies here. Instead, what we do is we make them fight to stay here. We should be recruiting the smartest, most talented people that will be hundreds of thousands of people per year. Well, hundreds of thousands. Okay. So we should have millions coming across the border. Sick J Cal is very reasonable. No. Yeah. It's
SPEAKER_00: great. Yeah. I think he's so much better when he doesn't
SPEAKER_02: moderate. Yeah. Yeah. Go ahead. Sax. You know, I'm an
SPEAKER_03: immigrant. You know, my dad came over. Yeah. My dad came in 1977 when I was 5 years old. Of course, he had an MD. He was a doctor. He actually had like skills and wasn't immediately going to become a net government dependent. So, I
SPEAKER_03: think that it makes sense to allow immigrants who can actually add something into our economy and bring skills and all the rest of it. But the problem we have is that if you want to take that reasonable position, you're told that you basically have to accept a situation of de facto open borders, which is ridiculous. No, you don't. These are two separate things and I'll just say you're conflated. It's the
SPEAKER_01: number one party that conflates these two issues. You know they're two separate issues. The Democratic Party has
SPEAKER_03: conflated these issues. Okay. Both parties are conflating
SPEAKER_01: them here at the All-In Podcast. Can we agree that? Yeah. Let's unravel them. One group of people could recruit people for PhD programs while one group of people allows people across the border to take service jobs. Yes, obviously the more nuanced policy is the way to go but but
SPEAKER_03: look let me tie this back to Davos man. What was the definition of Davos man? It was somebody who is pushing this ideology of free trade and open borders to such an extent that it creates a nationalist backlash or populist backlash. Fair enough. Yeah. That's exactly what's happened at our southern border is you have the people who believe in immigration push that ideology to such an extent that they won't create a rational, sensible southern border and if it doesn't cross our southern border, it's chaos down there. So look I'm in favor of bringing in the dream team. Yeah. I'm in favor of bringing in the dream team. But the
SPEAKER_02: response of open borders is the creation of this nationalist movement, right? The nationalist movement only exists in the face of open borders. I think that's that's the point right like the extreme bears the extreme. I think the immigration system should be based on points just like
SPEAKER_01: Canada. If the Davos men don't start taking
SPEAKER_03: into account these national considerations around the defense of their borders and these issues around trade hollowing out the middle class, then there's going to be an intense backlash and I don't think those elites have been managing the situation very well. It would have been it would have been better for them to pursue the more nuanced policy you're talking about. Why are we conflating the issue
SPEAKER_01: then? Why do the Democrats and the Republicans, Sachs make this such a polarizing issue instead of stating it the way I did? We're going to show it's so easy. It's so easy. You know, no, no, no. You know, when you when you conflate them, you can
SPEAKER_02: incite an emotional response from your voting base. That's it. That's why all of these issues. That's why all of these issues get based out. They get spaced out to the point that then you can drive someone to vote for you because you've now framed the other side as this extreme side and that's it. You earlier said hold on before you got suddenly very
SPEAKER_03: reasonable. You said that we have to allow the reason we haven't listened. I'm going to quote something you just said a
SPEAKER_03: minute ago. You said that we have to allow two to three million two to three million completely destitute practically illiterate migrants to stream across our border because one in a million of them might be an Elon Musk. No, no, there could
SPEAKER_01: be no, no, hold on. I was talking about the border. Hold on. No, no, no. Immigration typically includes when you say that word, the corpus of people coming in for education and the people coming across the southern border. So if you were to say immigration, most people would reasonably say that's both of those buckets. I separated them out here so we can have a reasonable discussion. Recruitment of higher education talented people with low education migrant workers. They
SPEAKER_01: are two different buckets and you have to be able to say these are two different buckets and that we should have a point based system. If and this is the conversation that doesn't happen amongst politicians but can happen here. Look at Canada. Look at Australia. They have what's called a point based immigration system. They give you points for everything that you bring to the country. If you bring money, if you speak the native language, if you have a degree, if you have a higher education degree or you have skills that that country needs, our country needs to move to a point based system. If you're coming across the board and you don't speak the language and you don't have an education, you have zero points. If you have a master's degree and you speak two or three points and you can let in buckets of people based on compassion, based on needing service workers and based on needing the next Elon Musk or the next David Sachs or Chumaf Palihapitiya. I think the
SPEAKER_02: argument J Cal is that the compassion argument falls on deaf ears in a time where people feel we cannot afford it and it's a luxury to embrace that model of immigration right now. Just pick a number we can reasonably absorb. This is what
SPEAKER_01: Finland did. People look at the southern border and see chaos.
SPEAKER_03: Obviously they want to get that under control before they're going to adopt your point based system. We could do two things at once. We could do another point based system. Are you
SPEAKER_01: opposed to the point based system? I like the idea of I
SPEAKER_03: don't know if my point of view is your points, but in concept, I like your points. No, no, we don't need to. I like the idea
SPEAKER_02: of admitting immigrants based on skills the country actually
SPEAKER_03: needs and a simple recognition that is better to bring in people who are immediately productive. Hold on. They could add to our economy as opposed to being net government recipients. Dependents. We're done. We're done. There are
SPEAKER_01: countries. I just want to point out there are countries. The Scandinavian country specifically that have said we can accept up to this many folks who are uneducated who don't speak the language because we have this many teachers and this many slots in school and so if you anything is Finland and Sweden, they said we can accept 50,000 per year of this type of immigration based on compassion. That's the reasonable discussion that has to happen here, but did you say that we
SPEAKER_03: have to do these two things at the same time? Meaning that until we impose an overhaul of our entire immigration system to be based on skills and points that we can't enforce the southern border. No, I think you can't enforce the southern
SPEAKER_01: border and do it. I think you can do these things at the same time. It's not. Let me just tell you there's going to be no I gotta move us. Canada and Australia are already doing it.
SPEAKER_03: Let me just tell you there's not going to be a broad-based constituency in this country for the type of immigration reform you're talking about until you get the southern border under control because people look at that on the news and see chaos and there's no excuse for that. They should be thoughtful. They should be thoughtful and they should just
SPEAKER_01: look at what Canada and Australia have done. Those countries have actually controlled this and it's not a polarizing issue there. It's a pragmatic issue. Okay guys. I'm
SPEAKER_02: going to move us forward to the the banning of TikTok. So I want to kind of change the the tone a little bit. This story recently is that TikTok has been banned for use on the campus Wi-Fi network. Let's go at a number of universities, including UT Austin, Auburn, Boise State, the University of Oklahoma. So college students can't access the app when they're on the campus network. This is following 19 states that recently banned TikTok and government devices. As everyone knows TikTok is a product from ByteDance, which is a Chinese-based company and there's been quite a lot of political and regulatory huffs and gruffs about ByteDance having this level of insight and access to users in the United States with the assumption being that much of the data that they're pulling out of the app is available to the Chinese Communist Party, which creates a security threat to the United States. That's one argument. I think there is also a significant tie-in to ByteDance. There's over 8 billion dollars of capital invested in ByteDance by firms that we know well like Sequoia Capital, Tiger Global, COTU, Susquehanna and others. They're trying to find a way to monetize their investment in what is truly the most viral, fastest growing, highest revenue growing, biggest startup in the world right now in ByteDance. So there is a restructuring proposal apparently underway that's being discussed in Washington DC right now to try and restructure the organization and the ownership structure and the oversight of TikTok and ByteDance such that US regulators and US companies can oversee the data, the use of the data, the algorithms underlying TikTok and monitor them from within the United States. Question for this group here on the McLaughlin group of 2023 is does that do enough for you? McLaughlin, do you guys think that that's enough? First up is Chamath who's been silenced for a bit. I think this is really bad news for
SPEAKER_00: ByteDance. Basically what's happening is that, and TikTok, all the frustration that all these legislators and politicians have had over Facebook and Google and other sort of big tech companies is going to get focused on ByteDance because you have this common enemy that you can point to as a boogeyman of sorts. And I'm not saying that it's right, but I think that what you're starting to see is it's much easier to pick a fight with a Chinese company and win and get broad-based support than it is to pick a fight against an American company with a bunch of American employees, an American market cap, an American know-how, an American IP that gets impacted. So I don't think this is going to end well for TikTok. And I think the goal, if I were any of these people on the cap table, would be to sell it in secondary to somebody else and get out. I think the next big shoe to drop is going to be advertisers who come under a lot of pressure. So, for example, think of all the advertisers that have left Twitter. There is a point of efficiency where you can live with all of the mess that Twitter has because it comes with a lot less scrutiny and oversight and political pressure than advertising on TikTok. And that, I think, is the next kind of like big wave here. So I think it's very, very bad. I think the enterprise value of this company is quite challenged and these guys should try to sell and get up. Who are the buyers in that
SPEAKER_02: secondary market, though? I mean, that's a lot of capital. The thing is, the cap tables haven't been segregated, so
SPEAKER_00: what you own is equity and ByteDance. But the problem is, the look-through ownership will discount a lot of TikTok if they see a lot more of this stuff happening. You guys have to remember, this is the first three or four weeks of 2023. Wait till we're here in September and October and November. Wait till the election year starts. It's not good. So it's a discount on ByteDance. That probably takes ByteDance down by 70 or 80 billion. So that's a 35-40% discount to their last mark. So, you know, if somebody can sell in the high hundred billions of dollars, I think you should. I think they should probably, they should consider it. It's worth it. I think. Jake, I know you got strong
SPEAKER_02: opinions. Well, I think you have to be incredibly pragmatic
SPEAKER_01: here. This is the same as the 5G issue. You cannot trust the Chinese government to not steal intellectual property or to put back doors into the software. It is common business practice there. Huawei was banned. They basically stole the source code from Cisco. That was proven and it was proven that they were spying on people. Canada, the UK, the United States, Vietnam, everybody has banned using 5G technology from China for a reason. Because they will use it to spy on you. This is the nature of an authoritarian government. It is far too powerful to have a not only the surveillance capabilities that are built into owning TikTok in the hands of the Chinese Communist Party to have the ability to very in a very nuanced fashion, trends certain videos that would steer the United States in a certain direction. In just stupidity. Yeah. In stupidity is one, of course, right? They're letting their you need to look at what. That 60 minutes clip is incredible,
SPEAKER_00: right? It's like they show they're showing science videos to the kids in China. Exactly. And they're showing stupid nonsense to the kids in America. What do you think over millions of videos do our children versus their children?
SPEAKER_01: You can be 100% certain they're doing psyops on our children as we speak. They are trying to make us dumb and distracted while they get smart and sharp. By the way, it's very simple. If you're a sucker, it's not the choices of our kids. The
SPEAKER_03: algorithm just gives you more what you want. Exactly. But
SPEAKER_00: that's like saying if you gave kids a choice between broccoli and chocolate bars, of course, if you put the supermarket and
SPEAKER_01: say eat, they're going to go right to the cereal aisle. The job of the parents acts is number one, know their name. And
SPEAKER_00: then number two, differentiate. Good things and that's your question. I agree with Chamath that the future is not bright
SPEAKER_03: for TikTok here because it's gotten caught up in the geopolitical rivalry between China and the United States. And that's only going to keep getting more and more intense. The US and China are headed for a big security competition. And by dance is caught in the middle. So I agree with Chamath about the future. But you know, this claim is made that TikTok is spyware. And you know, it's listening to you, it's surveilling you, it's keeping track of you. Like, what is the evidence for that claim? I just want to understand that a little better. Like, has anyone ever proven that like TikTok is spyware? And if it is, why doesn't Apple stop it? Can you explain that to me? Yeah, I think that has a complicated
SPEAKER_01: relationship with China. So the claim that they're not going to believe, right, so Jake, your claim is, let me I just want to
SPEAKER_03: pin Jake out down this for a second. Your claim is that 100% TikTok is spyware, and Apple is letting it happen because their relationship with the CCP. I do not have the evidence of
SPEAKER_01: specific instances of them spying. But I do know that this is what the Chinese government is aspiration is, is to be able to have backdoors to spy on all Americans. That's why they you know, are trying to get Huawei to happen. Well, you don't even need to know that because you can just open your eyes and look at and I mean, that's an insult, but you can just look at what TikTok has the access to it has access to your location, has access to your camera roll. And it knows you know, everybody in
SPEAKER_01: your social circle, because it has your address book. So by having your address book, having your location and having access to your photo roll, they have you compromised by default, the
SPEAKER_00: default settings, when you install TikTok, it turns on local network turns on microphone turns on camera, turns on background app refresh and turns on cell data. So TikTok is no worse than anybody else in that because a lot of other apps are very aggressively trying to harvest all that data as well sacks like it's like Alexa is always listening to you, right? But you feel but you feel safer with Alexa because it's a it's an American company or the perception of safety is there. So I don't think there's a huge thing to prove other than yeah, there's a setting that allows you to turn on the microphone, default, and they do it. But they were caught. I just
SPEAKER_01: want to make sure you guys understand this story. The New York Times by dance, the Chinese parent company of TikTok said on Thursday that an internal investigation found that employees had inappropriately obtained the data of us TikTok users, including that of two reporters over the summer, a few employees on a bite dance team responsible for monitoring employee conduct tried to find the source of suspected leaks of internal conversation and business documents to journalists and doing so the employees gain access to the IP addresses and other data of two reporters and a small number of people connected with reporters by the TikTok accounts they were trying to determine if those individuals were within the proximity of by dance employees. So there's an example of them using the technology to try to track down leaks. Hold on a
SPEAKER_02: second. That's exactly what any app a company can do. The photos, the screenshots we got from Twitter that were shared and all those files or whatever that happened a few weeks ago showed that many Twitter employees were able to log in and just view the direct messages between Twitter users and that there's no necessary logging or access privileges required to have access to that information. There are these holes in all of these social networking and consumer digital consumer product companies that allow individuals to go in and do things with consumer data. It's a feature. Sure, but it doesn't reference like some systematic control by a
SPEAKER_01: government agency. No, that's that's the key thing. What
SPEAKER_00: Jake just said is a key thing. Everybody tries to get these things turned default on every app tries to get access to your camera roll to your contacts to turn on the microphone. The problem isn't that those settings exist because Apple created them and Apple created a privacy framework where you have to opt out of it. Okay. The issue is that that data instead of going to an American company with American on with American data centers and American service, it's going to somebody in China or it's the perception that that's happening that I think is a death knell and this is also excluding all of the work that every single big tech company must be doing to point the finger away from them and this is something they can all agree on. If you got if you got Andy Jassy and Zuck and Sundar and Satya Nadella in a room, what do you think they could all agree on? Hey guys, are we better off pointing the fingers at each other or should we just point it over there to a company based in China? So do you think do you think that
SPEAKER_03: TikTok in a way is being scapegoated here or do you think it's a real security threat? Both both. Yeah. That's
SPEAKER_01: yes to both and you know what I think what we saw with the Twitter files for me personally, the one that was most concerning was the fact that the FBI was being treated. They didn't have control of it like the Chinese government has control over by dance at a wholesale level, but they were being given you know pretty close to they were given privileges, but they had more influence than they should have and they should have gotten subpoenas right. So even in a democracy like the United States, you can see the FBI using techniques to get employees on their side to get information on specific users. Imagine if the FBI just had god mode for Twitter or Facebook like what would happen even in a democracy. We see it happen. We see abuse the Chinese government is a Communist Party. They have no problem sucking the data down of every single person and using it however they want. I think the
SPEAKER_00: the problematic thing is that when you look at the capital structure of these Chinese companies post now Xi being ruler for life is the Chinese government has typically a seat on all of these boards. They also typically have a golden vote and so when you think about the governance, the governance of these companies has tilted far away from a normal cap table where it's one shareholder one vote to you are allowed to exist on this cap table at the benevolence of the government and so I think that you have to factor that in as well. So you know is it amplified probably but is there also non-trivial risk that we would never give to any other company. Absolutely like you know take the opposite example. How would we react if the government had a golden vote and a board seat on meta? Going into an election. I mean one party would be crazy and the other party would stay mums the word. That's what I mean. Let's
SPEAKER_02: talk about but let's be pragmatic. The news reports that came out this week indicate that they're talking about restructuring ByteDance. So let me propose this to you guys. If TikTok US were set up as TikTok US Inc. It's its own C Corp. It's based in the US and ByteDance owns passive non-voting shares in TikTok US Inc. All the software, all the services, the algorithms are all run in the US. The data is only sitting on servers in the US and the Chinese have an economic interest ultimately in what happens with that asset but that asset is entirely managed, run, controlled in the US. And I think that's where it's going to end up. You trigger CFIUS so you'd have to then make an exception.
SPEAKER_00:
SPEAKER_00: That sounds like it's part of the discussion that's underway
SPEAKER_02: right now is how do we get past this regulatory hurdle? Because I don't know how you turn off TikTok for 100 million people that are using it for two hours a day. Guys, we're making Instagram and YouTube have replicated it.
SPEAKER_00: We're rejecting deals left, right and center at much, much smaller thresholds because of CFIUS because we're not even dealing with China. Assume you get past CFIUS, Chamath. Assume that there is no,
SPEAKER_02: that they figure out a way. It's a bad assumption.
SPEAKER_02: Right. But that's obviously this $8 billion of capital. Because can I tell you what's happened? The minute that if you
SPEAKER_00: let the Chinese government around and do an end around on CFIUS to own 30% passively, then everybody who's had a deal rejected for a much smaller threshold for a much more benign issue will sue.
SPEAKER_02: Except that they started with this asset versus buying into it, right? That's the difference. And what they're doing is they're seeding the difference here is they're seeding control of the asset to US investors and oversight by the US government versus the reverse, which is trying to come in and buy an economic interest in the US asset. That's not what CFIUS adjudicates. It doesn't adjudicate
SPEAKER_00: where was this originated? It adjudicates in this cap table. Does this person exist? Should they exist? At what threshold? What do they know? And are we giving something that we shouldn't give? Yeah, let me give you another way of framing it. I'm just saying if the pragmatic answer is you can't just make up a bunch of stuff that blows up a bunch of other stuff. Let me frame it differently. What if ByteDance sold TikTok
SPEAKER_02: US to a US-owned private equity consortium, a US-run private equity consortium that effectively bought TikTok US and operated it here in the US?
SPEAKER_00: That's exactly what should happen. But my point is those people are smart enough to not pay full price. They'll say, you're fucked. That asset is worth zero. I will buy it for $10 billion. Take it or leave it. And you know what they'll have to do? They'll have to take it. So my point is the equity value is so impaired in this thing. Will you buy that? For 10 billion? Of course I'm a buyer. But these guys are smart enough to drive a huge bargain, a hard bargain. So if you're existing on the cap table and you've marked it at $320, I would be fucking selling it.
SPEAKER_02: Okay, well, look, something like this is going to happen. So it'll be interesting to watch. And if any group of people got together and tried to actually
SPEAKER_00: buy it for what the fair market value is worth via a spreadsheet, is a horrible investor in this moment. You should hold a gun to their head and you should extract a massive pound of flesh that gives you a huge margin of safety and makes you money good. We know people who are shareholders, if they could have sold it at $320
SPEAKER_01: or $120, they would have sold already. Well, no, there are people that will buy this thing in the
SPEAKER_00: hundreds in size.
SPEAKER_01: Then sell everything you can and then put it into another company. Now the problem is you have to show a markdown because you've
SPEAKER_00: already marked it at $320. So you gotta take a 65% discount.
SPEAKER_01: Yeah, if you're underwater, you're underwater. But for anybody who got into the sub 1 billion round, you can't eat IRR and you can't eat paper markups.
SPEAKER_00: You can only eat the distribution. So get the DPI and move on is what I said. Get the DPI and move on.
SPEAKER_01: It's another bet you could place. Why try to be greedy and get the last 3x out of this investment?
SPEAKER_02: I want to move away from software meets leisure to software meets human health and productivity. A couple of weeks ago, we were going to talk about this last week. It was announced that BioNTech was buying InstaDeep. InstaDeep is a broad horizontal AI or machine learning tools company services business. They partner with big businesses to help them build out ML driven infrastructure to improve their products and their operations and their businesses. One of their customers was BioNTech, the company that designed an own VIP for the original Pfizer COVID vaccine, one of the originators of mRNA based technology. BioNTech doesn't just focus on mRNA technology. They also focus on cell and gene therapies, the novel new kind of modalities that are emerging in therapeutics. It was a really interesting acquisition. It was a 250 person team that they bought the company for about $600 million specifically to improve how AI can be used to accelerate drug discovery. I'll just make a comment on this and then Sax, I'd love to hear your point of view on these types of businesses broadly. The capabilities of machine learning when applied to a particular vertical are quite profound. I've certainly been involved in this space in agriculture and increasingly doing more of this work in pharmaceuticals and biotech. And when you can have large unique data sets that you can then model using these tools and these capabilities and be predictive about what the next product iteration should be, it can really change the value in the trajectory of your business. One of the big trends in pharma right now is to move from in vitro testing, meaning you're running biochemical experiments in labs, in assays, iterating testing, experimenting to see what molecules work or what protein does what and if it binds to the target and doing more of this in silica as it's being called, which is in software. And rather than just doing testing in software, you can actually use tools like AlphaFold that can be predictive of large molecules and how they can drive outcomes to make decisions about what to put in your pipeline. So if you take 99% of the junk out of the top of your pipeline and you only focus on the 1% that the software predicts will be more successful, you much more quickly get drug discovery through the pipeline and you have a much higher hit rate. So the ROI is extraordinary, particularly when you're talking about multi-billion dollar revenue streams coming out the other end of that pipeline. And so I think the way this reads, these guys raised $100 million in a round last year, sold the company for $600 million. It seems very similar to DeepMind being bought by Alphabet a few years ago, where the application of the team is pretty broad across a number of opportunities, but BioNTech bought them to focus on the kind of pharma space. So I guess, Stacks, in the earlier stage, and I see a lot of teams now that are like, hey, we're AI for this or ML for that. A lot of pharma and biotech deals have to have the catchphrase ML or AI in their writing now because of the economic improvement of those businesses. Are you looking at enterprise software businesses that aren't necessarily about the typical subscription model where you sell a seat license and people pay for that, but have this broad tool set and toolkit where these folks are earning revenue share or participating in a services revenue stream for enhancing the value of their partner in the AI or ML space? And what's the better business model? Because I think this is where so many new teams are starting out, is what's the business model and what should we be focused on with our ML toolkit?
SPEAKER_03: I mean, the short answer is no. We haven't done any deals like that. Well, we're not pharma investors, so I don't know how I would be able to evaluate, even if it is a software product, I don't know how to evaluate its effect on pharma outcomes. So I mean, we haven't done any deals like that. But what about for other verticals?
SPEAKER_02: I mean, like, do you look at ML and AI companies that are more services or partner oriented versus just selling seat licenses to a software tool? I mean, is that a big trend you're seeing? I don't think we have enough data to tell you what the trend is.
SPEAKER_03: We did a deal called Pearl, which is creating an AI for dentistry. So what it'll do is it scans in all of the X-rays and, you know, dental records from from dental practices. And it gives a kind of a second opinion. It can spot things like cavities and things like that, or just changes in the condition where it's really powerful is over time, right? If it's got your last six sets of X-rays over a whatever, six year period, it can detect changes that are probably, you know, hard for a human to see. So they think they can get to like better than human sort of diagnosis by using computer vision. And then we invested in it sort of after that, where we realized, OK, this is kind of like a powerful application. So we invested in a company called Robo flow, which creates tools for computer vision. So Pearl created its own tools for taking a large number of X-rays and classifying them and then creating their own AI tools. Robo flow gives you that same tool set, but you can run it on any computer vision project. And they seem to be building a pretty big universe of software developers who are using their tools. And in this case, this was a team that was bought.
SPEAKER_02: They bought a 250 person team for $600 million that just had this capability set, really, and a toolkit. Does that change your outlook for investing in ML AI companies? When you see a $600 million exit for effectively a capability, they didn't have, you know, a core product that was in market. They were doing kind of these co-development deals. But I mean, how much does this sort of an AI? Well, I mean, AI is already the hot thing.
SPEAKER_03: Everyone's kind of looking at this now. I don't know. Like you never want to base an investment decision on the fact that some acquirer might come in and buy you for a large amount of money when you have no revenue or business model. I just think like that's not really a sustainable, although it does seem that AI engineers go for
SPEAKER_01: 2 million each, I think is kind of your point Dave on an M&A basis. Yeah. I mean, you deep mind got bought for what, 600 by Google. And I think they had 200 people. I think it was like 400. Yeah. It was like 400. Yeah. So yeah, it does seem like, and I think deep mind did not have a business concept in mind when they were funded. They just wanted to do research, right? That was kind of the platform capability similar to instant deep.
SPEAKER_02: I mean, there's a lot of these, that's what I'm pointing out is like some of these platform capabilities end up just getting bought for, you know, huge sums. Yeah. I mean, it's not a strategy as SACS points out.
SPEAKER_01: The amount you can invest in a company hoping for an unreasonable acquisition, meaning unreasonable,
SPEAKER_03: meaning that reason will acquire. Yeah. Yeah, like unreasonable, meaning that your own metrics don't reflect that valuation as a business. You might be worth it as a strategic acquisition of somebody else, but you, you actually raised an interesting question, which is, is a seat model the right way for one of these companies to price the product. And you may be right that that the seat license model doesn't really work because like how many seats do you really need to buy for these companies? It's also, look, I mean, one of my, like when I engineer,
SPEAKER_02: Yeah, when I worked at the, I mean, we've seen this, we've even seen, we've had these debates inside the companies
SPEAKER_03: I mentioned where like, you know, charging a $10 or even $100 a month seat doesn't really reflect the value of the insights that are being created. And so, yeah, there are like, you know, there, I don't think this has been figured out yet, But this is the big question in ML and AI.
SPEAKER_02: When I was at Monsanto, you know, we had all this IP licensing deals we do or new products would come to market and it was never cost plus or simple pricing. It was always about value capture. If in an enterprise setting, you know, because we sold to farmers, it's like how much value are you delivering for the farmers? If it's $100 of profit an acre, you try and charge an incremental $30 an acre for that product. And it was always a one third value capture model. And the same is true in biotech and pharma. The producer of the product or the co-developer of the product is often trying to value capture. And it's not a site seat license and it's not a service fee. It's more ultimately we want to get a royalty on the outcome on the improvement that we can deliver to you. And so there's all these novel business models that are emerging, at least that I'm seeing in pharma and biotech to participate more meaningfully, ultimately, in the drug development outcome versus just getting charged a fee for doing a service or a fee for a license to a software package. The value of these companies has gone down.
SPEAKER_00: I was an early investor, series A investor in a company called Flatiron Health. We sold it for $1.9 billion to Roche. That's the biggest exit in this space for this machine learning enabled stuff. It happened in 2018. And so what's really happened is the value of acquisition in M&A has gone down, even as the technology capability has gone way, way up. And why is that? It's because this stuff has yet to be proven to actually meaningfully improve the hit rate for these drug companies. So whether it's BioNTech or Roche or anybody else, the biggest problem we still have is getting the design space guessing that better. And these machines are better at doing raw calculations, but they're not necessarily better at veering towards this design space over this design space. And so as a result, you're not improving either the slugging percentage or the batting average of these pharma companies. And that's why they're paying less and less. So everybody will have this capability as an adjunct. The thing that you have to do is sort of what you guys have said, which is if there's a company that can actually do better guessing at the top of the funnel, the thing that you should probably do is just give it away in return for a back-end rev share and a royalty. And that business also exists. So the best performing company in pharma is a company called Royalty Pharma. It's a $22.5 billion company that has 90% EBITDA margins. It exists in Ireland. It's run in New York by this wonderful entrepreneur, Pablo Lagerretta, but that's what he does. He buys small pieces of royalties. And his whole thing is like the Paul Graham thing at YC. I'll give you just that little amount of support and all you need is a little lift in valuation to justify giving me the 6%. And the tooling company, the AI company that does that could win. Who would go to Roche and buy on tech or Lilly or somebody else and just say, look, use my tools and whatever drug you generate off of me, I just want a 3% royalty. And all you need to do is just show a 3% lift across a portfolio of assets. That would be a killer business model because if you look at what Pablo's done over a large number of successes, that's a ginormous company.
SPEAKER_02: JCal, I mean, are you investing in the seed stage, ML, AI companies and are there novel business models that you're seeing? We're not seeing too many yet, to be honest. We are seeing people play with chat GPT and kind of do, you know, experiments.
SPEAKER_01: But, you know, the more I've used chat GPT, we've connected it to our Slack. So you can actually ask a question in our Slack in a channel called AI testing and it will give the answer and everybody can see people like playing with it. You know, it's kind of like a parlor trick. Now I'm in like that phase where I'm like, yeah, this is impressive, but it didn't actually solve my problem. And it's slightly faster than doing a Google search. So I am thinking there's going to be a really good business created in taking the open source projects and forking them and verticalizing them like, you know, Saks is one that's doing dental work, you know, like this makes sense to me. Somebody should do it in accounting. Somebody should learn all of gap accounting, which is pretty simple because it's published
SPEAKER_00: FASB, all of this nonsensical accounting rules and give you a hundred percent guarantee of no malfeasance. So for example, you guys saw this Brazilian company. You want AI accounting. That's your, that's your look at this company. Logis, logis, look at this company, Americana in Brazil, which just torched $20 billion
SPEAKER_00: of enterprise value. Why? Because these guys were using Excel to do a bunch of complicated tasks. To do a bunch of complicated capitalization and cost accounting made two or three years of mistakes. It added up to two or $3 billion and they're basically going to file bankruptcy in the next few days. That's completely avoidable human error that should never happen. And an AI would be perfect for that. Like this is not super controversial to just follow gap accounting. Right. I mean, I don't know if you need AI for that.
SPEAKER_02: I think you just need software. Like a database would be good, but no, the problem is the database exists today.
SPEAKER_00: Like everybody sits on top of Oracle GL or Workday. It doesn't prevent these errors. So my point is you got to get humans out of the system and the AI should be the accountant. The AI knows the rules, generates the P and L and says, this is it. And by the way, that's way better risk management for the CEO and the CFO. Because as you guys know, if you're the CEO of a public company, you have to sign your signature that these things are legitimate. And how do you know? I would way better know that a computer did it. Like an open AI algorithm tells me, chum up. This P and L is perfect. Then some dude, I don't know at Ernst and young.
SPEAKER_00: Okay. I have a question for Saks. Saks. Epoo, can you please explain to me why Alec Baldwin is going to get charged with manslaughter for this rust thing? That seems really crazy. Can you just say, can you just explain what happens on a set with guns and how the hell did this happen? Like what the hell is going on?
SPEAKER_03: Well, I've produced two movies, but neither one of them involved, you know, guns or shootouts or anything like that. So I haven't had like firsthand experience with this. I have, you're a gun owner.
SPEAKER_02: So you're an intersection of movie producer and gun owner. So it's a good, I understand the rules of gun safety and that kind of stuff.
SPEAKER_03: Look, Alec Baldwin did not follow the rules of gun safety. The first thing I would do if I was ever handed a gun would be to clear it. I'd like check it, see if it was loaded and clear it. When you never pointed at you at somebody, you always treat a gun as if it's loaded, even if you think it's not. But he was in a very specific situation, which is he's on a movie set and the person who's handing him the gun is the armor and someone whose job it is and said, cold gun.
SPEAKER_03: Yeah, exactly. It's somebody whose job it is to make sure that the gun is handled properly and unloaded and all that kind of stuff. And they're using it on a set. So I agree with you. I don't quite understand why Alec Baldwin is liable in that situation for the gun going off the person who screwed up here. The person who screwed up is the armor. The armor. I have a question person whose job it was to never allow live ammunition on the set, but to handle the guns properly. He hired this person.
SPEAKER_01: I thought the whole point of guns in movies was that they were fine blanks.
SPEAKER_03: Yeah, they were firing blanks, but they had blanks and regular ones in their kit for whatever
SPEAKER_01: reason, because they were shooting real ones as well. But this is involuntary manslaughter. And I think Baldwin is also the producer of the film. So I don't know if this has to do with his hiring of the armor. You know what I'm saying? No, that I can speak to.
SPEAKER_03: Listen, you frequently give stars in an independent movie a producer title. He's not responsible for the physical production of the movie. I bet anything he's not. There's a guy called the line producers responsible for the physical production. And my guess is he wasn't even responsible for the business side of the production. They've got other producers for that. So it doesn't make sense to me if they're going to charge him for having some sort of overall liability as a producer to then not charge the other producers. That just doesn't make any sense. So I think this producer credit thing is probably a red herring. Like I said, I think the armor is the person who is secretly responsible for this situation. They're the ones who screwed up. They're the ones who had a responsibility to make sure that the gun handed to an actor. I mean, Alec Baldwin's an actor. Yeah, look, conservatives in social media are dragging the guy because they think he's a douchebag and he doesn't know how to handle guns, but that's not his job. He doesn't. He's not a question. Yeah, movies.
SPEAKER_00: Why would you ever have live ammunition on a movie set?
SPEAKER_03: You shouldn't. They shouldn't.
SPEAKER_01: Yeah, you shouldn't. It's a mistake.
SPEAKER_00: So it's not as if like the scene is different if you have a real bullet versus a blank.
SPEAKER_03: No, it should as far as I know, it should only be blanks. If I remember right, there was a story about how the gun armory people were taking members
SPEAKER_02: of the cast and crew and they were shooting guns for fun in the desert and they were doing like targets and messing around and teaching people gun stuff and just playing around, but using live ammunition and that that led into an accident that there wasn't good kind of transition. That's really bad.
SPEAKER_03: That sounds like the kind of negligence that caused this. But unless there are facts we don't know about, I don't know why. The armory is also being charged by the way, within the armory. That sounds totally legit to me.
SPEAKER_02: So guys, listen, I need to run another call. I was going to talk about this really fantastic paper on the one of the driving forces of aging as demonstrated by a team from Harvard in collaboration with many others on epigenetics and the loss of data integrity and epigenetics really being the core driver of aging in mammalian cells. It's an incredible paper. It speaks a lot to what we talked about last year, Yamanaka factors and partial epigenetic reprogramming of cells, how they can reverse aging. These guys have demonstrated it in a really powerful way. I'd love to spend some time on it. Maybe we pump that science corner to next week. Wrap up for today, I think we've talked about all sorts of fun stuff. It's been a real pleasure and an honor to be in the seat of the world's greatest moderator. We miss him today. We honor him. We look forward to having his return next week. It's been a pleasure chatting with you, gentlemen, and on behalf of the All In pod and my co-hosts, Chima Palihapitiya, David Sacks, Jason Kalakianos, thank you for listening. Bye bye. Love you boys. Bye bye.
SPEAKER_00: Oh, man. My haberdasher will meet me at... We should all just get a room and just have one big huge because they're all just useless. It's like this like sexual tension, but they just need to release them out.
SPEAKER_03: What? You're a bee. Bee. What? You're a bee. You're a bee. We need to get merch.
