E42: China's tech crackdown, CRISPR breakthrough, practical climate change solutions & more

1. 0:00 – 17:15

   Quick vaccine passports update

   1. JCJason Calacanis0:02

      (phone ringing) Pick up your phone, dipshit.

   2. DSDavid Sacks0:05

      Hello?

   3. JCJason Calacanis0:06

      Sacks.

   4. DSDavid Sacks0:07

      Yeah. I'll, I'll be ready in, like, two minutes, okay? I'm sorry. 000s of viewers-

   5. JCJason Calacanis0:10

      Let's go. Splash some water on your face, take a couple of whatever you need, some (beep) and, uh, (beep) . Let's go. We're waiting.

   6. DSDavid Sacks0:17

      Okay. I'll be there in two minutes, okay? I'm sorry.

   7. JCJason Calacanis0:19

      Okay, hurry up. This is your chance to get max airtime.

   8. DSDavid Sacks0:22

      (sighs) Uh, are we really gonna record without Freeburg?

   9. JCJason Calacanis0:24

      You, listen, Freeburg's out. That means you're gonna get, by default, 33.3% of airtime. It's gonna be your biggest week ever.

   10. CPChamath Palihapitiya0:31

       We're going all in. Don't let your winner slide.

   11. JCJason Calacanis0:36

       Rain Man David Sacks.

   12. CPChamath Palihapitiya0:40

       We're going all in. NSN.

   13. DSDavid Sacks0:41

       We open sourced it to the fans and they have just gone crazy with it.

   14. JCJason Calacanis0:44

       WSI.

   15. CPChamath Palihapitiya0:45

       Queen of Quinoa. We're going all in.

   16. JCJason Calacanis0:49

       Hey, everybody. Hey, everybody. Welcome to another episode of the All In podcast. With us today, the dictator himself, Chamath Palihapitiya, and The Rain Man, David Sacks. I'm J-Cal. And the Queen of Quinoa quit the show. He's not here.

   17. CPChamath Palihapitiya1:06

       Where is the queen?

   18. JCJason Calacanis1:06

       He's, he quit the show, I think. I think he quit. So we're looking for a science person. If you know anybody, email all, scienceguy@theallinpodcast.com if you wanna apply for the science position here. No, uh, he couldn't make it. He was, uh-

   19. CPChamath Palihapitiya1:20

       Freeburg's moving. He's moving.

   20. JCJason Calacanis1:22

       He's moving, I guess we can say that without invading his privacy, but he's, he's not gonna be able... We thought we'd do a show anyway 'cause there's so much going on. Uh, and I think we should start with this. Do we wanna start with the COVID stuff again for the third episode in a row or do you wanna-

   21. CPChamath Palihapitiya1:37

       No.

   22. JCJason Calacanis1:37

       ... start with China and then back into COVID?

   23. CPChamath Palihapitiya1:39

       No. Fuck COVID.

   24. DSDavid Sacks1:40

       I think we should just do COVID quickly because I think, you know, as much as the audience complained about it, we got a lot of comments saying, "Why are you talking about COVID so much?" We were ahead of the curve, um, predicting this whole new Delta wave. You know, we told people what was coming. I think it was a useful service, so people might not wanna hear it, but it was, I think, I would say-

   25. CPChamath Palihapitiya1:59

       It was refreshing.

   26. DSDavid Sacks1:59

       ... we were probably two weeks ahead of the national media.

   27. CPChamath Palihapitiya2:00

       It was very refreshing. I think that we've gotten a couple things actually right the, a couple weeks ahead of other people. Yeah. So.

   28. JCJason Calacanis2:08

       Yeah, I mean, it was pretty obvious that this was going to race through the places that had low vaccination and having the breakthrough cases is... I don't think anybody anticipated that. And the thing we didn't-

   29. DSDavid Sacks2:25

       Yeah. Over the last week on Twitter, I'm seeing this big debate on whether vaccinated people can spread the Delta variant. And I'm like, "Guys, didn't you see the show two weeks ago? We covered this."

   30. JCJason Calacanis2:35

       Yeah.
2. 17:15 – 37:37

   China's massive tech crackdown: reasons, ramifications, & more

   1. JCJason Calacanis17:15

      situation has been perplexing to me. You know, my position was always be c- be careful working, uh, in China or investing in China or investing in Chinese companies because they could change the rules at any time and change the rules they have in the past. Uh, a year we talked about obviously Ant Financial, uh, and Jack Ma going MIA. ByteDance's CEO and founder, uh, stepping down as CEO amid Chinese regulations and all the scrutiny. Uh, and then we have DiDi last week being pulled from the App Store in an unprecedented penalty where you're not allowed to download DiDi. Um, the b- existing users can use it. And then on top of that, uh, all the educational companies this week were told that they, uh, cannot operate as for-profit companies, and these companies have gone public in Hong Kong and in the West. Uh, and this has caused such an acute effect. SoftBank, uh, is clearing a bunch of its Uber position to cover their losses in DiDi.Uh, and then there is the story of Larry Chen, who was a Chinese education entrepreneur. He was worth 15 billion in January. Now he's lost 99% of his net worth according to Bloomberg. He, uh, founded Gaotu Techedu, uh, or Tachedu, which is a Chinese online tutoring firm. As we know, education's huge, uh, in, um, China. That company, uh, Gaotu, peaked at $142 a share in January and has fallen to $3 a share. Big sordid story there. Tencent lost 100 billion in market cap in three days early this week as China cracked down on what they called a monopoly in music rights. So while we debate what happens with the monopolies here in the United States, China just literally told them, and here's the quote from the BBC article, "The company and its affiliated businesses have been told that they can no longer engage in exclusive deals over music rights and must dissolve any existing agreements within 30 days." I mean, this would be like Biden just saying, "The app store is now open. You have to let other app stores in Apple..." Or, you know, just coming down and saying to Amazon, "You can't sell Amazon Basics anymore. In 30 days, no more Amazon Basics at the site." What are we... What do you think the endgame is here? Is this a... 'Cause China seems like they are very deliberate and they plan in centuries. What is happening here?

   2. CPChamath Palihapitiya19:36

      There's the short term and the long term. I think what's happening in the short term is that the same thing that we are talking about in the United States that Sax is, you know, very eloquently basically, I think led most everybody in just really framing for a lot of people, is this idea that, um, you know, we have privatized free speech and we have put the distribution of information into the hands of three or four founder CEO oligarchs. That's also true in China, and when you look under the hood of the major internet companies, there's four or five guys that are in charge. And so I think that in the United States, politicians feel increasingly uneasy with those folks having power because it's applied indiscriminately. Trump gets banned. Trump may not get banned. This person gets distribution. This article is considered misinformation. That article is considered disinformation. This article is suppressed. It's a dangerous place to be. Um, and in China, they were just like, "Enough's enough." So I think the short term as it relates to the internet companies was basically a realization that we are not going to allow any more devolution of power from the Chinese Communist Party to and into the hands of these internet entrepreneurs. So that was, that was sort of like the eme-

   3. JCJason Calacanis20:52

      So it's a move out of fear. They're scared they're gonna lose their power base.

   4. CPChamath Palihapitiya20:55

      No, no, no, they're not scared. I think they're just smart and they were like, "We're not gonna allow this to happen." So they don't have to deal with Section 230 or any law like that. I think it was just a realization that we want them to understand who is boss, right? And so there was a wave of resignations. There was, uh, now all of this market cap upheaval, and this is now where we get to sort of like the appetizer. And I think in the appetizer, what they're basically saying is, "We will control how money is made and who makes money." Um, and I think that that sets up the really difficult thing that I think happens, which is about the long term. So in this, in this thing, what's happening right now is China very firmly telling everybody, "We are firmly in control. There is no private market and there is no capital market without our approval." And that's a really big statement. Um, and in fact, it was such a big statement that, um, I think the Chinese, uh, security authorities then had like a conference call with Goldman Sachs, JP Morgan. All these folks were invited. And, you know, the vice chairman basically, his quote was something to the effect of, "We promise that any more changes, we'll at least let you know." Not a there's nothing (laughs) nothing to see here or there's nothing more to come. It's just more that as we decide new rules, we'll make sure that we give you guys enough warning. So it's very much firmly saying, "We know exactly how money is made. We will decide who makes money in what way, and we're going to make sure that, you know, all of this wealth creation, um, happens under terms that we define." And I think that's the set-up for the long term. The long term in China is complicated. It is an enormous demographic time bomb. We've talked about this before. By the end of 2100, China's population will shrink from 1.1, 1.2 billion people down to about 700 million people. Right? So they had very progressive, quote unquote, under their framework, laws of one child policy to basically make it economically viable in the '60s and '70s. There were such a number of people, those people were able to get great jobs in the, you know, '80s and '90s and 2000s. And now they've realized, "Oh wow, we made a huge miscalculation because now there are just not enough people." And so China's gonna shrink, and I think that honestly, I think Xi Jinping probably thinks the simplest way to solve this is to basically nationalize a lot of the economy over time. And so I... If I was a betting man, which I am general but I'm not in China 'cause I just don't understand the market, it's super complicated to me.

   5. JCJason Calacanis23:26

      Well, it's a rigged casino. It's a stupid place to bet.

   6. CPChamath Palihapitiya23:28

      I'm not gonna say that. I just think that I don't know the market. I think that this is-

   7. JCJason Calacanis23:32

      Well, I mean if they change the rules of the game.

   8. CPChamath Palihapitiya23:35

      Well, hold on, let me just finish what I was saying. I think that what we're start, what we're starting to see is the beginning of nationalizations. And I think it's gonna start in technology universe because those are the critical assets that the Chinese need to own for the future. So that's, in my opinion, what's happening. I think it's, uh, really important what's going on there. Um, and, uh, yeah, I don't know.

   9. JCJason Calacanis23:56

      Yeah. Sax, when you look at this, we've been talking about, you know, this, these two great competitors, America and China, and who's gonna win. How does China win if... Th- this would seem not having a vibrant entrepreneurial, you know, socialist communist hybrid, is, is this the end of that experiment and now it's just gonna go all national and then-

   10. CPChamath Palihapitiya24:19

       Doesn't that make it easier for the West to win, if China's just gonna say, "We're gonna, we're gonna operate everything," and they don't have a competition of ideas?

   11. DSDavid Sacks24:28

       If they go that far. I think it's really interesting actually to compare what's happening in China with what's happening on the US, uh, in the US 'cause on the surface, both countries are having this debate about whether big tech needs to be reined in, broken up, controlled. We're having that debate in the US and, and obviously they're having some version of it in, in China, but it's a little bit like the, the civil rights debate, right, where, you know, we have our civil rights issue in the US and, you know, they have Shenzhen. You know, they have, uh, the Uyghurs. You know, it's like a whole order of magnitude different in terms of the way they react, and I think there's... I, I would say there's three main differences here between the Chinese approach and the US approach. Number one, data privacy. We have a concept of separation between private companies and the data they control, and the data that the US government can get its hands on, and the US government typically has to get a warrant and go through a court proceeding to get that data. What China is doing, they've now (laughs) passed a law basically saying to all these companies, "Your data belongs to us. If we want it, we get it." They're taking operational control over the data, and you know they're gonna use it, okay? That's a big difference. Number two, I think that China seems to be-

   12. DFDavid Friedberg25:40

       Cough.

   13. DSDavid Sacks25:40

       ... really worried about these big tech companies, not just in terms of, um, whether they might engage in anti-competitive practices or consumer harm, sort of those conventional antitrust concepts in the United States, but they're concerned about these big tech moguls becoming power centers in China, and you saw this with Jack Ma, right? I mean, clearly the CCP had a problem with the way that Jack Ma had become a figure, that people rallied around him, they looked to him, they cared about what he had to say, and all of a sudden, yes, the Ant IPO was put on hold, but it was more than that, right? Um, you know, this was not just like, you know, what the SEC would have done. All of a sudden, Jack Ma disappears. He goes into some sort of house arrest. He comes out three months later looking kind of emaciated. Uh, you know, they are putting the, the fear of God in, you know, these big tech moguls in a way that we would never do in the US. I mean, look, I don't want Tim Cook to engage in anti-competitive practices, but I don't want anything bad happening to Tim Cook. I don't think the guy should be under house arrest. If he wants to donate his money to political causes and speak out as a private citizen, he has every right to do that and I'll defend his right to do that no matter, you know, how much I want, you know, Apple to be reined in. That, they don't have, that's, that, again, that separate concept in China. And I think the last thing that's going on here that's different is, you saw China put the kibosh on, there were 34 IPOs of major China, uh, Chinese tech companies that were scheduled to IPO in US markets, and they have sort of shut that pipeline down. And what it appears to be, to, they appear to be saying is that, you know, we've talked about re-shoring strategic industries back to the US like pharmaceutical manufacturing. They seem to be saying, "We are gonna re-shore the IPO business. We do not want you, uh, big Chinese tech companies IPOing on American markets, on American exchanges. We are bringing that business back to China." And that is why I think you're seeing, you know, giant ripple effects now because, I mean, to, to Chamath's point about decoupling, we now, it looks like are gonna be de-coupling our financial markets and, um, you know, th- that's why you're seeing, you know, gigantic hits to the evaluations.

   14. CPChamath Palihapitiya27:50

       Th- that's a, a, would you, are, would you agree with me that the de-coupling of these financial markets might be in the best interest of humanity and ultimately the decoupling of these two economies? If we don't see eye to eye about human rights and how to treat people, maybe it's good that we have a little more distance between the two markets? I mean, it, it's hard to know if engagement is the better process, but it doesn't seem like the Chinese Communist Party wants to have anything to do with democracy, anything to do with free markets. They want to control all the markets.

   15. DSDavid Sacks28:21

       Yeah, I mean, you could see, um... But i- in a, in a way, the product that the US was exporting to China was, uh, was our financial markets and-

   16. CPChamath Palihapitiya28:30

       Mm-hmm.

   17. DSDavid Sacks28:30

       ... no- and i- i- i- in, I think, a good way, right? So the, I think the bad version of this is when China's able to buy up ownership in critical strategic centers in the US and that affects people's speech rights over here. But this is not China buying up ownership in the US. This w- was China acting as a consumer of US financial markets, and-

   18. CPChamath Palihapitiya28:51

       Mm-hmm.

   19. DSDavid Sacks28:52

       ... um, I, and I think, I think it's different, right? When we're selling products over there, that helps correct our trade balance, right? This is why I don't have a problem with Elon selling cars over in China is he's helping our trade balance, okay? But-

   20. CPChamath Palihapitiya29:04

       Sure.

   21. DSDavid Sacks29:04

       So, but they're kind of canceling that. They're kind of saying, "We're gonna re-shore this industry. We wanna have a domestic, you know-"

   22. CPChamath Palihapitiya29:10

       This is-

   23. DSDavid Sacks29:11

       "... stock market."

   24. CPChamath Palihapitiya29:12

       This is, this is creating a mono economy, right? It's like, it's gonna blur the lines between public and private ownership, and it's going to basically make it one huge pot from which the Chinese government, um, can, can take and d- put back into as it deems fit for the broader success of China as a whole, right? So if you're a CEO and they don't like you, you're gonna resign, right? If you're a company and they're worried about your propensity to be a little too frisky on your own, they'll rein you in, uh, they'll either use cybersecurity law or something else. But the point is that I think that we shouldn't take this as free market regulators having their way. This isn't Lina Khan implementing, you know, some laws. This is a top-down decision to nationalize large parts of the economy, starting with technology. And I know that for some people that may seem unfathomable, but, um, if I'm a betting man, which I am, that's what I would bet on, that this is the beginning of the beginning of an attempt to pull these companies in. I mean at the, at... What David said is true.... the Chinese government owns the data of Chinese companies. So at the end of the day, the Chinese government also owns the users and it also owns the revenues, it just hasn't told you yet.

   25. JCJason Calacanis30:34

       Yeah. In a way, it's like the Chinese govern- ... In our, our government is trying to officiate the game fairly and create a really competitive, vibrant game. And I think what the Chinese government just said is the game's over. Like there is no game.

   26. DSDavid Sacks30:48

       Yeah.

   27. CPChamath Palihapitiya30:49

       We, we- No. There is a game, it just has, it just has one-

   28. JCJason Calacanis30:51

       What is the game? I mean, 'cause -

   29. DSDavid Sacks30:52

       The game is out of control.

   30. CPChamath Palihapitiya30:53

       ... who is president? It has an Uber CEO. It made a bunch of CEOs, general managers in a large corporation that report through a reporting chain to one person, Xi Jingping.
3. 37:37 – 41:25

   How will large firms & institutional investors react to the CCP's recent regulatory moves, mechanics of delisting public companies

   1. CPChamath Palihapitiya37:37

   2. JCJason Calacanis37:37

      What does this do to like the Sequoia Capital China, the Masayoshi-san investing heavily there, Tencent investing here?

   3. CPChamath Palihapitiya37:46

      I think all the Ch- all the Chinese LPs-

   4. JCJason Calacanis37:46

      Because Tencent's been very active in the United States, investing in companies. What happens?

   5. CPChamath Palihapitiya37:49

      All the Chinese LPs are- are fine, all the Chinese GPs are fine, all the Chinese companies are fine. I think David's right, it's just a discount factor. I do think it affects global dollar flows, and I think it's hard for, um, a western capital pool to allocate money into China without doing a little bit more work and applying a higher discount rate.

   6. DSDavid Sacks38:11

      Yeah, I would- I- I have to believe that the conversations happening in these firms that have made gobs of money in China over the last couple of decades, it has to be, "Are we living on borrowed time? How much more time do we have before China says that Chinese profits, Chinese return on investment are gonna go to Chinese individuals and companies under our control?" 'Cause that's- w- that's the direction it all seems to be headed.

   7. JCJason Calacanis38:36

      Yeah, and how quickly can they get m- get out of these positions? I mean, how do you even get out of these positions if- wha- and this is the other thing I don't understand, if they're going to reverse some IPOs, wh- how does that mechanically happen? Are they going to just say-

   8. CPChamath Palihapitiya38:48

      It's a- it's a buyout. It's a second, second transaction and they'll just do like a- a buyout.

   9. JCJason Calacanis38:54

      So if Masayoshi-

   10. DSDavid Sacks38:55

       Take private.

   11. JCJason Calacanis38:55

       ...-san owns some amount of Didi, they say, "Here's some-"

   12. CPChamath Palihapitiya38:58

       He'll get, "Here's the price per share that we pay you, here's your cash, give us the shares, ciao."

   13. JCJason Calacanis39:03

       That's incredible. A forced sale at whatever price they determine.

   14. CPChamath Palihapitiya39:07

       Uh, no. I mean, like, I think these things will operate more efficiently than that because you have a distributed shareholder base, so, you know, China can't force a shareholder of Didi to sell the shares because it's listed in an American stock exchange, but they- but if Didi does go private the way that, you know, the news reports are saying, somebody's gonna have to backstop that capital. I suspect it'll be a Chinese organization.

   15. JCJason Calacanis39:28

       So they will take Didi private again, and then buy out all of the shareholders who bought from around the world.

   16. CPChamath Palihapitiya39:34

       And- and by the way, if that does come to pass, I think that is the- that is an obvious signal that we're moving into sort of a more, a nationalization of critical resources, and China has determined that internet resources are critical, and I think that that's right. If I was in their shoes, that's exactly what I would do as well.

   17. JCJason Calacanis39:52

       Does this mean that we should be, uh, kicking out Chinese companies from operating in the US, i.e. TikTok, et cetera, David?

   18. CPChamath Palihapitiya40:01

       No, but I do think that TikTok needs to get carved out of ByteDance and it needs to have a completely American cap table, but that shouldn't be a government edict, that should be something that the ByteDance investors and board are scrambling to do right now because otherwise that equity value may go to zero. ByteDance should be a half a trillion dollar company. It probably is a couple hundred billion dollar company now, which means that it probably lost half of its market value.

   19. JCJason Calacanis40:26

       That's crazy.

   20. CPChamath Palihapitiya40:27

       Crazy.

   21. DSDavid Sacks40:27

       Yeah, I think- I think there's a few things for us to worry about there. Um, I mean, I- I- I- I- I like the idea of outcompeting China by having freer and more open capital markets and allowing anyone in the world to invest in our companies. I think the issues with TikTok are more around data, you know? We know now that any data that ByteDance ha- has belongs to the Chinese government. This isn't just a TikTok issue, it's any company-

   22. JCJason Calacanis40:53

       Right.

   23. DSDavid Sacks40:53

       ...any US company that's doing business in China. Look, it applies to Zoom, okay? Look-

   24. JCJason Calacanis40:58

       Yeah.

   25. DSDavid Sacks40:58

       ...Zoom, we're on Zoom right now, Zoom ha- is not a Chinese company but it has a giant engineering team in China. What are the data implications for that?

   26. JCJason Calacanis41:08

       Yeah, they stopped routing their servers through, remember they had some servers routing through China, but I do think they're gonna have to shut down and sell off whatever their assets are in China. That's gonna be untenable to have a communication platform, you know? It's- it's kind of like Huawei, right? We don't allow Huawei to operate and we're gonna have to do that with

4. 41:25 – 50:18

   CRISPR breakthrough, future possibilities

   1. JCJason Calacanis41:25

      software. Right, there's been a big CRISPR breakthrough, um, 65-year-old man named Patrick Doherty, uh, was suffering with a- a- a disease in which his protein was misshaped, misshapen, uh, building up in his body, destroying important tissues, uh, such as nerves in his hands and feet. He watched the same disease kill his dad, uh, and here's the quote, "Had watched others get crippled and die difficult deaths, uh, from this disease." And it's a terrible prognosis. He entered a trial utilizing CRISPR, the gene editing, uh, tool, and researchers reported the data indicating that the experiment treatment worked well. The study Doherty volunteered for is the first in which doctors are simply infusing the gene editor directly into patients and letting it find its own way to the right gene in the right cells, in this case, the cells in the liver, uh, making the destructive protein. The advance is being held not just as- not just for amyloidosis patients, but also as a proof of concept that CRISPR could be used to treat many other, much more common diseases. It's a new way of using the innovative technology. Jama, thoughts?

   2. CPChamath Palihapitiya42:30

      I think this is a really important breakthrough and what it allows us to do now is see a world where, look if you- if you think about...... the two different paths of the following idea. You're gonna make a solution to a problem. If, if the problem was, um, an internet company or you wanted to make a product, what you would do is you would go to Amazon Web Services, you'd be able to consume a whole set of abstractions, and then you would build a light amount of programming, which was essentially like the application logic of your app, right? I think a lot of people listening understand that idea because that's what they do. Here, what we're getting to a place is now soon, we're gonna be able to view biological problems in the same way. So we're building all these small little building- I don't wanna call them small, but building these very important building blocks that is very much akin to the building blocks we needed to put together the first set of computers, to put together MS-DOS. All of that allowed us to create Windows. Windows allowed us to actually access the internet, and there was this in seriatim development of things that happened, and I think that we're on the verge of that, and that's what these kinds of breakthroughs really show us, which is that you can view... So for example, you know, in a different company, um, they- they've created these mRNA gate arrays, logic gate arrays, so if you're, you know, a chip designer, you would understand how to basically create electrical function in part using, you know, gate arrays. But if you reduce a biological function to the same idea, now that same person has a translational ability to solve a different problem that they didn't have before. So I think what we're saying is that we're seeing this platformization, this AWS-ification of a biological tool chain with things like CRISPR and all of the other modalities that need to stack on top of it so that the next person can view it as a programming problem, and I think that that's the really exciting path that accelerates a lot of this development. But this is an enormously important breakthrough because it validated a lot of what CRISPR was beyond a lot of theoretical innovation that, that up until now was basically what it was known for. And a lot of investment had gone into companies that were trying to do things, uh, but this is the first really important one. Th- the funny thing about Intellia is that it's been public for like seven, eight years and it's just been toiling, toiling, toiling, toiling, and then, you know, the last little while, obviously it's gone absolutely crazy because of this breakthrough.

   3. JCJason Calacanis44:51

      Yeah, and related new cr- in related news, CRISPR creates its first genetically modified marsupials after years of using the gene editing technique CRISPR to genetically modify everything from vegetables to lab rodents. Researchers have used it to edit one of the hardest target chats marsupials, the MIT Technology reports. Uh, I guess it turns out they're very hard to edit and we're now editing marsupials and changing things like their hair color. So brave new world. Freeberg was here. The Freeberg ratio will be off the charts. All right, wrapping up, we have-

   4. DSDavid Sacks45:21

      Pretty incredible. Just o- just one thing to add to that.

   5. JCJason Calacanis45:24

      Yeah.

   6. DSDavid Sacks45:24

      I mean, I think what it, what it shows is that these COVID vaccines are just the first product, the first breakthrough product of this mRNA technology. There's gonna be a lot more. And what I wonder about is, you know, this, this category of vaccine hesitant people, they're kind of like, you know, in the, in the technology world, you have kind of a spectrum of early adopters, late adopters, Luddites, you know, people who are actively against-

   7. JCJason Calacanis45:47

      Laggards.

   8. DSDavid Sacks45:48

      ... technology. Yeah, well, I mean, Luddites are even more-

   9. JCJason Calacanis45:50

      Laggards and then Luddites, yeah.

   10. DSDavid Sacks45:52

       Yeah, Luddites are even more violently opposed. I think the original Luddites, um, they, l- th- I think the original Luddites were in England, they lost their jobs at some factory and so they broke into the factory with sledgehammers to destroy all the machines that replaced their jobs. So-

   11. JCJason Calacanis46:04

       Yeah.

   12. DSDavid Sacks46:04

       ... there's clearly a spectrum, and what I wonder about is that if you're on sort of the Luddite end of the spectrum with respect to biotechnology, I mean, are you gonna have a materially worse life because you're not getting the benefits of all these vaccines and all of these treatments? And, I mean, COVID could just be the first example of this.

   13. JCJason Calacanis46:22

       Well, I mean, if you build on it, it's sort of like we're gonna create a two-class society, one that is not only dealing with all the maladies and cancers and, and living longer, but we haven't even started to think about, well, taking somebody who's already in great health and what can you do for them? So, oh, you know what, uh, you can be two inches taller, you could add 10 IQ points, you could run faster, you could have higher blood oxygen, whatever. I mean, (laughs) we could h- we could genetically modify people to stay under water for 10 minutes, uh, and be, you know, better processors of oxygen like other mammals are. I- you could have super humans. I mean, tha- that's basically where this is going and th- that unlocks a whole nother level of ethical and moral considerations, but you're right, there could be a group of people who are like, "I don't wanna touch any of this," and they die at 60, 70, 80 years old. And then we got another class of people who embrace this and they have 20 more IQ points-

   14. DSDavid Sacks47:14

       (laughs) Yeah.

   15. JCJason Calacanis47:14

       ... and they live to 120. No, I mean, i- it's, it sounds funny but and like science fiction, but that is in the realm of possibility in our lifetimes.

   16. DSDavid Sacks47:22

       There's a lot of-

   17. JCJason Calacanis47:23

       So I don't kn-

   18. DSDavid Sacks47:23

       ... great science fiction written about this whole sort of transhumanist, um, idea. A, a, a book series I really like is, uh, Nexus by Ramez Naam, uh, who actually was a developer at Microsoft and, you know, then became a writer and he writes with, I'd say, a high degree of sort of accurac- accuracy and specificity about these technologies and how they might evolve. Um, people-

   19. CPChamath Palihapitiya47:47

       Jason-

   20. DSDavid Sacks47:47

       ... should be sure to check out that book.

   21. CPChamath Palihapitiya47:48

       Jason, be honest, if, if you could actually increase anything in your body through this gene editing, what would it be?

   22. DSDavid Sacks47:54

       (laughs)

   23. CPChamath Palihapitiya47:54

       Just throw, throw anything out there, what's the first thing that comes to your mind?

   24. JCJason Calacanis47:56

       Just put anything out there?

   25. CPChamath Palihapitiya47:57

       Anything out there, whatever-

   26. JCJason Calacanis47:58

       I would increase my muscle mass 100%. Increase my muscle mass, but I think-

   27. CPChamath Palihapitiya48:02

       By the way, there was a-

   28. JCJason Calacanis48:03

       ... percentage of fat would go down not in reality in absolute terms but just in percentages.

   29. CPChamath Palihapitiya48:09

       So this CRISPR thing was, uh, a public company called Intellia Therapeutics, um, but, uh, I wanna throw a shout-out to another startup that seemingly, I think, may have had a breakthrough this week called Form Energy. And the reason why these guys are interesting is that they've built this incredibly massive long duration battery out of iron. Now, why is that important? We have really simple ways of harvesting iron from the earth. It is literally everywhere. Everywhere you look, iron exists.It's not so true for nickel, it's not true for cobalt, it's not true for manganese, it's not true for lithium, it's not true for all of these other specialty chemicals that we need in order to build batteries. But these guys have solved a very complicated technical challenge that'll allow you to store energy cheaply, which has huge implications for electricity and grids, and so big shout out to these guys at Form, uh, because if, if, if it looks like what they said they did is true, it's a really important breakthrough that'll have some important, uh, ramifications. It's l- it's amazing, by the way, to see progress, no? You wake up and you read these things and you're just like, "God, this is incredible that there are people working away on shit that really matters."

   30. JCJason Calacanis49:27

       It's almost as if there's, like, one group of peop- we talked about cynicism in a previous episode recently. There's one group of people, whether you're in the founder circles or capital allocator or a journalist covering this space, uh, who understands it, there, there is a, a, a technical, you know, explosion going on here, an innovation that is going to solve a lot of problems, and then you have another group of people who think that all these problems are intractable. I'm kind of looking at this, you know, what happened with COVID, and I was talking to my wife about global warming and I was like, "Feels to me like we can solve global warming. Like, feels like it's very much in our control." And then there's another group of people who feel like it's over and don't have kids because the whole planet's gonna go on fire.
5. 50:18 – 1:06:03

   Taking the right approach to climate change with respect to population growth & consumption, carbon markets, practical solutions

   1. CPChamath Palihapitiya50:18

      you know, we have an enormous problem in the world in general which is that unless our birth rate is positive and accretive, um, it has huge implications to progress, right? If you just, like, if you eliminate or you decrease the denominator of the global population, the odds that there's another Elon Musk or Jeff Bezos that are created are just lower, and so net f- of anything else, a declining population rate, particularly in Western countries, has huge detrimental effects to the world. And so all the folks that think that they're going to solve the ecology of the world by not having kids, it's a little misguided. The thing to do is to actually have a positive birth rate, find technological solutions to this problem, and allow what we've been able to do, which is a rising populous to basically be motivated to work and solve problems. And I think that we have to be very careful about that because if, if people don't get this right, they're gonna take the wrong solution, it's not gonna be a solution as, at all, and it's gonna make the problems even worse. Could you imagine if the population of the earth shrank in half, what it would mean in terms of productivity, services, the healthcare requirements that are needed, the cost of providing those things? The economic viability of countries will go away. It would be a disaster.

   2. JCJason Calacanis51:31

      Yet there is a group of people who feel we should do exactly that (laughs) . And, and a not, not a small group of people, yeah.

   3. DSDavid Sacks51:37

      Well, they think that... I think, I think the mistake is in thinking that human consumption is the problem. Um, i- i- and specifically with respect to, to, to climate change or global warming. No, you, you, you can't see it that way because, um, look, humans, in order to exist, need to consume, and we're gonna emit carbon as part of that process. The important thing to focus on is, uh, energy production. Are you shifting to clean production? Not... 'Cause you're never gonna be able to shrink your consumption enough to, to basically eliminate carbon emissions. Um, it has to be done on the production side. And one of the interesting things that's happening now, um, I think we should talk about is, in Europe, they're creating this new carbon trading plan. I think China's even trying to set up one of these markets. And so they're creating these new, um, you know, marketplaces to trade carbon permits, and I think the most exciting part about this is that it gives an incentive for, um, for innovators to create new technologies that actually take carbon out of the atmosphere. Uh, they're called negative emissions technologies, because what happens is if you have a technology to take carbon out of the atmosphere, you can now sell a permit on the exchange that gives somebody else the right to emit that carbon. And now, those technologies, those n- those, um, those NETs, the negative emission technologies, it's unclear whether they really exist yet, but no one's gonna create them if there's not a customer for them, and that's what's really cool about these new tradable permit schemes, is they create a buyer for, for, for those NETs, and I think that's ultimately how we're gonna solve this problem of climate change. We're not gonna do it through reducing human consumption. Like, we're gonna have to go back to the Stone Age if you don't want to emit carbon. It's about moving to clean production of energy and creating, uh, negative emission technologies.

   4. CPChamath Palihapitiya53:32

      Yeah, let me just build on that for a second. There's, look, there's a bunch of cap-and-trade systems. China basically has a, a terra- um, uh, a carbon tax system in place. The big thing that none of these folks have gotten to yet, but I think if you look at the laws in Europe, they're going there, is the idea of a carbon tariff. And I think these carbon taxes, if they actually exist properly, will look like a tariff. What does that mean? Let's just say you're Britain and you want to import a Volkswagen from Germany. If Britain has a carbon tariff that says basically you need to account for all of the emissions that went into making this car and I'm going to assess an import duty that basically maps to that, um, I think that that's where the world is going, and that's probably, David, to, to your point, it's going to be a really big value unlock because the amount of money that'll get both made but also destroyed in that process will be incredible. And that's where we have a chance to really reimagine consumption in a different way. Like, there are just so many categories. I saw this interesting stat. If you look at CPG companies, right? Companies like Procter & Gamble, Clorox, and you compare them to the places where they sell their goods, like Walmart and Target...Every single major big box retailer has basically declared a net zero emission strategy in the next five to 10 years. Not a single company (laughs) on the CPG side, uh, has actually any plans to do anything meaningful anywhere near 2030, 2045, 2050. And when you look under the hood, those companies like P&G and Clorox are enormous emitters, enormous. So even though you walk into a Target and Amazon and you try to make yourself feel good, thinking- thinking to yourself, "I'm buying something that's zero emissions," it's not true. It's basically that Amazon will- will bear the cost of getting to net zero, but the products that you actually consume are horrible for the environment and the amount of, you know, um, fossil fuels that went into it and the amount of plastic that will then get put into the ocean, it's tremendous. And so moving slightly more aggressively beyond these cap and trade systems into something that looks more like a tariff, I think could be really important for the world and we're gonna need to do it.

   5. JCJason Calacanis55:44

      There's... And th- there are multiple ways to do it. I don't know if you guys saw Elon backed this, the, uh, XPRIZE carbon sequestrant- sequestrant project, which is $100 million prize. And you can do this in multiple ways. You can do it at the factory. Uh, there's the one trillion trees.org, I don't know if you saw that, where they're trying to plant a trillion trees because that's the original way to, uh, sequester this carbon. So there- there's going to be like three or four different ways to do this and if there's an incentive to do it, yeah, that, um, is gonna help for sure.

   6. DSDavid Sacks56:15

      Part of why there's such political disagreement over this is because you look at approaches like the Green New Deal... I mean, I think they understand the- the- the- the problem, but what they're proposing, it's always on the consumption side. It's basically politicians picking and choosing how people are gonna consume carbon, whether it's, you know, cracking down on private planes to, you know, factories. I mean, again, taking us back to the Stone Age. Um, n- nobody wants to s- No- no one sane, I think, wants to support that kind of totalitarian principle that the politicians get to tell us how to consume. But this is- this is why I think these, um, these- these market-based solutions where you say, look, carbon emissions are obviously an externality. If you want to emit, you need to basically pay the correct price for carbon emissions and we use the- the money that you pay, uh, as- as- as some sort of, um, whether it's a tax or whether it's buying a permit, we use that money then offset into negative carbon emissions. It's a market-based system where the government controls the externality, but they don't dictate how people get to consume carbon. And I think that's the right balance and we don't really have that type of balanced conversation in the US yet because-

   7. CPChamath Palihapitiya57:31

      Hmm.

   8. DSDavid Sacks57:31

      ... you've kind of got one side that says they want to save the planet, but they want to control everything. And then you got the other side saying, "Well, look, I want to save the economy because your plan, the Green New Deal is gonna destroy it." What we need is- is again, a market-based solution to this.

   9. JCJason Calacanis57:46

      And I guess the criticism of a market-based solution is you're basically giving people a way to... Uh, uh, the most cynical interpretation would be you can pay to pollute. You can just, you can pollute all you want and just pay a fine essentially, but that's not the right way to look at it. You're actually offsetting, somebody else is capturing what you put out there. And it, depending on the rules of the road, if you had to capture 50% more than you put in, you could create a formula there, right? I mean, there could be some formula that over time-

   10. CPChamath Palihapitiya58:15

       There's been a lot- there's been a lot of fraud in this market, like, um, you know, people sell these carbon credits from, you know, certain forests and there's this joke which is like, there's been a tree that's been sold like 80 billion times because it's like-

   11. JCJason Calacanis58:28

       (laughs)

   12. CPChamath Palihapitiya58:29

       ... you can't really verify, you can only really estimate the amount of carbon sequestration that, you know, for example, a tree actually does in the first place. And so there- there's been just a lot of, um, unfortunately, you know, fly by night, uh, unreliable, non-trustworthy ways that this market has evolved. People have been waiting for decades for this carbon trading market to really step into high gear, which is why some folks think the more aggressive plan will just be introduce tariffs and let the market, David, to your point, sort it out.

   13. DSDavid Sacks58:57

       Chinmay, what- what do you- what do you think the prospects are for these negative emission technologies? I- I can't believe that a solution as low tech as planting trees is gonna solve the problem with all the carbon-

   14. JCJason Calacanis59:08

       And algae.

   15. CPChamath Palihapitiya59:08

       Yeah. No.

   16. DSDavid Sacks59:08

       Yeah, so the question is, what do you- what do you- what do you think the pr- Assuming we create the market, the demand for negative emission technologies, the permits to emit, um, what do you think the prospects are technologically if that innovators are gonna come up with these solutions?

   17. CPChamath Palihapitiya59:24

       I do think that we are a couple of breakthroughs away from these things being non-issues. So I'll give you a couple of examples. If you look at like... I'll just use batteries as an example 'cause where I'm spending a lot of time. When you look back and like you ask yourself like, "How did we decide to make the batteries the way we make them?" Um, you know, was it some like, you know, broad survey of every single chemical composition and all these different structures and we realize that, you know, a composition of nickel and manganese and cobalt was the right thing to do, or lithium and iron and phosphate was r- It turned out that it was mostly like a handful of people decided and we all just been iterating around the edges ever since. So one of the solutions to a lot of these problems is to actually go back to first principles. The problem is, that as these industries get built up, and you know this, you have so much, um, PP&E, like so much equipment, so much investment in physical CapEx that's happened, the idea of switching platforms is almost impossible because it's not economically viable. So we are in this situation today where a bunch of solutions have been proposed, David, to solve that problem, right? The problem with carbon capture and other- other things and negative emission technologies is that they're extremely expensive, they're very inefficient, they require an enormous amount of energy themselves, and it's not clear that they work. So what's happening? One is that there's been some pretty novel innovations in moving people past-... some of these basic problems by looking at the periodic table to try to find different ways of solving things like energy storage, which has huge implications to climate. But the second is that we are pushing the boundaries of physics in different ways as well and that's where there's going to be the potential for an enormous breakthrough, specifically around superconductors. So what is a superconductor? It's something that allows an enormous amount of energy to basically trans through it. Now we have this issue which is that you can actually create superconductors in highly controlled environments that are extremely, extremely cold but they have incredible performance characteristics that would revolutionize power and energy transmission and storage. People have been innovating in bringing that up to room temperature. In that breakthrough, which I think you will see in the next 20 to 30 years, it's just a complete sea change of how we think about this whole problem. So I think the short term, we're innovating in the periodic table. In the long term, we're figuring out how to bend the laws of physics and I think that those are- those are probably the two most practical solutions to a lot of these things that remove the constraints that we've created. And again, the constraints have been completely human-defined which is the sad thing. They were not necessary from the start. We could have made very different decisions had we known these problems were going to be as big as they were. You know, the way that we make plastic didn't have to be this way, right? The amount of petroleum that we use, it d- it didn't have to be in this specific way but this is where we are.

   18. JCJason Calacanis1:02:20

       And there are direct air capture technologies, DAC, which is basically an energy issue. You can literally suck the carbon dioxide out of the air, um, and-

   19. CPChamath Palihapitiya1:02:30

       Again another- another issue of material science because the- the- the substrates that you use tend to be relatively inefficient and so to really activate them, you're pumping a tremendous amount of energy through there.

   20. JCJason Calacanis1:02:39

       That's the issue is, can you get the energy? And I think when we talked about the small reactors, uh, the small modular nuclear reactors, if energy is free or it's solar-based, uh, you could- you could kind of get a virtuous cycle going here.

   21. CPChamath Palihapitiya1:02:53

       That's essentially what superconductors allows you to see is a world where you basically have limitless free energy.

   22. DSDavid Sacks1:02:59

       It sounds like the thing that we all agree on is that this problem is ultimately going to be solved by innovation and this is the problem I have with so many of the political proposals is, you know, our ability to innovate is a function of the size and scope of our economy and the incentives and rewards for innovation and the freedom for entrepreneurs to do their thing. And if you crush that-

   23. JCJason Calacanis1:03:19

       Yeah.

   24. DSDavid Sacks1:03:19

       ... you know, with government mandates, you won't get the innovation we need to get out of this problem.

   25. JCJason Calacanis1:03:23

       We can easily innovate our way out of it and it requires some individual to say, "I want to dedicate my life to it," and then what is the motivation to do that and who are the capital allocators who are going to give them the billion dollars to create this company?

   26. CPChamath Palihapitiya1:03:39

       I- I- s- I spent a bunch of time, so I'm the capital allocator that'll give billions, in fact I did a survey of the superconductor space-

   27. JCJason Calacanis1:03:44

       I'll give millions. (laughs)

   28. CPChamath Palihapitiya1:03:44

       ... as an example, and here's what I found. Of the- of the four folks that I found, uh, who are all e- each individually doing things in superconductors that I think are incredible, they're all immigrants, every single one were not born in the United States. You could- you- they are so fucking happy to be here, they feel so lucky and they don't understand why everybody complains all the fucking time.

   29. DSDavid Sacks1:04:14

       (laughs)

   30. JCJason Calacanis1:04:15

       Yeah, complaining is- I- there is a disease of constantly complaining about stuff and if you count the number of times you complain every day and it's more than two or three times a day, uh, you need to get your head examined. You're- you're probably just talking yourself into anxiety problems. Stop complaining, start building. I mean these problems are solvable.
6. 1:06:03 – 1:13:19

   Quentin Tarantino's approach & impact on Sacks, Chamath's poker story

   1. CPChamath Palihapitiya1:06:03

      God for that guy it's interesting I just listened to Quinton Tarantino's on a podcasting tour because he's got a new book he he wrote a novel out of The Once Upon a Time in Hollywood characters and I just started listening to it it's fantastic uh listen on Audible and um Brian koppelman from the moment interviewed Quinton I listened to it yesterday on my bike ride and he was just talking about how he just never gave up and he had written True Romance and then he wrote um what was the other one he wrote at that time Natural Born Killers natural killers yeah and he was just talking about how the first movie nobody would do then he wrote the two screen plays and nobody would do and then he got to Reservoir Dogs and you know they tried to scrape together $800,000 and he kept asking like why didn't you quit why didn't you quit he's like well you know I just I figured it out like I figured out I had a voice and then nobody would buy my scripts because I was trying to do something Innovative

   2. JCJason Calacanis1:07:01

      ... and they were reading the scripts and they didn't understand what I was doing in terms of innovating on how a movie would be with, you know, how he does with Pulp Fiction. He changes the time and tells the storytelling in a non-linear fashion. And he's saying nobody understood it, but every time I read it, I realized I had a voice. It was my voice. It was getting better and better. And then people, you know, I sold those movies and then he kept building them. And it was very inspiring to think about that take of, like, he just didn't give up and he just-

   3. DSDavid Sacks1:07:28

      Totally.

   4. JCJason Calacanis1:07:29

      ... looked at the work-

   5. DSDavid Sacks1:07:30

      No question.

   6. JCJason Calacanis1:07:30

      ... and he found his, he found his own value in his own work, improving. Even without the external-

   7. DSDavid Sacks1:07:38

      How many times do you go-

   8. JCJason Calacanis1:07:38

      ... you know?

   9. DSDavid Sacks1:07:39

      It's a, it's a fantastic story. It's like one of those classic, you know, Hollywood or entrepreneur stories. He's working at a video store for years and, you know, he would start rec- he was, uh, making his own movie and he would, uh, film on the weekends and then-

   10. JCJason Calacanis1:07:53

       Mm-hmm.

   11. DSDavid Sacks1:07:53

       ... you know, he had, he made a few hundred dollars every week basically at th- r- and then he would rent the equipment on a Friday because then they would only charge him for one day because it was the weekend, so he could basically record the entire weekend. And so he'd go off and record and, and then he'd have to go back to work. And he started making this movie, you know, one weekend at a time for, like, two or three years and then he finally put the, he didn't even have the money to get the film developed. So finally after three years, he gets the film developed and he's like, unfortunately it sucked. It wasn't what he was expecting. But during that time, uh, he wrote True Romance, which then got bought. He sold that screenplay. That gave him a little bit of money. Then he wrote Reservoir Dogs and then he met Lawrence Bender and, you know, Bender went out, read the script and was like, "Holy shit, this is amazing." They raised, uh, you know, a million or so bucks to make the movie and then that kind of launched everything. And, uh, yeah, it's, it's one of these, you know, amazing rags to, to riches stories. Um, you know, they're kind of rare in, or they're more rare in Hollywood. They occur all the time in the tech industry. We see them-

   12. JCJason Calacanis1:08:50

       Well, you know-

   13. DSDavid Sacks1:08:51

       ... all the time.

   14. JCJason Calacanis1:08:51

       ... that's such an interesting point. He said, uh, they were like, "He would never let you make that movie now." And, you know, in another conversation, I think I listened to three podcasts with him. Uh, Joe Rogan, Brady Senelis, and then Brian Koppelmans, and all three of them are tremendous. But, uh, I think in the Brady Seneli- and, and in the Joe Rogan one, he's like, "Oh, they would never let you make that movie." And he was like, "Bullshit. You can just make it. I just made it. I, did you not see the last two films and how politically incorrect they were?" And, you know, I don't care what Bruce Lee's, you know, fans think of how I portray Bruce Lee. He was a, he was a bad actor. He was a terrible, you know, human being to his folks. And he, his basic thing was everybody keeps waiting to ask for permission and he's like, "I'm just gonna make my movies and, uh, let the chips fall where they may. I'm not gonna be censored. I'm not gonna censor myself and I'll make my 10 movies and that's it. Game over."

   15. CPChamath Palihapitiya1:09:40

       I'm gonna tell a rags-

   16. DSDavid Sacks1:09:41

       Tarantino-

   17. CPChamath Palihapitiya1:09:41

       ... to riches story. I wanna tell this, uh, poker story.

   18. DSDavid Sacks1:09:44

       Can, can I give one last story on Tarantino-

   19. CPChamath Palihapitiya1:09:46

       Yeah, yeah, yeah, yeah, yeah.

   20. DSDavid Sacks1:09:46

       ... before the end of... You tell your story? Tarantino's success with Reservoir Dogs, I think it came out in 1991. Um, that really inspired me to want to make movies, um, because I saw that somebody could make a movie outside the system for so little money, and that's why I made Thank Me For Smoking. Um, and we have another, we have another mo- independent movie coming out next year about Salvador Dali, which, you know, finally got made after about 15 years. So, um, yeah, I mean, he's inspired a lot of people and it, he shows what can be done.

   21. CPChamath Palihapitiya1:10:15

       Uh, this is a rags to riches story that involves J-Cal. So, uh-

   22. DSDavid Sacks1:10:18

       (laughs) .

   23. CPChamath Palihapitiya1:10:18

       ... I get invited, I get invited to the Harvard Business School to give a speech.

   24. JCJason Calacanis1:10:22

       Oh, okay. (laughs) .

   25. CPChamath Palihapitiya1:10:22

       First and last time I was invited 'cause I was disinvited, Jason, after that, what happened, but-

   26. JCJason Calacanis1:10:26

       Well, the, the back two rows walked out in the first five minutes. (laughs)

   27. CPChamath Palihapitiya1:10:30

       Wow.

   28. JCJason Calacanis1:10:30

       It was great. (laughs) .

   29. DSDavid Sacks1:10:30

       It was fucking incredible. It was incredible. I, we, I get invited to do this thing. Obviously it's in Boston. It's in wintertime. Right, J-Cal?

   30. JCJason Calacanis1:10:37

       Yeah, it was, it was winter and it was Boston.

Episode duration: 1:17:28