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All-In PodcastAll-In Podcast

E3: Modern Cold War, politicizing the pandemic & more with David Sacks & David Friedberg

Modern Cold War between US & China, economic recovery, potential mass migration out of San Francisco, pandemic politicization & more with David Sacks & David Friedberg Subscribe: https://bio.fm/theallinpod 0:01 Jason & Chamath intro David Sacks & David Friedberg 1:15 Everybody gives their quarantine update: Sacks is in Mexico while running Craft remote, Chamath got a new poker table & is excited for shelter-in-place to end, Friedberg is getting back into a rhythm 8:04 Chamath & Sacks reflect on the coming return to normalcy & politicization of the virus 12:41 Sacks on 3 major data-driven discoveries about the virus 15:54 Friedberg on fatality rate data, overestimating the lockdown's impact on stopping the virus 19:32 Getting back to work 21:05 Chamath on the stock market not reflecting the economy, Sacks on what an economic recovery might look like 28:00 Friedberg on potential of another NYC-level outbreak, Chamath on negative impact of left/right culture war 34:05 Sacks on democratic hesitation to end lockdowns giving Trump a strategic advantage, Friedberg on Hydroxychloroquine's benefits/risks 37:57 Sacks on potential resorting of the Bay Area & Silicon Valley due to remote work 41:51 Chamath on benefits of working remote, why San Francisco might lose large numbers of people 45:18 Tesla/Fremont situation a microcosm for politicization of the pandemic, benefits of people starting to distrust inept bureaucrats 49:33 Chamath on the beginning of the modern Cold War, dealing with market conditions considering China's standing in the world, ideological issues 53:46 Sacks on US/China relationship, how US can penalize China 59:25 Friedberg on how US can leapfrog China in manufacturing by using modern, automated solutions

Jason CalacanishostChamath PalihapitiyahostDavid Friedberghost
May 21, 20201h 6mWatch on YouTube ↗

EVERY SPOKEN WORD

  1. 0:00 – 0:01

    Intro

    1. JC

      Hey, everybody. Welcome to

  2. 0:01 – 1:15

    Jason & Chamath intro David Sacks & David Friedberg

    1. JC

      the All-In Podcast with Jason Calacanis and Chamath Palihapitiya. We record this podcast, well, on a, on a really unique schedule, Chamath. What's our schedule right now? Whenever we feel like it?

    2. CP

      Uh, basically, it is whenever our significant others get so sick of us-

    3. JC

      (laughs)

    4. CP

      ... that they kick us out (laughs) and say, "Don't come back."

    5. JC

      Yeah, we get thrown to the pool house-

    6. CP

      We get thrown to the pool house.

    7. JC

      ... we decide to pop up the podcast. Uh-

    8. CP

      Exactly.

    9. JC

      ... you're in, uh, Atherton. Uh, I am in the city in San Francisco. And-

    10. CP

      Thank you, Duke of Discretion. W- Is there anything else you'd like to do to help them?

    11. JC

      Uh, put a beep!

    12. CP

      My address, my gate code.

    13. JC

      (laughs) Gate code-

    14. CP

      (laughs)

    15. JC

      ... uh, off the fence. Um, w- you know, we had two guests on that people just went absolutely crazy for. Uh, the two David-

    16. CP

      But they weren't available, so... (laughs)

    17. JC

      So (laughs) we're just gonna talk shit about them.

    18. CP

      (laughs)

    19. JC

      No, we have two amazing Davids in our lives, David Friedberg and David Sacks. And they are super smart, super effective at their work, uh, everything we're not, Chamath. And so we thought we'd bring them back on the podcast and we'll do a little roundtable here and talk about life in the age of corona. So welcome back to the podcast, David Sacks.

    20. DS

      Yeah. Good to, good to be back with you.

    21. JC

      And also David Friedberg.

    22. DF

      Thank you, guys. Happy to be here.

    23. JC

      All right. Fantastic. So I just want to start off with our quar check.

  3. 1:15 – 8:04

    Everybody gives their quarantine update: Sacks is in Mexico while running Craft remote, Chamath got a new poker table & is excited for shelter-in-place to end, Friedberg is getting back into a rhythm

    1. JC

      How is everybody doing in this quarantine? How's everybody's mental health? Let's start with you, Sacks.

    2. DS

      Um, well, as you might be able to see, um, we've moved our, our bunker to a undisclosed Mexican location.

    3. JC

      (laughs)

    4. DS

      Uh, uh, you know, and it's been great. Um, you know, uh, we, you know, I think... I- it's really kind of sad because where we're at is, is a tourist city that would normally be, um, at peak season, and it's just deserted right now. All the construction has stopped. Um, normally you see lots of, you know, hotels and houses, um, being built, and that's all stopped. Um, and, uh, there's no tourists, so it's all just kind of cleared out. But, um, I think it's quite safe. You know, uh, every, uh, worker that I've seen here since we landed at the airport to, you know, got transported to, to this community we're at, I mean, has been wearing a mask. Um, much more consistent than I think in the US. And, um, you know, I think it's been, it's been fine.

    5. JC

      Now, of course, you founded, uh, the, uh, Craft Venture capital firm, and people know before that, uh, you obviously did Yammer and sold that to Microsoft for a billion dollars plus. And before that, you were, uh, the COO of PayPal. What's going on with your business? Are you actively investing? Uh, and how is your firm running remote?

    6. DS

      Um, it's, it's, it's worked very well. I mean, we've always been super collaborative as a firm. We were always o- we were already on Zoom and we were, you know, we share everything on Yammer. Um, and, uh, so for us, just moving to Zoom wasn't that difficult. We've done four or five deals, I think, since, uh, the whole kind of quarantine started.

    7. CP

      I'm sorry, sorry, sorry. Did you, did you say that you actually use Yammer now-

    8. DS

      (laughs)

    9. CP

      ... in 2020?

    10. DS

      We're still using it.

    11. CP

      Oh my God.

    12. JC

      Is Yammer still (laughs) available?

    13. DS

      Yeah.

    14. CP

      That's insane. That's insane.

    15. DS

      It's, I mean, it's kind of gotten a little bit buried inside of Microsoft, but you can certainly still get it. And, uh, no, we love it. I mean, the, uh, the whole firm kind of works, works in Yammer and, uh, it works very well for us.

    16. JC

      And now what's gonna happen with this incredible office that you have, this beautiful office you have in San Francisco and commercial real estate now that... Are you gonna come back to work? We saw Twitter, um, and Square, the Jack, uh, collection of companies, they're not gonna come back to their offices. They'll work from home primarily going forward. What are you gonna do?

    17. DS

      Well, it'll be a great asset for us in the year 2025 or something like that. Um, no, I mean, we, we will eventually go back to work there. Um, I think that the team still likes having an office. I think, you know, the idea that everyone wants to work out of, like, a small room in, you know, an extra room in their house, I think is probably getting... is probably a little overrated. I think people would like to get back to the office. Um, but do we have to have one? No. I mean, I think we've proven that we can do our jobs via Zoom and, um, you know, we've done a lot of... we, we've done, like I said, we've done four or five deals since this started where we haven't met with the entrepreneur in person, you know? It's all been done via Zoom.

    18. JC

      Wow.

    19. DS

      And it's, it's worked great.

    20. JC

      All right, Chamath, how are you doing? What, how's, what's your mental health like? Uh, I, you know, I get to see you once in a while on, uh, CNBC throwing bombs, um, but, uh, how are you doing?

    21. CP

      Uh, I was really excited for, um, phase two of the shelter-in-place to, uh, start here in San Mateo County. So that's been really good. Um, a new poker table that I had built arrived today, which I'll be, uh, installing after this. And what I mean by I'll be installing, uh...

    22. JC

      You'll be supervising (laughs) .

    23. CP

      I'll be supervising, um-

    24. JC

      You'll be watching as people do real work (laughs) .

    25. CP

      I'll be watching and, um-

    26. JC

      It's a beautiful table. I saw the pictures of it.

    27. CP

      Oh my God.

    28. JC

      Does it have an infinity edge? Is it an infinity edge poker table?

    29. CP

      Uh, no, no, no, no, but I'll send you a picture when it's all done, but it, it just looks stunning. Um, and, uh, I really want to try to organize a game soon so that I can get you guys back into the, um, into my little cave here.

    30. JC

      Yeah.

  4. 8:04 – 12:41

    Chamath & Sacks reflect on the coming return to normalcy & politicization of the virus

    1. DF

    2. JC

      Yeah. I think one thing I'd like to sort of talk about is we've had you both on the podcast early on at the start of the pandemic, and I'm curious, Chamath, now that we're here, um, over two months in quarantine, uh, sheltering in place, and a lot of information, a lot of cards have turned over here, right? We've seen the flop, I think. Uh, but we haven't seen the, the turn in the river, so to speak. What is your assessment of what we were talking about, you know, a month or two ago and what we thought about this and what's become reality and what hasn't? What are you more optimistic about, what are you more pessimistic about? Chamath, let's start with you.

    3. CP

      I think that, um, we will have this pandemic or this disease, uh, well in hand within two years. And so whether it's a combination of a therapeutic and a vaccine or just a therapeutic, um, I just think that we're gonna kick its ass. And so that's made me more optimistic. Um, I think that the thing that's made me more pessimistic though is the return to normalcy has been sort of cut on political lines, and it's been so massively politicized. I mean, when David talks about the fact that, you know, you can go to a developing country like Mexico and all of a sudden, you know, everybody can get around the idea of masks, it's because that there's a level of common sense there that, uh, trumps politics. And, uh, in the United States, that just isn't the case. And so what you're seeing in, in this crazy way, I think, is sort of the center left and the left, uh, probably sticking very firmly to the ideology of sheltering in place and a lockdown, probably on the sort of hope that it gets Trump out of office. And on the other side, sort of the red states, I think have basically said, "Hey, uh, I would rather get sick from coronavirus and take my chances than the 100% chance of failure that I have in my professional life if you leave me at home for another week or month or what have you." Um, so that's been a, a huge disappointment of, uh, of how political this whole thing has gotten.

    4. JC

      And, and Sax, you've been talking about, like, common sense procedures. Sort of same question to you, what you first thought, and you had been talking about, you thought an L-shaped recovery, so we'll get into also the economy here, but in terms of the disease, what did you think two months ago that you don't think now, and what do you think, uh, yeah?

    5. DS

      Yeah. Well, in preparation for this, I kind of went through my Twitter feed to see, uh, what, what I was saying the last time I was on, on the pod and how well it was holding up. And two months ago today, I tweeted that, um, the pandemic, uh, that underreaction caused the pandemic and overreaction will cause the depression. And I think that's kind of where we are right now. Um, we still have this pandemic with us, but now we're also potentially facing, I think, a, a potential depression because of the way we're, we're overreacting. We're still in lockdowns, um, in, you know, huge swaths of the, of the country. Um, and, uh, no- no one can quite understand why. I mean, the original reason for the lockdowns was to buy us time so that the hospitals wouldn't become overwhelmed like Italy. Well, n- nowhere in the country did the hospitals get overwhelmed, and we're still in these lockdowns. And, um, and so, you know, I, I think that, um, it's, it's long overdue for, for it to end. Now at the same time, you know, where w- I agree with Chamath that this whole thing has become politicized, where, um, you know, the, the, the people who generally want to get us out of lockdowns don't believe in doing anything. You know, they're not even, you know, a lot of them aren't even willing to wear a masks, which I think is just kind of insane. Um, so, you know, wh- where I come out on this thing is that I think we should end lockdowns but wear masks, and it's very hard to find anybody...... you know, in the, in the political spectrum who, who agrees with that because, you know, o- one side wants to keep lockdowns going indefinitely and the other doesn't want us to wear a mask.

    6. JC

      I- it makes no logical sense, obviously. And if you think about our political system, the left is so far left that the moderates on the left side don't have a place to live anymore. And then on the right, the conservatives, which I would put you in, uh, the group of who are, um, you know, looking for fiscal conservan- conservatives, um, they don't have a home anymore either. And so the most reasonable approach is clearly to start going back to work for people who are not at risk and who wear a mask.

  5. 12:41 – 15:54

    Sacks on 3 major data-driven discoveries about the virus

    1. JC

    2. DS

      Yeah, I think, I think there's been, since the last pod that we did together, I think there's been three kind of major discoveries or sets of facts that have come out about the virus. Number one, um, the official fatality rate has been over s- which is about 6%. Um, you know, it's a very high fatality rate. It's pretty scary. But we now know that that's overstated by probably at least 10X, um, because it doesn't take into account all the, the asymptomatic cases or mild cases, uh, that just never got tested. Um, you know, so there're a lot more-

    3. JC

      And this is the fatality rate of people who contracted the virus?

    4. DS

      Right. As op- yes, exactly. Uh, as opposed to people whose case... The, the, the, the problem with the, uh, it's kind of a, a debate between the, the IFR versus the CFR, the infection fatality rate versus the case fatality rate. The, um, the problem with kind of the official CFR numbers is that only the people who got really sick are, you know, ever got tested. And, um, you know, Freeberg was the earliest person, um, I know to s- start talking about the need for wide-scale population testing and these blood serology tests and other kinds of tests to establish what the real baseline is. Um, but regardless of, like ... And there's been a whole bunch of different tests with different results. Um, I, you know, um, w- we don't know exactly what the true IFR is to this day, but we do know it's probably closer to half a percent than to 5%. So that's sort of discovery number one. I think discovery number two is... And we knew a little bit, we saw a little bit of this from the Wuhan data, but now it's really clear, th- that which populations are at risk. And it's, uh, you know, the, the data seems to suggest that people under 60 who are healthy, don't have sort of preexisting conditions, are 50 times, um, less likely to develop, or, or there's, there's a 50X greater chance for those over 60, uh, in terms of a, of the, of, you know, having a really bad outcome. Um, and so for people under 60 who don't have these preexisting conditions, it's, you know, it's just not... Yes, there's always, you know, examples to the contrary, but it's not this, this sort of gigantic risk. And so for two-thirds of the population, they don't have a huge risk and we're still locking them down. Um, I think the third thing, the third study, um, n- not just study, there's, there's been studies and there's been models and then we've also seen practice, um, is that wide-scale use of masks, sort of ubiquitous mask wearing, um, is sufficient to control the virus, meaning to, to stop the exponentiality of the virus. We've seen, you know, in, in the Asian countries or Czechoslovakia, other places, they've been able to get the, you know, the, the so-called R naught, the, the, um, you know, the viral coefficient, to go below one with, you know, wide-scale use of masks. And so we have a way to prevent the virus from going exponential that doesn't require lockdowns. Um, and so the thing, you know, I, I blogged about w- the last time I was on your show was, why would you do this most severe thing, these lockdowns, and not do this easy thing that's just merely inconvenient-

    5. JC

      Yeah.

    6. DS

      ... which is a mask?

  6. 15:54 – 19:32

    Friedberg on fatality rate data, overestimating the lockdown's impact on stopping the virus

    1. DS

    2. JC

      Freeberg, when you look at it, and you're the, I think have the deepest science, clearly have the deepest science background of all of us, what, what, how do you look at this pandemic, uh, now that we're 75 days into it here in the Bay Area, and obviously, you know, this started in December, it looks like, um, in China. What's your take on it now? What did you get right early and what ha- have you changed your mind about recently?

    3. DF

      Um, I think... I'm, I'm actually... Funny, when you say that, I just pulled up the original WHO joint mission on COVID final report. And the date of this report, by the way, is February 20th. So there was this big thing they published, 40 pages long from the WHO, and in it they highlighted, you know, the, um, this fatality rate estimate inside of Hubei, uh, you know, Wuhan and outside of Hubei, and they, they... You know, we knew from this data very early on that we were at about a half percent fatality rate. And then, you know, we saw all of this other stuff happen with Korea and the Princess Cruise ship and the ND- NBA players. Very early on, we saw all these people that were roughly asymptomatic. And we're starting to get two kind of explanations for why that is, but from the beginning, I felt really, like, you know, this is gonna be a largely, um, asymptomatic kind of spreading, uh, uh, infectious vector. What th- what I got wrong was when we went into lockdown, I don't know, Chamath, if you remember this, when we talked the first time on Jason's... on, on your, your guys' podcast. I asked you guys... or you guys asked me when I thought we'd be back and I was like, "Oh, April 7th we'll be back at work." And I also had a bet going with you guys and I said, "We're gonna have less than 20,000 deaths in the US." I so overestimated the effectiveness (laughs) of the lockdown, and I think that was kind of, you know, one of the, the more kind of, like, striking things to me, is the quote unquote "lockdown." And I just sent a video to Nick. Nick, do you have it? Can you cue it up? So basically, I... This is what I think has happened in the United States. Like pull this thing up. I was in Berkeley on Saturday, and I went to play... to meet some buddies and we played frisbee golf on campus and had a beer with some-

    4. JC

      Yeah.

    5. DF

      ... college buddies of mine. And, uh, so I'm walking around in Berkeley and there is frat party after frat party going on. No masks, everyone's on top of each other. You can see the, the video right here. I took a video of one of the frat parties.

    6. JC

      I think that's beer pong.

    7. DF

      ... yeah, they're all playing beer pong. There's like girls and drinking and people are passing around bottles of vodka, and there's no mask. And this was the entire campus of Berkeley. Like, and I think this is what's gone on, like around the country. So the belief that you could just kind of like lock away the virus, I believe like, oh my God, there's, it's so extreme, it's so draconian. We're gonna shut down the, the world. And this thing is gonna get stopped in 30 days, like happened in China. That is not what happened in the United States of America. Like people want to be free. People want to party. People want to live their life. They want to go to work. They want to see their friends and family. And they, they're not used to being told no by the government. Um, and so I think that's been, to me, the biggest surprise is just like how ineffective the quote unquote lockdown has been. And I think it really speaks to the need that David mentioned, which is this lockdown isn't binary. You can't just say, "Lock everyone down or let 'em all out." You've got to nuance your way to a solution, which means like masks, which means watching out for nursing homes, which means temperature checking before letting people into buildings of over 100 people. Like all the stuff that I think needs to be done for this to be kind of effective at, you know, tracking and tracing. And we can't just assume, um, that, you know, a quote unquote lockdown is gonna keep people inside and keep this thing from spreading. Because the frat party, as you'll see, is the perfect representation of what, uh, what's really going on out there.

    8. JC

      All right, circling back around to you, Chamath, uh, what, what do you think of what the two Davids sort of outlined there in terms of the path forward and, and how we all handicapped what was going on?

  7. 19:32 – 21:05

    Getting back to work

    1. JC

    2. CP

      Well, I think the reality is that, um, by, um, hook or crook, we're gonna basically exit this lockdown sooner than we think, because I think people just can't take it anymore. So there's no point in having a shelter in place order if everybody's running around playing beer pong. Um, and so it's not doing anything. Um, and so you might as well get the productive value of, um, the economy going again by letting people go back to work. Um, you know, we, we... And just finding some simple ways that, uh, people can look past the politics and just do the right thing. Wear a goddamn mask and shut the fuck up and go back to work. Uh, it's, (laughs) it's really like... I mean, it... When you think about it, it's like, why is this such a big deal? Um, get everything you want and just put a little bit of cloth over your face. I mean, a lot of the folks that push back on this, um, you know, they're, they're better off wearing the mask. (laughs)

    3. JC

      Yeah. The... I mean, it is pretty striking when you watch the protests and you see a bunch of people who are, you know, obviously older and obviously obese-

    4. CP

      Those are, those are not the, the best of those are not the best looking knives in the drawer, let's just put it that way. (laughs)

    5. JC

      Not, definitely not. And-

    6. CP

      A little dull and rusty is what I would say.

    7. JC

      Well, and you know, they're carrying guns and they've never served a day in the army. I mean, it's, they're, they're literally cosplaying Marines.

    8. CP

      Well, that, that �?​s l- ... I have nothing-

    9. JC

      (laughs)

    10. CP

      ... to say about that. All I'm saying is the, the, this whole mask thing is not such a big deal. Just, uh, uh, if you can wear a mask and get back to being productive and get back to a job, I think you should be allowed to.

  8. 21:05 – 28:00

    Chamath on the stock market not reflecting the economy, Sacks on what an economic recovery might look like

    1. CP

    2. JC

      All right, so we had a big debate, uh, V-shaped, W-shaped, U-shaped, L-shaped recovery. I was in the, um, aspirationally V-shaped, but I'm expecting a U. Uh, Sachs you were the L, and I think, Chamath, you were the, the W... The U or the L. We've had a V. How do you explain, Chamath, what is going on in the stock market? 'Cause you said it was the end of days. You said this is gonna be a disaster. Is it going to be disaster? Is this the end of the days and we've got some false rebound and this V-shaped recovery is not sustainable? What... How do you explain this-

    3. CP

      I think, I think there's, there-

    4. JC

      ... inexplanable V-shaped responsibility... uh, re- response.

    5. CP

      There's two things to keep in mind. Um, first of all, the economy is completely fucked. So don't, don't que... you know, don't look at Facebook, Apple, Amazon, Microsoft, Google, and a handful of, you know, internet SaaS companies and, and kid yourself. We have 30 million American men (laughs) and women out of work. That is every fifth person you see walking down the street does not have a job.

    6. JC

      What happens when lockdown ends? If we... If the lockdown ends in June as expected for most people-

    7. CP

      Well let me, let me just explain the-

    8. JC

      ... how many, how many people are-

    9. CP

      ... the first rebound.

    10. JC

      ... how many rebound?

    11. CP

      Yeah. Yeah, no. So, so look here, here, here's the thing that we've had. We've had trillions of dollars of money printed into the system. And when you print that money into the system, which the Federal Reserve has done, it hits the asset markets and it has basically stabilized the bond market. And the incremental dollar sits in the hands of an individual who must put the money to work. Because when you look back at this, this is not, you know, uh, a random person managing their 401 (k) . The overwhelming majority of the money sits in the, sits in the hands of hedge funds or pension funds or sovereign wealth funds or mutual funds. They have a job to do. And so you have to think about what is their incremental decision. So even if the stock market made no sense on any valuation metric, the incremental dollar that they have, which they're paid to put to work, will get put to work. And so what you've actually seen is, uh, a dispersion. And what I mean by that is if you graph the S&P 500 index, um, versus the unweighted S&P 500 index, which basically means, uh, the first one ranks companies by market cap and gives the biggest companies more weight. The other one ranks every company equally. There's been a massive split, a dispersion. And what it really shows is that companies that traffic in bits, so software businesses, have a bid, and companies that traffic in atoms have gotten completely decimated and they are literally worthless. Um, and so when you put all these th- things together, the real economy is in the toilet. There are tens of millions of, you know, men and women out of work. Um, the earnings power of real companies that do physical things in the world are cheaper and lower than they've ever been. Meanwhile, the companies that have, uh, high velocity, high margin, software-driven businesses, um, have gone to the moon. So it's unfair to look at 30 or 40 businesses and paint that as a, as a V-shaped recovery. It is a...... equity market that is buoyed by fed dollars that is not mapping to the reality of what's happening on the ground.

    12. JC

      Okay. So, Sax, uh, you're, you're pretty plugged into the economy and you think about this a lot. What do you think the recovery looks like? Is this going to be two, three, four, five quarter recession? Is it going to be Depression-era like some people are apt to say? W- w- what keeps you up at night thinking about the economy and what gives you hope?

    13. DS

      Well, I, I, it, it kinda depends if there are other shoes to drop. Um, so, so I agree with Chamath that, you know, the state of the economy right now is terrible and it's divorced from the financial markets because of, you know, all the money printing and interventions that the Fed and Treasury are, you know, have been doing. Um, you know, one way to think about it is, well, the stock market's denominated in US dollars and if, you know, they just printed a whole bunch more of them, those dollars are worth less and so, um, you know, the, the price of those stocks are gonna rise. Um, but, but yeah, I think looking forward, um, you know, I, it's probably gonna be a two to three year process to get out of this unless some other shoe drops, which could make it much worse. Um-

    14. JC

      So you're, you're betting on two to three years to get back to, let's call it single digit unemployment?

    15. DS

      Um, well, let's see. We're at, like, what? 15% right now or something like that? Um, so, you know-

    16. JC

      35 million people, you get down to, you know, 10 million again? 20 million?

    17. DS

      Yeah. I mean, it's, it's hard to say. It's gonna take a long time to create all those jobs. You know, a lot of these businesses are not just gonna come, you know, racing right back. Um, so yeah, I think it's probably, like, a two to three year process to get back to some sort of, you know-

    18. CP

      And by the way, the thing you have to remember is, like, look, the unemployment numbers that we have had in the last probably seven or eight years, so during Obama and Trump, have been completely manipulated because the number of people that are entirely leaving the workforce, um, is quite high. And so, you know, it's not just a numerator problem, we have a denominator problem too. There are fewer and fewer workers that, you know, um, are willing to work because some of them just give up.

    19. JC

      Right. Or it's just not worth it for the pay that's available is another stated reason.

    20. CP

      So the thing that we're gonna have to figure out is, like, how many of the people that are leaving the workforce may never come back? And that has a, a societal toll and weight that we all have to bear.

    21. JC

      Yeah, there's gonna be a lot of people who maybe are in their 60s or maybe even late 50s, they got 10, 20 years left that they could be, uh, working in management, sales, whatever it is and they just say, "You know what? It's not worth it, I'm gonna go, uh, try to find a place to stay and maybe not rejoin the workforce." Early retirement or just capitulation.

    22. CP

      Yeah.

    23. DS

      Well, an- and, but, you know, remember I said about other shoes dropping. I mean, we, we're still in the early... I, I, I think we're still in the early stages of seeing the repercussions of what, you know, a two, three month shutdown of the economy, you know, what, what that's gonna look like. And so the, you know, the wave of defaults is just beginning and, um, who knows what happens with cities and states, um, and so on down the line. I mean, who knows... You know, does, do the debt markets have kind of an inexhaustible, um, you know, desire for... to, to, you know, to buy US debt or could we reach some sort of saturation point? Um, and then that triggers the next, you know, set of, of, um, crises. So we just don't... You know, I would say, like, the two to three year outlook is, is the one that's kind of, like, what it looks like today but if there are these other big shoes to drop it could

  9. 28:00 – 34:05

    Friedberg on potential of another NYC-level outbreak, Chamath on negative impact of left/right culture war

    1. DS

      turn into something much worse.

    2. JC

      I, I think, Friedberg, we're all in agreement that there will be a second wave of some type, uh, just depends on how big the spike is. Do you think there'll be another New York City level outbreak where we'll see, you know, 2,000 people, 1,500 people dying in a certain region every day for some sustained period of time? What are the chances of that happening, Friedberg?

    3. DF

      I don't know. I mean, I think going forward, the, you know, the New York situation, people's behaviors have been shocked so, you know, to the points earlier, the most effective thing you can do is stop coughing on your hand touching a railing, someone else touches the railing and touches their mouth. I mean, that's kinda how this goes. Um, you know, there's been early on some weird, like, aerosolized, aerosolized studies that they've kinda said, "Hey, this thing spreads in the air," and so on. It's really, you know, you gotta be in a closed, kind of confined space and people are wearing masks now so the likelihood of the transmission happening at the rate that we saw in New York... Great paper out of MIT, by the way, that shows how this happened on the subway. Um-

    4. JC

      Oh, really? Describe it.

    5. DF

      Yeah, it identified the subway as kind of the primary vector that drove transmission in New York City.

    6. JC

      That was always my, uh, thesis-

    7. DF

      Yeah.

    8. JC

      ... and I remember talking about it and saying, "H- how is this not obvious to everybody that eight million people ride that thing every day or something?" Like, it's so obvious.

    9. DF

      And they did, they did an incredible job proving it. So it's not like people running in Central Park are spreading coronavirus to each other, it's everyone in these confined spaces coughing in the air and then you kinda get this stuff.

    10. JC

      And 20 people get on and off at every stop. That's the other thing people don't realize is that it's not just a bunch of people... It's not an airplane where you have X number of people going in one direction for three, four, five hours. This is 20 people getting on and off every five minutes.

    11. DF

      That's right.

    12. JC

      It's almost like you couldn't design a better incubator for it.

    13. DF

      And I don't think a city in, in the United States approaches the density that you have in New York. So remember, these are not deterministic factors. There's like a spectrum, a probabilistic spectrum here. So you have a lot of people, they have a certain type of behavior, they're not wearing masks. You kinda add these up and you end up with this really high kind of vector that drives this, uh, this rapid spread as we saw in New York City. You're not, you're not gonna see that in Dallas, you're not gonna see that in Houston, you're not gonna see that in San Diego. You're gonna have more of the slow steady burn, uh, as some risk is taken in the environment. Some risk is taken by frat parties and people not wearing masks and people touching their mouth, but it's not gonna have the same sort of massive effect you saw in New York. So I wouldn't expect us to have a New York style second wave.... I do expect there to continue to be this, like, slow burn going forward of new cases. And it's certainly gonna be more obvious now that we're testing a lot more.

    14. JC

      A- and so Chamath, at this point, we're basically putting a price on life and saying, "Hey, some amount of deaths is worth taking the risk." And as Americans, a unique group of people in the world in how we look at personal freedom, Americans are just making the choice, "Hey listen, if you don't want to take the risk, stay home, but the rest of us, if we wanna take the risk, we're gonna go take the risk." That's what this has come down to in your mind, Chamath?

    15. CP

      Yeah, I think that, um, it's very difficult for Americans to, um, um, envision a world where, like, you know, their personal freedoms are infringed upon. I mean, it's sort of like kind of one of the founding principles of the entire country. Um, this is why I think that the, the tragedy of this thing is that the, the way to get everybody what they want is so simple. Um, as David said, it's like, you know, above 65, you stay home, you work remotely. Under 65, you temperature check and wear a mask and, you know, you're 95% of the way there, but it's become a left versus right decision to do it. You know, the mask wearers are still in a lockdown and the non-mask wearers want to get back to work and basically, like, there's, there's... It's just a, it's just another kind of culture war between the left and the right. Um, I- it's, it's really just shocking to me. I mean, I- my- for, for, for, for what it's worth, you know, if I was... I am a betting man, so I'll just tell you. You know, my line now is that I think that Donald Trump is overwhelmingly likely to win as a function of people's frustration in the, about the lockdowns. And I think that the Democrats' best hope of winning in November is ending these things sooner rather than later.

    16. JC

      I- it's amazing we're talking about a pandemic, a once in a hundred year pandemic it looks like, and we're literally looking at our reaction to it through the lens of this president being reelected or not. Like literally, that's the determining factor on the advice we're giving to people. We're telling people they can't go to the beach, but they can be on an airplane. They can't go to the Tesla factory, but they can ride the subway. I mean, on a communication basis, is there any worse way we could have communicated this to the populace?

    17. CP

      Well, the communication was bad, but the, the... I think the bigger problem quite honestly is that the Republican Democratic governors in the United States can't get on the same page. And, um, at the same time, there's just a, a tendency to support Donald Trump or not support him in a very reflexive, instinctive way that isn't helpful right now. And, uh, and there just doesn't seem to be enough political wherewithal and courage to just stand up and do the right thing, independent of what your, um, uh, what your political persuasion is. So... But, but I think at, on the margin now, I think you have different but very similar boundary conditions to 2016, where there are all these people that kind of like told you one thing and did another. There are all these people right now that probably are, you know, preference falsifying as we speak and, you know, they'll show up into the voting booth and they'll be angry if they're not back in their jobs, especially if they've been laid off by as re- as a result of not being able to get vaccinated.

    18. JC

      And they would blame that on the Democrats, not the Republicans, and therefore Trump gets his next term.

    19. CP

      Well, because the, the, it's, it's the Democratic states that are pushing the hardest to basically like... You know, you saw the craziness in Los Angeles, but like, you know, Eric Garcetti was basically like, "We'll, we'll enter the shelter in place in, you know, December of 2022." And it's like, uh, this is, it's Los Angeles. I mean-

    20. JC

      Yeah, it's not gonna happen.

    21. CP

      You know, players gotta play. I mean, like this is, this is unbelievable.

    22. DS

      Yeah. Well,

  10. 34:05 – 37:57

    Sacks on democratic hesitation to end lockdowns giving Trump a strategic advantage, Friedberg on Hydroxychloroquine's benefits/risks

    1. DS

      the, the... I do, I agree. The lockdowns, the, uh, or the unwillingness to end the lockdowns, um, gives Trump an issue for November, a- assuming this continues, um, that supercedes the incompetence of the COVID response, which is that, you know, our lives and livelihoods are not owned by politicians to, you know, meter out and give back to us in, in drips and drabs and, um, as they see fit. That is the issue that the lockdown crowd is giving to Trump and I do think it will, if it's still the issue in November, it will supercede the, the, you know, the initial incompetence of the COVID response.

    2. JC

      And what did you think of this whole, um, what's the drug that Trump said he was taking, David Sachs?

    3. DF

      Hydro- hydroxychloroquine?

    4. JC

      Yeah. So wha- uh, or Friedberg, maybe you take it. Um, we talked about that early on and that, and I think you properly said like if you took it early this could be, you know, uh, could, has potential, taking it later it's probably too late. I think you nailed that on the pod last time. Why has this become such a political issue? And what are your thoughts on that drug specifically and its potential efficacy?

    5. DF

      Look, I- I'm not a doctor, um, but it, uh, from what I understand, um, is there's a... So just so you know, there's like side effects to this drug for a small percentage of the population, and, uh, this drug can actually inhibit, um, energy production in certain cells which can cause organs to dysfunction, uh, and it particularly shows up in the heart. So, uh, people end up with, uh, what's called a long QT interval and potentially some heart issues that can be pretty dangerous and deadly, uh, depending on, on, on your body. So it's really an un- a little bit of an unknown. There's also issues longer term with, um, with vision impairment. It can damage your retinal cells and cause vision loss. So there's risk to this drug. It's not like taking, you know, an Advil. Um, it is a, it is a measured risk. It's a low probability, but the severity can be high. And so typically with a scenario like that, doctors and scientists like to see, you know, phased clinical trials and you kind of do, you know, um, randomized and you have placebo and testing. And so that hasn't necessarily been done for this particular virus and this particular condition. Um, and often the design of those studies matters a lot.... so you could give it to a bunch of "COVID patients," but if it's not being given to COVID patients either before or right as they're getting sick, maybe it doesn't show the results that you would expect from a prophylactic treatment, meaning you're getting it before you're really sick. And that's where it may be the most efficacious. Um, and so some people are saying, "Wait, we don't know enough. Don't do it. It's not worth the risk," because of that small percentage high severity problem- ... while others are saying, "Oh my gosh. It's totally worth the risk, 'cause the downside if you get coronavirus can be really bad." And you know, so, so there's a lot of room for debate here. And when there's a lot of room for debate, you usually kind of revert to some sort of base belief or some base kind of political point of view or something. And I think that's what's gone on here. This isn't a clear cut, the sun is, the, is yellow and the sky is blue kind of conversation. This is like, I can interpret this a lot of different ways. Um, it does seem that like, look, this drug, you know, like a lot of, um, uh, ha- has an effect in, in the same way that a lot of other, uh, that this drug might have on a lot of other viruses. Um, and this especially, plus zinc, uh, you know, and this, uh, Z-Pak, uh, this, uh, azithromycin, which is an antibiotic, together may be really, um, effective. And so yeah, if you weigh the downside and the probability of that downside for a patient against what the potential upside would be, depending on their risk factors, now that we know those better for COVID, you can make an educated decision and maybe it should just be left in the hands of doctors, uh, versus like, have some national statement about it. I don't know. Um, but yeah, certainly a lot of room for debate and, and thus a lot of kind of, you know, political engagement on this.

  11. 37:57 – 41:51

    Sacks on potential resorting of the Bay Area & Silicon Valley due to remote work

    1. DF

    2. JC

      Sacks, is it, there has been a lot of talk about what the Bay Area looks like after this, whether it's commercial real estate with Twitter and Square going full work from home, um, and people not wanting to work in cities. What are your general thoughts on what the world looks like a year from now and maybe five years from now? If there is gonna be some permanent change, uh, what do you think it would be?

    3. DS

      Well, I, there could be a big resorting. Um, I mean, it, it, it kind of depends if the virus becomes endemic as something we, we kind of end up living with. Um, uh, but you know, l- so, so let's, if, if it does, I mean, if you're like over 70, are you really gonna wanna stay in a place like New York City or are you gonna wanna go somewhere else? And so I could imagine if this does become this longterm thing that's just an endemic, you know, we don't, if we don't have a vaccine, I could see cities resorting where, you know, New York has people who are comfortable with COVID risk. And you know, as soon-

    4. CP

      (coughs)

    5. DS

      ... um, I think San Francisco, the, the big issue with San Francisco is that, um, there are always a bunch of reasons not to wanna live there. I mean, the, the city just seems like chronically mismanaged. Um, there's a huge homeless-

    6. JC

      Feces, lots of poop.

    7. DS

      There's a huge homeless problem. There's just, you know, public health issues with that. There's, there's a lot of crime that isn't responded to properly. So there's all these like reasons not to live there, but the reason why people chose to live there is because the tech industry had a very strong network effect and you needed to be in Silicon Valley or San Francisco in order to have access to these, these jobs and opportunities. And if those jobs and opportunities are now available via Zoom and you can be doing them from anywhere, are people still gonna choose to live in San Francisco? You know, with... and, and you know, with the, the, um, the cost of living and housing and apartments and all the rest of it that, that goes, that goes along with it. So yeah, I mean, I think there is some chance that this whole remote work thing could break, um, Silicon Valley's network effect, and that would be really bad for places like San Francisco, which, you know, otherwise might not be the greatest places to live.

    8. JC

      Yeah, I, my thesis on this in terms of getting out of the recession, I think remote work could lead to a level of efficiency and profitability in the companies that we have never seen before. If you think just about every manager now knows how to manage remote workers, right? You learn that in like three, four weeks. You figure out how to manage people remote. Even people who hated managing people remote, all these Gen Xers and Boomers who are managing, you know, Millennials and, and earlier Gen Xers, they now know how to do it. And what they quickly learn is these three or four people in my team are crushing it. These two or three people don't need to be here. They're not actually adding any value. So I think what's gonna happen is they're gonna cut the bottom people, then they're gonna cut their office space. Now you've removed, I don't know, call it 30% of the cost basis of a business, 40%, and it's operating better and people are happier. And then when you do hire somebody, there's gonna be more talent available and you've just opened it up that you can hire somebody anywhere in the world without an office and you don't have to relocate them and you don't have to pay... I don't know what you guys think the average additional cost is to be in San Francisco, but I'm gonna say $30,000. So a $40,000 a year job or a $50,000 a year job becomes a 70 or 80, something like that. And if all that happens, these companies are gonna be so profitable that they're gonna start growing and that leads us out of the, um, economic downturn. Any thoughts on my, uh, my thesis?

    9. CP

      That's not a thesis. That's a hope.

    10. JC

      Yeah. (laughs)

    11. CP

      Hope's not a fucking strategy, Jason.

    12. JC

      Yeah. (laughs)

    13. CP

      Just letting you know.

    14. JC

      Well, I just think it's a potential way out. I think it, I mean, what do you think in general about this trend of remote

  12. 41:51 – 45:18

    Chamath on benefits of working remote, why San Francisco might lose large numbers of people

    1. JC

      then, Chamath?

    2. CP

      I think it's great and I think that we're realizing that, um, you know, there's no monopoly on innovation. And companies can be, uh, really productive remotely, that most of the work in an office is busy work and politics and you can cut it all out. And you can do, uh, the same amount of work in much less time, which gives you more time to frankly be with your family or take up a hobby or learn a second language or a third language. I mean, I just think it's so much better for people to realize like we gotta, you know, it's, it's not like you're... you know, it's not, it's not 1820 or 1920, it's 2020. So we're gonna live to 100 years old. Like, we have a long time to be in the grind. And so, um, you know, working-... and accomplishing what you used to in half the time and not having to commute and being able to live where you want, near people you like. Man, that has a huge positive impact to your kids, you, your community. It's just way better. I just think, um, offices are just complete, kind of like, it's all Shakespearean theater in the end and cutting it all out is great. And specifically, San Francisco is just a complete cesspool dump of shit. And so-

    3. JC

      (laughs)

    4. CP

      ... you know, being able to just get out of that city is just-

    5. JC

      All right, everybody welcome to the all... (laughs) You're listening to the All-In Podcast.

    6. CP

      I mean, I wread- I read some stats yesterday that were just so unbelievably shocking, like the number of break-ins, the number of, uh-

    7. DF

      Number one in the country.

    8. CP

      They're number one in the country. The, the, the amount of disease that, like communicable disease like typhoid. And I'm like, "Typhoid? I, I, I was born in a country and scratched and clawed to emigrate as a refugee-"

    9. DF

      (laughs) .

    10. CP

      "... to leave a country that had typhoid as a disease."

    11. JC

      Welcome home, Premoth.

    12. CP

      Just to end up back in that in San Francisco.

    13. JC

      Did you bring it? (laughs) .

    14. CP

      That's a joke.

    15. JC

      You brought it with you? (laughs) .

    16. CP

      That's an absolute joke. So-

    17. JC

      Yeah.

    18. CP

      Um, yeah, I mean, the idea that I'd never have to go to San Francisco ever again is, oh my god, it brings joy to me.

    19. JC

      It, it is a, it's an unmitigated disaster. This, and I think this'll be part of the boom-bust cycle that, you know, David, you were part of when you were here at Stanford, you know, getting an office in San Francisco or having an apartment. It was cheaper, I think, in the city than it was down in Palo Alto, was it not?

    20. DS

      Well, back in, yeah, when we moved Yammer to San Francisco, which was 2009, I think we were able to get space for $20 a foot per year.

    21. JC

      Crazy.

    22. CP

      Wow.

    23. DS

      Yeh, it was really cheap.

    24. DF

      That's what, that's what I paid 2007, 2008. 2020.

    25. CP

      I read a, I read a, I read a crazy article. Um, it was about, uh, the Kushners and this building that they own that Brookfield Asset Management was gonna buy. And, um, and it said that they bought this building and so the Kushners moved to, like, Park Avenue, the General Motors building overlooking Central Park or something, right? It's a beautiful building. And it actually quoted in there the price that they were paying. And it was incredible because it was like 100 bucks a square foot per year. And I realized, oh my god, they're paying less for Central Park views in New York than I'm paying for a warehouse in Palo Alto.

    26. JC

      (laughs)

    27. CP

      What the fuck is going on? This makes no sense whatsoever.

    28. JC

      Yeah. That'd be supply and demand right there.

    29. CP

      Uh, and I thought to myself, like, this is, this is crazy. Like, California is so expensive. The taxes are so high. Uh, it's, I think people will, are gonna leave in droves, honestly.

  13. 45:18 – 49:33

    Tesla/Fremont situation a microcosm for politicization of the pandemic, benefits of people starting to distrust inept bureaucrats

    1. CP

    2. JC

      What do we think of Elon, um, selling all his homes and then actually saying he's gonna leave and, you know, move Tesla out?

    3. CP

      I mean, I don't think it's a practical reality to move Tesla out of, out of California. I think that the incremental f- facilities can be built wherever he wants them to be built based on where he gets the tax incentives.

    4. DS

      Well, but I think, uh, the Tesla Fremont was a really good example of this sort of, like, culture war that's going on, this, this political ba- battle over lockdowns. And, um, you know, you had kind of a mid-level health, uh, department bureaucrat in Fremont padlocking their factory and saying they couldn't go back to work, um, whereas if he was in Texas, he could. Um, and then, you know, around the same time, you had this whole, like, Chile Luther thing in Texas where she was a small business owner, um, you know, owns uh, uh, like a haircut place. And she was basically gonna be put in jail for a week for giving somebody a haircut. And, uh, there was like a, you know, dust-up over that. Um, so, you know, I, I think that, like, you know, the, the country is certainly ready to get back to work and, um, and if this is the political debate, you know, in November... I'm not sure it will be because six months is a really long time from now, but, um... or was it four or five months? Um, but if this is the political debate, I, you know, this, this will be the way that, that Trump gets reelected.

    5. CP

      Mm.

    6. JC

      Yep.

    7. DF

      I think there's gonna be some pretty significant benefits because of the reaction you guys are speaking to. It's not just about people moving, but it's a reaction to regulation. And, um, that could have some pretty profound ef- effects that could benefit certain, um, sectors and businesses and accelerate, uh, new outcomes. One of the things that, you know, I have a strong belief in is like I think in 20 years we could kind of eradicate all infectious disease. The only thing holding that up is regulation, 'cause the science is known, the engineering is basically there, and it's simply a function of getting these things approved and getting across the finish line. Doing gene editing in humans for genetic mutations that cause harm to humans is a, is a technique that we've known for 20 years. And there was a guy, uh, a patient that died, uh, in 1999 from, uh, one of the first AAV treatments, the viral vector gene editing treatments. After that, there was this clampdown and suddenly everything stopped and there was, like, no longer any progress in the space, and they're just now starting to come back. And there's a lot of, um, you know, really interesting technology that, uh, has been kind of hindered. I mean, you know, not being able to put Teslas out I think is the tip of the iceberg of what people are seeing regulation can do, uh, to businesses. And, um, look, I'm, I'm by no stretch, uh, you know, a libertarian party card carrier, but, uh, I do think, and I see it in businesses that I'm involved in all the time, that this, you know, incredibly onerous, like, overreaching regulatory burden and bureaucrats, um, really hinder great new things from happening in the world. Um, and it's just become so friggin' apparent how inept the people are that are making the decisions that are doing this to us are, uh, during this crisis, and I think it could have a profound benefit on kind of deregulation and accelerating the adoption of new, new tools and new technologies that could really help us all.Um, so I, I view the positive side of this. It's not just, like, everyone's gonna leave California. Like, there's inept bureaucrats and over-regulation everywhere.

    8. JC

      Let's talk geopolitics for a moment. Chamath, um, you know, you heard the president call it the Wuhan virus. Obviously, he... there's no doubt that it came from there. There is a debate. Was this something that was not created in a lab, but that was being studied in a lab and accidentally got out and that's how the jump happened? And there's some tension there between China and the US. Wh- what do you think the global reaction is gonna be and the fallout will be for China, if any? Japan is paying factories, I read, uh, and helping subsidize them to move factories out of China so they can move that dependency. We obviously saw the dependency on PPE and drugs being made, actually, in Wuhan, in that area, and how we don't have a supply chain that we can rely on for really mission critical stuff. How do... how will we look at this Chinese relationship, uh, in the United States and globally, post-pandemic?

  14. 49:33 – 53:46

    Chamath on the beginning of the modern Cold War, dealing with market conditions considering China's standing in the world, ideological issues

    1. JC

    2. CP

      This is the beginning of the modern Cold War. And so it's America versus China, um, except that China is a much more worthy adversary for us than the USSR, SSR was at their peak. And the reason is because China has been making strategic investments for the last 30 years. Um, you know, the biggest thing that prevents China from really going guns blazing, broadside attack on the US, is that the US dollar is still the reserve currency of the world. Uh, but even there, China, you know, is trying to do a digital currency and a stablecoin. And, um, these are all these state-sponsored initiatives that come from, frankly, just strategic decision-making to try to usurp the United States as the most powerful country in the world. Um, and so again, it goes back to, is this a political issue or is this an ideological issue, or is this an exceptionalism issue, or is this just the practical reality that we do not want another country being number one? And, uh, can we all agree? Uh, and if we can all agree, then I don't think they'll win. Uh-

    3. JC

      Where do you... where do you sit on it? For you, is it practical? Is it ideological?

    4. CP

      Completely practical. I have zero... Like, y- uh... you know, I- I've been thinking about this a lot because, uh, I have not done any investments and I just did my first.

    5. JC

      Oh.

    6. CP

      Uh, so it's been three months and I did... and it was a credit deal, so it's not even equity. Um, and, uh... You know, I, I was... and I was re- reflecting on what, what am I trying to do? Because I felt myself frenetically, you know, spending and working too much and, you know, looking at all these different opportunities. And I realized, wait a minute, like, my job here is, uh, not to win some finite game. Like, this is not ending like a basketball game or a soccer match. This is like, I'm trying to be in this thing for 50 years, so my goal is to survive. And the reason why I say that is my ideology is very fluid. I have to be able to adapt to market conditions as they change because if I wanna be a relevant, you know, person in the world in 50 years from now, um, first rule of business is don't go out of business. Second rule of business-

    7. JC

      Yeah.

    8. CP

      ... is don't forget rule number one.

    9. JC

      Right.

    10. CP

      You know? Um, so in that context, I think it's a very practical thing that we just have to deal with China and make sure that they do not usurp America's, uh, uh, standing in the world as the most important country of the world.

    11. JC

      Just-

    12. CP

      It's fine.

    13. JC

      For me, it's ideological. I just don't want a communist country, uh-

    14. CP

      I don't care about that.

    15. JC

      ... that is torturing (laughs) their citizens as the number one country in the world.

    16. CP

      I, I would tell you-

    17. JC

      I think it's just really dangerous.

    18. CP

      But, but I have a real issue with this. Like, I don't think you have the right to judge. Just like Californians can't judge Texans and Texans can't judge Floridians.

    19. JC

      Oh, no. See, that... you're wrong. You absolutely should judge people who are-

    20. CP

      No.

    21. JC

      ... torturing people and not allowing people to have freedom of speech. Uh, yeah, you should judge them actually. Actually, human rights violations-

    22. CP

      I, I-

    23. JC

      I think you should judge people.

    24. CP

      I, I think that we... There's, there's a lot of that stuff in America that you stay silent on, Jim.

    25. JC

      No, that's not true. I am absolutely for cannabis. Uh, anybody who's arrested for cannabis violations and, and low level drug things, I think we... they should be let out of fre- out of jail just like, uh, J.B. Pritzker did in, in Chicago. I mean, and I think the death penalty should be repealed too because we don't apply it properly. Those are the number one and two things, probably in the United States, that go against the human rights, uh, dec- the Declaration of Human Rights. And I'm actually very pro fixing those things. I was totally against waterboarding, and I think that was the worst moment in modern American history.

    26. CP

      I, and I... I, I honestly, I honestly think that, like, China's gonna b- do China. You know, uh, India's gonna be India. And instead of getting caught up in our own ideology, um, you should change it in your own country and then make sure that the other country doesn't win.

    27. JC

      Well y- and that's my point, is do, do you believe engagement with China leads them towards democracy and better human rights conditions for their citizens or not? Again, I think-

    28. CP

      That's, that's the fool's errand. That is an absolute from me.

    29. JC

      But it worked for East Berlin and it, and it did work in saving Europe from the Nazis, so.

    30. CP

      But the boundary conditions are entirely different, and China has proven that it works. Europeans were genetically bred to be lazy oligarchs.

  15. 53:46 – 59:25

    Sacks on US/China relationship, how US can penalize China

    1. JC

      store. Saxypoo-

    2. DS

      Yeah.

    3. JC

      China. Hawk, dove, engagement, isolation. Where do you stand? You heard Chamath say his position. Where do you stand?

    4. DS

      Yeah. Decoupling from China is gonna be a bipartisan issue now. Um, I think bo- both candidates now will be... Well, Trump is gonna, is gonna run blaming China for, for what happened, and I don't think Biden's gonna be defending China. Um, in fact, they're gonna try to peg him with the whole Beijing Biden label, and he's probably gonna need to try and out-Trump Trump on, on China. So decoupling is gonna happen. Um, it doesn't really make sense for us to be dependent on China for our antibiotics, for our medicines, for our PPE, for, you know, any of these... um, you know, any, any of these products that are important for national survival. Um-... I think all that stuff is gonna come back home. Um, I think, you know, trading with them for other things, might be, uh, toys, apparel, things that just aren't fundamentally strategic the same way. I think that can continue. But, um, you know, the, the thing about trade is it creates interdependence, and I don't think that, uh, this country is gonna want to be dependent on China for anything strategic anymore.

    5. JC

      Two questions for you, David. What is China's liability, if any, at this point with this pandemic? Uh, obviously if they, uh, you know, didn't, they withheld information or silenced whistleblowers, there, that's a, a whole different level. And then TikTok, should we allow TikTok in this country? Uh, should we, if we're not allowed to have Facebook or Twitter in China? Take those questions either way you want.

    6. DS

      Well, the, on liability, I mean, I think, yeah their liability is, is huge. Um, I mean, (laughs) there's still a bunch of questions we gotta answer around where exactly the virus came from. Um, but the, the really fateful decision that I think China made is when they shut down travel to Wuhan, uh, to and from Wuhan, uh, you know, with respect to other parts of China, but they let people from Wuhan just kind of, you know, leave to go all over the world. And so, you know, the, they weren't letting people from Wuhan go to other parts of China, but they were able to come to the US. And, um, so I, I think they do have huge liability, but are we gonna hold them to it? No. I mean, a- as a practical matter, um, you know, we're not gonna ... You know, it'd be, it'd be a mistake to, to try and, uh, change the principle of sovereign immunity in, in the courts. But, um, I think in terms of popular opinion, they do have, um, they do have-

    7. CP

      There are other ways to, there are other ways to, quote unquote, "punish them." Like, I mean, and the US is already doing it. So, you know, for example, the US is limiting and constraining Huawei's ability to get access to 5G. And so, you know, it really forces China to either buy European and American equipment, which is essentially to say that, you know, the, the Five Eyes will be able to basically spy into China. Um, or they have to basically, you know, uh, storm into Taiwan and take over TSMC. I mean, so there are, there are all these other gambits and strategies that one can take without getting ideolo- ideologically caught up in, you know, Chinese human rights, because they're not gonna change.

    8. DS

      Yeah. I mean, uh, I, look, all wealth comes from trade. You know, whether it's at the level of individuals or nations, uh, wealth comes from trade. And so it would be silly for us to say that we're just never gonna have trade with China. But I think that, you know, trade also creates interdependence. And so we're not gonna, I don't think, continue to engage and c- or depend on them for things that-

    9. JC

      Yeah.

    10. DS

      ... are vital to our national survival. And so, you know, th- that, that's gonna be the change. And the other thing is, you know, we're gonna demand that the trade be more reciprocal.

    11. JC

      Take the TikTok example.

    12. DS

      Well, you know, what, what's probably gonna happen is that the, the TikTok will probably be caught up in some larger negotiation and, you know, as a quid pro quo, well, Tesla gets to sell cars in China and TikTok gets to operate in the US. Maybe. Um, but, you know, I, I, I don't think TikTok sort of falls into the, you know, necessary for national survival category, so it really falls into the reciprocity, um, you know, principle. And the question, I guess, will be, are we getting enough in return to allow them to operate here? And I think that's the way that all this commerce is gonna, is gonna start working.

    13. CP

      And, and that's the thing, at least we can, like, confront our hypocrisy. So Jason, I don't disagree with you about how, you know, gross the human rights record is, I just think it's a joke that we all sort of, like, cry foul, like it's, like, the biggest thing in the world when we can't even clean up our own backyard, and then meanwhile we continue to trade with them. That's just utterly unholy.

    14. JC

      Yeah, so that's why I think we have to continue to work on cleaning our backyard while continuing to enable the ... freedom to clean up our own backyard. Meanwhile, win the game against China. And-

    15. DS

      Yeah.

    16. CP

      ... winning the game is not basically pushing for human rights reforms, it's making sure, as David said, we have a better trade balance and make, and making sure that, like, you know, that the critical parts of the supply chain and infrastructure that America needs for national security isn't dependent on a third party who have completely different incentives than we do.

    17. JC

      Yeah. Well, and then there's also, like, soft things, like, why is the ... You know, why are we taking American movies and changing the ends in order to have them sold in China? Like, they're literally corrupting our art and, and that incremental dollar that Hollywood's getting or whichever, you know, person trading with China is getting, I think, is not worth giving up what makes America unique and a leader in the world. Freeburg, you have any thoughts

  16. 59:25 – 1:06:36

    Friedberg on how US can leapfrog China in manufacturing by using modern, automated solutions

    1. JC

      on China?

    2. DF

      There's about 112 million people in China that work in factories. Factories in China are purpose-built, so they're built to make a thing and then they gotta get retooled if you wanna make another thing. You take those two facts, it's very hard to kind of replace China (laughs) as a source of production for a lot of what we consume in this country. That's the reality. So there's two ways you could go, and then there's two kind of necessities and you end up with a matrix of, like, two by two. You could de-couple from China and, um, basically recreate that same production system here in the United States, and that just wouldn't fuckingly be possible. Like, we don't have enough people to work, we don't have the ability to do that. The cost of everything would go up by 5X. We could invent new systems of production, which we have the ability to, 3D printing, bio-manufacturing, all these other kind of really interesting ways of making stuff that could replace the old factories that are run in China. Um, similar to kind of what maybe Elon has tried to do with his automated, you know, factory with Tesla. And so through automation, through 3D printing, through bio-manufacturing, you can kind of change the methods of doing the stuff. If we could do that, then we could de-couple from China. So the reality is, like, I, I don't know, like, how we continue to consume things at the-... you know, as a percentage of, of wallet share for, that come from China without rebuilding how you make stuff, uh, 'cause we just can't make it anymore.

    3. CP

      No, but that's the whole point. By the way, I think the reason why that's valuable is that that's the best way for us to actually get back to an inflationary cycle as well. So I completely agree with you, it is incredibly inefficient, it'll be incredibly costly, but that's where I think you shift the balance of power so that instead of all the power sitting on the side of capital, you shift it to the side of labor. Labor demands more wages, and then all of a sudden costs go up, input costs go up, prices go up, inflation exists, and that fixes a lot of our debt problems, it fixes our deflationary supercycle. It fixes a lot of things. And so, I agree with you.

    4. JC

      So if things got more expensive, it would be good for the economy.

    5. CP

      It'd be very good. Very good.

    6. DF

      Yeah, even... But even, look, even with maximal... Like, look, the, replace 112 million workers in China with some number of Americans, um, you know, I'm not sure you could make all the stuff you need to make here.

    7. JC

      Yeah, I mean, there's other countries too. I mean, uh, I think people are moving fact- Japanese are moving factories to Taiwan and Vietnam.

    8. DF

      Yeah, but if we create new methods of production, which we're uniquely positioned to do, uh, we can completely reinvent the wheel in a lot of industries and actually produce for the world.

    9. JC

      Yeah.

    10. DF

      'Cause right now, you know, China exports physical goods, the US exports, uh, virtual goods. And if we want to get into the business of making physical goods, we have to just do it 10X better. We have the ability to do that, we just got to get the fucking will. So if I were to take $3 trillion of federal money and, you know, treasury bonds and hope that they don't turn into junk bonds, I would basically turn that money into reinventing the systems of, like, how do we make stuff using these new technologies that the US is uniquely positioned to capitalize on. And one-

    11. JC

      I love this leapfrog strategy.

    12. DF

      ... one, one, one US worker could make a hun- could make the same thing that 100 Chinese workers makes.

    13. JC

      There you go. I love it. That's... And I think that's where we got to, an hour into this. Freiberg, you win. You got the best, I think you got the hottest take in the whole group-

    14. DF

      (laughs)

    15. JC

      ... is if we are gonna bring back manufacturing, let's leapfrog it. Let's just go, let's just... You, you don't have to keep letting them make, you know, socks or iPhones but, you know, let's make the next automated factories and the 3D printing factories here.

    16. DF

      And biomanufacturing.

    17. JC

      Anybody have, anybody have anything they need to promote or plug at the end of the podcast? Anything they're working on that, uh, people should know about?

    18. CP

      No, but I love you guys. I fucking miss you. I want to kiss all of you on the mouth when I see you.

    19. JC

      Wow, just exactly what I was thinking, Chamath. I was about to... So back at you.

    20. CP

      I've been, I've been locked down for three months.

    21. JC

      I have lost my mind. I mean, this is-

    22. DF

      That's crazy.

    23. JC

      May 12th for me and I-

    24. DF

      I think we all got to go to Mexico and see Sax for a margarita.

    25. JC

      Yeah, let's do it.

    26. DS

      I'm gonna have some friends, have some friends come down and, um, we play golf and no one wore masks within our little circle and nobody got sick.

    27. DF

      Yeah.

    28. DS

      And, you know, um-

    29. JC

      And you've all been tested?

    30. DS

      We haven't been tested, but we haven't, we don't have any symptoms.

Episode duration: 1:06:36

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