Can Flock cameras fight crime without destroying privacy?

Kara Swisher 0:00 There are legitimate worries about surveillance

Chris Larsen 0:03 I talked to my son about that. He's 19, and he always gives me a hard time. "I can't... You're doing this surveillance thing. What are you doing?" And I was like, "Well, we cut down on crime, you know, 70% smash and grab." He said, "I'd rather have the crime than the surveillance."

Kara Swisher 0:15 It is on. [upbeat music] Hi, everyone. My guest today is Ripple co-founder Chris Larsen, a crypto billionaire who's poured his money and influence into reshaping San Francisco. His vast surveillance camera network has been credited with helping reduce crime and criticized for expanding private surveillance across the city. We'll get into that, along with AI reform, crypto regulation, and national politics. Chris is a really complex thinker, and he takes positions that don't always align with any political party, and he often is on the cutting edge of some issues that are important, so I really wanted to talk to him. We recorded this conversation live at San Francisco's Pier 27 as part of the Odoo Experience. Let's get into it. Chris, why don't we just sort of get your assessment of San Francisco right now? Because it really ha- there was, of course, the Fox News period where everything was doom and gloom. Mu- much of it-

Chris Larsen 1:09 Right

Kara Swisher 1:09 ... much of them, what they were saying were lies.

Chris Larsen 1:11 Yeah.

Kara Swisher 1:12 Um, talk a little bit about how you look at San Francisco as an innovation center right now.

Chris Larsen 1:17 Yeah. Well, first of all, I mean, the city's really doing great. We've really, uh, come back.

Kara Swisher 1:21 Mm-hmm.

Chris Larsen 1:21 Uh, we were... Uh, we had some problems, right? Uh, a lot of those were political, self-inflicted wounds. Um, but, you know, we've got a fantastic mayor now, Mayor Lurie. Uh, and we've, we've really... Yeah, I think we should applaud. 74% approval rating.

Kara Swisher 1:36 Mm-hmm.

Chris Larsen 1:36 That's incredible in San Francisco. But we, I think we fixed our public safety problem as well. W- we were, you know, the nation's capital as, in terms of smash-and-grab-

Kara Swisher 1:45 Mm-hmm

Chris Larsen 1:45 ... crimes, which are not violent crimes, but they are the kinds of crimes that make people say, "I just don't wanna go into the city, and I, and I don't wanna have my workers there." It's like 25,000 smash-and-grab incidents that were reported every single year. That's down now 70%.

Kara Swisher 2:00 Mm-hmm.

Chris Larsen 2:01 And it's because we've, uh, given the police the right tools. The voters, uh, approved Prop E back in, uh, 2024. That gave them drones, uh, these license plate readers. I know there was some controversy on-

Kara Swisher 2:12 We're gonna talk about that

Chris Larsen 2:13 ... cameras. [laughs] Um, but it's been incredibly effective. Uh, b- and we've stood up something called a real-time investigation center. So that's a game changer because now instead of, you know, there's a crime, and it gets reported, and it's too late, everybody's gone, nothing can be done about it, that's how it used to be. Now they're catching these smash-and-grab crews in real time.

Kara Swisher 2:34 Mm-hmm.

Chris Larsen 2:34 They get one incident, and these folks sort of come into the city. They do 10 hits a day f- uh, of, of, uh, uh, crimes. Now you see one of them, we send a drone over to witness them, uh, doing a second act. With the license plate readers, we can see where they're going. You, you send a, uh, unmarked police car with a plaincl- uh, closed police officer in it. They put a spi- a, a, a spike strip out right when they're going by. And, and they've basically eliminated these crews. And even the crews are talking about this on some of their podcasts. Believe it or not, they have podcasts.

Kara Swisher 3:08 Mm-hmm. Mm-hmm.

Chris Larsen 3:08 Um-

Kara Swisher 3:08 As they should

Chris Larsen 3:09 ... which is, as they should. [laughs] Um, but it's, it's great news because nothing works unless you have public safety.

Kara Swisher 3:15 Right.

Chris Larsen 3:15 And that's why the mayor says this is number one objective, still is. And then you need clean streets, and we've made a lot of progress there. Obviously, we had a big homeless, uh, problem. Still have some work to do there, but we've made a ton of progress in making sure that, particularly in the Tenderloin, that that doesn't become a containment zone.

Kara Swisher 3:34 Mm-hmm.

Chris Larsen 3:34 So you can see the results, and I think that set the stage for this AI boom, that people wanted to be right here.

Kara Swisher 3:40 Mm-hmm.

Chris Larsen 3:40 And that's great news obviously for not just the city, but for the state. It's literally like the entire world is sending us a check, and, you know, that's been a real blessing.

Kara Swisher 3:48 Talk a little bit about the AI boom. It's the latest. Obviously, you and I have been through several of these-

Chris Larsen 3:53 Oh

Kara Swisher 3:53 ... you know, um, where, where it grows and then it comes back. And San Francisco itself has gone through many of these.

Chris Larsen 3:58 But we're a boom-bust city, for sure.

Kara Swisher 3:59 Right.

Chris Larsen 3:59 Always have been.

Kara Swisher 4:00 But talk about the current one because o- obviously, people are worried about the AI boom turning into an AI bubble, and we'll get to that in a second. But what, what, why are they coming back to San Francisco? I, uh, I often tell the story of this one guy. Like, they all left all of a sudden for Miami or Austin-

Chris Larsen 4:16 Mm

Kara Swisher 4:16 ... or wherever they wanted. I know. [laughs] It's like it's hot and wet there, and it's hot and dry there. Um, but they all were, like, trying to tout and sort of kicking San Francisco on the, the place where they made their fortunes, which I thought-

Chris Larsen 4:27 Right

Kara Swisher 4:27 ... was particularly ungrateful. Um, but they had to kick it at the same time. And so I was a- I was at, um, a, a res- a really good restaurant here, a, a, a place. Tart- it was a Tartine, actually, down-

Chris Larsen 4:40 Mm-hmm

Kara Swisher 4:40 ... down over that way. And we, I was with a very well-known AI person, and we saw this guy from across the room, a big table of people eating the delicious food of Tartine. [laughs] And we went over and we're like, "Get the fuck out of here."

Chris Larsen 4:53 [laughs]

Kara Swisher 4:53 "You can't have our food. What are you do-" Of course, had moved back.

Chris Larsen 4:55 [laughs]

Kara Swisher 4:56 But still continued to pretend they were conducting themselves in Miami, where none of that happened. Is there something about San Francisco in your, like, uh, is there, uh, in this world of digital, is the, is place important anymore for innovation?

Chris Larsen 5:10 Uh, I think place is super important. I mean, what we have here, I think it's a, it's a fine soufflé that's, uh, very hard to replicate.

Kara Swisher 5:17 Mm-hmm.

Chris Larsen 5:17 You've just got the right amount of, you know, obviously, major capital that's just down the street. But you've also got still the remnants of the hippie movement, right?

Kara Swisher 5:26 Mm-hmm.

Chris Larsen 5:26 Um, you've got all kinds of, uh, experiment- uh, experiential, uh, ideas around art, uh, that you don't see anywhere else. I think even Burning Man is a, a great influence for sort of creativity going big.

Kara Swisher 5:37 You're going tomorrow, right?

Chris Larsen 5:39 We'll go tomorrow. Absolutely.

Kara Swisher 5:40 Have fun.

Chris Larsen 5:40 It's, uh, as a lot of people say, you can't understand Silicon Valley-

Kara Swisher 5:43 He asked if I was going. I laughed in his face. [laughs]

Chris Larsen 5:45 We'll get you there one day.

Kara Swisher 5:46 No, you never will. Never.

Chris Larsen 5:48 [laughs] Okay. All right.

Kara Swisher 5:49 Not unless there's a Four Seasons Hotel there. I-

Chris Larsen 5:51 [laughs] Okay, good point.

Kara Swisher 5:53 Yeah.

Chris Larsen 5:54 Um, but you know, it's, it's the creative energy-

Kara Swisher 5:57 Mm-hmm

Chris Larsen 5:57 ... um, thinking differently. Um, art and, and engineering, that's kinda what goes on there. But-

Kara Swisher 6:02 Yeah

Chris Larsen 6:02 ... uh, I think that's what you have here.

Kara Swisher 6:04 Mm-hmm.

Chris Larsen 6:04 And that's very hard to replicate. Everybody always says, "Hey, we're gonna build a Silicon Valley." It's not happening.

Kara Swisher 6:09 Right.

Chris Larsen 6:09 And the concentration of, uh, venture capital here, when you look at AI, I mean, it's, it's just off the charts compared to anywhere else.

Kara Swisher 6:16 Mm-hmm.

Chris Larsen 6:16 Uh, that says a lot. You know, you gotta admit, like, California's had some problems. San Francisco-

Kara Swisher 6:20 Mm

Chris Larsen 6:20 ... we've had our problems. Yet despite all of that, this is still the place where people came to think the impossible.

Kara Swisher 6:28 Mm-hmm.

Chris Larsen 6:28 And th- and this is where they're setting their, their, their companies at.

Kara Swisher 6:31 Why is that from your per- I was thinking about this last night. We had a reunion of our Recode staff, but I really did say that same thing.

Chris Larsen 6:37 Mm.

Kara Swisher 6:37 What is your reasoning for it? What creates the current AI boom, and what is the worry you have around, obviously the, the inflated, possibly inflated valuations, et cetera?

Chris Larsen 6:47 Well, there's a lot to be worried about with AI. We could talk about that.

Kara Swisher 6:49 We're, we're gonna talk more in detail.

Chris Larsen 6:50 But I think, um, this is still a place where you come up with a crazy idea, people are not going to talk you out of it-

Kara Swisher 6:57 Mm-hmm

Chris Larsen 6:57 ... or talk about how stupid it is. Every idea I've ever had, and I t- talk to my friends around here, and it's like, "Oh, right on. Go for it. That sounds awesome."

Kara Swisher 7:05 Mm-hmm.

Chris Larsen 7:05 And that matters, actually. And then I think the other thing is you have a lot of sort of veterans who have been how many cycles now?

Kara Swisher 7:12 Mm-hmm.

Chris Larsen 7:12 Who stayed here even after they made their fortunes-

Kara Swisher 7:15 Mm

Chris Larsen 7:15 ... 'cause it's a wonderful place to live.

Kara Swisher 7:16 Mm-hmm.

Chris Larsen 7:17 And there is a notion of sort of, uh, paying it back, right? So like, I had a lot of mentors that helped me, that I wouldn't be here if it wasn't for one sentence a couple of people said at the right time.

Kara Swisher 7:29 Mm-hmm.

Chris Larsen 7:30 And I think we all remember that, and then you try to help the next group that are, that are coming around. So even if you're not involved with AI, which is, you know, a lot of young folks are, are just doing incredible work, um, you might be involved just from sharing your experience or sharing your encouragement. Um, that's a, that's a very hard thing to replicate as well.

Kara Swisher 7:51 I- in a place

Chris Larsen 7:51 And we have it here.

Kara Swisher 7:52 In a place. Um, uh, so let's go through some stuff that you've been involved in as an entrepreneur. Uh, I wanna... We're gonna through a whole range of different things, from cryptocurrency, uh, to politics. But let's start with some news. The Digital Asset Market Clarity Act, which the White House says will provide a regulatory framework for cryptocurrencies, is set to have a procedural vote in the Senate later this month, September 15th, actually. President Trump has been putting a lot of pressure on lawmakers to get this passed. Talk about where you are on this. Obviously, the Trump administration has been friendly towards cryptocurrency and friendly to himself, uh, in terms of benefiting himself rather.

Chris Larsen 8:27 Well it's-

Kara Swisher 8:27 He's just a good businessman, people.

Speaker 8:29 [laughing]

Chris Larsen 8:33 Let me go in this direction over here.

Kara Swisher 8:34 Okay. [laughs]

Chris Larsen 8:35 So-

Kara Swisher 8:35 [laughs] Well done. Well done, Chris

Chris Larsen 8:37 ... uh, no, you know, obviously, we've been very involved with crypto policy going back-

Kara Swisher 8:42 Mm-hmm

Chris Larsen 8:42 ... it's going fif- 13 years now.

Kara Swisher 8:44 Mm-hmm.

Chris Larsen 8:44 Since 2012 is when we started out. There was nothing on the books there. We were all paranoid. We were always gonna be arres- arrested at any moment, right?

Kara Swisher 8:51 Mm-hmm.

Chris Larsen 8:51 For sort of counterfeiting or whatever, a million different worries that you could have. Um, and some, you know, some progress was made over the years, but then we had the Biden administration. I was a big backer of Biden and, and, and Kamala for president, but they really screwed up here.

Kara Swisher 9:06 Mm-hmm.

Chris Larsen 9:06 They really screwed up. They were supposed to be a sort of a moderate governing, you know, regime, and they outsourced their financial regulation to the Elizabeth Warren wing-

Kara Swisher 9:16 Mm-hmm

Chris Larsen 9:16 ... and Gary Gensler, who were determined to block any regulation specifically designed for the industry, which is a completely novel industry. It didn't fit into anything that we had, and they went after this sort of regulation by enforcement lawsuit, uh, approach, I think designed to hobble the industry or destroy the industry. They just got it in their heads that this was all bad. And, and obviously, lots of just bad stuff happens in any technology boom.

Kara Swisher 9:42 Mm-hmm.

Chris Larsen 9:42 But there's a lot of great stuff here in modernizing the world's financial infrastructure, uh, tokenizing assets to make them cheaper to trade globally. Uh, uh, lots of great s- uh, stuff, and they didn't go in that direction at all. So we had a very anti-, uh, crypto regime. And as you know-

Kara Swisher 9:58 Mm-hmm

Chris Larsen 9:58 ... we were sued by the Biden administration, Gary Gensler. We had a four-year battle. It was brutal. We were lucky we survived it. We spent $150 million defending ourselves. We ended up winning.

Kara Swisher 10:10 Mm.

Chris Larsen 10:10 I think right after I saw you last-

Kara Swisher 10:12 Yeah

Chris Larsen 10:12 ... uh, on your show in 2023, maybe a week after that.

Kara Swisher 10:15 Mm-hmm.

Chris Larsen 10:16 Um, we did get a favorable ruling, um, but it was brutal. And if we didn't have a lot of money, we were in a, a small startup, we would've been finished.

Kara Swisher 10:23 Mm.

Chris Larsen 10:23 And that's just not right. So we wanted new regulations that were specific to the industry. This administration obviously been very pro and wants to be the, uh, crypto, you know, leaders of the world. Um, and they have so far gotten through one bill, the, the Genius, uh, Act, f- uh, that regulates stable coins. That's a really important-

Kara Swisher 10:45 Mm-hmm

Chris Larsen 10:45 ... development. So that's now clear. But we need this market structure bill, kind of maybe even the more important bill called the Clarity Act.

Kara Swisher 10:53 Mm-hmm.

Chris Larsen 10:54 Boy, it's been negotiated here now for a long time. It's been really tough, but I think there is bipartisan support. We're hopeful we get it through because we need to get this, um, offic- you know, a really official rule so that people know what to do, so consumers know what to expect. It's better to have, uh, more regulation that's clear-

Kara Swisher 11:14 Mm-hmm

Chris Larsen 11:14 ... than no regulation, and that's what we want.

Kara Swisher 11:16 H- where do you expect it to pass, or where is it at this point?

Chris Larsen 11:19 It's still tough. Uh, there's still some tricky areas around ethics-

Kara Swisher 11:24 Mm

Chris Larsen 11:24 ... uh, that the Dems, uh, uh, want to see happen. I get why they want that to happen. I just hope we can get a compromise that, that works because no bill is actually worse. For, you know, how ethics go forward-

Kara Swisher 11:38 Yeah

Chris Larsen 11:38 ... it would be better to have as strong a, a, a bill as we can possibly get.

Kara Swisher 11:42 What's the most important part of this bill from your perspective?

Chris Larsen 11:45 The most important part of it is defining what is a commodity, what is a security.

Kara Swisher 11:50 Security.

Chris Larsen 11:50 That's always been-

Kara Swisher 11:51 Right. It's always been the issue

Chris Larsen 11:51 ... always been the hang-up.

Kara Swisher 11:53 Mm-hmm.

Chris Larsen 11:53 And we got clarity in our court decision, but most of the other players don't have that.

Kara Swisher 11:59 Mm-hmm.

Chris Larsen 11:59 And, uh, if you don't have that clarity, I think the problem is, could be, from one administration to the other, you're just whip-sawing back and forth.

Kara Swisher 12:06 Right.

Chris Larsen 12:06 And that's just no way to have

Chris Larsen 12:08 a market work.

Kara Swisher 12:08 Which won't grow. And of course, the crypto industry hit back hard against Democrats. And Sherrod Brown lost his, was sort of widely derided by the crypto industry. In loss, he looks like he's gonna be back. Um-

Chris Larsen 12:20 Yeah. I, I love Sherrod, and that was unfortunate. He, I think, again, his staff went in the wrong direction. I don't think it was him. Uh, he was more of an Elizabeth Warren-type influence on his staff.

Kara Swisher 12:30 So you like her, Elizabeth, right? [laughs]

Chris Larsen 12:34 Um, I used to. I really did. But I-

Kara Swisher 12:35 Yeah

Chris Larsen 12:35 ... I, I don't like what she's been doing lately. She kind of leaned into the anti-tech, anti-innovation-

Kara Swisher 12:41 Yeah

Chris Larsen 12:41 ... uh, lane.

Kara Swisher 12:41 Well, it's a good fertile field, by the way. Um-

Chris Larsen 12:44 True

Kara Swisher 12:44 ... so White House disclosure, but you do have these problems. You talked about this ethics issue. White House disclosure forms show President Trump made more than $1.5 billion from crypto investments last year. It- should there be some laws in place to prevent government officials from, uh, profiting off of cyber, uh, currency?

Chris Larsen 13:00 I think no question. Uh, same with stock trading. We see that in both parties. But, uh, absolutely, we need a lot of, there's a lot of work to be done there as far as how our government works.

Kara Swisher 13:08 And then what, what does it do for the pe- the citizens that are worried about corruption or, you know, crime and, uh, there are legitimate issues.

Chris Larsen 13:19 There are, but it's still a, it's a pretty regulated business already, right? I mean, finance, fintech, I always think is very different from, let's say, communications, right? Communications, you have First Amendment, so it's much harder to regulate, and you have these problems with the social, you know, media companies on that score.

Kara Swisher 13:35 Mm-hmm.

Chris Larsen 13:35 But what, you, financial, uh, transactions, you don't have a First Amendment on, right? So you don't have the freedom to do a lot of things you see in traditional data companies.

Kara Swisher 13:45 Mm-hmm.

Chris Larsen 13:45 So it's already heavily regulated. Um, but this just makes it clear in, in, in this specific industry, which I think the big thing here is it's making the traditional financial industry embrace it and modernize some of their systems and make them faster, cheaper, more global.

Kara Swisher 14:01 Which they seem eager to get into. They do seem.

Chris Larsen 14:04 I think it's this notion of an internet of value. We have an internet of information. It, the world works better if you have an internet of value, and value is different than information, uh, for all kinds of reasons. Um, that's a good thing for the world, and you need the clarity of regulation for the big guys to really step in for... They're, they're in pretty good right now, but this would really settle a lot of questions and give them the confidence to invest, you know, a decade out.

Kara Swisher 14:29 But you would be for a stipulation that government officials shouldn't be profiting?

Chris Larsen 14:34 Sounds good to me.

Kara Swisher 14:35 Yeah.

Chris Larsen 14:35 Yeah. I don't think they should be able to trade stocks or-

Kara Swisher 14:37 Mm-hmm

Chris Larsen 14:37 ... any of this stuff, and you see a lot of that going on.

Kara Swisher 14:39 Yeah.

Chris Larsen 14:39 Doesn't make sense to me.

Kara Swisher 14:40 Yeah, absolutely. We probably should pay them more than, or something.

Chris Larsen 14:44 I agree with you on that one.

Kara Swisher 14:46 Yeah.

Chris Larsen 14:46 Yeah. And here in San Francisco, too, it's crazy the responsibility they have and how little they make, and I think that just sets up all kinds of problems.

Kara Swisher 14:53 So, um, last time we were on stage together, we talked a lot about the balance between surveillance and civil liberties. Um, and recently, the debate was brought right to your front door.

Chris Larsen 15:01 Mm.

Kara Swisher 15:01 In the past few years, you've helped fund an extensive surveillance network throughout San Francisco that now allows police to monitor residents in real time, with the goal of catching suspects, as you noted. You've said you have bright lines around surveillance are no facial recognition and profiling and no stop and frisk. Um, talk a little about this. There are people, you talked backstage, my son is worried about it, yours. [chuckles]

Chris Larsen 15:22 Yeah. Mm-hmm.

Kara Swisher 15:23 So talk a little bit about this, 'cause part, it, part, it, immediately when I see your name, it's like, "Oh, the surveillance guy." I'm like, "It's a little more complex than that." And then I-

Chris Larsen 15:30 It is. Yeah

Kara Swisher 15:31 ... don't want, I get exhausted trying to explain it. But there are legitimate worries about surveillance, given it could go a very different and very ugly way. You just have to look to China. You have to look to a lot of the autorit- authoritarian countries. Talk a little bit about this.

Chris Larsen 15:46 Yeah, it's almost the issue of our day, and you're right. I talk to my son about that. He's 19, and he always gives me a hard time. "I can't believe you're doing the surveillance thing. What are you doing?" And I was like, "Well, we cut down on crime, you know, 70% smash-and-grabs." He said, "I'd rather have the crime than the surveillance." Like, ugh. You know, so- [laughs]

Kara Swisher 16:02 [laughs]

Chris Larsen 16:02 ... I get it. You know, this is a-

Kara Swisher 16:04 Yeah, yeah

Chris Larsen 16:04 ... this is a, this is a tough issue.

Kara Swisher 16:05 Right.

Chris Larsen 16:05 It's a really tough issue. You know, but in '24, that's when the voters of San Francisco approved Prop B. That's, that's what allowed the police to have these tools for the first time.

Kara Swisher 16:15 Mm-hmm.

Chris Larsen 16:15 And again, it was a game changer. It's incredible th- to think that's only two years ago.

Kara Swisher 16:18 Mm-hmm.

Chris Larsen 16:19 So the world has changed so much. And, you know, there wasn't a lot of opposition. Now it's tremendous opposition.

Kara Swisher 16:25 Right. Well-

Chris Larsen 16:26 Last year, and certainly in '24, I think people saw Flock cameras as a tool.

Kara Swisher 16:31 Yeah.

Chris Larsen 16:31 "Oh, great. Sounds good. We're gonna catch the, all the, all these smash-and-grabbers." Now, huge opposition, right?

Kara Swisher 16:36 Mm-hmm.

Chris Larsen 16:36 It's called Deflock movement, literally.

Kara Swisher 16:38 Right.

Chris Larsen 16:38 Um-

Kara Swisher 16:39 Well, because, well, there's a reason for it. Let me just, the, the Flock cameras, for people who don't know, it's automatic license plate readers. They've been getting a lot of bad press. There have been multiple reports across the country of police officers using Flock cameras to stalk people, including ex-wives and girlfriends. A lot of common sense oversight, uh, tools like requiring officers to enter a case number for running a place just don't exist now. A feature has become mandatory, uh-

Chris Larsen 17:02 Hmm

Kara Swisher 17:02 ... on January 1st. So ta- uh, 'cause if, my whole premise of a lot of this stuff is that if it's become a tool, it can become a weapon instantly.

Chris Larsen 17:11 For sure. And-

Kara Swisher 17:12 And-

Chris Larsen 17:12 Yeah

Kara Swisher 17:13 ... and anticipation of that never happens.

Chris Larsen 17:15 Yeah. And, and I think the thing that's really changed, two things. One, I think the AI arms race I think is so unpopular, and we can talk about that later as well. Uh, it's caused so much mistrust. That's one thing. And then, of course, we have this disaster with ICE-

Kara Swisher 17:31 Mm-hmm

Chris Larsen 17:31 ... where literally Americans are being killed, and people are being scooped up. And put in God knows where. That's not what voters signed up for. I think those two things, together with new surveillance tools, that's what's making people upset.

Kara Swisher 17:45 Nervous.

Chris Larsen 17:46 Nervous.

Kara Swisher 17:46 Yeah.

Chris Larsen 17:46 Rightfully. I totally get it. Um, so I think-

Kara Swisher 17:49 I mean, I have no question in my mind that Mark Wayne Mullen would use these tools to abuse citizens. No question at this point.

Chris Larsen 17:56 Uh, y- you know, I, I, I totally get it. I think this is gonna be the issue of w- of the day, though, is, uh, because this is, it's a trade-off always, public safety-

Kara Swisher 18:04 Mm-hmm

Chris Larsen 18:04 ... and privacy, and, you know, just being able to not be seen. Um, where is that line? I think the line is gonna be moving. I think what it says, though, is that governments, including San Francisco, and San Francisco's really good on this, right? So their use of these tools, by the way, are incident-based. So they're not just doing surveillance and looking everywhere and trying to see if somebody's doing something wrong. It's when you get a report of a smash-and-grab, uh, incident or a strong-arm robbery, then a drone is gonna be sent over there. That's what they do, but I get it. You know, people are still uncomfortable 'cause it could change. But again, I think San Francisco could do, needs to do a better job. San Francisco keeps Flock information for a year.

Kara Swisher 18:45 Mm-hmm.

Chris Larsen 18:45 That's way more than the average. The average is about 30 days. And Flock just, ch- 'cause they know they're under pressure, changed their default setting to seven days.

Kara Swisher 18:53 Mm-hmm.

Chris Larsen 18:54 And to go even further, New Hampshire just ha- um, has a, a, a law now that says Flock information can only be kept for three minutes. So three minutes to see if that matches a crime, and then you have to get rid of it. So I think we gotta tighten that up here in San Francisco, and, um, hopefully we can do that soon. Another thing when I... You know, what's new is we've never had this many drones in the air. They're super effective, right? This is a drone as first responder. It's a huge force multiplier for the police. But we've never had 100 drones in the air owned by the government. We do now. Now, if you're on the street, you don't really have an ex- You know, you're, you're in public lands. That's one, that's, that's one thing. Y- y- y- you can never pick up audio in, in our systems. That's important, right? Ring cameras do, for example. But you can pick up people's backyards from a drone. I would like to see those, uh, those technologies blacking out people's backyards, uh, blacking out people's decks, places that are private, so that, uh, 'cause, uh, again, I think people are bothered by this, right?

Kara Swisher 19:58 Mm-hmm.

Chris Larsen 19:58 So-

Kara Swisher 19:58 So t- so people are bothered. Demonstrators with Sunrise Movement gathered outside your house to, um-

Chris Larsen 20:04 They did

Kara Swisher 20:04 ... protest your support of these tools. Um, y- this backlash, are you... Uh, uh, uh, i- i- it has to do with a lot of abuse that is, that no one thought of. And I, I recall when I saw Facebook Live for the first time, I was sitting in a room, and I said, "Okay, what are you gonna do about bullies, murderers, suicides?"

Chris Larsen 20:23 Yeah.

Kara Swisher 20:23 Um, uh, someone strapping a GoPro on their helmet and shooting a church-

Chris Larsen 20:28 Yeah

Kara Swisher 20:28 ... or a synagogue. I was like, "What are your tools to deal with this if this happens?" And literally, the tech said to me, "You're a bummer."

Chris Larsen 20:36 [laughs]

Kara Swisher 20:37 And I was like, "Yeah, I'm a bummer."

Chris Larsen 20:39 Yeah.

Kara Swisher 20:39 "So is the human race."

Chris Larsen 20:40 Yeah.

Kara Swisher 20:40 "So I don't know what to tell you." Why isn't there, uh, uh, any kind of, uh, transparency around the consequences for people to decide on? Because voters, I know they approved it, but if they understood how, how do we make it so that it's deeply transparent so they can make the trade-offs they want to?

Chris Larsen 20:58 Yeah. And w- and San Francisco does have multiple layers of approval on, you know, how these things are deployed. There are audits of them. But obviously, we have to do more because the, the temperature and the anger, again, I think people are putting all of these tools, and data centers are the expression of a great, uh, amount of anger and angst about this whole AI revolution we're living in right now.

Kara Swisher 21:23 Mm-hmm. I was talking to some of the people who are building these data centers, and they had me in, and they said, uh, "We'd really love your thoughts on why people are, uh, feeling this way." And I said, "They hate you."

Chris Larsen 21:34 [laughs]

Kara Swisher 21:35 You're, "And you're hateable."

Chris Larsen 21:37 Yeah.

Kara Swisher 21:37 Like, I don't know. Like, you know, there's an expression, a punchable face. I'm like, tech has a punchable face right now-

Chris Larsen 21:42 Yeah

Kara Swisher 21:42 ... in a way that deservedly kind of thing.

Chris Larsen 21:46 For sure.

Kara Swisher 21:46 And so, so th- these are all linked together.

Chris Larsen 21:49 Yeah.

Kara Swisher 21:49 And data centers, as you're right, is a proxy for having these AI companies tell us they're gonna take all our jobs. They're gonna kill us.

Chris Larsen 21:56 That's right.

Kara Swisher 21:56 They're gonna, "What, what are you doing here, human, still?"

Chris Larsen 21:59 Yeah.

Kara Swisher 21:59 "You're still here bothering me." Um, how do, how does it... Because at the same time, I just interviewed the mayor of Lansing, Michigan, which I talk about a lot because it was really striking. He put together a data center deal that was all the right things, uh, closed loop water, uh, payments to the, to the citizens, long-term property taxes. They had to pay the difference in any electrical problems-

Chris Larsen 22:21 Mm-hmm

Kara Swisher 22:21 ... so that rates wouldn't go up. Whole, everything, the, uh, total transparency. The, there was no NDAs. The citizens rejected it.

Chris Larsen 22:29 Yeah. Yeah.

Kara Swisher 22:30 Rejected it.

Chris Larsen 22:31 Yeah.

Kara Swisher 22:32 So there's no, no amount of money or promises were believed in any way.

Chris Larsen 22:38 Yeah.

Kara Swisher 22:39 So why should we believe you? Not you, but you know.

Chris Larsen 22:43 Yeah.

Kara Swisher 22:43 Why should we believe tech at this point when that happens, when there's things that are beneficial, like you're talking about?

Chris Larsen 22:49 Right. Yeah, I'd almost separate tech from the AI arms race.

Kara Swisher 22:53 Mm-hmm.

Chris Larsen 22:53 And the, there is an AI arms race that's completely out of control. It's all gas, no brake, no steering.

Kara Swisher 22:59 Mm-hmm.

Chris Larsen 22:59 And of course, that's gonna end badly.

Kara Swisher 23:01 Mm-hmm.

Chris Larsen 23:01 And I would say that's AI insanity.

Kara Swisher 23:03 Mm.

Chris Larsen 23:03 Yet it continues. And when you have companies, I mean, they're so wealthy, and they're, and I mean, the, the future wealth is staggering when we think about it. Um, but when you have them telling you, "Hey, we invented fire."

Kara Swisher 23:16 Mm-hmm.

Chris Larsen 23:16 "We invented nuclear, [laughs] you know, energy. Um, you know, uh, and this is really dangerous, and it's gonna destroy jobs, and it's gonna hurt, you know, kids and take over humanity." And then 20 minutes later, they're releasing the new super powerful model.

Kara Swisher 23:31 Mm-hmm.

Chris Larsen 23:32 Uh, you know, w- I don't, I just don't know how you reconcile that. And then I think everybody understands, like, that's not good. Um, so I think the data center, um, opposition, which is staggering-

Kara Swisher 23:44 Mm-hmm

Chris Larsen 23:45 Uh, maybe that's healthy. That's the way to sort of stop it, slow it down, or force regulation-

Kara Swisher 23:50 Mm-hmm

Chris Larsen 23:50 ... you know, in that industry. 'Cause the other thing the industry is doing is they sort of tried to take a reverse page out of the crypto industry-

Kara Swisher 23:57 Mm-hmm

Chris Larsen 23:57 ... setting up super PACs, but to crush anybody that dared come up with any guardrails.

Kara Swisher 24:03 Mm-hmm.

Chris Larsen 24:03 And you saw this-

Kara Swisher 24:04 Yeah

Chris Larsen 24:04 ... in the Alex Boris race, right?

Kara Swisher 24:06 Mm-hmm.

Chris Larsen 24:08 Um, that doesn't make any sense, right? So you actually need people now to be, um, really s- leaders, to be smart, and to be working on these guardrails, and maybe even slowing it down.

Kara Swisher 24:20 Well, yesterday Donald Trump told people they were stupid and poor if they didn't go along with it. Howard Lutnick said no water would be involved. He's such a moron. Um-

Chris Larsen 24:30 Well, the, the weird thing about that is, uh, which I don't get, is the MAGA movement is actually pretty aligned on this.

Kara Swisher 24:36 They are.

Chris Larsen 24:37 Uh, they don't trust these companies.

Kara Swisher 24:39 They do not.

Chris Larsen 24:39 Uh, they are very concerned about kids and families and loss of jobs.

Kara Swisher 24:42 Yeah.

Chris Larsen 24:42 I mean, that's exactly what we talk about here, right?

Kara Swisher 24:44 Well, that's where you see Marjorie Taylor Greene and Elizabeth Warren coming together in a big blob. It's really [chuckles] an interesting and strange-

Chris Larsen 24:49 Yeah, and you saw some of the child protection folks getting together. Steve Bannon on this issue.

Kara Swisher 24:53 Yeah.

Chris Larsen 24:54 And by the way, I think that's good news. This is maybe one area we can find-

Kara Swisher 24:56 Oh, nothing with Steve Bannon is good news.

Chris Larsen 24:58 [laughs]

Kara Swisher 24:58 But that's fine.

Chris Larsen 24:58 But that's kind of encouraging.

Kara Swisher 24:58 All right, sure. Something came up in our last conversation that democracy is messy. We talked about it, and why, uh, why you said you'd rather vomit blood out of your eyeballs, I don't know how you would do that-

Chris Larsen 25:08 Okay [laughs]

Kara Swisher 25:08 ... than run for office. Um-

Chris Larsen 25:10 Still

Chris Larsen 25:11 true.

Kara Swisher 25:11 But there is the worry about billionaires, you know, using your money to, to just fund it.

Chris Larsen 25:17 Mm-hmm. Yeah.

Kara Swisher 25:17 Like u- using your money to fund these agencies to g- do fast track adoption, um, without having enough people coming in on it, like enough citizens being able to do that.

Chris Larsen 25:28 Yeah. Uh, for sure. Look, there's way too much money in politics. The Supreme Court made a huge mistake with Citizens United and with gerrymandering. Uh, that should be the top two things that we try to change in hopefully our next administration if we can do that. Um, but it is the rules of the game, so I mean, if you wanna get involved in policy, you have to play that, uh, that game, unfortunately. Um, we can't let the oil industry sort of dictate energy pri- uh, policy, and then have the solar folks, for example, sit back and go, "Oh, look at our lovely product. I hope everybody lo- loves it." No, it doesn't work that way. You gotta get out there and fight.

Kara Swisher 26:04 Mm-hmm.

Chris Larsen 26:04 You know, uh, this is politics. It's not a, it's not a pillow fight.

Kara Swisher 26:08 So speaking of that, according to The New York Times, you spent about $3.5 million on Alex Boris, who's-

Chris Larsen 26:12 Mm-hmm

Kara Swisher 26:13 ... who was under attack from OpenAI for his AI safety advocacy.

Chris Larsen 26:17 Right.

Kara Swisher 26:17 Um, why was that fight... I wasn't surprised you were there, but others were, like, that you were there. Um-

Chris Larsen 26:23 Well, it was just this totally obnoxious fucking thing from this Greg Brockman, like 50 million bucks he's gonna drop on Alex's head for him to dare-

Kara Swisher 26:31 [chuckles]

Chris Larsen 26:31 ... to come up with any kind of gui- guideline.

Kara Swisher 26:32 Greg Brockman is one of the, one of the cr- one of the top executives at OpenAI.

Chris Larsen 26:35 President. President.

Kara Swisher 26:36 President, right.

Chris Larsen 26:36 And they try to say, "No, that wasn't OpenAI." Of course it was.

Kara Swisher 26:39 Mm-hmm.

Chris Larsen 26:39 It was a s- it was a strategy.

Kara Swisher 26:41 Mm-hmm.

Chris Larsen 26:41 And so that was just wrong. And, um, you know, we wanted to show that people that, you know, like Alex and, um, obviously Scott Wiener here, and, uh, Manny, uh, Rutinel in Colorado, who did win, we put a million bucks into that race, that they're gonna ha- we're gonna have their backs.

Kara Swisher 26:58 Mm-hmm.

Chris Larsen 26:58 That we're gonna support you to defy this big money.

Kara Swisher 27:02 Mm-hmm.

Chris Larsen 27:02 And we're talking about big money in AI. It's so big now.

Kara Swisher 27:05 It is.

Chris Larsen 27:05 It's, it's so scary what could be coming down the pike here.

Kara Swisher 27:09 Mm-hmm.

Chris Larsen 27:09 Um, but money doesn't always buy results when you have that much opposition.

Kara Swisher 27:15 Right.

Chris Larsen 27:15 Um, so I think that was important. You know, obviously Alex didn't win, but he came pretty close.

Kara Swisher 27:19 Right. But the... You just talked about money. The Guardrails Alliance, a new super PAC backed by tech workers, labor unions, and other rank-and-file workers are, are backed Boris. Uh, they were up against Leading The Future, which is, as you noted, Greg Brock's, uh, this, funded by OpenAI's president, uh, Greg, uh, Brockman. It is an operating budget of $100 million compared to Guardrail's goal to raise 15 million. You, you told The Times that OpenAI was, quote, "Trying to destroy and intimidate and send a clear message that if you do come up with clear guardrails, we're gonna crush you."

Chris Larsen 27:50 Oh, yeah.

Kara Swisher 27:50 So talk a little bit about this.

Chris Larsen 27:52 No, I mean, that's-

Kara Swisher 27:52 And just let... I'm sorry. Let me do one thing. You're an investor in Anthropic, which is OpenAI's main rival. Um-

Chris Larsen 27:58 Well, no, this is actually not true.

Kara Swisher 27:59 Okay.

Chris Larsen 27:59 I mean, it is true. I mean, I have indirect investments in OpenAI, Anthropic, and, uh, SpaceX.

Kara Swisher 28:05 Okay. All right.

Chris Larsen 28:06 So all the same.

Kara Swisher 28:07 Right. Okay. So all different people that we're doing.

Chris Larsen 28:09 Yeah.

Kara Swisher 28:09 Okay. So talk a little bit about this money differential because it's vast and there's plenty more coming.

Chris Larsen 28:16 It is, but I think the good news here is when you have that much opposition to what's going on, and it's clear you do, um, I think it's kind of ineffective. And you compare that to the crypto industry where you really didn't have a lot of opponents. You had sort of an Elizabeth Warren wing, but there isn't really sort of a populace that was sort of anti. And then on the other side, you had 50 million Americans trading crypto. That was, that was a big plus. That's not the case in, in the AI thing. Well, the, the AI thing is different. It's, this is not Airbnb. This is not Uber. It's not crypto. All of those had lots of policy implications, lots of political action committees. But those are, like, incremental things in how the world works. AI is, like, an existential threat to, like, human existence, right?

Kara Swisher 28:58 Mm-hmm.

Chris Larsen 28:58 This is a different thing. I mean, it is fire. Like, they invented fire, and then they're trying to say, "Oh, well, we don't need fire stations or fireproofing or" You know?

Kara Swisher 29:06 Mm-hmm.

Chris Larsen 29:07 Uh, it's just crazy.

Kara Swisher 29:08 Mm-hmm.

Chris Larsen 29:08 So it's a whole different beast, and I think the money isn't working.

Kara Swisher 29:12 Mm-hmm.

Chris Larsen 29:12 And if it w- if it had been working, you wouldn't have this kind of backlash.

Kara Swisher 29:15 Right.

Chris Larsen 29:15 And I think you can see-

Kara Swisher 29:16 But now they're trying to un-backlash it.

Chris Larsen 29:17 They're backing off, right?

Kara Swisher 29:18 Yeah.

Chris Larsen 29:19 They're trying to talk about how all the positives... And there are po- don't get me wrong.

Kara Swisher 29:23 Right.

Chris Larsen 29:23 This is a, uh, potentially a fantastic, you know, future that we could be living in, but only if we take the very, very difficult middle path between this AI insanity we're on now, this ar- this unmitigated arms race. Which by the way, Dar- you know, Anthropic and Dario, they're, they're doing better.

Kara Swisher 29:42 Mm-hmm.

Chris Larsen 29:42 But they're still in the arms race.

Kara Swisher 29:44 Right.

Chris Larsen 29:44 They're still re- releasing Like today, another powerful model with-

Kara Swisher 29:48 Mm-hmm

Chris Larsen 29:48 ... okay, this seems to be fine.

Kara Swisher 29:49 Mm-hmm.

Chris Larsen 29:50 Um, and warning about, a- about all the dangers that will happen. So we can't be on that path, and we can't be on the Bernie Sanders shut it all down, just walk away from it path. It's, as Tristan Harris in Center for Humane Technology, they do great work on this. Um-

Kara Swisher 30:05 Yeah, he's about to come out with some new stuff.

Chris Larsen 30:07 He's so good.

Kara Swisher 30:08 Yeah.

Chris Larsen 30:08 Um, but the- he- well, like he says, this is a very difficult middle path we need to walk. That means you need extraordinary, you, you know, brave political leaders who are knowledgeable, and you need a lot of, I think, the people in tech to stand up and to push back on the folks that are in the arms race bubble. They, they, they, they don't even... Some evil people, mostly good people doing really good work-

Kara Swisher 30:31 I think just one evil person's not good.

Chris Larsen 30:33 [laughs]

Kara Swisher 30:33 And we know which one that is.

Chris Larsen 30:34 Yeah, you can do a lot of damage, right?

Kara Swisher 30:35 Yeah.

Chris Larsen 30:35 But, uh, they're in a bubble though. They're not seeing this.

Kara Swisher 30:38 So why, why aren't they seeing this? I mean-

Chris Larsen 30:40 Well, I mean, a couple of things. I think, uh, many of them have. I mean, if you look at people that donated to Alex Boris, let me give some props to a lot of the open AI employees.

Kara Swisher 30:50 Mm-hmm.

Chris Larsen 30:50 Like, their leaders were doing one thing, but the employees were actually backing the Alex Borises. And if you look at, uh, a lot of the Anthropic employees, and Anthropic, I think, does a much better job-

Kara Swisher 31:00 They do

Chris Larsen 31:00 ... across the board. Um, what is it now they're involved with in this, uh, Alaska race?

Kara Swisher 31:05 Mm-hmm.

Chris Larsen 31:05 Because, uh, backing the candidate who's really good on AI regulation, that's encouraging.

Kara Swisher 31:11 Mm-hmm.

Chris Larsen 31:11 So maybe it's the leaders who are in a bubble, but the employees see the power and the danger of these things.

Kara Swisher 31:16 Well, you know w- w- you know them. I d- why do you think they're this way?

Chris Larsen 31:22 I mean, I do think you get in a bubble with anything. It's super exciting work. Um, you know, just the reaction of the world, I mean, in, like, what, four years, it's the only thing we talk about. Uh, it's pretty intoxicating, I'm sure, and they're also super working probably nonstop, probably no time to sleep, right? You, you do... I think you do get in a bubble. And-

Kara Swisher 31:43 You get in a bubble

Chris Larsen 31:44 ... they probably don't meet a lot of folks in places that are really concerned about this stuff.

Kara Swisher 31:49 Mm-hmm. Yeah, they, they don't. [laughs]

Chris Larsen 31:51 Yeah.

Kara Swisher 31:51 They don't, that's for sure. They live in their... They go from their planes to their houses to their-

Chris Larsen 31:55 But one thing I would say, I think, I think the social media miss, I mean, w- that w- we let that get away from us, right? I think that actually is some good news because we've seen this movie before.

Kara Swisher 32:06 Right.

Chris Larsen 32:06 And so it's pretty hard to, to, uh, to pitch all that BS, it's all good-

Kara Swisher 32:12 And you-

Chris Larsen 32:13 ... when we can see what happened

Kara Swisher 32:13 ... you're seeing that in these cases, these social media cases-

Chris Larsen 32:16 Yeah

Kara Swisher 32:16 ... which are going their way and using product liability as the way, um, we thought about this, right?

Chris Larsen 32:24 Yeah.

Kara Swisher 32:24 Product liability versus Section 230 or free speech, they're now losing.

Chris Larsen 32:29 Yeah.

Kara Swisher 32:29 And you saw this giant, uh, settlement, which is, is small, but it's bigger than, than I expected.

Chris Larsen 32:35 It's a good development.

Kara Swisher 32:36 It's a good development.

Chris Larsen 32:37 Mm-hmm.

Kara Swisher 32:37 And it's still not over.

Chris Larsen 32:38 That's exactly right.

Kara Swisher 32:39 So do you... Switching gears on this thing, you're against the billionaires tax, 'cause people are mad at billionaires. I don't know if you know that, but they are. Um, uh, even people who like money, like myself-

Chris Larsen 32:50 Mm-hmm

Kara Swisher 32:50 ... I'm mad at billionaires, right?

Chris Larsen 32:51 I can't wait to get back to 900 million and I can be a good person again. [laughs]

Kara Swisher 32:53 Okay. All right. [laughs]

Speaker 32:54 [laughs]

Kara Swisher 32:57 That's a good billionaire joke. Um-

Speaker 32:59 [laughs]

Kara Swisher 33:00 [laughs] And there's not that many, I can tell you.

Chris Larsen 33:02 [laughs]

Kara Swisher 33:03 Um, but, but, uh, talk about this-

Chris Larsen 33:05 Yeah

Kara Swisher 33:05 ... 'cause many people feel you're not paying your fair share. That's, I think, the, uh, issue. And the one-time 5% tax, what's the big deal?

Chris Larsen 33:15 Well, look, uh-

Kara Swisher 33:15 Also, we need your money. Thank you.

Chris Larsen 33:16 [laughs]

Kara Swisher 33:17 Just give it to us.

Chris Larsen 33:18 Okay. Everybody hates billionaires. If you wanna, if you wanna get even with the billionaires, make them stay in California, where they pay-

Kara Swisher 33:24 Mm-hmm

Chris Larsen 33:24 ... 13% and they don't get capital gains breaks.

Kara Swisher 33:26 Uh, make them stay. It's such a terrible place to live, but go ahead.

Chris Larsen 33:28 Well, I mean, it's good for the state, you know, the s-

Kara Swisher 33:31 Okay. All right. Okay.

Chris Larsen 33:31 You know, that's one thing. But-

Kara Swisher 33:32 Yeah

Chris Larsen 33:33 ... uh, look, it's a terribly designed, uh, bill, and I think Mark Cuban has made this point, right? Y- W- We both know in, in tech and in many small businesses, most of your wealth is paper wealth.

Kara Swisher 33:44 Mm-hmm.

Chris Larsen 33:44 And, you know, we both lived through the dotcom crash, right?

Kara Swisher 33:46 Mm-hmm.

Chris Larsen 33:47 You know, I think most of those stocks went... They were down 99% within a year.

Kara Swisher 33:51 Mm-hmm.

Chris Larsen 33:52 So imagine if the day they set your tax bill was pre-crash-

Kara Swisher 33:57 Mm-hmm

Chris Larsen 33:57 ... and then you had to pay it post-crash. The tax bill would be five times bigger than your net wealth, uh, uh, w- net worth, and you'd have no liquidity to pay it. And so in that real- and, you know, that would apply to the AI folks right now. A lot of paper wealth, you have another AI crash that could happen any time, same situation. I mean, entrepreneurs, they would never set up in California. Y- Y- Why would you risk that? You could just go across the border to Nevada or Arizona or Texas or Florida, and you wouldn't have that situation. That will drain money out of the general fund.

Kara Swisher 34:29 Mm-hmm.

Chris Larsen 34:29 And that hurts, that hurts most workers in California, including teachers, firefighters. That's why they're against it. Um, look, this, this structure was designed by Dave Reagan from, uh, the, when this local SEIU unions. It was designed to give more resources to those union members, right? It's, it's not fair. It's not well structured. And I think Dave Reagan never meant this to go on the ballot. This was meant as a sh- his MO is to shake down the state government with these really painful propositions and then negotiate away for some other benefits. Luckily, this time, Governor Newsom didn't go for it, and this thing is on the ballot. Uh, it's terrible, and we need to defeat it.

Kara Swisher 35:12 S- At the very time people really don't like billionaires. Do you think that is the case? Is it going to be defeated? And if it's not, what happens?

Chris Larsen 35:20 I mean, you never know with the mood here. I think if you care about Silicon Valley, people here, uh, get involved in the opposition. There's, there's other ways to fix the income disparity, and we have to.

Kara Swisher 35:31 And billionaires like Peter Thiel slip out of all manner of payments by manners of tricks. W- How would... Like, Scott Galloway has proposed an alternative minimum tax or-

Chris Larsen 35:40 [laughs]

Kara Swisher 35:41 ... some other way to do this. But most people feel, "I pay more taxes than-" Elon Musk, this is insane, like, it, by, on a per capita basis. So why, why not figure out something that is fair? 'Cause they block that too.

Chris Larsen 35:57 Yeah, I don't buy the studies that show, like, the secretary's paying more than the billionaires. Like, we're paying a lot of money into-

Kara Swisher 36:03 Mm-hmm.

Chris Larsen 36:03 If you're here in California, you're paying a ton of, of, of, of taxes. But look, this has to be fixed at the federal level. Um, look, you know, we have a $2 trillion annual deficit now, 40 trillion in debt. Obviously, we need to tax the wealthy more, but again, at the federal level, and do it on income, because again, wealth taxes don't work. You had 15 countries, I think it was, in Europe that you had this in the '90s. They've almost all done away with it because it just doesn't work. So income is cash. That's the way to tax. But get- do away with the capital gains taxes federally. We don't need it. And then I think in an AI world, w- look, we gotta stop valuing capital over people. And right now, you know, you can write off a private jet in one year. It's ridiculous.

Kara Swisher 36:47 Mm-hmm.

Chris Larsen 36:47 So get-- you have to do away with that stuff.

Kara Swisher 36:49 Mm-hmm.

Chris Larsen 36:49 Maybe, you know, allow, allow people to write off 10 years of employing a person. That'd be a better way to go. And so we really gotta redo our tax structure. But look, the only way you're gonna get there is you gotta get a Democrat in the White House, and that's what we should be working for. And by the way, part of the way of doing that is making sure that California is a, a problem-solving state and not creating more problems like this, this tax would create.

Kara Swisher 37:13 So where do you imagine this going now? You-- Billionaires, of course, have been threatening to leave New York City for more than 20 years over similar taxes, and they never do. Um, do you think this would happen in San Francisco?

Chris Larsen 37:25 Oh, people will leave for sure. People already are leaving. But yeah, again, you wouldn't, you wouldn't be here in a structure like that. It's too risky. It, it just wouldn't work. Um, but look, I, I think you have sort of the worst of the worst on this thing if it passed, because I think it's tied up in the courts forever. I think the Supreme Court throws it out. Looks very unconstitutional to, to me. But so you'd have the worst of the narrative-

Kara Swisher 37:47 Mm-hmm

Chris Larsen 37:48 ... people leaving, just in case. You'd never get a dollar out of it because it'd probably be overturned at the Supreme Court. Again, it's, it was never designed, I think, as a solution for this problem, and there's-- and we have to solve this problem.

Kara Swisher 37:59 So your solution is the federal government reforms the tax system.

Chris Larsen 38:03 Well, you gotta get a Democrat in the White House, and then we've, you know, we've gotta maybe get rid of the filibuster so you can get this through, depending on what happens with Congress. But yeah, we have to completely redo our tax system.

Kara Swisher 38:15 So I wanna finish up talking about, uh, solutions, just so you're talking about. If you had to-- One of the things is tax reputation is really-- The, the polls are really quite clear about that, I think. But what could happen to turn that around from your perspective?

Chris Larsen 38:31 So look, it just-- You just have different situations in different parts of the country. Obviously, in Washington, the unions don't have much power. In California, the government unions have too much power, and SEIU as well. And look, our, our budget is up even though our population is flat, so we definitely are not being very efficient. We, uh, it, it can't just always be a revenue issue. And I think people will support higher taxes. I would. I'll pay more if I know it's being used efficiently. But, uh, I, I don't think we're there yet, and I think the reason is, is Sacramento is too dominated by a couple of government unions and by SEIU, and they're there every single day threatening legislatures. And we need to stand up a permanent sort of pushback by the business community, not the tech community. This isn't even about tech policy. It's just about being problem solvers. And w- look, we know the problems in California are housing, right? The energy's too expensive. It's too hard to build stuff. Um, those are the problems people want solved. If you deal with that, I think you get, you, you get maj- majority support. And, uh, that just-- We gotta be more active, uh,

Chris Larsen 39:41 the business community.

Kara Swisher 39:41 How do you look at the current California race for-- I just interviewed Steve Hilton, for example.

Chris Larsen 39:46 For governor?

Kara Swisher 39:47 Yes. I-- Becerra will not do an interview with me.

Chris Larsen 39:49 Uh, yeah, we just said yesterday we're supporting Becerra. We have had a number of meetings with him. I like him, and we were meeting specifically on climate policy.

Kara Swisher 39:57 Mm-hmm.

Chris Larsen 39:58 I spend most of my time on climate change work, but the climate folks, w- look, we failed. Like, we're kinda-- We need a reset.

Kara Swisher 40:05 Mm-hmm.

Chris Larsen 40:05 Like, we're all stuck. The, the climate folks, we've been advocating for too many things that are expensive, a green premium, and that's not working for working people, and that's why you get the backlash, right? I think the oil and gas industry, they're stuck. Like, they're fighting us on every front, but they've gotta start making sustainable fuels. And we're big believers you need a lot of electrification, obviously, although we've lost that race to China, and we can talk about that. But, um, look, we don't necessarily have an internal combustion engine problem. We have a sustainable fuels problem. And the oil industry could make fuels from renewable energy, from so- You can make fuel from solar panels, nuclear, wind. You can absolutely do that. It's not economic today, but solar was not economic 10 years ago. It's the cheapest form of energy today. Um, so, and they also have to figure out ways of sucking carbon out of the air. Uh, they're not gonna do that because they're nice guys, but they're gonna do that under pressure, and there's a lot of pressure points going on, including the insurance crisis, which I hate to-- We love that issue. I mean, it's a terrible thing going on. But because it is a direct result of too much carbon in the air, and that's warming the Earth, and this extreme weather, I mean, every d- day you turn around, then there's like, oh, an- a- another act of God, right?

Kara Swisher 41:21 Mm-hmm.

Chris Larsen 41:21 No. It's because of too much carbon in the air, right? So they're responsible for that, and I think there will be a moment of a, some kind of grand settlement where the, the, the damages will be in the trillions. It'll be a tobacco moment. But you don't, you're not gonna kill the oil and gas industry. We've been trying to kill it, and that's not working. But if they started changing the way they make fuels or sucking the carbon out of the air, that can work. And by the way, there are a billion and a half Uh, internal combustion vehicles in the world. I mean, like, what are we gonna do? We're gonna throw it out in the ocean? I mean, that's just not gonna work. And again, China has sort of taken over all of the, the EV industry. We can't, we probably can't compete with them anymore. We can probably compete on internal combustion engines with sustainable fuels. America's pretty good at that. But we can't have a situation where, you know, there's 10 million cars being exported from China now. It's-

Kara Swisher 42:11 Mm-hmm

Chris Larsen 42:11 ... crazy how big that has grown.

Kara Swisher 42:13 Right.

Chris Larsen 42:14 We can't get into a situation where all of your cars are made in China, and they're self-driving, and you lose all the jobs of making the cars, and all the jobs of driving the cars. We are fucking not gonna let that happen.

Kara Swisher 42:26 Okay.

Chris Larsen 42:26 Can't let that

Chris Larsen 42:27 happen.

Kara Swisher 42:27 All, all right. Wow, okay. Car- [laughs] Okay. Um, so I wanna end on that. So, um, the, I was gonna ask about China.

Chris Larsen 42:33 Yeah.

Kara Swisher 42:33 Like, what's happening there. And you're absolutely right. You go there, and what they're doing in cars i- has been astonishing. If you go anywhere in the world, BYD cars are everywhere. A lot of Chinese vehicles, uh, robotics, innovative. Um, electrification, innovative. What, how do you look at the challenges from China? Because they are also ahead in climate stuff, like climate and capture and things, uh, even-

Chris Larsen 42:57 Oh, no, except for, uh, carbon capture.

Kara Swisher 42:58 Carbon capture.

Chris Larsen 42:59 We can own that, and we have to own that.

Kara Swisher 43:00 Right, but they're ahead in a lot of stuff that-

Chris Larsen 43:02 It's true

Kara Swisher 43:02 ... towards sustainable, 'cause they see the problem themselves.

Chris Larsen 43:06 Yeah, I think it's less for climate and more for s- energy security.

Kara Swisher 43:09 That's right.

Chris Larsen 43:10 A different objective. That's probably why they haven't gone into CDR, carbon dioxide removal, and we can own that, and, and we need to. And the w- the oil and gas industry is pretty good at molecules. [laughs]

Kara Swisher 43:20 Mm-hmm.

Chris Larsen 43:21 They've gotta figure out how to do that. But yeah, the us versus China, we're gonna lose to China in the AI thing. It's a red herring. It's, uh, it's t- th- that's not right. We can't think that way. Um, they're operating in a whole different reality, and we can't compete in that reality 'cause we don't want that reality. That said, there's lots of stuff we can be doing together. Like, we've gotta get together on the really scary stuff on AI, like biological war. I've just read that book, Biological War: A Scenario.

Kara Swisher 43:52 Mm-hmm.

Chris Larsen 43:52 Scary as hell, worse than a nuclear holocaust. We've gotta work together on that. On EVs, I, I just mentioned, you know, we can't lose all the job. However, you know, the BYD Seagull, $10,000 car, fabulous car, we should be letting that into California at least for our low-income folks.

Kara Swisher 44:09 Mm-hmm.

Chris Larsen 44:09 Right now we, we have these crazy high pr- g- uh, gas prices, 70%, 7-

Kara Swisher 44:13 Yep, we won't

Chris Larsen 44:14 ... 70 cents a gallon, right, in tax. That's the most regressive tax in the world. That's hurting the guy that can't afford to live in Silicon Valley, lives in Modesto-

Kara Swisher 44:22 Mm-hmm

Chris Larsen 44:22 ... paying a fortune, and he can't afford an EV. They're all 50, 50 grand. Let him buy a Chinese BYD G- uh, Seagull.

Kara Swisher 44:30 Mm-hmm.

Chris Larsen 44:30 Uh, but maybe it'd have to be income tested, 'cause we're never gonna make that stuff, right?

Kara Swisher 44:34 Mm-hmm.

Chris Larsen 44:34 So I think it's, it's just complicated. We've gotta be working with them, but we've gotta also know that they are trying to, they're trying to eliminate our way of life.

Kara Swisher 44:44 Mm-hmm.

Chris Larsen 44:44 They want their way of life, and we gotta always remember that, but there's tons of things we can do together.

Kara Swisher 44:50 Mm-hmm,

Kara Swisher 44:51 especially around AI safety.

Chris Larsen 44:52 Uh-huh.

Kara Swisher 44:52 100%. All right, the last thing is, one of the things, as you've noticed, Chris is all over the map here, and it's a really interesting thing. I often find you really interesting, and Mark Cuban's very similar in that way. You don't quite know what direction you're gonna go. Obviously, y- you have very liberal tendencies. You've been supportive of Democrats. At the same time, you're against the billionaires tax. But how, in this very partisan era, where it's really like, ugh, like, v- it's very hard to operate for most people.

Chris Larsen 45:21 Yeah.

Kara Swisher 45:21 And if, and, and especially with an administration who is actively hostile towards lots and lots of people with voting and obviously trying to do all manner of horrors with ICE and everything else, which it seems very obvious, and the polls are showing that. Nobody's liking what's happening here.

Chris Larsen 45:36 Yeah.

Kara Swisher 45:36 How do you get back to a a- area of comedy anywhere, like, a- at all, where it's gonna, where people are going to get a l-

Chris Larsen 45:45 Uh, w-

Kara Swisher 45:45 Or maybe they won't. Maybe this, we're post America.

Chris Larsen 45:48 I, I think we'll get back there. We've had other difficult times in American history, really bit difficult times.

Kara Swisher 45:52 Yeah.

Chris Larsen 45:53 And we've always overcome.

Kara Swisher 45:53 Well, I always go, when people in Washington, it's like, "Oh, we can't speak to anyone," I'm like, "Civil War."

Chris Larsen 45:57 Yeah, no.

Kara Swisher 45:58 We had a civil war. [laughs] We had-

Chris Larsen 45:59 We've had lots, lots of challenges. I think, number one, dump your social media. Just get off that shit.

Kara Swisher 46:04 Mm-hmm.

Chris Larsen 46:04 It's just really bad for you.

Kara Swisher 46:06 Mm-hmm.

Chris Larsen 46:06 And it's ruining our country. I think the other thing is we gotta get a notion of fighting really hard for what we believe in. Yeah, fight really hard, but then loving your opponents when the fight is over, right? After a football game, you fight really hard, you shake hands after. We gotta get back to doing stuff like that.

Kara Swisher 46:23 How do you do that? I get that. I get that. Like, just-

Chris Larsen 46:25 Well, you teach your kids.

Kara Swisher 46:26 Yeah.

Chris Larsen 46:26 I mean, that's maybe, uh, our generation is too far gone, but, you know, it's not our world anymore. So we gotta teach our kids to think that way.

Kara Swisher 46:34 So who do you look at that you find, even if you might not agree with them among the political figures or leaders?

Chris Larsen 46:40 Oh.

Kara Swisher 46:40 I mean, obviously Dolly Parton, but we don't have her anymore.

Chris Larsen 46:43 Well, I've pointed to two. I think Talarico, James Talarico, we've gotten to know him pretty well. You know, I ask him, "If you get to the Senate, you're gonna impeach Trump, right?" And he's like, "No, no, I'm gonna make Trump a winner. I'm gonna make him a winner." And you know, and Mark Cuban has done the same thing with his drug pol- you know, program.

Kara Swisher 47:00 Mm-hmm.

Chris Larsen 47:00 And gave Trump the credit. Great. Uh, uh, if that works, that's, that's one step.

Kara Swisher 47:05 Mm-hmm.

Chris Larsen 47:05 We gotta start working with our fellow Americans. Rob Sands, another guy who's gonna be governor of Iowa, I believe, uh, same thing. You know, he's a Dem in a red state.

Kara Swisher 47:15 Mm-hmm.

Chris Larsen 47:15 Uh, and he's gonna win. He's just, he's a problem solver. He's pragmatic. He'll-

Kara Swisher 47:19 Mm-hmm

Chris Larsen 47:19 ... he, he goes everywhere. He talks to everybody.

Kara Swisher 47:22 Mm-hmm.

Chris Larsen 47:22 So we gotta, we gotta start doing that more.

Kara Swisher 47:24 So last words for people here. There, there are a lot of entrepreneurs, businesspeople. You've obviously had a lot of success. You have a very interesting life. What, what would be something you would say to entrepreneurs to think about going forward? In this really sort of, it's a moment right now we're

Kara Swisher 47:39 in.

Chris Larsen 47:39 Yeah.

Kara Swisher 47:39 It's hectic.

Chris Larsen 47:39 Uh, well, something that always helped me, there was somebody before I started my first business, and I'd never thought I would've, but he said, "Cut, cut, you know, cut the lifeboats," right? Don't be afraid. Don't be afraid of failing. Uh, failure's a badge of honor if you do it with grace and, and, and honor. And, uh, you got nothing, nothing to be afraid of, and you have the incredible tool. Well, I think from this conference, right? You have incredible tools now.

Kara Swisher 48:02 Mm-hmm.

Chris Larsen 48:03 Including, this is where AI, I think, is really good. You know, we've never had a higher number of small businesses starting. Um, so as, you know, go for it and take those risks.

Kara Swisher 48:12 And, and in San Francisco, you're gonna stay?

Chris Larsen 48:16 100%.

Kara Swisher 48:17 100%, all right. All right. Chris, thank you for being here. As usual, incredibly thoughtful conversation. And thank you Odoo for, uh, hosting. We're at the Odoo Experience in San Francisco. Odoo makes an all-in-one suite of business software, everything from sales and accounting, uh, to inventory and operations, on the theory that you shouldn't need 10 systems to run one company. That's a very good thing.

Chris Larsen 48:41 Yeah.

Kara Swisher 48:41 Anyway, thank you so much, and thanks to Chris Larsen.

Chris Larsen 48:44 Yeah, thank you, Kara.

Kara Swisher 48:44 Today's show was produced by Nishat Kurwa, Tracy Hunt, Madeline LaPlant-Dubé, Michelle Aloi, Katherine Milsop, and Cailin Lynch. Special thanks to Bradley Sylvester, Lyssa Sowep, Julia Sharpe-Levine, and Manola Moreno. And our theme music is by Trackademics. And thanks again to Odoo for hosting our conversation. If you're already following this show, the drones haven't found you yet, yet. If not, what the flock are you doing? Thanks for watching. See you on Thursday. [upbeat music]