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Why Iran economic collapse could precede political collapse

Sanctions cut Iranian incomes to $200 a month. Microsoft pledges grid funding; FERC rules and a Cerebras deal reshape the data center power calculus.

Jason CalacanishostDavid FriedberghostChamath Palihapitiyahost
Jan 17, 20261h 10mWatch on YouTube ↗

EVERY SPOKEN WORD

  1. 0:00 – 4:18

    Bestie intros!

    1. JC

      All right, everybody, welcome back to the number one podcast in the world, your favorite podcast, the All-In Podcast. With me again, the core four, the original four: David Friedberg, Chamath Palihapitiya, David Sacks. We're here, and there's a lot going on in the world. Gentlemen, how's everybody's week going? Anybody got big plans for next week?

    2. DS

      JCal, your ship has finally come in. Your invitation was not lost in the mail.

    3. JC

      What? Really? [chuckles]

    4. DS

      You have been invited to Davos.

    5. JC

      [laughing] What? I gotta get my guitar. [singing] Oh, Davos, kumbaya.

    6. DS

      Don't blow it now.

    7. JC

      I'm gonna bring my guitar.

    8. DS

      Don't blow it now.

    9. JC

      Don't blow it? Explain to the audience what's happening here, Sacks. What's happening?

    10. DS

      Well, as it turns out, one of the houses there is in need of content, so they've offered All-In a stage to interview people.

    11. JC

      All right, so we got stage, microphone. You're going.

    12. DS

      I'm going, yeah.

    13. JC

      President Trump is giving a major talk there on Wednesday, I understand. Uh, and so there's a stage and microphone, so I'm-- I cancelled my ski trip in Japan to go to Davos.

    14. CP

      Even Jason is going [laughing] to Davos.

    15. JC

      Even JCal-

    16. DS

      Even JCal.

    17. CP

      Even Jason. Even JCal is at Davos.

    18. JC

      Even JCal. I mean, it's pretty funny. I was invited to be part of that, like, um... You probably got this, too, Chamath, back in the day, like, their young leaders for $50,000 a year. So we're gonna be doing some interviews, and, uh, if you wanna be interviewed by me and/or Sacks at the USA House, email jason@allin.com if you're there, if you have ideas for speakers, and, uh, we're gonna be booking in real time.

    19. DS

      I haven't been to Davos.

    20. JC

      Okay.

    21. DS

      I guess the way it works is there's a bunch of houses. So countries have houses, and then companies sponsor houses.

    22. JC

      Hmm.

    23. DS

      And there's stuff happening there. There's, like, stages set up, and there's constant interview... So, you know, I've gotten a bunch of requests. Basically, everyone's interviewing everyone else at Davos.

    24. JC

      Yeah.

    25. DS

      Does that make sense? I mean, it's like all the attendees are just constantly interviewing each other. [laughing]

    26. JC

      [chuckles] It's like-

    27. DS

      And that's weird

    28. JC

      ... the podcast circuit. All these podcasters now-

    29. DS

      Right

    30. JC

      ... have run out of guests, [laughing] so they just interview each other-

  2. 4:18 – 14:28

    Iran's breaking point: regime change coming?

    1. JC

      All right, I guess we gotta talk about what's going on in Iran. Regime change could be happening. There have been massive anti-regime protests over the last month. As everybody listening probably knows, Iran has been ruled by an Islamic dictator since the 1979 revolution. Ali Khamenei is, uh, in power since 1989, and if you wanna understand why this is happening, there's probably two data points that you should know. In the short term, uh, last, you know, six, seven years, inflation has been bonkers. If you think, you know, seven, eight, nine percent inflation during COVID was acute and, and, you know, 2.6 now people are complaining about, uh, take a look at this chart, boys. Uh, it's, it's been 30% on average since 2019 due to sanctions. Obviously, those things, uh, can work. There's been food shortages, people in the streets. Long term, here's a chart, and this is from 2020, so you can add six years to the chart you're seeing here, but, uh, there's a lot of young people in Iran, and the populace is made up of a lot of 20-somethings and 30-somethings, and they have Starlink, and they have access and VPNs, and so they want to be part of the future. They want to modernize. Sacks, this was a point of contention last year. We were talking about interventions going on, you know, foreign wars, and your concerns about that. This one is from the bottom up, so I think that makes it quite different, yeah?

    2. DS

      Well, look, this is a highly dynamic situation. I don't really wanna comment on something except to say that I trust President Trump to make the right decision and handle it.

    3. CP

      ... As I understand it, the protests are either fizzling out or being cracked down on at this point, and I tend to think it's dying down, but I'm not sure, and it's, it's a dynamic situation. I really- look, the problem is whenever I comment on something like this, it ends up being, "Trump advisor David Sacks says whatever," and-

    4. JC

      Oh, yeah, you get clipped and, yeah.

    5. CP

      And the reality is, I'm only involved on two issues, and this isn't one of them, so I don't really think I should be commenting.

    6. JC

      Yeah. Friedberg, you've been talking about this, and, uh, I think it was part of your predictions from the show last week, the prediction show. Here's your Polymarkets, and then I'll let you give your thoughts on it. Khamenei out as Supreme Leader of Iran by January 31st. That was up, uh, around 27% and now has dropped to a 10% chance. And will the regime fall before 2027? $2.6 million in volume, 37% chance. It's been up there, as high as, I think, 50-somewhat percent, and this is before the end of the year, so, hmm. Obviously, a breaking news type situation. By the time we tape on Thursdays, as everybody knows, come out on Fridays. So this could be radically changing, but just broad strokes, what are your thoughts here, Friedberg?

    7. DF

      I mean, I think it's inevitable that there's a break in the country because of the effect of sanctions. The average income is about 200 bucks a month in Iran, and the price of food is roughly the same as the US, maybe a little bit less than the US. I mean, they're... A combo meal at McDonald's, I just pulled this up, in Tehran is four bucks equivalent. So again, if you're making $200 a month and it's four bucks to go to McDonald's, costs catch up pretty quickly. I think that ultimately is what breaks civil society, is when people can't afford the things that they need, and people have no choice but to stand up. And an oppressive system, an oppressive regime, can keep people down for so long until they're starving or they can't get access to things like medical care, and these are the sorts of things that ultimately lead to these moments. So it seems like it's an inevitability. The United States has put a lot of pressure on the regime in Iran, and it seems to be starting to break. The key question that everyone's asking: is Trump gonna act in supporting the revolution? Which, theoretically, I would imagine, would involve attacking IRGC sites, which are the Revolutionary Guard that are sort of the internal security force that maintains the regime's control over the people. And if they take out, uh, IRGC sites, will that actually result in the people being free, and what's the transition plan? This is obviously a very messy situation. Reza Pahlavi is in Europe, and he said he's ready to come back, and he is the Shah's son. And if he comes back, how are you going to give him influence and control? This is the same question that recently came up in Venezuela. There is a very large infrastructure that needs to be overseen of government agencies, and, you know, you can't bring an outsider in and just plug them right in to take over everything. It's a very difficult transition, and that's when things fall apart, when people steal stuff, when, uh, things get turned off. So how do you maintain kind of the core functioning of society without breaking it by bringing someone new from the outside? That's where this gets very messy. So I, I don't know what's ahead.

    8. JC

      Yeah, and the strikes didn't happen last night. Bessent announced some increased sanctions. That always seems to be one of the best ways to handle this, is to increase the economic pressure, as you pointed out, Friedberg. And for people who don't un- who are not familiar, Iran is a large country. It's the second largest in the Middle East, behind Egypt, I believe, and close to 100 million people. 95 million people, I think, live in Iran. Uh, this would have a dramatic impact on the region if there was a transition here. Obviously, you've heard about, uh, different Houthis and Hezbollah being supported, funded, housed in Iran, so th- this would be quite dramatic, huh, Chamath, if this turned over? Uh, it's- even if it's a 10 to 30% chance this were to happen, any thoughts on what that would mean? You know, we've been watching this modernization of the Middle East and just Saudi, UAE, Qatar, everybody having a seat at the table, increasing influence, increasing modernization in those countries. What would this do in the region?

    9. CP

      It's really hard to tell. It's an incredibly vibrant people. If you look at the Iranian diaspora, they're really a dynamic part of every culture they join. If you know Persians in LA or Persians, I mean, they're-

    10. JC

      I mean, you and I play poker with the diaspora in LA. These are the most fun-

    11. CP

      They're incredible people

    12. JC

      ... people in Westwood. They're, they're the greatest.

    13. CP

      They're the greatest people.

    14. JC

      They're shutting the club down, the last people out at the game. Yeah.

    15. CP

      They're really great. The thing that I would say is that I don't think that you can paint the Middle East with a broad brush here. It's a very different culture than the other Middle East countries. It's a fundamentally different religion. It's a fundamentally different language. So I would just say that I don't know what's actually going on in Iran. There's been so much information containment that I take Sacks' point of view, which is, I think the only people in the United States right now that have an accurate sense are probably the military and intelligence apparatus of the United States, and the rest of us are underreacting or overreacting to small pieces of information without really knowing the context and the mosaic of the whole.

    16. JC

      In a breaking news environment, it's, uh, best to do some research and, uh, yeah, be humble and thoughtful- [chuckles]

    17. CP

      But by the way-

    18. JC

      ... guard your positions, yeah.

    19. CP

      The crazy thing about this, if you shift away from Iran, was specifically the information warfare game is totally different. So what did you have? You had SpaceX enable Starlink over Iran, and then there was the attempt to use that mechanism to get information out, to fill in the mosaic, right? So-

    20. JC

      Yeah

    21. CP

      ... Was what was happening ninety percent? Was what was happening ten percent? Was there counter-revolutions that were supportive of Khomeini? None of us knew anything, 'cause you would see these snippets, and it was very hard to actually triangulate. Then you had this entire information channel get shut down, and you had all kinds of blocking mechanisms that essentially drove the packet loss down to, like, eighty, ninety percent. And it's just important to understand that is the generation of warfare and information that we are going to see in every conflict going forward, especially when you have something as ubiquitous as Starlink and other things in the sky to help you get the information out. You're just gonna see these tactics increase.

    22. JC

      And I don't know if you guys ever saw it. Anthony Bourdain, rest in peace, did a really great Parts Unknown in twenty thirteen or fourteen-

    23. CP

      That's the best Anthony Bourdain I've ever watched.

    24. JC

      Yeah. Yeah.

    25. CP

      If you wanna see Iran, it looks so amazing.

    26. JC

      Yeah.

    27. CP

      Look at the Anthony Bourdain Parts Unknown-

    28. JC

      Yeah

    29. CP

      ... in Tehran. It looks like a party.

    30. JC

      Well, yeah, and young people there.

  3. 14:28 – 31:18

    Solving energy prices: Microsoft first hyperscaler to "pay its own way" and subsidize residential electric costs

    1. JC

      All right, Microsoft is gonna pay its own way on data centers. We've been talking about this, um, you know, energy needs for AI identi- data centers for a long time now, and, uh, there's been this theme: Hey, if the data centers are gonna take all this energy, it's going to spike local power consumption. We saw a number of data centers, gentlemen, maybe pull out of projects where there was local pushback on them. On Monday, President Trump, our President Trump, addressed this PR crisis on Truth Social, calling out Microsoft, "I never want Americans to pay higher electricity bills because of data centers." Two words, data centers. I added the last part. Microsoft will make major changes beginning this week to ensure that Americans don't pick up the tab for their power consumption. Microsoft President Brad Smith announced they will pay higher electricity rates where they are building data centers to cover the cost of the new power generation and grid upgrades. Seems like a pretty simple idea, and they're also gonna pay to replenish water that it draws from the reservoirs. That issue has also been a little bit overblown. Friedberg, you probably-- or actually, Chamath, you probably know a lot about that, and you can explain the data center recycling water issues-

    2. CP

      Yeah

    3. JC

      ... and the misperceptions. And they're not-- Microsoft has announced they're not gonna accept any tax breaks or electricity rate discounts, so that era seems to have ended. Chamath, you're involved in a number of data centers, and obviously, David Sacks, you're involved in this as our AI tsar and civil servant. So, Chamath, why don't you start us off here?

    4. CP

      You guys can find the clip, but we talked about this a few weeks ago, that these kinds of things were in the offing. I really like it. It's a very good first-order set of things to do, which is to step into a local area and take all of these energy issues off the table-

    5. JC

      Mm

    6. CP

      ... at least to the extent that you're contributing to it. The problem is that the data centers are only part of the problem. The reality is that we have a whole new way of living that is drawing more and more electrons. We are at a shortage for what we need. The reaction of the utilities is to now build, which is the right reaction. The problem is that, for the last twenty years, they've been under-building. So as they catch up, even if you have the data centers that are willing to pay their fair share, rates will still go up. So what do we need to do that is beyond what Microsoft just announced? I think all the hyperscalers should copy what Microsoft did. I think it's great that the president was able to get these guys to the table to agree to it. What is the next major thing? The next major thing is when you actually create a hundred or two hundred billion dollar tax equity vehicle, and you have them completely subsidize and pay for the electricity costs of homeowners. How do you do that? You do that by paying for them to get solar and storage. Why would they do that? They would do that for two reasons. Number one, and the most important, is that it will give them a social license to operate throughout the country. The second reason is that the president preserved the ability to make those kinds of investments and be tax-advantaged for doing it in the one big, beautiful build. So if you put these two things together, I think step one is, you go into a local area, you tell the local residents, "We'll pay for the water, we'll make sure there's minimal noise, and we will make sure that we take absolutely no discount. We pay our fair share, even if it means paying more than you do for electricity." That's step one.... But now I think we need to go in with step two. Here is a bunch of money that we have allocated to go and fit your house out with solar, with storage, with next-generation heat pumps, with a modern set of infrastructure so that you are totally resilient, and now you are completely ambivalent to what the grid has to do in reaction to all the demand that's coming.

    7. JC

      Yeah. I had, um, Zach Dow from, uh, Base Power on this week in Startups, I don't know, a year ago now, and, uh, we were talking about this, and I said, "Hey, why, why, why wouldn't you just..." And, and what they do is not solar, because solar takes time. You've got to rip up your roof. There- There's some complications with solar. You need to have the space for it. It's expensive to install. They just put a battery, like a little R2-D2, outside your house. They fill up that battery when energy is cheap and plentiful, and they deploy it when it's expensive and the grid has challenges. And, uh, he said those kind of deals are in the works, or the discussions were happening, and that was back then. So this is a really easy win-win-win type situation, Chamath, you're describing. Sacks, this feels like proactive now, thoughtful ways to communicate to the populace of, "Hey, the AI boom is here, and you have concerns. We're gonna get ahead of them." So, uh, have you been involved in any of these discussions? Is, uh, are you talking with Chris Wright and, like, overlapping in terms of the, um, communication here, or is it just a free market solution?

    8. DS

      Well, Jason, the, the president's been ahead of the curve on this issue really since the beginning of the administration. I don't know if you recall, but he said that he was gonna make AI companies into the biggest power companies because he understood that the data centers that they needed required a lot of power, but they were gonna stand up their own power generation, and they wouldn't just draw off the grid. And so I think this understanding has always been there. When I've talked to the hyperscalers, they also tell me that their plan is not to draw from the grid, it's to basically set up their own power generation behind the meter. It's called colocation. And in fact, I think ultimately this will bring down rates for residential consumers for two reasons. One is that when the data centers create their own power, they can sell back or donate back to the grid when they connect. They don't have to connect to the grid, but once they do, they can donate back. And then second, there's a number of fixed costs in power generation. It's not just variable, right? There's these large fixed costs, and so as you increase scale, those fixed costs get amortized over a greater amount of supply, and that brings down the variable rate, basically the, the meter rate for everybody. So scale is good, and I think the deceptive nature of the criticism here by, like, Bernie Sanders and people like that is, what they say is, "Well, we just have to shut down all the data centers, period." When the real problem here is that he and others like him have over-regulated power generation to death so that it's too hard to set up net new power, right? I mean, if power generation were easier, there wouldn't need to be a limit on what the data centers could use. They could just bring their own power. So that is the obvious solution here, and it's good to see Microsoft make this pledge and sort of formalize that. I think all the other hyperscalers will do that. Again, it was never part of their plan, I think, to draw on the grid for their power needs. They always, I think, understood that they'd have to stand up their own power, and the issue is just regulations getting in the way of that. And just one final point on this is that there are a bunch of regulations by FERC, for example, that interfere with the ability to do colocation. Colocation is when you put a data center and the power generation next to each other, or you do them together. And Chris Wright, the Secretary of Energy, has directed FERC to make a bunch of changes to make behind the meter and colocation easier so that these data centers can stand up their own power. And the only reason that hasn't happened is just because of the usual bureaucratic delays, but that is well on its way to happening.

    9. JC

      All right.

    10. DS

      Does that make sense?

    11. JC

      Yeah, it makes total sense. And, you know, if we start thinking about incentives, incentives obviously matter, and I don't think a lot of people know this, but... And I've-- I think I talked about it when we were talking about nuclear, Friedberg. In France, the people who live near the Tavannes, uh, I think is how it's pronounced, uh, reactor, they pay point one percent [chuckles] tax versus the twelve percent regional average. And so they-- And then I think the UK has also talked about these sort of danger zone or, uh, proposals and payments. You can give people a discount to incentivize them and reward them, giving them free local electricity, et cetera, for living near a nuclear power plant. That hasn't come up here in the United States. And there's been a lot of, of FUD, fear, uncertainty, and doubt, Friedberg, around these data centers, people throwing around a lot of talking points. I think you and I discussed offline the, the misperceptions about water usage and that the water usage is largely recycled in these data centers. Um, if you know about that, would you, would you inform the audience about that piece of data?

    12. CP

      Well, we got a lot of water.

    13. JC

      [chuckles]

    14. CP

      It just goes around in a circle.

    15. JC

      [chuckles]

    16. CP

      So I don't think that's an issue.

    17. JC

      Uh, but clean water and the cost of clean water increasing for a local population is the, is the issue-

    18. DS

      No, what Friedberg's referring to-

    19. JC

      -and the misperception there.

    20. DS

      The modern cooling systems in these data centers, the water recirculates and transports the heat out of the data center, so it's not like the water is used up. I guess there's a separate type of evaporative cooling that does use up some water, but modern data centers don't use that. So the water issue is really a, a total hoax, and it's really kind of a sub-hoax of this larger affordability issue. I'm not saying that affordability isn't an issue, but it was caused by Biden's nine percent inflation, and now Democrats are trying to make it an issue. When it comes to the power for data centers, again, this all comes back to the fact that the regulations make it too hard to generate net new power. So again, scaling demand on its own, not a problem if you also scale supply of electricity. In fact, it brings down prices for everyone because scale creates economies of scale.

    21. JC

      ... Yeah, and 90% of that water is reused, and there's closed water loop systems and-

    22. CP

      Here's my pitch.

    23. JC

      Yeah.

    24. CP

      I think the president should try to create a three, four, $500 billion tax equity fund and help eliminate the electricity costs of 50 to 100 million American households.

    25. JC

      Amazing.

    26. DF

      Well, here's the-- let me, let me give you the math. So we consume in this country about four trillion kilowatt hours of electricity. Average price is 18 cents a kilowatt hour, so it's about, call it $750 billion of spend on electricity every year. One third of that, 250 billion, is residential consumption. Two thirds of that, 500 billion, is industrial and commercial consumption. Theoretically, you could increase the price on industrial and commercial consumption by, call it, 50% and make all residential electricity in the United States free. If you're a residential user, you get a cap of free electricity every month, and if you use more than that cap, you get charged, but below that cap, you're free, based on whatever, square footage of your house, I don't know, whatever. And then on the commercial and industrial side, the reason you would then have an incentive to build private power systems would be that you can bring your cost down. And instead of centralizing all of this with the utilities, what it can do is it can force a market demand for industrial and commercial users to build their own power systems, which would increase overall electricity supply in the United States. The data centers are the tip of the iceberg, but if you make this a pan-industrial problem, then all of the industrial companies would have to take this path.

    27. CP

      The problem is it doesn't change the net consumption model. If you actually go to solar and storage for every fifteen million homes, you take a terawatt hour of demand off the grid. That's an extra terawatt hour that you don't need to build, but you can't build that quickly. So the reason why I like solar and storage is you make these folks so self-reliant, now all of a sudden, we're actually catching up to China faster than we would've otherwise.

    28. DF

      You're talking about residentials?

    29. CP

      Yeah. Your idea, which is a good one, the problem is, they're still using grid services.

    30. DF

      Right, or they don't have to. That's the point. Like, if they end up-

  4. 31:18 – 35:09

    OpenAI's compute deal with Cerebras, the renaissance in decode silicon

    1. JC

      OpenAI has struck another compute deal. This one's worth over ten billion. OpenAI is buying compute capacity from Cerebras. That's C-E-R-E-B-R-A-S. They committed to purchase up to seven hundred fifty megawatts over three years. Cerebras, like Roc, makes specialized chips for AI inference. Cerebras is in talks to raise one billion at a twenty-two billion dollar valuation, according to reports, and they're expected to IPO this year, potentially in the next couple of months. Sam Altman's an investor in the company, so, uh, he knows it well, [laughing] and they're-

    2. CP

      [laughing] Is he really? Stop.

    3. JC

      I- I mean, it's in the notes.

    4. CP

      Stop. [laughing]

    5. JC

      It's in the notes. I-

    6. CP

      You can't say this stuff if you don't know if it's true.

    7. JC

      It's in the notes! It's in the notes. Take it out and post it.

    8. CP

      [laughing]

    9. JC

      If it's not, I-

    10. DS

      Oh, my God.

    11. JC

      Reported by The Information. I don't know. It could be information, could be misinformation-

    12. CP

      Yeah

    13. JC

      ... shout out-

    14. CP

      Uh, uh, okay

    15. JC

      ... to our friends at The Information. [snorting laugh] These were your competitors at Roc, yeah, uh, Chamath?

    16. CP

      They were.

    17. JC

      Contemporaries, yeah?

    18. CP

      They're fantastic. We both started at the same time. We took slightly different technical approaches. The big difference that what Cerebras said initially from the start, and this is my friend Andrew Feldman, so I'll give him a shout-out, very smart guy. If you see a chip, what you actually see is a wafer, and a wafer is full of little chips, right? And you, you literally tear them off. That's why they're called chips. Andrew was like, "No, I'm just gonna make one ginormous chip the size of a wafer." And so if you look at it, Nick, maybe you can find a picture of it. These things are huge, and at the time, people were like... I don't think they've really understood what the power of what Cerebras was building and what Andrew was building. And then the first folks that really got on board were the Emiratis, so MGX and G42, and you started to run these models, and what you started to see was, man, their inference is blazing fast. Again, back to what we talked about last week, because when you have the compute and the memory in the same place, physical distances are now minimized, and the complexity is minimized, so you just have incredible speed. What I can tell you is that OpenAI is aggressively trying to diversify so that they have multiple paths of inference available. They have a huge deal with AMD. They have a huge deal with NVIDIA. They now have a huge deal with Cerebras. If you look at the trail of breadcrumbs, my belief, there's gonna be a renaissance in silicon. Young, small teams building decode silicon can make a fortune over the next ten to twenty years. It's a huge opportunity. It's gonna be like the PC wars, Dell versus Compaq versus all of these companies. It's super exciting, and congrats to Cerebras. They deserve it.

    19. JC

      Is there, um, any argument that compute needs will level off in some way? We will have built so much capacity, and the software will get better. There's been some talk about Anthropic being resource-constrained as the contemporary to OpenAI, and I think there's pretty much uniformity amongst elite AI users that Claude is a much better product now than OpenAI, and the models are better, the applications are better, but they're doing it with less. So could the build-out be- could it slow down? Is that a scenario that's out there, or is this always gonna be up and to the right for the next five, ten years? What's your crystal ball say? Sacks, are you still there?

    20. DS

      I'm here.

    21. JC

      Oh, okay. [laughing]

    22. DS

      [laughing]

    23. DF

      Why is he on- why is his video off? Turn it on.

    24. JC

      I mean, you can turn it back on, and then when you talk, we'll just-

    25. DF

      [sighs] Jeez.

    26. JC

      -go back and forth.

    27. DS

      Texas still has a ways to go, I have to say.

    28. JC

      Yeah. All right, there you go. All right, so anyway, uh, Abbott, you could-

    29. DF

      This is your best internet? It's-

    30. DS

      Texas infrastructure is, uh-

  5. 35:09 – 56:13

    Billionaire backlash in California: Wealth Tax exodus

    1. JC

      Okay.

    2. DS

      Well, let-

    3. JC

      Here it is

    4. DS

      ... maybe we should just talk about BTA, 'cause this is where this is going. [laughing]

    5. JC

      Well, I mean, listen, you move houses. So you move houses, you could have a little internet issue. It's okay.

    6. DS

      Well, I mean, I'd rather have an internet issue and keep one hundred percent of my money than- [laughing]

    7. JC

      [laughing] Lose five percent.

    8. DS

      Lose five percent plus thirteen point three per year, and it's not gonna be-

    9. JC

      Yeah

    10. DS

      ... a one-time tax. That's the biggest lie.

    11. DF

      Oh, yeah.

    12. DS

      It's five percent now, five percent later, ten percent after that.

    13. JC

      Yeah.

    14. DS

      You know-

    15. JC

      But you can afford

    16. DS

      ... then it'll be an exit tax.

    17. JC

      Yeah, mansion tax.

    18. DS

      They're, they're coming for all of it.

    19. JC

      Yeah, [chuckles] nice.

    20. DS

      So the internet can get fixed. The internet-

    21. JC

      Yeah

    22. DS

      ... let's put it this way, my internet can get fixed a lot more easily than California can.

    23. CP

      What are the ten states that constitutionally ban asset taxes?

    24. DF

      Yeah, so it's direct and, a- implicit in those states' constitutions, or they have an amendment to the constitution that makes it, um, direct or implicit, that you can't do a wealth tax or an asset seizure tax.

    25. JC

      And which are they? Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas.

    26. DS

      According to Roc, only Texas explicitly bans wealth taxes.

    27. JC

      Hmm.

    28. DF

      Yes, that is correct, but because of some of the other state constitutions, it's implicit. So Texas has, in their constitution, an, a prohibition on, quote, "tax on wealth or net worth." Washington has a uniformity clause, which treats income as property, which bans non-uniform rates.... Florida's constitution bans any sort of personal tax. Pennsylvania has a strict uniformity clause, which would make it impossible to have graduated tax rates or distinguished tax rates amongst populations. Illinois has a strict constitutional mandate for a flat, non-gra- graduated tax rate, so you cannot do, uh, a separation. Um, and then asset seizure is referred to as a civil asset forfeiture, which is a separate legal issue, but implies in states like New Mexico, Nebraska, and North Carolina, you cannot actually have an asset taken from you by the state. So there, there's a bunch of states that this would be constitutionally protected against.

    29. JC

      Friedberg, has your mind changed since last week about whether this is gonna make the ballot?

    30. DF

      I, I don't think it's gonna make the ballot. I mean, look, I, I think it's not... I'm not saying 100%, I'm saying slight overweight that it's not gonna get there.

  6. 56:13 – 1:10:44

    Greenland acquisition: Why it's crucial

    1. JC

      topic. Congratulations to Greenland on, uh, accepting a very generous offer from President Trump. We welcome you as the 51st state. Maybe that'll be happening any day now. US officials met with reps from Denmark and Greenland at the White House on Wednesday to discuss how the US could take control of Greenland. This has been something Trump's been talking about for years, and remember my rule number one of President Trump: He says a lot of things. "One way or another, we're gonna get it," March 4th, 2025. "I need it for psychological reasons, to actually own it," 2021, he said that. "We're gonna do something with Greenland, either the nice way or the more difficult way," January 9, 2026. Denmark doesn't seem to want to play ball. They say they have a fundal- fundamental disagreement about this. That being said, there's only 50,000 people there, and it's, uh, Polymarket's got it a 17% chance that we acquire it, which is [chuckles] significant as a starting point. 50,000 people getting a half million or a million dollars each would probably be a pretty good deal. It's a very strategic piece of land. If you look at what's happening with the ice caps melting, Sacks, and Russia positioning a lot of their ships up in the Arctic, there's a pretty clean shot going past Greenland to the northeast of America. So maybe you could just talk about why this is... And, again, you're not speaking for the administration, and it's not your lane, but why is Greenland so important?

    2. DS

      Well, it is becoming more significant from a national security standpoint as those Arctic ices melt, and you have new shipping lanes that have opened up. So it is important on, on that dimension. But look, American politicians have wanted to acquire Greenland for a long time. The great Secretary of State, William Seward, wanted to acquire it. He acquired Alaska. He wanted to get Greenland, too, was unable to make that deal. But FDR and Truman both were interested in acquiring Greenland. It didn't work out, obviously. So this is a, an old idea that's new again, thanks to President Trump. I think he makes a great point. Why does it belong to the Danes? You know, it's a small country in Europe. It's not part of North America, and I think if we can acquire it for national security reasons and resource reasons, we should, and I think the odds of him pulling this off are much greater than 17%.

    3. JC

      Chamath or Friedberg, you have any thoughts on, uh, the 51st state?

    4. DF

      I don't know anything about it.

    5. JC

      Yeah.

    6. DS

      Well, they don't have to become a state, to be clear. What I mean-

    7. JC

      No, no, I know

    8. DS

      ... They can become a protectorate.

    9. JC

      Yeah, I mean, territory, wh- whatever it is, yeah. Could be like a country club, whatever.

    10. DS

      [laughing]

    11. JC

      It's, it's important that we get, [chuckles] get memberships.

    12. DS

      This is a huge piece of real estate in the Western Hemisphere.

    13. JC

      Yeah.

    14. DS

      It doesn't really make a ton of sense for Denmark to own it. It makes a lot more sense for it to be part of the US.

    15. JC

      And?

    16. DS

      We're willing to pay for it, and I think that we can make them an offer that they can't refuse.

    17. JC

      Absolutely, and it has-

    18. DS

      We're gonna send Luca Brasi over there. [laughing]

    19. JC

      I tell Luca Brasi, "Yeah, make him an offer he can't refuse." It's got, uh, a lot of rare earths minerals. There's a lot of oil offshore. Their big export now is, is fish, obviously. But this has lots of potential, Friedberg, in terms of the resources, and, um, yeah, why not get it done? Uh, Trump loves real estate. We got him for another three years. I say let President Trump cook, and if he wants to buy some other land, I'm here for it. I love building the empire. This is my favorite Trump. Friedberg-

    20. DF

      Yeah, look, I mean-

    21. JC

      You love this Trump or not?

    22. DF

      ... The old adage is there's always a deal, there's always a price, except when you're negotiating with a government. So I don't know how that's gonna go. My understanding, my experience, is that they do not want a deal. They're not interested. There's a whole bunch of national pride associated with that. You can't break national pride. As we know, as patriots of America, it is very hard to fight national pride. I don't know if the economics are really gonna play out, but security guarantees, maybe other benefits for the, the great Kingdom of Denmark, there could be a strong alliance and partnership for the United States.

    23. DS

      I think it could be important for the US to have a new frontier. You know, maybe what we can do is send all these progressive socialists-

    24. JC

      Hmm

    25. DS

      ... off to Greenland to tame this new frontier.

    26. DF

      I wanna go.

    27. JC

      Yeah!

    28. DS

      We need that spirit.

    29. JC

      Send Mondame there. They get the grid.

    30. DS

      We need that, we need that spirit of the frontier of, of cowboys-

Episode duration: 1:10:44

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