Trump vs Harvard, Nvidia export controls, how DEI killed Hollywood with Tim Dillon

1. 0:00 – 6:56

   The Besties welcome Tim Dillon!

   1. JCJason Calacanis0:00

      All right, everybody. Welcome back to the number one podcast in the world, the All-In Podcast. After our triumphant week last week, we had an amazing episode, uh, thanks to Larry Summers and Ezra Klein for joining us for the great tariff debate. Number four episode in the world last week and, uh, man, we got a banger ready for you today. Before I get to that, couple of quick plugs.

   2. CPChamath Palihapitiya0:24

      Did you call the DNC to clean up the roadkill, Jason, from last week?

   3. JCJason Calacanis0:27

      I'm an independent, folks.

   4. CPChamath Palihapitiya0:28

      (laughs)

   5. JCJason Calacanis0:29

      Just... I know these guys keep trying to pin me as a Democrat. I'm an independent critical thinker for life. But I do think Ezra is, um, got a little PTSD. I haven't heard from Ezra-

   6. CPChamath Palihapitiya0:38

      Does the DNC have a roadkill cleanup crew?

   7. TDTim Dillon0:41

      (laughs)

   8. JCJason Calacanis0:41

      You know, it's amazing. You have an episode like that where I thought we made great progress on dealing with those issues and, and came to some consensus at the end, and then every single person universally, if they're on the right, "Oh my God, Saxon, Chamath destroyed them." If they're on the left, the left's position was, "Oh my God, Saxon, Chamath finally got destroyed." Anyway, you decide for yourself. We're just here to talk about the most important news stories and, uh, All-In Summit-

   9. TDTim Dillon1:07

      I think Chamath is right. I think they sent the same crew that cleans up the armadillos from the road.

   10. CPChamath Palihapitiya1:12

       My God. (laughs)

   11. TDTim Dillon1:12

       (laughs)

   12. JCJason Calacanis1:12

       Okay.

   13. CPChamath Palihapitiya1:13

       The armadillos.

   14. TDTim Dillon1:14

       Yeah.

   15. JCJason Calacanis1:14

       All righty. Here we go. September 7th to 9th in Los An-

   16. TDTim Dillon1:17

       There are a couple armadillos left, uh, lying on the side of the road.

   17. CPChamath Palihapitiya1:20

       (laughs)

   18. JCJason Calacanis1:20

       All right. Okay. All-In Summit is going into its fourth year, yada yada.

   19. TDTim Dillon1:25

       (laughs)

   20. JCJason Calacanis1:25

       September 7th to 9th. Apply, allin.com/summit.

   21. TDTim Dillon1:28

       Uh.

   22. CPChamath Palihapitiya1:28

       Pronouns everywhere. Pronouns everywhere on the highway, Jason.

   23. JCJason Calacanis1:31

       Tell me who to be... Come on. Come on, guys.

   24. CPChamath Palihapitiya1:31

       Pronouns are everywhere.

   25. TDTim Dillon1:32

       (laughs)

   26. JCJason Calacanis1:32

       Can I... Can, can we at least get through this?

   27. CPChamath Palihapitiya1:33

       People just trying to clean up the pronouns. It c- the shovels weren't big enough for all the pronouns.

   28. TDTim Dillon1:37

       (laughs)

   29. JCJason Calacanis1:37

       Freeberg was on Jeopardy again, celebrity Jeopardy, and I don't want to ruin it for you, but he had an amazing comeback victory. But really excited to have on the program today one of your favorites. He was on the show pre-election.

   30. CPChamath Palihapitiya1:50

       One of my favorites.
2. 6:56 – 28:45

   Nvidia H20 export controls, the China workaround, plausible deniability by chipmakers selling to China-linked entities

   1. JCJason Calacanis6:56

      H20s banned. The US and China trade war has been escalating. On Monday, the White House informed NVIDIA that they were putting an indefinite export restriction on NVIDIA's H20 chips to China. And so in this filing, uh, NVIDIA said it expects a $5.5 billion hit to their quarterly earnings. Stock dropped 6%. For those of you who don't know, H20 is essentially the weaker version of the H100. It was designed actually to comply with, uh, these export restrictions on AI chips and allow them, NVIDIA, to sell something into China. NVIDIA CEO, CEO Jensen Huang was, uh, visiting China today. He told Chinese state media, quote, "The China market is very important to us." Yada, yada. Saxey, um, you're here. I think you got some, uh, official, uh, information for us on this. What, what, what's the story here? Wasn't this supposed to be the chip that was made for China?

   2. DSDavid Sacks7:54

      In a sense. I mean, there is a long history to this.

   3. JCJason Calacanis7:57

      Okay.

   4. DSDavid Sacks7:57

      So, first of all, just to be clear, we're not talking about tariffs. We're talking about export controls. And the export controls are designed to prevent certain sensitive technologies, technologies that could have a dual use, potential military as well as consumer application, from going to China. And this goes all the way back to 2019. The first Trump administration placed a ban on extreme ultraviolet lithography equipment going to China. This is the key technology in the printing of transistors on the silicon wafer in the semiconductor manufacturing process, and there's only one company in the world that makes these machines. They cost like $200 million. It's called ASML. It's a company in the Netherlands. In any event, the first Trump administration prevented these machines from going to China, which I think in hindsight was a really farsighted decision, because if it weren't for that, China might today be dominating global manufacturing of semiconductors. And their inability to get that sort of lithography equipment, I think, definitely put a dent in their plans. Subsequent to that, in 2022, the Biden administration started adding leading-edge chips to the export control list, like you said, the H100. NVIDIA then designed a new chip that was basically a version of the H100, but they reduced the amount of FLOPS, or computational power, just below the threshold so they could continue selling to China. That was called the H800. The Biden administration then added the H800 to the export control list in 2023. So, NVIDIA developed the H20, which again is kind of like a nerf version of the H100, just has less computational power. I think the issue is that FLOPS isn't the only criteria by which you can measure the power of a chip. There's also now memory bandwidth. And in the new paradigm of reinforcement learning and, and test time compute, memory bandwidth actually matters more than the amount of FLOPS. And if you look at the memory bandwidth on the H20, it actually has 20% more memory bandwidth than the H100. So, I think there is a view that this chip is just frankly too good.

   5. JCJason Calacanis10:09

      Mm.

   6. DSDavid Sacks10:09

      And the response I'd have to people who don't think we should be restricting this is, "Are you against export controls in general, or you just think that we're drawing the line in the wrong place here?" 'Cause, you know, I've heard folks like our friends like Bill Gurley and so forth say that-

   7. JCJason Calacanis10:24

      Yeah, I was about to, um, yeah, pull-

   8. DSDavid Sacks10:25

      ... that we're making a mistake. But I think the question for those people is, would you sell them everything? I mean-

   9. JCJason Calacanis10:30

      Mm.

   10. DSDavid Sacks10:30

       ... if China wanted to buy the latest NVIDIA chip, the GB200, would you sell that to them? Would you sell them-

   11. JCJason Calacanis10:35

       Well, yeah. So-

   12. DSDavid Sacks10:36

       ... a million of those? Would you sell them five million if they're willing to pay a premium?

   13. JCJason Calacanis10:39

       Yeah.

   14. DSDavid Sacks10:39

       It seems to me that at some point, you have to say that some technologies are just too sensitive to be sold to China. And so then the question is just, are you drawing the line in the right place?

   15. JCJason Calacanis10:49

       Let me bring Freeburg in on that. Freeburg, uh, friends of the pod like Gavin Baker said these tariffs, uh, and these type of bans are gonna essentially guarantee that America will lose AI because, and Gurley as well has this position, that we're now gonna make China force them to make their own chips. Now, mu- you know, necessity will be the mother invention, and it's gonna escalate, and we'd be better of just selling, um, these instead of the latest ones. What's your take on that, that, you know, this will be the, uh-

   16. DFDavid Friedberg11:16

       Well, I think this is the critical-

   17. JCJason Calacanis11:17

       ... inspiration for them to build their own NVIDIA?

   18. DFDavid Friedberg11:20

       It's an important question. Last year, China announced and began a $37 billion investment in developing their own 3-nanometer, uh, chip technology. So, you know, the EUV lithography systems that Sax is referencing, um, require these wavelengths of light at about 13.5 nanometer, which is, you know, the, the previous technology was like 200-plus nanometer. So, it's very, very small wavelengths of light that you have to be able to manipulate very, in a very kind of discrete way to print circuits that are just 3 nanometer scale. And so, uh, it turns out that last year China, uh, made a claim that this investment they had made was starting to pay off, and they had developed their own EUV system. And their big semiconductor company is called the Semiconductor Manufacturing International Corporation, or SMIC, in China.They launched a, a chip, a seven-nanometer chip with Huawei in their Mate 60 Pro, which is sort of like their iPhone competitor in China. And so they're proclaiming that they've already got this EUV technology. From what I understand, and Sax would know better than I, it sounds like there was a lot of reverse engineering and workaround of existing technology in order to deliver that system.

   19. JCJason Calacanis12:36

       Got it.

   20. DFDavid Friedberg12:36

       But they may now already be investing in and developing their own system. So J-Cal, I think they're doing it either way.

   21. JCJason Calacanis12:43

       Got it.

   22. DFDavid Friedberg12:43

       I think that they're going to invest and build their own EUV and chip manufacturing capacity either way. And the question is, does this slow them down or limit their ability on the application or the AI layer to kind of-

   23. JCJason Calacanis12:53

       Yeah.

   24. DFDavid Friedberg12:53

       ... be held back for some period of time?

   25. JCJason Calacanis12:54

       Obviously accelerates it, 'cause they have no choice but to, accelerates their commitment to it. So, Tim, you've been talking about these, uh, EUV technologies in the 200-nanometer, one specifically during-

   26. TDTim Dillon13:04

       (laughs) It's my entire sp- it's my entire special.

   27. JCJason Calacanis13:07

       It's in your related special, yeah.

   28. TDTim Dillon13:07

       It's a little crazy that you'd rip me off like this.

   29. JCJason Calacanis13:10

       (laughs)

   30. TDTim Dillon13:10

       My entire special-
3. 28:45 – 57:04

   Trump vs. Harvard: Why the White House is threatening to take Harvard's tax-exempt status away

   1. CPChamath Palihapitiya28:45

      31st, three federal agencies announced they were reviewing nine billion, nine billion multi-year federal grants and $256 million in contracts that went to Harvard, three agencies, education, health, and the GSA. This past Friday, April 11th, the group sent a letter to Harvard's president and the head of Harvard Corporation, laid out a series of changes the White House is demanding. Merit-based hiring and admissions, staff, admissions students, all that good stuff. Cancel all your DEI programs, no more DI. Reform international admissions. No more admitting students that are, quote, "hostile to American values." Increase the different, um, viewpoints on diversity across all departments and abolish admission practices that served as an ideological litmus test. Harvard's president, Alan Garber, said he would not comply. Later that day, the White House responded by freezing 2.2 billion in grants, 60 million in contracts. They now wanna take away, the White House, the tax-exempt status of Harvard, which would be absolutely insane. It's happened, actually, once before in 1970s. Bob Jones University in South Carolina was doing outwardly racist stuff, and, uh, the IRS, according to CNN, is looking into this. Your thoughts, Chamath? Well, it's more than the IRS is looking into it. They're thinking of revoking their tax-exempt status.

   2. DFDavid Friedberg30:10

      Yeah.

   3. CPChamath Palihapitiya30:11

      How about I tee this up slightly differently?

   4. DFDavid Friedberg30:13

      Okay.

   5. CPChamath Palihapitiya30:13

      Tim, you brought up something that I think is really important, which is, what is the American dream for all these people that are cascading between half jobs and half measures?

   6. DFDavid Friedberg30:22

      That's right.

   7. CPChamath Palihapitiya30:24

      That's a really important question, and right now, if you look at...... the top of the educational hierarchy, Harvard, what have we seen over the last few years? They are at the absolute bottom of the rankings with respect to free speech. They have lost all of these cases, all the way up to the Supreme Court about how they do admissions. Harvard doesn't just have a front door, it's got a bunch of side doors, it's got a bunch of back doors, and they discriminate. And what is the opposite of discrimination? It's meritocracy. And I think with 20 plus years of discrimination, what Harvard did was made it fashionable for other schools to discriminate. And if you compound that for 20 years, it doesn't just touch the universities, it starts to touch the high schools and the middle schools. Where we live, at the beginning of COVID, we had some morons at the Board of Education decide to take away AP calculus and AP math because it made people feel bad. It's absolutely ridiculous. And then we pound these kids with ADHD pills and what happens is what you described, Tim. So what is the point of fixing Harvard? It's really important because the opposite of what they do, what they do is discriminate, is a meritocracy, and we need to make that fashionable again. And the m- the biggest reason goes back to, again, I'll just go back to the, the chip conversation. The Chinese are so well-organized. If you look at the Chinese and the Indians together, those are 2.5 billion people swimming in a meritocratic soup from the day they're born. That's the only way they climb out, and it's eat or be eaten. And then when they graduate from an education system that is purely meritocratic, you know what they do? They enter a workforce that's also meritocratic. So it's compounded into their psyche that you just have to perform. Whereas what we do is we do all of these fake things that make people feel really bad about themselves, they look at other people that think that shouldn't deserve to be in places, get places, and so we have to turn that tide. And so whatever it takes, the most severe and extreme measures must be undertaken to fix this. That's my point of view.

   8. JCJason Calacanis32:35

      Mm. Tim, your thoughts on, uh, Trump wanting to take away the nonprofit status of Harvard.

   9. TDTim Dillon32:40

      I went to the, um ... I went to one of these encampments during the protests. I wanted to see it for myself to see what was going on. I do, I, I did like, there was a lot of, you, uh, you'd see a non-binary, uh, Asian dressed up like a Hamas, and I think that's fun. I think it's college.

   10. JCJason Calacanis33:00

       Mm-hmm.

   11. TDTim Dillon33:00

       So I think that people are going to express views that are often, you know, probably anti-American. I don't think we can ... you can't shield yourself from that. I don't, I don't like deporting people that are, you know, critical of Israel, for example, unless they've committed crimes and you can provide they're providing material support, you know, if you can prove they're providing-

   12. JCJason Calacanis33:22

       Due process.

   13. TDTim Dillon33:23

       Due process. Well, you need to provide, you know, if they're providing material support to Hamas or something like that, that's a different story, but if they're here on a legal resident visa, they should be allowed the space to, you know, express themselves as any other American citizen would. Now, that being said, it is impossible to look at higher education in America right now and not be embarrassed, truly. Truly, the word is embarrassment. These should be the shining example of, as Chamath was saying, institutions that prepare people for the real world, but what they really are, they've all been captured in this quasi-religious cult of insanity where people are elevating, uh, different types of characteristics outside of intelligence and merit as the most important things to be considered for admission, uh, you know, to, to be given academic achievements and things like this. It's kind of embarrassing. And I think if these institutions are gonna follow that path, they're gonna have to live and die on their own. They're not gonna be able to be taxpayer subsidized and funded. They have massive endowments from, uh, uh, multi-billionaires whose families all go, but like Chamath said, they do engage in discrimination. And, and frankly, you know, I, again, I'm not for drawing ideological lines and I'm a big free speech guy, but I do think that you don't find much ideological diversity on any of those campuses, certainly not in the faculties at all, and it doesn't prepare anybody for world ... And all the politics are, are very aesthetic.

   14. JCJason Calacanis34:52

       Mm-hmm.

   15. TDTim Dillon34:53

       I mean, all these people are out there, you know, showing off, exhibiting their virtue, but at the end of the day, they're still getting a very cushy internship and a nice job and, you know, they're going to summer in Martha's Vineyard. You know, for example, I, I was lucky enough to go to the Kennedy compound this summer. I went sailing with their family and they're really great kids, and a lot of the kids there were from-

   16. JCJason Calacanis35:14

       On the vineyard or the rock? Where, where were they?

   17. TDTim Dillon35:16

       Uh, no, they're on, uh, you know, Hyannis, whatever, the famous-

   18. JCJason Calacanis35:18

       Yes.

   19. TDTim Dillon35:19

       ... thing. And I went there and a lot of their f- you know, young, their young kids are of case kids who are young, they went to Harvard, and a lot of these Harvard kids are all good kids, but, you know, some of them are very interesting, right? Because they, they said to me, they said, "You own a house in the Hamptons." I said, "Yeah." They go, "Do you ever go out there in the winter?" I go, "Yeah, sometimes I do. It's quiet, nice, you could write, you could work on stuff." They go, "Yeah, well, we-" you know, they go, "It's kind of depressing to come to the Cape in the winter because all these people here are on drugs." And I say, "Yeah, because you shipped (laughs) their jobs away." So it's just as stunning that these are Harvard kids, they're very smart kids, but you have these chasms where they, you know, where, where you would think it would be completely obvious to people at, at, at this, you know, amazing academic institution that, yeah, of course the people are on drugs, they're embracing pathological behavior, they, they don't have a future, but these schools have become these really insular bubbles where these people have these really well-meaning aesthetic politics which says, "We don't care about your economic circumstances. Here's a trans Batman."

   20. JCJason Calacanis36:15

       Mm.

   21. TDTim Dillon36:15

       And I don't think that that, that seems to be the ethos of higher education in America right now and it's, it, it's, it's very hypocritical, and I, I think it's why the Democratic Party no longer connects because they're too closely associated with, like, that type of, you know, that type of-

   22. JCJason Calacanis36:32

       Elite.

   23. TDTim Dillon36:32

       ... vibe.

   24. JCJason Calacanis36:33

       Identity.... politics. Yeah. Freeburg, what's your thought? Should the IRS revoke or threaten to revoke here, uh, their nonprofit status? Is that a, uh, fair technique here because, uh, they won't acquiesce and, uh, do exactly as instructed? What do you, and what do you think is gonna happen here? Could this possibly result in them losing their IRS status?

   25. DFDavid Friedberg36:57

       Harvard's endowment is $53.2 billion.

   26. JCJason Calacanis37:02

       Huge.

   27. DFDavid Friedberg37:02

       Uh, assume they make 7% return, you know, they're making $4 billion a year in income generated from those investments and that endowment. I think there's a couple of, two really important questions. One is, should the role of the federal government be to give out money equally to institutions or should the role be to give money to the institutions that are gonna provide the highest ROI for America? Or is the goal to redistribute wealth and is that the, the, the point of federal spending and federal expenditures? So, you know, you could kind of think about Harvard, MIT, and a few other institutions that have truly great research institutions embedded within them as being the best ROI for America from a grant perspective when you're giving out research grants, that's the best place because it, uh, uh, it... Just like any other great technology company, it accumulates capital because it accumulates talent and that has a network effect, and now you've got a few institutions that have a monopoly on high-quality talent, and as a result, it's the best ROI for America. Is that what the federal government is investing in or is, should the federal government be trying to support universities all over the place that are more in need, particularly a university that has $53 billion of capital, do they really need the federal funds? So then the next question, I think, is like what is the limit on the government's ability to influence whether or not an institution gets their capital? Is it statutory? Is it mandated by law or does it become politically motivated, socially motivated, et cetera? Because in other parts of how we're seeing decisions being made, we're saying Chevron Doctrine was thrown out, and when Chevron Doctrine gets thrown out, we can't rely on the regulatory scrutiny of the administrators of the capital, we have to rely on the law and is there a law that they're relying on? And I think that's the key question, is to have the administration point to the laws that they believe are being violated to, to, to kind of make, I would say, a strongly defensible argument about why they would withhold the capital to make sure that they're compliant with the law and whatnot, and have it not be kind of, you know, just, "We, we would prefer to see you do things differently because we think it's socially better." So I think those are kind of the two key points. Whether or not these institutions deserve nonprofit status, I don't know why an institution that has $53 billion of capital and is making probably 4 or 5 billion a year shouldn't pay taxes on that income. That income is being used to, in a variety of ways, to build nice buildings and there's IP that's held by these institutions, that IP is used to start startups, they get equity in the startups, they have income streams on their IP. I mean, they really do operate like technology development centers. So, you know, what is their, the original kind of reason for saying that they should be tax-exempt? The majority of the capital is not being used to educate students, the majority of the capital is being used to reinvest to make new capital.

   28. JCJason Calacanis39:59

       Sachs, your position on, uh, Harvard losing its tax-exempt status potentially because they will not, uh, stop their DEI programs or they wanna, I guess, better stated would be that they wanna make their own decisions about this and not have the federal government make this decision.

   29. DSDavid Sacks40:14

       Let's get to the nitty-gritty of the legal issue here. In 1983, there was a case called Bob Jones University versus the IRS in which the IRS challenged the tax-exempt status of Bob Jones University because Bob Jones had this bizarre and reprehensible policy banning interracial dating on campus and interracial marriage based on a strange interpretation of scripture, at least that's what they said it was. In any event, Bob Jones lost that case and they lost their tax-exempt status. As far as I know, they kept the policy and they continued to operate as a private university. But the Supreme Court found that if you enshrine a racially discriminatory policy in violation of the civil rights laws, then you cannot get tax-exempt status. So that was the precedent. Fast-forward to 2023, we have the case Students for Fair Admissions versus Harvard. This is the Supreme Court case a few years ago that said that affirmative action policies that use race as a factor in admissions are a violation of the Fourteenth Amendment's protection against racial discrimination. So Harvard lost that case. They were found to be racially discriminating in admissions. Now, what Harvard did in the wake of that is that they claimed that they removed access to information about an applicant's race from the admissions process so that the admissions readers don't know what race a student is. This is their claim. But at the same time that they did that, they updated their application, replacing the long form essay, you know, that all of us filled out decades ago when we went to school, with five shorter questions asking how applicants will contribute to a diverse student body.

   30. JCJason Calacanis41:58

       Mm.
4. 57:04 – 1:18:06

   Hollywood's DEI facade, thoughts on AI, and more

   1. JCJason Calacanis57:04

      comedy to you, Tim, and, and, and your cohort, during that, like, peak DEI, peak cancellation? It felt like the Overton window was closing pretty harshly on you guys.

   2. TDTim Dillon57:14

      Yeah.

   3. JCJason Calacanis57:14

      There was a lot of attempted cancellations of comedians, people trying to secretly record you. You got those yonder. What, I don't know what those are called, those bags-

   4. TDTim Dillon57:22

      No.

   5. JCJason Calacanis57:22

      ... that you put th- you put the phones in. Eh, what was that moment in time like to-

   6. TDTim Dillon57:26

      I was told by co- countless executives to play up my Indian-ness, and I tried.

   7. JCJason Calacanis57:30

      Yes. You tried.

   8. TDTim Dillon57:30

      But it was just in bad taste.

   9. JCJason Calacanis57:33

      (laughs) Yes.

   10. TDTim Dillon57:34

       It was in terrible taste when I came in and I (laughs) tried to be Indian, and, and it-

   11. JCJason Calacanis57:38

       Mm-hmm.

   12. TDTim Dillon57:38

       It just wasn't good. No, I think ... Here's what it was. I started, you know, uh, uh, you know, having more of a career in, let's say, 2016, 2017, 2018, and then we were kinda on this path where you'd go have a meeting in, in Los Angeles with people about doing a show or whatever, and they would start. All of these words and verbiage would creep in. They'd go, "We're really interested in marginalized voices, elevating voices that haven't been heard. We're interested in empowering pe-" And th- these were LA executives. They're monsters. They care nothing about anything, and that's why they're good at their job, right? The only reason you can be good at your job as an executive in the entertainment business is to really not look at human beings as humans. You have to look at them as products.

   13. JCJason Calacanis58:18

       Objects. They're objects.

   14. CPChamath Palihapitiya58:20

       (laughs)

   15. TDTim Dillon58:20

       That's, eh, eh, that's what you do.

   16. JCJason Calacanis58:20

       Yes. Manipulated.

   17. TDTim Dillon58:21

       Right?

   18. JCJason Calacanis58:21

       Pawns on a chess board.

   19. TDTim Dillon58:22

       It's what it is. You know what I mean?

   20. JCJason Calacanis58:24

       Who puts the nature on it.

   21. TDTim Dillon58:24

       If I called my agent today and said, "I'm really tired doing everything I'm doing," he'd say, "Have you tried drugs?" Like, they-

   22. JCJason Calacanis58:30

       Right? This would be a ... Wh-

   23. TDTim Dillon58:32

       (laughs) Yes.

   24. JCJason Calacanis58:32

       I was wondering about that.

   25. TDTim Dillon58:33

       (laughs)

   26. JCJason Calacanis58:33

       Because you have such high energy. I don't-

   27. TDTim Dillon58:35

       Yeah.

   28. JCJason Calacanis58:35

       ... know why you're not embracing the cocaine or speed-

   29. TDTim Dillon58:39

       No, I don't need it.

   30. JCJason Calacanis58:39

       ... or Adderall.

Episode duration: 1:38:34