E27: The Great Inflation Debate, Amazon gets spicy on Twitter, rethinking supply chains & more

Jason Calacanis 0:00 Hey, everybody. Hey, everybody. Welcome to the All-In Podcast. With us today, again, the Queen of Quinoa, David Friedberg, David Sacks, the Rain Man himself, and of course, the Dictator here, Chamath. And let's get ready. It's- it's time.

David Sacks 0:16 (laughs)

Narrator 0:16 (instrumental music plays) ****** He's known as the Globetrotter ******

Jason Calacanis 0:19 Chamath-

Narrator 0:20 ****/ He broke out ****/ But he known as the Cold Choler ***

Jason Calacanis 0:20 ... and Sacks.

Narrator 0:21 ****/ From home he froze ****/ He sold his home ****/ And closed his own door ***

Jason Calacanis 0:22 Here it comes, everybody.

Narrator 0:24 ****/ He closed his own door ***/ ******/ He chose his own disorder ***

Jason Calacanis 0:26 Sacks is ready.

Narrator 0:27 ***/ He chose his own disorder ***/ ******/ He goes no further ***

Jason Calacanis 0:27 In the red corner-

Narrator 0:28 ***/ He goes no further ***/ (laughs)

Jason Calacanis 0:29 ... representing Richard Nixon-

David Sacks 0:31 (laughs)

Jason Calacanis 0:32 ... Ronald Reagan-

David Sacks 0:33 (laughs)

Jason Calacanis 0:34 ... Nixon, and rich people everywhere-

David Sacks 0:36 (laughs)

Jason Calacanis 0:37 ... David "The Rain Man" Sacks.

David Sacks 0:40 Somebody's gotta do it.

Jason Calacanis 0:41 And in the blue corner, representing- (laughs)

Chamath Palihapitiya 0:45 LBJ.

Jason Calacanis 0:46 ... the underserved-

David Sacks 0:48 (laughs)

Chamath Palihapitiya 0:48 (laughs)

Jason Calacanis 0:48 ... the forgotten, the underdogs-

Narrator 0:50 (instrumental music plays) ******/ So he don't have to tell you ***/ ******/ He goes all in w***/ ******/ So he don't have to tell you ***/ ******/ He goes all in w***/

Jason Calacanis 0:50 ... the woke left, Chamath Palihapitiya.

Narrator 0:55 (instrumental music plays) ******/ So he don't have to tell you ***/ ******/ He goes all in w***/ ******/ To let your winner slide ***/ ******/ Rain Man, David Sacks ***/ ******/ I'm goin' all in w***/

David Sacks 1:05 And it's sad. We open sourced it-

Narrator 1:07 (instrumental music plays) ******/ So he don't have to tell you ***/ ******/ He goes all in w***/ ******/ To let your winner slide ***/ ******/ Rain Man, David Sacks ***/ ******/ I'm goin' all in w***/

David Sacks 1:07 We open sourced it to the fans and they've just gone crazy with it.

Narrator 1:09 What he says-

Jason Calacanis 1:10 WSI's Queen of Quinoa.

Narrator 1:12 (instrumental music plays) ******/ I'm goin' all in w***/ (instrumental music plays ends)

David Sacks 1:16 And- and I will also be representing John F. Kennedy, who said a rising-

Jason Calacanis 1:21 Oh.

David Sacks 1:21 ... who said, "A rising tide lifts all boat," and maybe even some Bill Clinton too.

Chamath Palihapitiya 1:25 Bill Clinton.

Jason Calacanis 1:25 Oh.

Chamath Palihapitiya 1:25 Bill Clinton. I was gonna say.

David Sacks 1:26 Yeah.

Chamath Palihapitiya 1:27 Don't forget-

Jason Calacanis 1:28 Really? Don't forget Bill Clinton?

Chamath Palihapitiya 1:28 ... the champion- the champion of the left and the right. Yeah. Okay. Bill Clinton did a great job. He ended- he ended the welfare state.

Jason Calacanis 1:35 All right. So, here we go, folks. Um, in- in- in show housekeeping, we do need to point out that, uh, we- we've been running some polls. (laughs) The- the fans of the show have been running polls. And I- I- I don't even know why I'm bringing this up-

Chamath Palihapitiya 1:51 (sighs)

Jason Calacanis 1:51 ... because I got barbecued in them. (laughs) But we have three polls we need to share with the audience from Twitter. The first is, if you could have just one of the All-In Pod besties to mentor you in your startup growth, who would it be and why? Looks like Rain Man, you ran away with that one with 39%. The Dictator with 34. Queen of Quinoa coming in at 17. And Ubersderforth and Fester (laughs) came in with a measly 8%.

Chamath Palihapitiya 2:15 I will tell you, this is- this is why 83% of startups fail.

David Sacks 2:19 (laughs)

Jason Calacanis 2:19 (laughs)

Chamath Palihapitiya 2:19 They choose the wrong mentor.

David Sacks 2:22 (laughs)

Chamath Palihapitiya 2:22 (laughs)

Jason Calacanis 2:22 Perfect.

David Sacks 2:24 So I was- I was proud to win this one, but the truth is... So Chamath was slightly ahead. And then I put my thumb on the scale by retweeting the poll, 'cause obviously, my followers are more likely to vote for me.

Jason Calacanis 2:34 Yes.

David Sacks 2:34 So then I shot ahead, and I kept real quiet 'cause I didn't-

Chamath Palihapitiya 2:38 (laughs)

David Sacks 2:38 ... want Chamath retweeting it-

Jason Calacanis 2:41 Woo!

David Sacks 2:41 ... to his 1.2 million followers. And if he had done that, he probably would've blown me out of the water. But I kept real quiet till the time elapsed, and then I- and then I shared it with the group.

Chamath Palihapitiya 2:51 No- nobody keeps a track of, uh, followers, but, uh, it's actually closer to 1.5.

Jason Calacanis 2:56 (laughs)

David Sacks 2:57 (laughs)

Chamath Palihapitiya 2:57 (laughs)

Jason Calacanis 2:57 The only person who knows your follower count better than you, Chamath-

David Sacks 3:00 (laughs)

Jason Calacanis 3:00 ... is Phil Hellmuth. (laughs)

David Sacks 3:03 (laughs)

Chamath Palihapitiya 3:03 (laughs)

Jason Calacanis 3:04 Phil Hellmuth actually-

David Sacks 3:05 (sighs)

Jason Calacanis 3:05 ... every morning, Phil Hellmuth subscri- uh, subtracts his number of subscribers from yours to know the net. All right, second poll came up. Thanks, Matt, for this, by the way. Matt Yarger, no friend of mine. All right, per request, (laughs) let's do another poll and see the other side of this story. If you could have just one of the All-In Pod (laughs) besties moderate your podcast, who would you choose? And (laughs) it turns out The Dictator, 31%, to my 30.6%, a full 1% more than me. I came in second, World's Best Wingman, and Rain Man, 21%, Queen of Quinoa, 16%. And then most importantly, which bestie would you want in your- on your side in a bar fight?

Chamath Palihapitiya 3:47 I will say, it's Chamath's smooth, velvety voice that, uh, that ran away for him here.

Jason Calacanis 3:51 Hmm. Thank you.

Chamath Palihapitiya 3:53 Yes.

Jason Calacanis 3:53 Which-

David Sacks 3:53 I think- I think the- no. I think the audience was just trying to hurt Jason.

Chamath Palihapitiya 3:56 (laughs)

Jason Calacanis 3:57 I think what it is-

David Sacks 3:57 They were just trying to hurt Jason. That was it.

Jason Calacanis 3:59 They just want-

David Sacks 3:59 That was it.

Jason Calacanis 4:01 ... some like pain. (laughs)

David Sacks 4:01 (laughs)

Chamath Palihapitiya 4:01 Jason has heard he's inadequate by more than 1% for a long time. It's not the first time. (laughs)

Jason Calacanis 4:07 (laughs)

David Sacks 4:07 (laughs)

Jason Calacanis 4:07 Uh, it's- I mean, people are like-

Chamath Palihapitiya 4:08 Usually it's measured in inches, not percentages to people.

Jason Calacanis 4:11 Somebody was dunking on me on Twitter, and they're like, "You're the poorest of all your friends." I was like, "That's the strategy. (laughs) Always have more powerful and richer friends than you. Then you don't have to worry about picking up the check." Okay. Uh, and then there was another interesting AI breakthrough this week. I don't know if you saw.

Chamath Palihapitiya 4:28 Wait, wait, wait. Did you talk about the bar fight? What was the... Oh, I'm curious. I-

Jason Calacanis 4:30 Oh, the bar fight one. Hold on. I- you're right. I didn't get to that one. Uh, the bar fight was... Oh, here we go. For some reason, these morons seem to think that your stick legs are gonna help them in a fight. (laughs)

Chamath Palihapitiya 4:44 Bro, that's a bad... Uh, honestly, I- I need to correct this. Like, that was maybe bad lighting or a bad camera angle.

Jason Calacanis 4:50 (laughs)

David Sacks 4:50 Oh. (laughs)

Chamath Palihapitiya 4:51 But hold on a second. No, hold on. (laughs)

Jason Calacanis 4:54 Oh, really, guys?

David Sacks 4:54 (laughs)

Chamath Palihapitiya 4:54 No, stop it.

Jason Calacanis 4:55 You got to be kidding.

David Sacks 4:55 (laughs)

Chamath Palihapitiya 4:55 Wait, wait, wait, wait. Oh, my word.

David Sacks 4:57 (laughs)

Jason Calacanis 4:57 Oh my god. Really?

Chamath Palihapitiya 4:57 You know what? I-

David Sacks 4:59 (laughs)

Jason Calacanis 4:59 So-

David Sacks 4:59 (laughs)

Jason Calacanis 4:59 You are opening up a Pandora's box right now. (laughs)

Narrator 5:01 (laughs)

Chamath Palihapitiya 5:02 Wait, I- honestly. They're not-

Jason Calacanis 5:04 Chamath-

Chamath Palihapitiya 5:04 They're... Guys, guys, guys, guys, guys, honestly, come on. They are not as skinny as people seem to be railing. And honestly, I'm- I'm happy to... You know, if- if there's a standard-

Jason Calacanis 5:15 Prove it.

Chamath Palihapitiya 5:15 ... way of measuring-

Jason Calacanis 5:16 Prove it. Prove it.

Chamath Palihapitiya 5:16 Is there... Okay, you know what, Jason? If there's a standard way, if somebody can tell us, what is the standard way of measuring leg circumference, I'm happy to submit my- my-

Jason Calacanis 5:25 (laughs)

Chamath Palihapitiya 5:25 ... my measurements. I don't think they're that skinny.

Jason Calacanis 5:27 (laughs) They're really, really anorexic.

Chamath Palihapitiya 5:30 (laughs)

Jason Calacanis 5:30 It's super disturbing.

Chamath Palihapitiya 5:31 Fuck you.

Jason Calacanis 5:32 You got a lot going on up top. I'm very proud of you. But below the belt, mm, not so good.

Chamath Palihapitiya 5:36 That's not true, bro. I work out my legs a lot. You know, it's-

Jason Calacanis 5:38 You do?

Chamath Palihapitiya 5:38 ... it's- it's-

Jason Calacanis 5:39 Keep working them.

Chamath Palihapitiya 5:40 ... my... It's legs and abs to keep your back strong as you get older. I will tell you guys one thing this po- this, uh, podcast will win in a poll is the hosts talk about themselves more than any other podcast on the internet. (laughs)

Jason Calacanis 5:50 (laughs)

David Sacks 5:50 (laughs)

Chamath Palihapitiya 5:50 We no longer exist.

Jason Calacanis 5:51 No, because we need to talk about each other in order to make fun of each other.

Chamath Palihapitiya 5:54 Yeah, this should be called the Navel Gaze Podcast. All right.

David Sacks 5:56 (laughs)

Jason Calacanis 5:56 All right, here we go.

Chamath Palihapitiya 5:57 Let's go.

Jason Calacanis 5:57 So, uh, besties that you most want in a fight. Queen of Quinoa coming in dead last.

Chamath Palihapitiya 6:01 Yeah.

Jason Calacanis 6:02 I'm coming in at 17%. Rain Man, 32%. And Chamath, I guess that thirst trap you tweeted got you 39% in that poll.

Chamath Palihapitiya 6:10 ... I, uh-

Jason Calacanis 6:11 The other- the other- the other thing these polls taught me is- is why democracy doesn't work. But go on, Chamath. Yeah.

Chamath Palihapitiya 6:15 I can- I can hold my own in a physical altercation. (laughs)

David Friedberg 6:19 (laughs)

Jason Calacanis 6:19 I think, yeah, I think you want Chamath and I, 'cause I think Sax is gonna be under the table calling 911 and Freeberg's gonna try to talk it out and get just-

6:27 (laughs)

6:27 ... absolutely sucker punched. He's gonna be like, "Guys, we don't really need to fight." Boof. (laughs) All right.

Chamath Palihapitiya 6:33 Jason- Jason is the one that would smash the beer bottle, create a shiv, and say, "Let's go."

Jason Calacanis 6:38 Let's go. (laughs)

Chamath Palihapitiya 6:38 I- that- I- I would- I would have Jason, uh, I would- I would actually pick Jason as number one. Uh-

Jason Calacanis 6:43 And y- if you were gonna be in a bar fight?

David Sacks 6:44 Jason certainly touts his Taekwondo skills on more than one occasion he's claimed-

Jason Calacanis 6:49 (laughs)

David Sacks 6:50 ... to be a expert in Taekwondo.

Jason Calacanis 6:52 Can we pull up the video? Isn't there a video of you doing Taekwondo?

6:55 Where's the video?

Chamath Palihapitiya 6:55 (laughs)

Jason Calacanis 6:55 Oh, yeah.

David Sacks 6:55 (laughs)

Chamath Palihapitiya 6:55 No, where's the video of Jason pushing Hellmuth? (laughs)

Jason Calacanis 6:59 That's a fake news video.

Chamath Palihapitiya 7:01 If you wanna see Jason-

David Sacks 7:03 (laughs)

Chamath Palihapitiya 7:03 ... and a grown man, another grown 50-year-old overweight man fighting, we have video of that.

Jason Calacanis 7:08 Yeah.

7:08 (laughs)

David Sacks 7:09 Well, I don't... That- that- that one I don't know if we should show, but Nick, you should definitely insert the image of J Cal trying to do the Taekwondo kick and it looks like he's about to have a her- herniated groin.

Jason Calacanis 7:18 (laughs)

David Friedberg 7:19 (laughs)

David Sacks 7:19 It's about- it was like it's about to fall over.

Jason Calacanis 7:21 About five years ago. Yeah, insert that picture.

David Sacks 7:22 Yeah.

Jason Calacanis 7:22 Yeah, it was from my 20s.

Chamath Palihapitiya 7:22 All right, let's start, Jason.

Jason Calacanis 7:23 All right, let's start.

Chamath Palihapitiya 7:23 What do you got? What do we got

Chamath Palihapitiya 7:25 this week?

Jason Calacanis 7:25 I guess the- the topic we should get right to is inflation. Um, this is a topic we've been talking about a whole bunch, uh, because we're printing a ton of money. Everybody seems to think the hedge against inflation is to buy Bitcoin or do you put your money into equities? And are we actually gonna see things other than homes and education massively inflate? We've seen some anecdotal evidence of this. Tesla increased the price of their cars. Used cars have gone up in price, which is a function of the lack of production of some cars during the pandemic, so there- there might be a multitude of factors there. But just putting it out there, are we gonna go- are we gonna face inflation that, you know, goods and services are gonna just go through the roof in cost? Or do we have enough efficiency, uh, in the system that the average consumer is not gonna see massive inflation in the products and services they buy coming out of the pandemic?

David Sacks 8:16 Well, isn't- isn't the- isn't the real issue that Chamath says inflation is good and he... Because it creates equality and he thinks 1979 was a great year?

Jason Calacanis 8:24 Yeah. (laughs)

David Sacks 8:24 I think you should go straight to that.

Jason Calacanis 8:26 All right, I was gonna-

David Sacks 8:27 No, no, no, no, let's- let's go-

Jason Calacanis 8:30 I was gonna tee it up first to explain his tweet storm.

David Sacks 8:33 No, no, no, let's go...

Jason Calacanis 8:33 Okay.

David Sacks 8:33 And then I'll respond.

Jason Calacanis 8:34 Okay, there we go.

Chamath Palihapitiya 8:35 So I think, David, you got unnecessarily emotional and personal. That was not... Again, these- these were things that I've learned from someone who I will say without betraying him, um, is an extremely well-respected person at an extremely well-known institution that basically has helped make a lot of, sort of, you know, capital allocators very smart about things and has made people a lot of money. So, uh, I was relaying what I learned through him. So let me just relay that again, and I'll just start with this. Whenever you have a dollar of income, you can do one of two things with that income. You either consume things, right? So you buy. Or you can save and you can put it into investments for the future, right? So consumption and investment. The reality is that most people, so the lower 60% of the income distribution, essentially spends above their income, right? The lowest actually spends at, so a dollar earned is a dollar spent. And then the middle two, because they have access to credit, a dollar earned, they spend about, you know, uh, percentage points more than that. When you get to the richest, uh, 20% of the population, they're actually able to save and they save about 13 cents of every dollar and they're able to invest in the future. So, consumption and investment. The reality is inflation comes through a volume of activity, right? So you, as a rich person, can go and buy one $100,000 necklace at Tiffany's. It doesn't move the needle for inflation. But when, you know, 200,000 people buy a $1,000 television, that's felt in the economy. It moves. So inflation comes because of gross tonnage of volume so you need consumption. And by definition, what that does is it pushes consumption into those, you know, that 60 to 80% of people that are not the top 20%. So what it means is that, you know, you have a volume game of people buying things, and when they buy more of those things, inflation goes up. How do they buy more things? They have more income because their propensity is to consume. So then you have to ask yourself, "Well, where is this incremental, uh, income coming from?" And all he has observed, which I think is very credible, is we had the supernatural event in the pandemic. We've now started to print trillions of dollars of incremental consumption. And that's going to start to lead to the most simple ways in which consumption manifests in inflation, which is via commodity prices. What does that mean? Let me state simply. A rich person lives in a well-insulated house, drives an electric car, and eats fish. A less rich person lives in a poorly insulated house, lives- you know, drives a, um, an SUV and eats beef. Beef versus fish as a simple example, it consumes 20, 30, 50, 100 times more input costs to generate that same pound of protein than a fish does. It's just an example of showing how income distributions and the effects and the consumption patterns of large swaths of people drive different consumption behaviors which drive inflation. So all he was trying to represent to me was that idea, which is that we have printed trillions of dollars. We are creating artificial levels of consumption. That consumption will actually drive up commodity prices. Commodity prices will actually drive up inflation. Then what he sh- told me was the best analogy, again, it's not perfect but it rhymes to the history, is what actually happened in the 1970s.... which is that by having this sort of, um, boundary condition, you have to ask yourself, what will happen if inflation rips higher? And, you know, starting in the late '60s through s- the '70s, that's kind of what you had, a same kind of boundary con- Forget the way in which the money got to people. You know, in this case, it was a government check. But in the late '60s and early '70s, we had similar kinds of programs. We had Head Start, we have, uh, you know, AmeriCorps, we had Food Stamps Act, we had the Social Security Act. All of these things were transfer payments. And when you put h- that much money into the hands of a large swath of people, consumption went up, commodity prices went up, inflation went up. It peaked in 1979, but it also happened that when that happened, the gap between the rich and the poor was the lowest it had ever been. And so I thought that that was a really interesting thing to observe.

Jason Calacanis 13:12 Okay. Sachs, you, uh, were triggered, you were triggered by this.

David Sacks 13:17 Well, I wasn't triggered, I just said it was Chamath's worst take ever.

Jason Calacanis 13:20 (laughs)

David Sacks 13:20 And then, uh, and then-

Chamath Palihapitiya 13:22 But, but David-

Jason Calacanis 13:23 (laughs)

Chamath Palihapitiya 13:23 But David, it wasn't my-

David Sacks 13:24 I don't remember what point you were triggered.

Chamath Palihapitiya 13:25 It wasn't my take, David.

Jason Calacanis 13:26 What's wrong with the take? Let's, let's

13:27 No, no. Okay. Well, let me, let me explain what... Let me explain what's wrong with the take. I created a PowerPoint. So-

13:32 Oh, boy.

13:33 (laughs)

David Sacks 13:35 I pulled a Chamath.

Chamath Palihapitiya 13:36 Woo.

David Sacks 13:36 No, it's not boring. And, and Chamath has done it too, so don't-

Jason Calacanis 13:39 (laughs)

David Sacks 13:39 ... don't even go there.

Jason Calacanis 13:40 I'm gonna, I'm gonna do email. You guys come and hit me up at the second half.

13:43 No, no, Friedberg, we're gonna keep the-

David Sacks 13:44 No, no, no, no, no.

Jason Calacanis 13:44 We're gonna keep the Friedberg Index high. So go ahead, Sachs, take us through the PowerPoint. What did, what do you wanna explain?

David Sacks 13:49 Okay. I'll, I'll keep this quick. Okay, so I've called the PowerPoint Chamath's Worst Take Ever.

Jason Calacanis 13:54 (laughs)

13:54 (laughs) Oh, no.

Chamath Palihapitiya 13:57 David, David, it says right at the top of the disclaimer, "Here is something I learned today." Why is it my take?

David Sacks 14:02 Well, you said... You responded to me then saying that I didn't like facts, so that was your response. So I am proving... I'm gonna show you some facts, okay? So first of all, let's ask the question, was 1979 a good year? I don't think you can just cherry-pick this one number, the j- the Gini index, and say that this was some sort of great year. 1979, a severe recession begins, which ultimately leads to negative .3% GD growth in 1980. The words stagflation and misery index become household terms. We had unemployment of 6%, on its way to 7.2% in 1980. We had a 13.3% in inflation rate. The prime rate for a 30-year mortgage was 11.2%. Good luck trying to-

Jason Calacanis 14:43 Wow.

14:43 Wow, wow.

David Sacks 14:43 Yeah, try to... Good luck trying to buy a house. We had long lines at the gas pump. There was an oil embargo and we had price controls.

Jason Calacanis 14:49 I remember it. Do you guys remember the gas pump lines?

14:51 I wasn't born yet, but go on.

14:53 Yeah, it was crazy.

David Sacks 14:55 And then, you know, Jimmy Carter declares a national crisis in confidence. This was the so-called Malay Speech, and he was well on his way to becoming a one-term president. So what this shows is that-

Chamath Palihapitiya 15:06 David, wait, David, David.

David Sacks 15:07 You know, s- hold on. Th- no, no, let me just, let me just do the takeaway. So the takeaway is that, you know, the Gini index says 1979 was a great year. And, you know, the, the issue is, the reason it wasn't is 'cause it's a lot easier to make everyone equally poor than ev- than equally rich. When the economy does poorly, guess what? The gap shrinks. Um, then Mar- Margaret Thatcher had a great line about this, "So long as the gap is smaller, they would rather have the poor be poorer." That's a great video everyone should watch on her last speech to Parliament. Chamath, Chamath posted this chart showing... This was the, the percentage of wealth held by the top 0.1%. Chamath, we'll go to you next to explain one, two, and three. But let me just point out, look at when else the Gini index was plummeting, the 1930s. The Great Depression did a great job creating relative equality by making everyone poor. So my point is, yeah, I understand there are these equalities, but you know what creates inequality? Economic booms, that's what creates inequality. What we should care about is not just inequality but economic growth, real wage growth, poverty, how many people are below the poverty line, and concentrations of power. So that's what we should be looking at, not just this Gini coefficient. Let me stop there. I've got other slides, but I'll stop there and let you respond.

Chamath Palihapitiya 16:18 Sachs, bo- go back one slide. Um, the, the, the three points there were just, uh, interesting to me. Number one was, uh, LBJ and the war on poverty and all those social programs. Number two, and you spoke about this, but I don't think you're doing a full, accurate assessment. What Carter, what Carter's biggest mistake was, was he stopped the transfer payments, because LBJ started them, Nixon continued them, Carter stopped them. And I think it's important to frame-

Jason Calacanis 16:46 Explain what transfer payments are for people who don't understand.

Chamath Palihapitiya 16:49 Well, it's basically like, you know, there, there are all kinds of ways to get money into the hands of individuals, you know? We, we now talk about universal basic income. That's a way of transferring money from the government and from systemic holders of capital to individuals. Um, food stamps was a way, the Social Security was a way, um, there's all kinds of different ways.

Jason Calacanis 17:09 Welfare.

Chamath Palihapitiya 17:10 Welfare was a way until Clinton disassembled that. So I, I think that what, what we'll never know is what would have happened if Carter hadn't actually stopped those balance of payments. And the, the key point is about what happened then afterwards in three. So you had this basically stopping by Carter. He didn't get to... he didn't get to reap any of the benefits of it. Reagan comes in and says, "You know what? We're gonna simplify the tax code. We're gonna defund all kinds of stuff, including, for example, all the mental health defunding," that he had already done in California that spewed people with mental health disease onto the streets of San Francisco and Los Angeles. And that sort of continued. And then the real cataclysmic change on top of all of this, which sealed the fate of that trend line, happened, uh, in point number three, which is when George, George Bush, uh, in 2001, had this really seminal decision, which is he had the ability to block China from entering the WTO, and instead he let them in, and he traded that for a vote on the Security Council. And when you think about what really happened there, you unleashed...... one billion people willing to do anything at a cheaper, faster, and better rate. You ushered in globalization, you ushered in the gutting of the middle class of America, and you transferred all that wealth creation that could have happened in a more inefficient, but in a, in a balanced way that could have benefited Americans, and you shipped them abroad to China. So I think it's just interesting to note that basically since 1979, we've all been singing from the same playbook. And, and I think that maybe what we need to do is figure out whether we need to come back to this idea of shifting the balance of payments back into the hands of individual consumers. And all I'm saying is, without making a judgment, is when you look at what, um, Biden has done in, just in the first 60 days, 1.9 trillion dollars of, uh, stimulus and a proposed $3 trillion stimulus package, we're just, you know, we're not even-

Jason Calacanis 19:15 Infrastructure package.

Chamath Palihapitiya 19:16 We're not even three months into his presidency, and you forecast that forward, it feels like we're entering an era of spend, spend, spend. And that was an opinion of mine, which I believe is actually fairly accurate. I do think it will drive inflation. I do think it'll drive commodity prices. And I think on balance, I do think it will suppress the wealth creation of the rich. And I do think it will give folks that, uh, don't necessarily have investments the ability to make more in real income, which they will spend.

David Sacks 19:45 Well, okay, just, just quickly. So I'm gonna begin by agreeing with the, the part of Chamath's, um, response that I agree with, which is, uh, what happened around 2000, 2001, which killed wage growth for the average worker. Chamath is right about that, but it wa- it wasn't just George W. Bush. It was a bipartisan disaster. In 2000, Bill Clinton pushes Congress to approve the US China Trade Agreement and gave them, uh, full access to the WTO. This was basically temporary MFN. And look at what he said. He said, "Economically, this agreement is the equivalent of a one-way street. It requires China to open its markets to us in new ways." And it turned out to be a one-way street the other way. And then he also said that, "For the first time, our companies will be able to sell and distribute products in China made by workers here in America without being forced to relocate manufacturing to China. We'll be able to export products without exporting jobs." Well, gee, the exact opposite happened. So, and then, and then what happens in 2001 is Bush makes this situation permanent. He grants permanent, what's called permanent normal trade relations, which is basically MFN status in perpetuity to China, granting them full access to our markets. And Chamath is right that that devastated the average worker, because all of a sudden they're being forced to compete with, you know, foreign labor that's potentially making $2 a day, uh, and is not subject to the same labor laws and environmental laws as workers in the US are. So I agree with Chamath about what happened then, but, but I gotta go back and clean up this view of what happened between 1980 and 2000, because that's where I think we have this, this disagreement.

Jason Calacanis 21:20 Let's talk about the China thing for a second. I-

David Sacks 21:22 Yeah.

Jason Calacanis 21:23 We made a mistake there. We got hoodwinked. Um, we don't have access to their market. I think it's g- it would be good to pause for a second and say, "Okay, we tried this experiment for 20 years. There was some good that came out of it. Our companies were able to grow and become the dominant players in the world, like Apple, uh, but, and Amazon, right? We did capture a lot of this value. And a lot of people came out of poverty in China, I guess on the margins. That's a good thing. We can all agree. But it's a communist country and we basically enabled a communist country to become essentially, you know, uh, our, our counterparty in, in running the planet and, and, and in our leadership positions on the planet." What do we do now in terms of unwinding this? Is there a way to roll this back or do we just mute it from this point forward? And how does it become a two-way street or is that just not even possible as we've seen with the NBA and some other companies, Twitter, Google, just not being allowed to even operate in China?

David Friedberg 22:16 Who's we? America?

Jason Calacanis 22:19 Yeah.

David Friedberg 22:19 The United States?

Jason Calacanis 22:20 The United States. I mean, how do we-

David Friedberg 22:21 United Citizens, US companies, global companies? I mean-

Jason Calacanis 22:24 Yeah.

David Friedberg 22:24 You know, I think that the, the challenge is your-

Jason Calacanis 22:27 All of that, yeah.

David Friedberg 22:27 ... your framework, right? Because-

Chamath Palihapitiya 22:28 Guys, I think, I think there's one big thing you're, you're forgetting in 2001, which is I think that Bush actually traded away access to the WTO so that they could guarantee China's vote when he wanted to go to war with Iraq, which happened in 2003.

Jason Calacanis 22:41 Okay, well, but, but-

David Sacks 22:41 Two, two dumb decisions that got worse by being put together.

Jason Calacanis 22:45 But, okay, all I'm saying is it was a trade.

David Sacks 22:46 Yeah.

Chamath Palihapitiya 22:46 It was a trade. He traded, he traded access to... He traded access to the WTO in return for their support for a UN resolution to go to war with Iraq.

David Sacks 22:56 Look, I, you know, you, Chamath, you said that I was defending the Republican point of view. I'll, I'm not. I'll be the first to say that George W. Bush was... His presidency was a disaster. I think it'll go down as one of the worst. He got us into all these, um, stupid foreign wars in the Middle East. He began them. I think the decisions with China were a mistake. Um, so I certainly don't want to defend that. And by the same token, I think the Clinton years were, were generally great years in America. So this is not a partisan analysis on my part.

Jason Calacanis 23:23 For you, Burton, what, what do you think though about the China concept here and, and how we would go forward? And what's the, what's the path forward with China?

David Friedberg 23:31 I, I, I mean, again, like I think it comes down to your objective and who are you solving for. Um, and, uh-

Jason Calacanis 23:39 Who should we solve for? Democracy? The human species?

David Friedberg 23:42 Well, I mean, I, I feel like-

Jason Calacanis 23:43 The environment?

David Friedberg 23:44 ... the point of view that, you know, one government is innately better than another is being tested and proven right and wrong every day right now (laughs) . And, um, and I'm not sure that it's fair to say that just because the form of government that, uh, the, you know, that the Chinese have kind of, um, adopted and used to govern their, their, their, their country and their people, uh, is innately wrong. Um, there's certainly things that are innately wrong in many democracies and that are innately wrong in many, uh, non-de- democratic republics. And so I- I'm not sure it's fair to just say that, um, you know, that that's really the objective is let's get rid of that communism. I mean, that was an easy kind of simple...... you know, check that you could use a few decades ago as a way to kind of rally everyone emotionally towards some cause. But, um, I- I think there's- there's a lot of businesses today that operate effectively in their own kind of geopolitical cloud, and it's a little bit, um, a- of a- of a kind of misstatement to think that an American company is an American company. It's not that American, quote unquote, American companies solely build their stuff and sell their stuff in the United States. Many Amer, quote unquote, American companies build stuff overseas and sell stuff overseas. And globalist, uh, globalization, as much as we might want to kind of poo-poo the effects it's had on the average, quote unquote, American worker, um, it really has transformed the way businesses operate with respect to, um, uh, uh, uh, politics in countries. Um, there's a, oh God, what's the book? I can't remember the book, but there's a book that speaks to how, uh, uh, a lot of large multinational corporations today effectively have to operate as if they were countries into and unto themselves. And so they have competing interests with respect to what the average American or the American government or the American people might have, even though they might be, quote unquote, American companies, and there might be some intricate tie. Um, and so I'm not sure it's as simple as we have to, quote unquote, defeat China. We are so intricately tied, uh, to the, uh, uh, to the economy of China, to the workers of China, and vice versa, um, and I think that it's a much more complicated thing than, you know, here's our three-point checklist for how do we, quote unquote, beat China. Uh, and that's- that's why it's hard, and that's why I think a lot of smart people have, you know, kind of taken on and been challenged by and failed at trying to resolve a path forward where there's this, quote unquote, looming enemy that is gonna become the global economic power which strips the American, uh, uh, people of- of their influence around the world. And, you know, that may be kind of the inevitability of the 21st century. I don't think that there's a si-

Chamath Palihapitiya 26:13 And that's a pretty dark inevitability if- if-

David Friedberg 26:14 But I don't know if there's a simple, easy answer, and I don't know if from a- from a business point of view, let's say, I'm a company, I'm not sure I necessarily feel the effects of one, quote unquote, country affecting, you know, having more influence globally with other countries than others. It turns out a lot of businesses have greater influence than a lot of governments. Um, and so, you know, one way to kind of think about the evolution of globalization, and maybe even with respect to kind of th- the notion of what we've been talking about decentralization, is that maybe governments themselves become less important, uh, in the 21st century. And it's the kind of decentralized online movements and- and businesses and- and, you know, other kind of entities that perhaps are not as regulated and controlled and owned by governments and, you know, maybe the big failure of the 21st century will be governments. (laughs) We'll see.

Chamath Palihapitiya 27:00 Chamath, do you have thoughts on, uh, China?

David Friedberg 27:02 I'm sorry. That was a bit esoteric, but, um-

Chamath Palihapitiya 27:04 No, no. I- I think it's-

David Sacks 27:05 Yeah.

Chamath Palihapitiya 27:06 ... it is an interesting point.

David Sacks 27:07 Saksiboo, the thing- the thing that you're not willing to acknowledge is that even when GDP shrinks, it's like a- it's a- it's- it's shrinking from a base where there's substantive growth year over year. Like, you know, our- the GDP in 1969, when LBJ was president, was less than a trillion dollars, and the GDP now is like 23 and a half trillion dollars. And so it's been nothing essentially but a straight line up. And so, you know, this idea that we- the inflation causes, you know, the- the only way that we close the wealth gap is by making everybody poorer is not true. We're- some people may be getting less rich at the same rate so they feel poorer, but the idea that you actually become poorer is just not true. It's a feeling that you have, but it's not rooted in fact.

Chamath Palihapitiya 27:47 So, Saks-

David Sacks 27:48 Well- (laughs)

Chamath Palihapitiya 27:48 ... when- when you look at the wealth gap, are you concerned about the gap or are you concerned with how, you know, the status of the folks on the bottom and how much their lot in life has gotten better?

David Sacks 28:00 Yeah, I mean, I'm concerned with both. Um, actually, there- I have a slide on this too.

Chamath Palihapitiya 28:06 I would buy this argument, and I've heard this argument from, before from people not as smart as David. I would buy this argument if GDP did something other than go up in an absolute straight fucking line.

David Sacks 28:17 No, it doesn't. It doesn't.

Chamath Palihapitiya 28:18 It does.

David Sacks 28:19 Well, hold on. I- I- let me- I'm gonna show, let me show GDP in a second. The first thing I wanna just cover is that part of the problem with the GINI index is it doesn't fully account for government transfers. This is something I didn't fully know until I researched it, um, after your tweet storm, Chamath. But basically only 2% of the population, so the publicly reported stats are that 13.5% of the US population lives in poverty. Once you actually take into account all these programs and transfer payments, uh, it's more like 2%. You can see this on this chart on the left here that the green represents the transfer payments. By the way, I'm not against transfer payments. I think we need a social safety net. I want the social safety net to be, uh, as effective as possible. I don't want it to trap people in government dependency. I want it to work. I want it to get people out of poverty and into the opportunity economy. But I absolutely believe we need a social safety net and we need these transfer payments. And you can see that the green bars there make a huge difference in reducing poverty. The GINI index doesn't really take that into account. Well, how do you fund this- these types of transfer payments? The more of a- of a stronger economy that you have, the more that you have a government- the more that you have an economic boom, the more that you see real wage growth and the ability to fund these programs. Let's go back to- let- let's just look at GDP for a second. So if you go back to- let's go back to this period, '82 to 2000. I call this the Reagan-Clinton boom. I see this as a bipartisan- a relatively bipartisan period where under Reagan and Clinton you had GDP growth of almost 4% compared to the usual 2%, two and a half percent. By the way, this is why Reagan and Clinton left office with huge approval numbers despite scandals. Remember Reagan had Iran-Contra, uh, Clinton had Lewinsky. None of that mattered really in the eyes of the American people because the economy was so strong. And you can see that here. And by the way, it hasn't been this strong in the 2000s. We've never really gotten back to this type of economy, um, you know, since- since, uh, you know, 2009.

Chamath Palihapitiya 30:17 Is that because of the economic boom of the PC and internet eras? What would we attribute it to?

David Sacks 30:23 The- the- the technology boom has a huge impact. But let me just describe what started it, okay?... what st- what happened in 1981? Re- Reagan's inaugurated as president in January of 1981, he cuts the top marginal income tax rate from 70 to 50%, and I'd say equally important, you had Paul Volcker at the Fed. He breaks inflation, he jacks up interest rates, causes a very severe recession in 1982, but it broke the back of hyperinflation and we... it ushered in decades of declining interest rates. You can see that on this chart here. Interest rates have more or less been in the decline since Paul Volcker was at the Fed. What does this do? It made the, the, um, it reduced the, the, the risk-free rate of return, which leads to more investment in, um-

Jason Calacanis 31:07 In everything.

David Sacks 31:08 ... in, in everything. It leads to more investment. It ca- caused a, caused a rally in the bond market and the stock market.

Jason Calacanis 31:14 And by the way, no one remembers mod- in a modern era. I'm sorry, Sax, but like most... Interest rates for buying a home, mortgage rates, were over 6.5% for most of the, um- Yeah, it was 15%. ... most of the last couple of decades, yeah.

David Sacks 31:26 Yeah. Good, good luck buy-

Jason Calacanis 31:27 I mean, Da-

David Sacks 31:27 Good luck buying a home in the 1970s, right? Like...

Chamath Palihapitiya 31:29 David, can you... Like, can you actually be intellectually honest and overlay aggregate-

Jason Calacanis 31:35 (laughs)

Chamath Palihapitiya 31:35 ... actual GDP on this chart? 'Cause what you'll see is, it goes up and to the right, independent of all of this bullshit.

David Sacks 31:43 No, there, that's not true. You can see it on the-

Chamath Palihapitiya 31:44 That is absolutely true. And I'll just... Can I share my screen now?

Jason Calacanis 31:47 Well, you're talking about the GDP gr- growth rate versus-

Chamath Palihapitiya 31:49 No. This is-

David Sacks 31:50 This is GDP growth rate.

Chamath Palihapitiya 31:50 This is simple... Forget growth rate. What is the actual number?

Jason Calacanis 31:55 Right. We're talking about the real number, not the percentage growth, 'cause I was actually about to ask a question about-

Chamath Palihapitiya 31:59 The real number, guys.

Jason Calacanis 32:01 I'll ask it too.

David Sacks 32:01 This is the change. This is the-

Chamath Palihapitiya 32:01 This is grade two. I know.

Jason Calacanis 32:02 Right. But does, uh, but does-

David Sacks 32:02 This is, this is the change in GDP.

Chamath Palihapitiya 32:04 I know. I'm talking about grade two mathematics here, guys.

Jason Calacanis 32:07 Does, does two percent-

Chamath Palihapitiya 32:07 The absolute number.

Jason Calacanis 32:10 Keeps going up and to the right because-

David Sacks 32:11 No, no, no, it doesn't. Th- these, these, these dots that are below zero are recessions-

Jason Calacanis 32:15 Right. But those are very minor-

David Sacks 32:17 ... in which GDP actually shrinks.

Jason Calacanis 32:17 ... compared to-

Chamath Palihapitiya 32:17 Those are changes from the year before, so when you're compounding naturally-

David Sacks 32:21 No, no, no, no, no, no. The green and red bars at the very bottom are changes from the year before, but these are absolute percentage changes in GDP.

Chamath Palihapitiya 32:29 I know. So-

David Sacks 32:29 A recession, a recession is defined as two quarters of negative growth. So GDP can go down.

Jason Calacanis 32:36 Yes.

Chamath Palihapitiya 32:36 David, can I just show you the aggregate GDP growth from 1960 to 2000? And you can just look at this and tell me what's... What, what is wrong with the Trading Economics website that, that everybody else would use?

David Sacks 32:48 Go for it.

Jason Calacanis 32:48 Yeah, bring it up. I mean, I, I think one of the things that I have as a question for everybody is, is there a m- is there a major difference between, uh, two percent, two and a half percent, three percent growth, in terms of how we all experience our lives? And what are we optimizing there for? Are we optimizing for consistency or are we opt... And you know, no recessions?

Chamath Palihapitiya 33:10 Well, this is what's interesting. So do you see this chart right here?

Jason Calacanis 33:13 It's perfectly consistent with the exception of the-

Chamath Palihapitiya 33:15 This is the aggregate GDP, okay?

Jason Calacanis 33:18 ... financial crisis. Yeah.

Chamath Palihapitiya 33:18 It started off at less than a trillion in 1950-something. It was about, you know, a trillion dollars in 1968, and it's about $23 trillion now. This is the aggregate of what has happened in the American economy over the last 70 years.

Jason Calacanis 33:33 Compounding interest is an amazing thing.

Chamath Palihapitiya 33:35 Now... Exactly right. Now this has happened in Democratic presidencies, Republican presidencies, when rates were at 16%, when rates were at zero percent. So all I'm saying is, we have a natural tendency and inertia to move forward. The rate of change, we can debate, and obviously it has ebbed and flowed over years. But the fact that it's towards moving forward and downhill with increasing momentum is undeniable. And so again, I would ask, w- when we think about the fact that the natural tendency is that the next five or 10-year period, in aggregate, will become bigger and better, there'll be more of the pie to share, why is inflation a bad thing? Because all it does is depress financial assets. It drives up earnings and income, which drives up consumption of the lower three or four quartiles of the... or lower three quartiles of the earnings population. I just don't see why it's such a bad thing.

David Sacks 34:28 I think, I think mild, mild inflation, you know, in the 2 to 4% range is, is fine. And it's probably better, it's certainly better, I would say, than 2 to 4% deflation. But when you start to get runaway inflation like we did in the 1970s, it massively increases interest rates, and that makes it harder for people to buy houses and borrow money and invest money, because now the risk-free rate of return is higher. And, uh, and that leads to stagflation.

Chamath Palihapitiya 34:53 But that only applies... I know, but that only applies to the top quartile of the population. The bottom three quartiles don't give a shit about what you just said, because they don't do it.

David Sacks 35:05 Um, I don't, I don't think people want to, uh, sp- have to spend, uh, $600 on a loaf of bread, you know? That's... It... Look, you look at Venezuela, you look at Weimar Germany, you do not want inflation to get out of control and there... It can spiral out of control, because once people start to expect-

Jason Calacanis 35:20 I- is that, is that realistic though, that it will spiral out of control given technological advances, efficiency? I mean, what... That's the backdrop this is all against.

Chamath Palihapitiya 35:28 You, you are, you are bringing up the, I think, the, the really brilliant point, which is, could it really even happen today? Because if you think about where we allocate our time and attention and consumption, half of it, by definition, are things that are just so naturally deflationary. We're all, you know... We're, we're, we're on YouTube, you know, Facebook, TikTok all the time. Those are naturally deflationary sinks of time and energy and effort and money, right? So today, to Jero- to Jason's point, like, I think that that's actually true. I don't think that it's even possible to actually have hyperinflation anymore.

Jason Calacanis 35:59 Where do we have hyperinflation? NFTs, Bitcoin-

David Sacks 36:02 Yeah.

Jason Calacanis 36:03 ... equities, and homes.

Chamath Palihapitiya 36:04 Financial assets. Financial assets.

Jason Calacanis 36:06 And homes. Right? I mean, and that's a highly regulated... And, and I guess healthcare and, uh, educat- higher education. Those... But regular- Pretty much anything that the government's involved in.

Chamath Palihapitiya 36:17 Basically (laughs) . Well, and the government's not-

David Sacks 36:19 No, it's true.

Chamath Palihapitiya 36:19 ... involved in NFTs and Bitcoin. Those are the anti-government portfolio. But-

Jason Calacanis 36:23 But by the way, healthcare inflation really started in Obama, because of Obamacare. Yeah. Anything that the government's involved in, inflates.

David Sacks 36:30 Yeah, 'cause if the government's paying the bill, why would you raise prices?

Chamath Palihapitiya 36:33 Well, there-

Jason Calacanis 36:33 And then... (laughs)

36:33 W- where, w- where, there's, there's no competitive market. There's one customer-

David Sacks 36:36 Yeah, s-

Jason Calacanis 36:36 ... charge whatever you want, et cetera.

David Sacks 36:38 So to, so to Chamath, to be clear, I, i- inflation is not my number one concern right now. I'm just saying that it would not be a good thing to let it get out of control. That's all. Um, but I, it's not, it's not-

Jason Calacanis 36:49 Your main concern is-

David Sacks 36:49 ... the biggest concern on my list.

Jason Calacanis 36:50 Your main concern is dunking on Chamath for that tweet storm.

David Sacks 36:54 No, no, I'm not dunking on him.

Jason Calacanis 36:56 (laughs)

David Sacks 36:56 I'm... He, he dunked on me saying that, you know-

Jason Calacanis 36:59 It basically turned into a bunch of 15-year-old girls- (laughs)

Chamath Palihapitiya 37:01 (laughs)

Jason Calacanis 37:01 ... who said something and got misinterpreted on social media, and now we have to work it out-

David Sacks 37:06 No, no, no. I'll tell you, I'll tell you what-

Jason Calacanis 37:07 ... with group therapy on Friday, and you, the audience, are the beneficiaries. (laughs)

David Sacks 37:10 No, I, I, I'll tell you, I'll tell you my, my main concern, is this idea that economic booms are not a good thing, because, you know, God forbid, the people at the top

David Sacks 37:20 might get richer. Um, that's the problem.

Jason Calacanis 37:22 All right. Well, let's pivot to that, then.

David Sacks 37:23 Yeah.

Jason Calacanis 37:23 I don't know if you guys have been following, um, what's happening with, uh, the head of operations at, or cons- I guess he's the head of warehouses at Amazon. Amazon is standing up to Elizabeth Warren on Twitter. They're mixing it up. Did you guys see these tweets? Let's pull 'em, pull them up.

Chamath Palihapitiya 37:39 No. What? It's going what?

Jason Calacanis 37:40 You haven't seen these? (laughs)

Chamath Palihapitiya 37:41 No.

Jason Calacanis 37:42 Jamal, didn't you donate, like, some ridiculous amount of money to Elizabeth Warren's campaign?

Chamath Palihapitiya 37:46 No, 25K, just a little-

Jason Calacanis 37:48 Oh.

Chamath Palihapitiya 37:48 ... tasty poo. It was a little teaser bet, and I, and I didn't like what I saw, so I had to shut it down. I shut it down on the turn. The flop was not-

Jason Calacanis 37:55 Oh, was the deal- deal or bet, was it deal or bet?

Chamath Palihapitiya 37:56 Deal or bet. The flop, flop bet, I c- I-

Jason Calacanis 37:58 Just want to get information.

37:58 You, you, you limped in? You limped in with seven-four?

Chamath Palihapitiya 38:01 I limped in with seven-four offsuit. I put a little teaser bet out there. I didn't like what I saw-

Jason Calacanis 38:05 Yeah.

Chamath Palihapitiya 38:05 ... and so I f- I folded.

Jason Calacanis 38:06 Basically, Amazon is finally saying, "Hey, we're just gonna st- we're gonna stand up when Elizabeth Warren or Bernie Sanders kinda attack us and attack Bezos." Uh, and they just said, "Listen, you guys set the minimum wage. Do your job. We moved the minimum wage at Amazon to $15 an hour. We made our decision. Get back to work and set the federal minimum wage at $15 an hour, and stop telling us we don't pay our taxes, 'cause you make the tax law." So essentially, this dovetails with the hearing. I don't know if you guys watched any of the hearing with Zuckerberg and everybody, but basically, they were all... O- o- it seems like big tech is just putting their foot down and saying, "Just tell us what you want us to do, because we're doing it. We're giving people $15 an hour now."

David Sacks 38:49 Yeah, but you know what Zuckerberg, what, what Zuckerberg and Dorsey basically said is that, "If you don't like that kind of speech, then why don't you prohibit it? Instead of telling us to do it, you can't and you won't, because y- you know, it's, it's, it's a violation of the First Amendment." So that, yeah, they were kinda pushing back on them, saying, "Listen, if, if you have such a problem with it, pass a law."

Jason Calacanis 39:10 Yeah. And this guy, Dave Clark, do you guys know Dave Clark at Amazon?

Chamath Palihapitiya 39:13 Nope.

Jason Calacanis 39:14 So this is the guy who's been mixing it up. And if the audience is listening, you can see a bunch of this, uh, on the YouTube channel because we, we'll put in the graphics.

Chamath Palihapitiya 39:22 Oh, wow. He's the, he's like the number two guy there. He, he runs all-

Jason Calacanis 39:26 Yeah.

Chamath Palihapitiya 39:26 ... he runs the entire retail business, I guess?

Jason Calacanis 39:28 Yeah. So now, Amazon is on a full-court press to engage with, let's call it the socialist left. Um, I guess they call themselves Democratic Socialists 'cause they don't wanna be called Socialists. (laughs) Uh, and they're saying like, "Listen, we give people healthcare. We give them 15 bucks an hour. And if you want to tour the facilities, tour the facilities, but nobody is peeing in bottles." And then, of course, the press and a couple of people showed bottles with pee in them, that drivers can't stop to even go to the bathroom, which I think is a tragedy and horrible. People should not have to pee in bottles. I mean, they asked me about it on CNBC today. I was like, "Uh, this is a serious question." Like, of course nobody should be peeing in bottles. But if you look at this exchange, I think we're kind of hitting the end of this debate, which is everybody kind of agrees, we should have healthcare for everybody in the country. We should have a $15 minimum wage. Why are we dunking and fighting with each other when we've got this adversary which is... or two adversaries, with Russia and China. We have these two crazy adversaries who want to build authoritarian countries and control the economy and eventually control the planet. Why is, why are Americans fighting with each other over these issues?

Chamath Palihapitiya 40:32 I mean, this is, this is just incredible. I, I just want to read it.

Jason Calacanis 40:35 Yeah, read it.

Chamath Palihapitiya 40:35 Bernie Sanders says, "I look forward to meeting with Amazon workers in Alabama on Friday. All I want to know is why the richest man in the world, Jeff Bezos, is spending millions trying to prevent workers from organizing a union so they can negotiate for better wages, benefits, and working conditions." To which he replies, "All we want to know is why the senator is one of the most powerful pols and poli- politicians in Vermont for 30-plus years and their minimum wage is still only $11.75. Amazon's minimum wage is $15 plus great healthcare from day one. The senator should save his finger-wagging lecture until after he actually delivers in his own backyard." To your point, it, it is getting to a point now where folks are like, "All right, guys, so step up and change the laws, um, and change the incentives." And I think that that's going to be really important. Saksi, you had something that you, uh, you were really miffed by, uh, what Zuck said or something, uh, at the thing about all this?

David Sacks 41:30 Uh, well, well, I, what, what Zuck was trying to do in that hearing, uh, the, the Stratechery guy. What's his name? Uh, Ben Thompson or-

Chamath Palihapitiya 41:36 Ben Thompson.

David Sacks 41:37 ... uh, yeah.

Chamath Palihapitiya 41:37 Stratechery. I think it's Stratechery.

Jason Calacanis 41:39 (laughs)

Chamath Palihapitiya 41:39 Stratechery.

David Sacks 41:40 Uh-

Chamath Palihapitiya 41:40 No, no, no, no. It's Stratechery.

Jason Calacanis 41:42 Is it?

Chamath Palihapitiya 41:42 No, Stratechery. I, I, he literally said it.

David Sacks 41:44 (laughs)

Chamath Palihapitiya 41:44 He came to the poker game that we do at the D Conference, uh, or the Rico Conference, whatever it's called, Co Conference, and he said it's Stratechery.

David Sacks 41:53 Okay. Right, it's Strategy plus tech, right?

Chamath Palihapitiya 41:55 And he said it's the worst, it's the worst name that was ever created. Stratechery.

David Sacks 41:58 Yeah.

Chamath Palihapitiya 41:59 Stratechery.

David Sacks 41:59 Anyway, it's a-

Jason Calacanis 42:00 (laughs)

Chamath Palihapitiya 42:00 It's 100 bucks a year. He's got like 10,000 people paying for it. It's crazy. Fabulous.

David Sacks 42:04 What, what-

Chamath Palihapitiya 42:05 Yeah, makes millions off it.

David Sacks 42:05 He, the way he... Okay, great. So the way-

Chamath Palihapitiya 42:09 (laughs)

David Sacks 42:09 Thank you for that.Thank you for that clarification.

Chamath Palihapitiya 42:13 (laughs)

David Sacks 42:13 What, what Ben Thompson wrote, the way he described Zuck's statement is that Zuck was pulling up the ladder, uh, on all the other social networking sites that might come afterwards. And it was, look, it was one of those tactical maneuvers that's in Facebook's sort of narrow self-interest, but it's so obviously in their self-interest that, you know, people slammed them for that. It's just too Machiavellian. And basically what Zuckerberg said is, "Listen, we now have over (laughs) 30,000 people doing content moderation. You guys should check... Y- you, the, the lawmakers should change Section 230 to say that, you know, you, the social media sites only get Section 230 protection, the liability shield, if you engage in this kind of content moderation. But if you're a site that doesn't, then you don't get protection." Well, what's, what's Zuckerberg trying to do? You know, small startups can't hire 30,000 people to do content moderation. So this is like classic regulatory capture, but done brazenly in the open at a congressional hearing.

Chamath Palihapitiya 43:11 I think you're right. I think it kind of makes a, a lot of sense from him. The, the game theory is pretty obvious, which is like, okay, make it now impossible for anybody to compete with us and, uh, you basically lock us in forever. Which it's pretty, pretty brilliant. The question is, what do you think the odds are that politicians fall for this? I think they're f- they're forcing their hand now, so they don't have much of a choice.

David Sacks 43:31 Well, I think... Yeah. Well, I mean, the Democrats on that committee have basically been saying that disinformation is a huge problem and you, the social m- media sites need to correct it, you need to control it. And so Zuckerberg comes along and says, "Okay, great. No problem. We've hired 30,000 content moderators. We're gonna do what you said. In fact, we're gonna hire more. And by the way, if you really want to get tough about this, why don't you modify Section 230 to require it?" Well, how many other startups can ever hire that number of content moderators? This is creating a moat that will basically protect Zuck and Facebook forever.

Chamath Palihapitiya 44:03 Yeah, recapture. Yep. And the other-

Jason Calacanis 44:05 Recapture.

Chamath Palihapitiya 44:05 ... crazy thing in this was they, this stupid format they come up with where they give each person who's, you know, a senator or congressman or s- or congressperson who's doing the questioning, they give them five minutes. So they're like, "I only want a yes-no answer." And you're like, "I'm going to ask you the most challenging problem in the world. I need you to answer yes or no, binary, one or zero." And it's like, well, that's not kind of how a nuanced issue works, like Section 230. This is gonna take some time. Can I get one minute to answer the question, two minutes to answer the question? And so Jack and, uh, Zuckerberg and everybody just kind of threw their hands up. They're like, "I, I can't answer this in a yes-no. Can you a- ask me, give me 30 seconds to answer these questions?" It was pretty ridiculous. And then they were trying to get them all to say that their platforms were used for the January 6th insurgency, and I don't agree with Zuck on much, but he was like, "No, I think the people who were involved in January 6th were responsible for it. So whether that's the president or the people who broke into the Capitol, they're the ones who are actually responsible for this." You guys didn't watch it.

David Sacks 45:05 Yeah, s-

Chamath Palihapitiya 45:05 Thank you, Jason.

David Sacks 45:06 So, no, I, well, I, I, I, I read, I read-

Chamath Palihapitiya 45:09 Sorry.

David Sacks 45:09 ... some summaries of it, and I think Dorsey actually did a, did a great job and I, I liked, I liked his performance. And let me read you a quote. Um, Mike Solana tweeted this, so, um, but he said, Jack said, "I don't think these decisions should be made by private companies or the government, which is why we're suggesting a protocol approach to help the people make the decisions themselves." That was Jack Dorsey. Now, that almost sounds like me if he just changed the word protocol to First Amendment case law. So I don't want these companies or the Senate Judiciary Committee, you know, censoring people. I want to use a revered external standard, which is the First Amendment case law that's been developed over the last two centuries. So Jack wants to use a protocol. Okay, but fine, but he's on the right track here, which is, he's saying, "Look, we don't want to be in the business of having this power to decide who's gonna have access to, you know, to the town square." And that's a step in the right direction.

Chamath Palihapitiya 46:03 But he's also got a project there to turn social networks into open standards. So in other words, the way we can all... Anybody can make an email client 'cause email is an open standard. Anybody can build a web page or a browser because HTML is an open standard. He wants to do that, and he's working on that inside of Twitter, where anybody is going to be able to take their tweets and they're gonna be decentralized, uh, there, there's gonna be no central server, and you're gonna be able to bring your own algorithm. So if you-

David Sacks 46:32 Well-

Chamath Palihapitiya 46:32 ... feel the algorithm is causing you to see extreme views, you can say, "I want mine to only lean towards... I want this one that leads towards positivity and kindness," right? And somebody can make a third party-

David Sacks 46:45 There's a-

Chamath Palihapitiya 46:45 ... algorithm that gets rid of jerks. You guys probably saw this week, but, uh, a, a deal was announced, an investment was announced, uh, Andreessen, Sequoia, myself and a few others, we did this thing called BitClout.

David Sacks 46:58 Oh, I heard about this. Yeah.

Chamath Palihapitiya 46:59 So what is it? Just to give you a sense of it. It's like, you know, basically-

Jason Calacanis 47:02 I've been hearing about it separately from a bunch of people.

Chamath Palihapitiya 47:04 Yeah. So I mean, like the, in a, in a nutshell, you know, what these guys did was they said, "Okay, well, you know, we're just gonna take, you know, this entire blockchain concept and we're gonna fork it and we're gonna create this thing where folks can, um, essentially, uh, have one blockchain." They can, you know, uh, have content around it and then identify sort of people and nodes and all of a sudden, like, we all have this currency that sits on top of this BitClout currency. And why that's interesting is their first, um, app that they built on top of this was basically a, a kind of a clone of Twitter, just kind of as a proof of concept app. And, uh, I think, Jason, it's moving to a place where now people with reputation and, um, people with trust can actually signal that they have it, and then, uh, that's a, probably a better way over time for, for, for folks like us to figure out, um, what is valuable and not valuable, what is trustworthy or not, irrespective of whichever end of the spectrum it's coming in off of. And then if there is disinformation, you know, that person's quote-unquote "BitClout" stock, right, the, their token will fall in value. Um, there'll b- probably be a lot of interesting apps that are built on top of this. I was really...

48:20 ... um, drawn to the general idea of the project, and I think that's what Andreessen and Sequoia probably felt as well. So, you know, there are these interesting solutions. There's BitClout, there's, Jason, what you said, this open source project at Twitter. It's all, it's all gonna be really interesting. But I think if we can get to a way where we can quantify reputation and trust, that's the- w- another way of around- working around the pulling up the ladder effect of,

Chamath Palihapitiya 48:42 uh, of what Facebook and Twitter effectively told Congress this week. Um, I wanna talk to you guys about what the hell, what the hell is going on in the Suez Canal and what does this mean?

Jason Calacanis 48:49 (laughs)

Chamath Palihapitiya 48:51 I mean, uh, Friedberg, what the fuck is this? This is unbelievable.

David Friedberg 48:56 You know, it's so random, um, and unfortunate, but this, uh, this ship that weighs 200,000 metric tons, uh, that's taller, it's longer than the Empire State Building is tall, going through the Suez Canal, which I think, you know, there's about 100 ships a day go through the Suez Canal. Um, and it's, uh, you know, the Suez Canal, uh, really is, um, uh, you know, kind of an, uh, amazing engineering accomplishment that, uh, connects the, uh, Mediterranean Sea to the Red Sea. It basically, uh, allows ships from Asia to not have to go all the way around Africa to get to Europe. And, uh, the ship, uh, goes into the Suez Canal and it had a blackout. Its power went out. And so it just kept cruising without being able to control the steering, 'cause there's, like, friggin' power steering on these massive ships.

Chamath Palihapitiya 49:41 (laughs)

David Friedberg 49:41 (laughs) You know, like, they don't have, like, a wire connected to the rudder.

Chamath Palihapitiya 49:44 (sighs)

David Friedberg 49:45 And so, um, you know, the thing with-

Jason Calacanis 49:47 No backup, no backup battery supply, I guess.

Chamath Palihapitiya 49:48 It was knocked down?

David Friedberg 49:49 Who knows?

Jason Calacanis 49:49 Exactly.

David Friedberg 49:49 No one knows. But like, the power went out and the whole total blackout on the ship, they couldn't get the power back on and the thing just keeps cruisin' and cruisin' and cruisin' and it cruises right into the side, which is this big sand barrier on either side of the Suez Canal, and it gets lodged in the sand barrier on the side. Now when you have 200,000 metric tons moving at a few miles an hour, that's an incredible amount of momentum of energy. And so it, when it lodges in the side, that's, you know, it's lodged in there. And now it's stuck.

Jason Calacanis 50:15 Mass times acceleration equals stuck. (laughs)

David Friedberg 50:17 Yeah, it's actually mass, half time, mass times velocity, but yeah.

Jason Calacanis 50:20 Mm-hmm.

David Friedberg 50:20 Y- you're close. And so, um, the thing just, uh, basically got lodged in there and they can't get it out. And now they think it's gonna take another week or two before they'll be able to kinda dig all around the sand and tugboat the thing out of there. Um, but I think what's interesting, so 10% of global trade moves through the Suez Canal. And about 100 of these massive ships a day, uh, you know, move through this canal. But it really highlights the fragility of our global supply chain. Similar to kind of the experience I think we had during the COVID pandemic when all of a sudden things like toilet paper were less available to us. Um, but, you know, a, a small power outage on a boat, on a ship, you know, uh, in the middle of, um, uh, of the Suez Canal can suddenly block up so much of global trade and cause, you know, massive fluctuations in commodity prices and availability of supplies and products for businesses around the world, there's gonna be rippling economic effects for a period of time. It's unclear how significant they're gonna be, but, you know, I, I really do think that, um, taking note of the fragility of our, of our supply chain in this particular context is worth taking a step back. And, you know, I, I, I, I spend a lot of my personal, uh, my work time, uh, obviously off the podcast, thinking about kind of our systems of industry. And, you know, the, the global industrial revolutions were really predicated on this notion of centralization. You know, we took, um, uh, a lot of our production systems and we centralized them and, and created automated repeatable tasks, and that reduced the cost and allowed us per unit of production, uh, to basically make things much more affordably. But the problem with centralization generally speaking in supply chains is exactly this, which is you, you have a supply chain, um, that is much more delicate. Uh, and, um, it is much more... I, I mean, think about the difference in power, right? If the power goes out at a power plant, all the homes that are connected to it lose power, versus if every home had their own power generator or solar cells, they could continue to support themselves. And in a similar context, so much... And this goes back to our conversation earlier about globalization, so much of our global supply chain for industry has become centralized by finding the lowest cost possible, but it loses all of its durability. And so the 21st century, and especially leading into this infrastructure bill that we're gonna be talking about, or, or that's gonna be talked about for, for a long time now, for months to come, presents an opportunity for us to think about durability in industry and durability in supply chains that I think is really profound and allows us to shift the balance of, um, of power, but also shift the sen- uh, the, the, the sources of production of all the things we consume as a species, uh, in a, in a much more distributed way. And that can be done using green technology, using, you know, 3D printing-

Chamath Palihapitiya 53:00 3D printers, yeah.

David Friedberg 53:00 ... using biomanufacturing, you know, using, um, uh, solar. Uh, there's a lot of technology-

Chamath Palihapitiya 53:05 Vertical farming comes to mind.

David Friedberg 53:06 Vertical fa- well, yeah, whatever, um, I, I, I'll disagree with you on that one and we'll talk about that separately. But I, I would argue like so much of, um, of industry has been centralized because remember, when the industrial revolutions took hold, the only skill set we had as a species was mechanical engineering. And in the years that followed we developed skills in chemical engineering and ultimately in software and hardware engineering. And now more recently in biochemical engineering where we can use biological systems to make stuff. And the advent of those technology capabilities I think really gives us the opportunity today to reinvent these supply chains. Um, and so the Suez Canal, I hope, is a little bit of a wake-up call, and I hope leads into some of the thinking around the infrastructure build proposals where we're about building durability in the supply chain. And in that process, by the way, creating manufacturing jobs, um, you know, in a more distributed way.

Chamath Palihapitiya 53:54 Let me build on, uh, what you're saying. So for all of the people listening that really, really care about, um, electrification and electric cars, and there's a bunch of Tesla bulls here, you know, Tesla uses a specific kind of battery called NCA. And, uh, there's, you know, other forms of batteries, but for the most part, and Tesla in China uses, uh, this LFP chemistry. But the point is, uh, there's a lot of very, very valuable nickel that goes into making lithium-ion batteries. And so if you believe in electrification and you believe in, you know, zero emissions and you believe in using these batteries, you need to believe in nickel, which is a tough business, okay? You're, you're grabbing, you know, rock out of the ground and you're leeching this, this extremely important, uh-... metal out of it. So just, uh, uh, a little while ago, there is a huge nickel manufacturer, uh, called, uh, Norilsk Nickel, right? And they have these, uh, two Russian nickel mines and just very recently, they flooded and, uh, the plug which had been erected for localizing the flooding was washed away, not for the first time, not for the second time, but for the third time. And people now think that getting all this water out of the mine, um, may take at least a year. Okay? So what, w- why should we care? Well, right now, if you think about all the batteries that we're forecasted to make in order to sort of eliminate climate change and, you know, do all these good things and for, you know, Tesla to, to make their, you know, beautiful cars or whomever that, that, uh, you know, um, they need nickel. And right now, we have, we have a deficit of nickel that's going to emerge now in less than a year, and we have l- uh, we have about a 37 to 40% shortage of what we need. So it's like you have all these grandiose visions of how the world should work and, uh, an electric failure in a barge shuts down the global (laughs) supply chain for weeks.

Jason Calacanis 55:50 Yeah. A flood in a nickel mine. (laughs)

Chamath Palihapitiya 55:51 A ph- a flood in a nickel mine is gonna cause the price of a Tesla to basically double. And shouldn't people at some point ask ourselves, "Is this really what efficiency is supposed to feel like on the ground?" And it may not be, right? And so maybe, again, going back to the first conversation, a little bit more inefficiency, a little bit-

Jason Calacanis 56:12 Redundancies.

Chamath Palihapitiya 56:12 ... more inflation, a little bit more redundancy will allow us to be resilient and maybe that's what we really want. (laughs) We don't- (laughs)

Jason Calacanis 56:19 Well, I mean, you could ask the people in Texas what they want after they lost their power and-

Chamath Palihapitiya 56:24 It's unbelievable.

Jason Calacanis 56:24 ... they, they have, they have one light snow storm and the whole city is destroyed.

Chamath Palihapitiya 56:27 Unbelievable.

Jason Calacanis 56:27 I mean, there really is, uh, there is something to having the redundancy in your home and the supply chain and obviously drugs, which we witnessed during the pandemic. And I, and I guess-

Chamath Palihapitiya 56:39 Right. Right. I mean, we, we, we-

Jason Calacanis 56:41 ... that's an opportunity with the infrastructure bill.

Chamath Palihapitiya 56:41 We were so, we were so concerned about, um, short term profit maximization that we offshored our entire pharmaceutical production and PPE manufacturing to China, which then said that they might ration it to us based on, you know, geopolitical concerns.

Jason Calacanis 56:58 No thank you.

Chamath Palihapitiya 56:58 So yeah. That, that, that is, that is, that is penny wise and pound foolish. The absolute definition. Is the, is the infrastructure bill, um, gonna fix it? Friedberg, do you have a rundown of the infrastructure bill?

David Friedberg 57:09 You know, there isn't a good cl- there isn't good clarity on this. My concern is, um, that there's gonna be lots of, uh, push for things like roads and, you know, stuff that doesn't create ongoing jobs, that so much money is gonna go into basically a, a disguised stimulus package versus, um, you know, w- the ideal kind of infrastructure program set, uh, is to enable industry. So if you go back and you think about like the Manhattan Project and the Apollo mission, you know, those were very expensive government programs that have a very specific mandate. But because they were big investments and difficult problems, they unlocked a lot of industry, um, that followed that initial development cycle. And I think that, that is kind of a good guideline for us to think about with respect to what we might hope for an infrastructure bill to do, which is to create unlock for industry as opposed to plowing money into short term service contracts with a bunch of guys who are gonna make a ton of money building roads and it doesn't really change the industry very much. And so I'm concerned it's gonna be a giveaway of money that's gonna create a short term stimulus, but doesn't really create long term effects in the industry. But we'll, we'll see what kinda comes out as they get more clarity on this. There's certainly a big push for "green" but I'm not sure the people that are "green" advisors in this, in this context, uh, are gonna be thinking about this, you know, this next century of opportunity. You know, w- yeah. So, so, so we'll see.

Chamath Palihapitiya 58:29 America's gonna have to have a real come to Jesus if they actually really give a shit about climate change. Um, you know, I'll give you an, uh, I'll, I'll give you a different example, like, um, again, to, to really electrify, you have to pull metals out of the ground. That is a dirty business. Okay? And there are impacts to the environment, even if you're the best at it. And right now in, in the Western hemisphere, it takes 20 years to green light a mine. 20 years. Our shortages start in the next year. In China, they have, you know, no issues whatsoever, right? Let's just say. So maybe it takes them seven to 10 years to get a, to get a project green lit. Now I'm not advocating that we become China, but, uh, I think that it's really important for us to realize that like, you know, uh, if we're gonna really take this seriously, uh, you can't have progress being hijacked by things that may not matter as much in the grand scheme of things. Like, there is the opportunity, for example, to build a massive set of copper and nickel mines in the Western hemisphere, but the minute that they get green lit, they get, there's an injunction that's filed by an NGO that'll say, "Oh, you know, we have to think about the land grouse." And it's like, well, (laughs) the v- like what the fuck (laughs) is the land grouse? Uh, and at some point, you have to figure out whether you actually want your kids to have asthma or not, and whether they can suck up, you know, PM2.5 and PM10 for the rest of their lives or you care more about the land grouse. And, uh, this is gonna come, uh, come to a head and hopefully the infrastructure bill paves the way for these decisions, because I think as a, a country, we're gonna have to decide, because many other countries, in order to have clean air and drinkable water, are gonna basically prioritize humans over the land grouse.

Jason Calacanis 1:00:11 Yeah. I mean, it reminds me of the nuclear discussion we had earlier in this podcast of like, we can't even put a new nuclear power

Jason Calacanis 1:00:18 plant in this country without it taking decades. And-

Chamath Palihapitiya 1:00:22 Any, uh, any, any interesting updates on the business side? I saw, uh, is Microsoft really about to buy Discord for $10 billion?

Jason Calacanis 1:00:29 Yeah, if you look at that compared to, you know, the Slack acquisition is Slack got bought for 28 billion with... Was it 800 million in revenue, yearly revenue at the time? And Discord has 150 million and they're gonna for 10, so-

David Friedberg 1:00:43 That's unbelievable.

Jason Calacanis 1:00:44 It's, it's an even higher multiple 30 times revenue versus 75-

David Friedberg 1:00:47 Sax, how do you feel about your Yammer sale for 1.2 billion at this point? (laughs) I mean, holy-

Chamath Palihapitiya 1:00:51 Well, it was, it was, in hindsight, it was probably cheap, but-

Jason Calacanis 1:00:53 It made the market.

David Friedberg 1:00:54 You know?

Chamath Palihapitiya 1:00:55 Yeah.

David Friedberg 1:00:55 Yeah.

Jason Calacanis 1:00:56 Yeah.

Chamath Palihapitiya 1:00:56 Well, I mean, back in-

David Sacks 1:00:57 ... 2012, we, we really thought back in 2012 that one to two billion was like the best case-

Jason Calacanis 1:01:04 The upper bound.

David Sacks 1:01:04 ... scenario of, yeah, the upper bound of what a SaaS exit would look like. Uh, we just never realized how big the market could get and now, obviously, you have Slack at close to $30 billion, you have DocuSign IPOing at $40 billion, you have Zoom at over $100 billion. And so the market's just ended up so much bigger than we ever thought and we were the optimists. We were the ones building companies in SaaS back then. And so the cloud has just been so... I mean and you see this now with, you know, the numbers that Azure and, uh, Google Cloud and AWS keep reporting where they're at like tens of billions of revenue and they're still growing like 40%, 50% a year. So the cloud is just so much bigger than what we all thought and what came before, so that's wh- I mean so I've just decided to stop trying to find new ideas and just ke- I mean new the- like a new thesis and just keep investing in this. That's why I'm kinda all in on, on SaaS right now.

Jason Calacanis 1:01:58 Do you think Microsoft is doing this to compete with Slack or they're doing it to just really take over gaming? Do you have any insights Sachs?

David Sacks 1:02:06 I think probably, it's probably an element of both where, uh, they do, like w- one of their few consumer business lines that's done really well is Xbox and gaming and they bought Minecraft and so I think they can get some value out of it there, but I have to believe that this is competitively driven. They gotta be worried about Slack. I mean the crown jewel at Microsoft is the Office suite. The reason they bought Yammer is to accelerate the transition of Office into cloud, social and mobile and, uh, and it, it did help do that. Uh, they gotta be worried about Salesforce now buying Slack. I mean that is, Benioff has been wanting to go after Office for a long time and this is his way to do it.

Jason Calacanis 1:02:47 Yeah. All right, uh,

Jason Calacanis 1:02:49 there you have it folks. Uh, another All-In podcast is in the can. Let me just ask a question. Are people making summer plans and fall plans based on the post-pandemic world?

1:02:59 I'm making, I'm making, I'm making tonight plans. I can't wait to get you victims into the poker room. Sachs-

David Sacks 1:03:05 (laughs)

Jason Calacanis 1:03:05 ... I want you to fly in please. Sachs, come and play.

1:03:08 Come play poker with us. What are you doing?

1:03:09 We need a full Besty victim.

1:03:11 What are you doing? Well, Sachs, what's your plan tonight? Like are you going to some fancy (beep) pasta restaurant with your wife and-

1:03:16 What are you doing? Popping bottles with (beep) (beep) ? Yeah. Who are you hanging out with tonight, Sachs? What are you doing? Yeah, what are you doing these days, Sachs?

David Sacks 1:03:23 I'm just hanging with the kids. It's Friday night, I mean I'm helping out.

Jason Calacanis 1:03:25 Okay, I'm just gonna ask again, do you know their names?

David Sacks 1:03:28 (laughs)

Jason Calacanis 1:03:29 Sachs, put 'em to bed.

1:03:30 How many kids do you have?

1:03:30 Put 'em to bed. Fly up north.

1:03:32 When are your birthdays? (laughs)

1:03:33 Come to the poker game.

1:03:34 Tell us your kids' middle names. (laughs)

1:03:38 (laughs)

David Sacks 1:03:38 (laughs)

Jason Calacanis 1:03:38 Oops.

David Sacks 1:03:38 Actually that's a good one. That's a good one.

Jason Calacanis 1:03:41 (laughs) Oops. Whoops.

1:03:43 (laughs)

1:03:43 (laughs)

1:03:43 You're like yeah whatever, John, Sue. Who knows? I went to the movies last night. Um, I was, I took my 11-year-old out. She wanted, she was, uh, uh, she wanted to go to Shake Shack so I took her to Shake Shack and the movie theater was there and it was open and I was like, "Oh let's go check it out of what's going on at the movie theater." And Terminator 2 was playing 15 minutes later.

1:04:03 Great film. Great film.

1:04:05 Incredible film. Holds up and amazing to see on the big screen. We walk in, I kid you not, you know, 100-seat theater with these beautiful big chairs. Nobody there and they were so excited.

1:04:16 Wait sorry Jacob, did you rent the whole thing?

1:04:19 No. It just happens to be that they're open for business.

1:04:21 That's so awesome.

1:04:22 They space people out and-

1:04:23 You know I'm, I'm-

1:04:24 ... it was $5 a ticket to see it.

1:04:26 I'm taking my, uh, I'm taking my daughters to the movies this afternoon, first time they've ever been to the movies. They're, uh, you know, three and a half and two. I am so excited to take them to a movie theater so we rented the whole theater for $99. It's the best deal in town. You know what- What, uh, what movie are you seeing? Uh, Trolls. You can choose a movie, that's the cool thing. There's like a list of like 50 films and you can pick a film so I got like a little kids film for them and they get to go see a movie theater and have popcorn, have the experience, it's gonna be awesome.

1:04:54 And wow.

1:04:54 And you can have other friends there?

1:04:56 Yeah, you can have up to 20 people. So you rent the whole theater for 99 bucks and you can kinda, if you wanna come see Trolls Chamav, just cruise up, I'll send you a ticket.

1:05:03 Oh my God, that's the coolest fucking thing. That's awesome. Yeah.

1:05:05 Zilla vs Kong is happening and I'm renting a theater for it so if everybody wants to bring their kids, um, it's a great series.

1:05:11 (laughs) My kids would never sleep after seeing that. That's a little scary. Yeah.

1:05:14 No, no it's not for three to five-year-olds but, you know, 10-year-olds, yes.

1:05:17 It's 100 bucks. This is an AMC theater. 99 bucks, it's awesome.

1:05:22 For AMC, yeah. But the Cinepolis I think charges 200 and that's the like really high-end theater where you can press a button and the waiter comes. And the waiter was like, "Thanks for coming. We really appreciate it, like you're one of the first guests."

1:05:35 No way. There is no way movie theaters-

1:05:37 Yeah it was like kind of an emotional moment for me to take my daughter again because that's what we would do every Friday.

1:05:42 Yeah.

1:05:42 You know, school would get out.

1:05:43 There's no way movie theaters go out of business. I mean they're just, it's such like, like a traditional experience, it's so American and it's just such a-

1:05:49 I wonder what AMC is trading at. Hmm.

1:05:51 Yeah. Right.

1:05:51 I wonder if AMC would be an interesting-

1:05:53 I, uh, I purchased-

David Sacks 1:05:54 Sachs, Sachs is sitting this conversation out. He's like I got my movie theater downstairs. The usher is on standby ready to let me in. (laughs)

Jason Calacanis 1:06:01 (laughs) Sachs, how many seats are you... Sachs is like, "Oh you can only rent a 20-seat theater? I have a 40-seat theater."

1:06:05 Sachs, how many theaters are, do you have built in your various homes?

1:06:09 Yeah tell Sachs. Yeah.

1:06:09 Do you only have one theater for home Sachs? Is it one theater per home?

1:06:12 No he's got a multiplex in each-

1:06:14 (laughs)

1:06:14 ... in case people wanna watch different movies.

David Sacks 1:06:17 Multiplex. (laughs)

Jason Calacanis 1:06:17 They meet at the popcorn stand.

David Sacks 1:06:19 I'm excited to go back to the movies. I've been-

Jason Calacanis 1:06:21 Me too. I love going to the movies.

David Sacks 1:06:24 ... ready to be able to do that soon.

Jason Calacanis 1:06:24 I love them. How excited are you guys to go Disneyland? I wanna take my kids to Disneyland.

1:06:28 This is, I can't wait for Disneyland to open.

1:06:29 Me, I can't wait. I can't wait.

1:06:30 Sachs and I, when we first were-

David Sacks 1:06:31 COVID is over. I'm so sick.

Jason Calacanis 1:06:33 COVID's over.

David Sacks 1:06:33 By the way, how right, how right were we, I think it was like two or three pods ago, we were saying that COVID would be over by Memorial Day.

Jason Calacanis 1:06:40 Memorial Day. And yeah, Memorial Day.

David Sacks 1:06:41 And look at this.

Jason Calacanis 1:06:41 Even in California, Gavin Newsom basically has finally capitulated to logic and everybody can get a shot now as of April 15th.

1:06:49 Yeah.

David Sacks 1:06:50 Which means by-

Jason Calacanis 1:06:50 Yeah, we berated him.

David Sacks 1:06:51 Which means by May 15th, everybody who wants to get vaccinated will be vaccinated.

Jason Calacanis 1:06:54 All it took was a recall and 2.2 million signatures.

David Sacks 1:06:57 It took the recall-... and, and shame, and shaming him and berating him on Twitter constantly.

Chamath Palihapitiya 1:07:01 (laughs)

David Sacks 1:07:01 I mean, Peter Pham was tweeting out, like, every day, the, the growing, uh, inventories of vaccine and all the open appointments. We all were. And it was, like, ridiculous. We kept at mentioning him.

Chamath Palihapitiya 1:07:11 Five million shots on shelves in, in a pandemic. I mean, you don't need to be Freeburg to understand how vaccines work. Each person's a blocker, right?

David Sacks 1:07:21 Yeah.

Chamath Palihapitiya 1:07:21 I mean-

David Sacks 1:07:21 And, and the other thing, the other thing that got Newsom to move was that Biden gave that press conference in which he moved up the date. And so then that prompted Newsom to move up his date. And the same thing happened, like, a month ago when, uh, when Biden gave that, that speech where he, uh, said... He gave that May 1st date as the date everyone should get vaccinated. So frankly, it'd be nice if we had a governor who would just do the right thing without the constant threat of recall and tweet shaming and, you know, a- and, and, and the President dragging him, you know, into the future. But, um, but I guess-

Chamath Palihapitiya 1:07:56 What should we do with all... I'm curious what you guys think of what we should do with all this extra supply. I had an interesting idea for the economy. If you come to America and you've tested that you don't have COVID, right? You take a test on the... before you get there. If you come to America, we will give you the vaccine at the airport. Like, literally.

Jason Calacanis 1:08:13 Jason, I think, I think here's what we're gonna do. From now on-

Chamath Palihapitiya 1:08:16 How great would that be for tourism?

Jason Calacanis 1:08:16 ... you're gonna have, you're gonna have three little chips a week. And you get to put a chip in a jar, and then you can suggest one of your ideas.

David Sacks 1:08:23 (laughs)

Jason Calacanis 1:08:23 But then once you hit three, we're done. (laughs) Okay.

Chamath Palihapitiya 1:08:27 I thought this was a good idea for the economy.

Jason Calacanis 1:08:29 Yeah, yeah.

David Sacks 1:08:29 Vaccine tourism? Yeah, vaccine tourism.

Chamath Palihapitiya 1:08:31 Vaccine... No, no, like formalized vaccine tours. If you come to America for vacation, complimentary vaccines on the way in.

Jason Calacanis 1:08:36 Mm-hmm.

David Sacks 1:08:37 I mean, we're already at the point-

Chamath Palihapitiya 1:08:38 Go to, go to-

David Sacks 1:08:39 ... we... everyone, everyone's... Look, I mean, look effectively, effective... No, I think effectively, we're gonna have that. It won't be at the airport, but... I mean, the... all the restrictions are coming off in every state by mid-April now, and-

Jason Calacanis 1:08:50 Jason, most people can't afford an international plane ticket. You know, they're not, like, gonna come to the US to, to get a shot.

Chamath Palihapitiya 1:08:56 I, uh, I would like to advocate that we take these extra vaccines and we ship them to the developing world.

Jason Calacanis 1:09:01 Yeah, they should go south of the border for sure.

David Sacks 1:09:04 For sure. Yeah. And by the way, we're doing a much better job vaccinating people than Europe. I mean, it's unbelievable that COVID is spiking in Europe right now because they've been so incompetent at getting people vaccinated.

Chamath Palihapitiya 1:09:14 Well, their issue was they didn't want to put the order in.

Jason Calacanis 1:09:17 They, they are shockingly, shockingly incompetent. Shockingly incompetent.

Chamath Palihapitiya 1:09:18 The Canadians and the Europeans said, "We want you to prove to us the vaccine works-

David Sacks 1:09:22 No, I, I-

Chamath Palihapitiya 1:09:22 ... before we put our order in." So they went to the back of the list. I don't think it's that, Jason. I think, I think, Jason, like, I think that, like, sometimes... I think over the last 40 years, there's been two polar opposites of governing people. One is what I would call the autocrat, and the other is what I would call kindergarten soccer where, when the ball... no matter where the ball is on the f- on the soccer field, every player on every team is surrounding it. Just runs. Yes. And so as a result, no progress is ... Here, progress is bursty and unpredictable and sometimes not great, but it can happen. And this is where, like, you know, so... Like, I mean, we are... I'm, I'm still shocked at the lack of scientific rigor and understanding by these people. And so how could you have an entire Western set of countries who are theoretically not stupid be in this situation in April of 2021 knowing what we know?

David Sacks 1:10:17 Yeah. Well, how's, how's, how's Brexit, how's Brexit looking now?

Jason Calacanis 1:10:21 (laughs)

David Sacks 1:10:21 Because Britain-

Chamath Palihapitiya 1:10:21 My God.

David Sacks 1:10:22 ... because Britain is like... is almost fully vaccinated. Their COVID numbers are coming way down.

Chamath Palihapitiya 1:10:27 31-

David Sacks 1:10:27 And then the British variant, the British variant, it started in the UK, is spreading like wildfire across Europe because they're too bureaucratic to get everyone vaccinated. So, I mean, Britain is looking really good by comparison right now. And I mean-

Chamath Palihapitiya 1:10:41 They opted out of kindergarten soccer.

David Sacks 1:10:43 (laughs) Yeah. And, and by the way, this is just to tie it back to the infrastructure for a second. I don't have a problem with infrastructure if the investment's gonna be spent wisely. But how much of us trust the government to spend the money wisely as opposed to on pork barrel spending and wasteful projects and taking too long? We have the Bay Bridge in San Francisco. The original Bay Bridge took two years to build, and then the, the repair of it took 17 years where they did, like, the, the upgraded version. And that's