Balaji Srinivasan: The Network State

Balaji Srinivasan makes a return appearance to The Knowledge Project, this time to go in-depth on Web3, Crypto, and the state of the world today. Srinivasan offers his unfiltered thoughts on the advantages and disadvantages of established democracies, the Russia-Ukraine situation, housing as an investment, education, legacy wealth, and which country he would bet on to dominate the future. Srinivasan is the former CTO of Coinbase and General Partner at Andreessen Horowitz, and is an early investor in many successful tech companies and crypto protocols. He is also the author of the book The Network State: How To Start a New Country. -- Want even more? Members get early access, hand-edited transcripts, member-only episodes, and so much more. Learn more here: https://fs.blog/membership/ Every Sunday our Brain Food newsletter shares timeless insights and ideas that you can use at work and home. Add it to your inbox: https://fs.blog/newsletter/ Follow Shane on Twitter at: https://twitter.com/ShaneAParrish Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  You know, it's weird in a sense like the US and India are like almost switching places or converging. It's the US that is now the country that's sort of got a lot of smart people who just can't seem to get it together as a society. And they're riven by ethnic and communal hatreds and so on. Whereas India has like a sense of itself and togetherness and for its flaws is able to put it together. But here's the big thing. India's strength actually may be that China is dangerously competent and the US state is dangerously incompetent. And India's in the middle. It's a Goldilocks. If China becomes a tech and manufacturing superpower, I think India becomes a tech and media superpower.

• 1:01Shane Parrish?

  Welcome to The Knowledge Project. I'm your host, Shane Parrish. The goal of this show is to master the best what other people have already figured out so you can unlock your potential. To that end, I sit down with people at the top of their game to uncover what they've learned along the way. Every episode is packed with timeless ideas that you can use in life and business. If you're listening to this, you're missing out. If you'd like special member only episodes, access before anyone else, searchable transcripts, and other member only content, you can join us at fs.blog/membership. Check out the show notes for a link.

• 1:40Shane Parrish?

  Balaji Sir Navasan joins me today for the second time. Balaji founded a large molecular diagnostics company, taught bioinformatics at Stanford, won an MIT TR35 for his work in geometrics, and holds a PhD from Stanford. More importantly, he's one of the world's leading thinkers on Web3 and crypto. I love talking to Balaji because there's no shortage of mind expanding thoughts and content and it really pushes the boundaries of what I think and what I think is possible. And this conversation doesn't disappoint. We talk about crypto, tech, investments, education. We go deep on the advantages and disadvantages of established democracies, how he's thinking

• 2:21Shane Parrish?

  about the Russia-Ukraine situation, housing as an investment, not consumption asset, legacy wealth, recognizing talent and which country he'd bet on to dominate the future. Sit back, relax, and let Balaji take us into the future. It's time to listen and learn. Balaji, man, I think the rest of the world is going to tell us never to talk again. The last time we talked, it was right before COVID and now we got the Ukraine-Russian thing going on.

• 2:56Speaker 02

  Well, I think that the world is going to be an eventful place over the years to come. So probably every podcast will be a few months before something crazy. Correlation is not causation. This is not investment advice. Various other incantations, perhaps with that we can, we can begin.

• 3:15Shane Parrish?

  What's the most interesting or surprising thing you've learned or changed your mind about in the last three months?

• 3:20Speaker 02

  Last three months? I don't know, but the last year, I actually wrote an essay on this for Barry Weiss's blog. And essentially, what was surprising to me was that the reduction in state capacity was bipartisan in the US. And that's to say, like, under Bush or under Obama, state capacity had been moderately high enough to do, like, even if you don't agree with it, the invasion of Iraq is a logistically complicated thing, you know, even, you know, operations in Syria or there are domestic actions, you know, foreign actions that were taken that required some degree of coordination. Under Trump, there was a

• 4:02Speaker 02

  huge visible decline in state capacity. Under Biden, that seems to have continued. Why is that surprising to me? Last summer, I kind of had this little... Tweet, which is a little bit surprising, but I said, you know, the federal government is losing control of affairs, both domestic and international. Inflation, Afghanistan, China and Taiwan, France on AUKUS, El Salvador and Bitcoin, 17 states were suing the feds on education, Texas on abortion, vaccines, many others. And of course, obviously now the, you know, Ukraine issue, you know, what I thought might happen and the thing that I was concerned about was that, you know, new government

• 4:44Speaker 02

  would come in and with total control, they'd be able to implement all kinds of crazy surveillance or whatever tactics. And in fact, this is what folks had thought about Trump as well. And it actually, in both cases, in both Trump and Biden, it has so far turned out to be all of a Potemkin village, right? Like they'll say, um, you know, some folks thought Trump would be, you know, like this competent surveillance state. Some people thought Biden would be able to do that, but neither has been able to do that. And that's really interesting because it makes one think, okay, um, let me step back and be like, why did I expect that? And why is the result actually completely different from where the words are and where the conversation is? And so I wrote this mini essay.

• 5:28Speaker 02

  So this is the thing that I changed my mind on. So I'll just read this little poem-ish kind of thing. For some time I'd been increasingly concerned that instead of marching into a future of freedom, we were heading into a time of tyranny. I still think something like this may take place in China's sphere of influence. Arguably it already has, but as the events of this year have unfolded, it appears we are not on track for a dictatorship of either the right wing or left wing variety. We're something more like American anarchy. If you squint past today's half ignored TSA like COVID regulations, you see a half ignored TSA like COVID regulator, namely a failing state that people can half ignore and arguably must half ignore because the USA itself is now the TSA and the TSA we know is safety theater.

• 6:13Speaker 02

  In the territory governed by this inept bureaucracy, you see power outages, supply chain shortages, rampant flooding, and uncontrolled fires. You see riots, arsons, shootings, stabbings, robberies, and murders. You see digital mobs have become physical mobs. You see a complete loss of trust in institutions from the state to the media. You see anti-capitalism and anti-vaxxism. You see states breaking away from the US federal government at home and abroad. And you see the end of power, the revolt of the public, the defeat of the military, the inflation of the dollar, and looming ahead, an American anarchy. What's coming isn't fascism or communism, like the left-wing and right-wing pundits will have you believe, even though they don't believe it themselves. What's coming is the exact opposite of that. A world where the civilized concepts of freedom and equity are extrapolated to their

• 6:58Speaker 02

  decivilizational limit, where you ain't the boss of me and we are all equal, where all hierarchy is illegitimate and with it, all authority, where no one is in charge and everything is in chaos. You can argue that this may be preferable to the status quo, if you'd argue that the chaotic Russia of the 90s was on balance better than the authoritarian Soviet Union of the 80s. You can argue it may be inevitable. As a Chinese proverb goes, "The empire long divided must unite, long united must divide." And you can argue that this transitional period of anarchy may be lamentable, but that it's better than the other team being in charge and that we can build a better order on the other side. And maybe so, but prior to any rebundling, I think we're on track for quite the unbundling. That is what I changed my mind about.

• 7:42Speaker 02

  Is there any, is there anything you'd change in that now? You know, the, the big thing is, so I think your, your reference might be to Canada, right? And the fact that Canada has implemented this financial surveillance and, and what have you. And, you know, will you actually see that, that top-down dictatorship? And the thing about it is, that's actually kind of a piece with this where...

• 8:07Speaker 02

  Yes, Canada did implement these unprecedented financial controls. Yes, it did affect these, you know, truckers. But because they were unable to successfully censor social media, Canada suffered probably the gravest PR disaster that I've ever seen in my life. I don't know about you, but like in the sense of abroad, I've never heard people talk about Canada that much and certainly not as negatively. This crackdown demonstrated insecurity. When you need to do something like that, it indicates that you feel you you can't just,

• 8:48Speaker 02

  you know, go and put out a megaphone and be like, hey, people, I'm listening to you, you know, we'll figure it out. And there's a mutual trust, right? You feel you need to do, not quite shooting at a mob, you know, kind of thing, but certainly not going out and trying to meet people halfway. The government felt extremely insecure. Second is it was much easier to argue against in some ways because it wasn't, you know, what's happened in the US for a while is a bunch of corporations just happened to all do the same thing at the same time. And then people can argue, oh, that's just the total coordination of the most powerful companies in the world. It's just private decision making. What are you against? You know, the free market, huh?

• 9:31Speaker 02

  And now in practice, that is quasi-coordinated or extremely coordinated behind the scenes by an incoming administration or by people who are aligned or even just by like social beliefs that they all share. But in this case, the fact the government had to push the companies to do it was useful because it showed a centralized hand behind the whole thing and it gave people something clear to argue against, which is state power, something people are skeptical of. So first, they had to use a lot of power. Second, they had to use it highly visibly. Third, because they couldn't censor social media, they took a major PRL. And fourth, they just aroused a lot of resistance. And what did they do with this? They harmed some poor truckers.

• 10:15Speaker 02

  And you know, the thing about this, by the way, is I'm pro vax, right? Like, I've been one of the earliest advocates of vaccines and so on on Twitter. Very, very, very, very beginning of this. I'm like, we need to do vaccine development. We need to, you know, defray the cost. I thought there was going to be a huge controversy over vaccine costs. There was to some extent. It's more kind of after the fact. One thing I hadn't forecasted was that in the presence of a potentially deadly virus, that people would be against the, you know, vaccines.

• 10:44Speaker 03

  This episode is brought to you by Michelob Ultra. Good times mean competitions between you and your friends, like seeing who can throw some pigskin the farthest or rush the field the fastest. Winner gets an ultra because it's not just a superior light beer. It's also giving fans superior access to their favorite sporting events. Superior is worth playing for. Visit michelobultra.com/superioraccess to enter. Enjoy responsibly. Copyright 2026 Anheuser Busch InBev Michelob Ultra Beer, St. Louis, Missouri.

• 11:13Speaker 04

  College football is back. So Hilton called to me, the superstition concierge, to make your fan rituals a reality. Need a room to match your lucky number? We got you. Want to make sure our team doesn't wash your lucky jersey? Oh, that smells lucky. Hilton's unmatched hospitality can keep up with any superstition. Even a marching band wake up call at 5:55 in 55 seconds. Hit it! When you need a team that will do whatever it takes on game day, it matters where you stay. Hilton, for the stay.

• 11:43Speaker 02

  Now, I get it. The thing about coronavirus and the thing that we're actually fortunate about, it's not the Spanish flu. So it's not 100 million dead. The way I think about it is it's like the Richter scale, right? It's not a billion people dead. It's not a nine. It's not 100 people dead. It's not 188. Is about 10 million people dead worldwide? So about 10 million people, it's going to be, it's like 6 million people are dead worldwide right now, I think from COVID, right? Like if I look at Google, what the number is, it's like about six. Okay, that's reported, of course. So, you know, there's some countries where the stats might be lower or higher, but ballpark as the thing keeps burning its way through the global population on the order of 10, certainly way more than one, right?

• 12:25Speaker 02

  So it's just bad enough to have been certainly like an important event, but fortunately not so bad that it actually like broke down civilization or, you know, something like that. At the beginning of it though, if you look at COVID deaths and you look at the curve, all deaths all time, the first several months going into basically mid-April 2020, it just looks like a straight exponential. And what you don't know is where that exponential is going to top at. We're very fortunate that it tops out at something like, you know, 7,500 deaths a day or something like that. And then it kind of sits at that set point-ish for basically the next two years. Okay. And that's the sum of all kinds of curves around the world. But who knows?

• 13:09Speaker 02

  That could have just gone whoosh like this and it could top out at 75,000 deaths a day. That's just like an experiment, which we're very fortunate that it turned out to be just serious enough that people could argue about it. Just bad enough to be really bad, but not so bad that it was like a completely undeniable to everybody that it was bad. You know, one thing I find is that people, if you've got a vaccine, then, you know, forget about masks and everything else, just go back to quote normal, right? And then you can ask, okay, do you, do you actually need that many booster shots or have you, is that going to give you more resistance? And I think that's an empirical question. And there are new tests that are fast tests for immunity, right? Determine the presence of

• 13:51Speaker 02

  Antibodies and you know, that should allow you to determine, you know, evaluate both herd immunity and effectiveness of immunization programs. And you can sort of get a sense of, you know, the number of NABs that are present individuals will give you some measure of whether you possess protective immunity to the virus. You can sort of look at your system and see if you're topped up in terms of immunity and whether you might really need a new booster shot. That's a very crude measure. And then you have to get into the specifics of, are you immune to this variant and so on and so forth, or partially immune because it's multivalent and all that stuff. But, but, but you should be able to assess whether you need a top up versus just kind of my, you know, mindlessly getting it or

• 14:35Speaker 02

  whatever. If you wanted actually some feedback to see, is this thing working versus just taking injections over and over, you know? So this is, the reason I say this is, this gives something in between, oh, just take a shot versus, oh, don't take a shot. It's like, okay, there's a metric that you can look at that should determine whether you have residual immunity, whether there might be a cost benefit to taking it, and whether you can evaluate that. And, you know, there's probably going to be some trade off at where that's worth it. And, and you can just look at that soberly. And this is, you know, a broader thing, which is, one of the most tragic aspects of all of this is that probabilistic cost benefit decisions are turned into, you know, morality plays where there's an obvious

• 15:16Speaker 02

  zero one for everybody of a billion people on Twitter. And that is just not what reality is. Do you know the term pharmacogenomics?

• 15:24Shane Parrish?

  No, never heard of it.

• 15:25Speaker 02

  So pharmacogenomics is just reverse refers to the fact that different people have different drug responses. You know, some people, for example, are fast metabolizers and others are slow metabolizers of caffeine or of alcohol or of drugs like warfarin and so on. And so, yes, height and weight and, you know, gender and so on, those are all inputs into a regression algorithm, but so are your genotypes, you know, CYP2A9 and VCR-C1. And so there's actually genetic impact on your drug dosage, as we kind of know, right? But that also affects immunity. You have immunogenomics. And again, we kind of know this, you've probably heard the story about how the trait that gives, sickle cell trait,

• 16:09Speaker 02

  also gives potentially partial immunity to malaria and infectious disease, right? So that's immunogenomics, right? Just proof, you know, it's a case study. The cystic fibrosis variant gives some potentially partial immunity in the heterozygous condition to Ursinia. That's, I think that's, I believe that's the case. Let me actually check that.

• 16:27Shane Parrish?

  So is the implication of this giving people information to make the choice? Or do you feel like they should be forced to take the vaccine? Or like, I'm just trying to tie this back to the Canadian and truckers and?

• 16:38Speaker 02

  Yeah, yeah. So this is a complicated one. We know that their, you know, sickle cell trait can give some resistance to malaria. We know there's mutations that are, have been hypothesized to give resistance to everything from HIV to the Black Death. And so that is probably also the case for COVID-19. There's probably, almost certainly, and I haven't looked at the literature recently, but almost certainly at this point, two years in, we know some genetic variants that might give more or less susceptibility to COVID-19 with millions and millions of, you know, cases and deaths and so on. We've probably done these studies. I haven't, I haven't looked, but if I, if I just dug into it. And so what that means is that one size fits all may not actually be the case. The maximum that we've been able

• 17:19Speaker 02

  to communicate so far is, oh, older people are more likely to get COVID. Overweight people are more likely to get COVID. Those have strong signals. And therefore, if you're in those risk categories, then you should go get it. But ideally, we would have everybody having a personal genome and you having a regression function where you could look at your phone and you could see an estimate based on all of your characteristics. And then if you wanted to, you could drill down into it and you could see the underlying raw data and where those coefficients came from. And even if you didn't believe it, you could have your software engineer or computer science, you know, or like academic or whatever friend diligence that equation, right? I'm not saying it's just a software engineer, of course, because, you know, it's not just code. There's also medical knowledge there. So whatever

• 18:03Speaker 02

  quasi priest you'd want to call on, you could have them, your most quantitative friend, you could have them go and look at that calculation and look at the raw data and look at the citations there. And then you could feel like, okay, I understand why they're reporting this risk, where it comes from, where the data is going into it, and I'm going to make a decision on that basis. It's sort of like an explainable score for your credit score or something like that. Why am I getting this score? Right?

• 18:29Speaker 00

  And that's possible. What I just described is actually not impossible with today's technology. If everybody, if we had not held back personal genomics in the 2010s, if we had not so heavily regulated it, we would have a billion people with personal genome, just like we have a billion people with, or hundreds of millions at least, with fitness trackers, right? And so the thing is, rather than saying, "Oh, it should be mandatory. Oh, it should be voluntary." Those are just like essentially the ramifications of a complicated decision into the government should do X or Y. It's like this, you know, 20th century state where the only outcomes are everybody has exactly the same rule. There's no gradation of things, you know?

• 19:11Speaker 00

  And this is kind of the difference from, from seeing like a state to learning like a machine. Do you know, you know the book Seeing Like a State?

• 19:19Shane Parrish?

  Yeah.

• 19:19Speaker 00

  Uh, you know, Seeing Like a State, this is a book about how, you know, governments, in order to see things, in order to make the population able to be governed, they make them legible. So everybody has to have a last name and a first name. You need to fit yourself into these, uh, you know, boxes on a form. You need to fit yourself into these categories governments created. For example, Asian American. People of South Asian and, and East Asian descent didn't really think of themselves as part of the same category until that sort of artificial creation of Asian American, you know, like by, by the US, which then groups folks in a way that they weren't grouped before. It's like, it's like saying, "Okay, now you're a basketball team, and you're a basketball team, and you're a basketball team." And then people start looking like, "Okay, I guess we're on the same team now," you know?

• 20:01Shane Parrish?

  Yeah.

• 20:02Speaker 00

  Um, you know, Seeing Like a State, so it makes these kind of classifications so that the state can see. But here's an interesting aspect of that. Most of those classifications are almost necessarily binary thresholds. It's, it says, "Did you make more than X or less than X this year?" Binary threshold. "Are you part of this category or not?" Binary threshold. And so the way the state sees is in terms of these sort of binary decisions. It's mandatory or it's forbidden. And, you know, one of the things that was a discouraging result in machine learning a long time ago was that neural networks that were just based on perceptrons, um, so-called just zero ones, couldn't actually get that far, right?

• 20:40Shane Parrish?

  Yeah.

• 20:41Speaker 00

  Like there's, you know, 1969, a famous book, Perceptrons by Minsky and paper. It showed it's impossible for these class of networks to learn an X or a function. Okay? They're only capable of learning linearly separable fashions, right? Basically, Perceptrons in neural networks, it's like this sort of 0-1 decision criterion. Okay. And for single-layer perceptrons, they can only learn simple kinds of functions. They can't learn XOR. And there's a book that came out that proved this. It actually turns out that multi-layer perceptrons can learn more complicated functions. But the point for our purposes is, it's a little bit imprecise, but these sort of bureaucratic

• 21:21Speaker 00

  0-1 boundaries that the state comes up with cannot actually model properly the complexity of the human population underneath. But machine learning can. And so if you have that data in a database, you can potentially draw much more smooth curves rather than these industrial-age, you know, lines. You don't ask somebody, "Are you inside or outside this set?" You have n variables that you can actually give a continuous decision boundary, right? For example, to bring it back to Earth, you have their genome, and they have, you know, millions and millions of SNPs, these variations, and then you can infer what their risk is based on that. And you can say, "You have a 97%

• 22:03Speaker 00

  chance of coming down with a bad case if you don't get the vaccine," or "You have only a 5% chance." You know, maybe this is just the scientists or whatever in me talking, but I do believe that force is really not... I mean, it's such a last resort. You really should try to persuade much more than one has. And I don't feel that the persuasion and the evidence presentation has been that good on this, because just changes all the time. And people say, "Oh, masks don't work, and now they do. The science says this. You know, follow the science. The science changes every day." And the issue is fundamentally that those, the people who are coming up with this stuff,

• 22:46Speaker 00

  they're not distinguishing between science in the sense of Maxwell's equations and science in the sense of a paper that came out last week. Maxwell's equations, that's capital S-science, that's real. You know, that has trillions of independent replications. Okay? Every single time, you know, you pick up the phone and you message me or somebody else, you're doing an independent replication of Maxwell's equations. If our theory of how the electrical and magnetic field worked were not correct, that would not work, right? So that's like science, okay? That's solid. That deserves our respect, right? A paper that came out last week that does not have any independent replications is not science in the same way Maxwell Equations is. And that's that that quantitative access is very important.

• 23:30Speaker 00

  Science is not about prestigious citations. It's about independent replications.

• 23:36Shane Parrish?

  Well, we're confusing the term science, right? Like, we're just using science for everything.

• 23:41Speaker 00

  We're using science for the form and not the substance.

• 23:44Shane Parrish?

  Right.

• 23:44Speaker 00

  The substance of science is independent replication. If I cannot independently replicate it, it's not science. If your data is hidden, if your methods are hidden, okay? The whole point of scientific publication was to allow others to replicate it. Right? Now, what that's evolved to in the modern age is something where it became prestigious to come up with these discoveries. And then it became just a pure prestige game where people often hid the data or the methods behind their discoveries or wrote them in a purple prose kind of way to keep scooping their competitors. And, you know, you could have whole fields where it was just this prestige game and nobody replicated each other's work because they were all reviewing each other's work. And that's like the reproducibility crisis in psychology and other areas.

• 24:29Speaker 00

  And that just became something where we use these proxies for the underlying variable. And then we focus too much on those proxies. Right? And that's a that's a fundamental problem in Western society now. You have prestige, which was a proxy for replication. Then you lost sight of that underlying thing of replication. Okay? Or you have elections, which is a proxy for the consent of the governed. But you lost sight of that underlying thing and start doing militarized police and all this type of stuff, just thinking, oh, I get 51%. That means I can ram it down somebody's throat as opposed to realizing, actually, it's a continuous thing. It's not just get 51% and you have the power of 99%. 51% you need to govern very humbly and modestly. Right?

• 25:12Shane Parrish?

  Yeah.

• 25:12Speaker 00

  You know, this also happened on Google, right? Like, Google had this great thing with where it was able to use backlinks as an imperfect measure of search quality. And now they've, you know, lost sight of that. And search quality is actually quite low for many queries, you know, as you've probably seen. Right? So this is a common thing where there's a cheap proxy for something and then people game that proxy. There's actually a term for this. It's like a goodhart's Law. When a measure becomes a target, it ceases to be a good measure.

• 25:42Speaker 00

  Have gotten away from what science is supposed to be, which is independent replication. It's become prestigious citation and insistent repetition. Somebody who can't replicate the study, just like, "It's science, it's science. Whoa, I can't believe you're against science, oh my god." And like, there's a thousand retweets. You know what? I don't care about a single one of those retweets. What I care about is, did you download the code at least? And the data set? And rebuild all the figures, right? And that's like V1, by the way. That's like the minimum threshold of replication. Just to dig into this for a bit, because I gave a talk on this. That is, it's actually a very important topic. And I'll come up to the vaccines thing. Because the reason is, I don't want to just say, "Oh, here's my opinion on vaccines, or here's my opinion on this or that."

• 26:26Speaker 00

  What I want to do is basically just say, "Okay, here's how I'm thinking about it. Here's my thought process. Here's my algorithm for thinking about this stuff." And then you can attack that, or you can listen to that, and then you can go and do it on your own, right? None the naive, "do your own research" way, which says basically, just look at Google. But if Google is corrupted, then that doesn't even work that well either, right? But, okay, more deeply, here's just a few concepts. First, I talk about it as the transition from fiat information to crypto information. The way that our system is based is academia studies something, they write up a paper, the media reports on it, and then the government regulates on that basis. That is the sense in which our society is based on, quote, "science."

• 27:11Speaker 00

  And if you think about it, almost every decision can be tracked back to that. That is the information supply chain, okay? From production, to dissemination, to regulation, right? Okay. So, um, once you think about this, okay, academia is the source, it's upstream of all of this stuff. If there's a dispute at the government level, what did the Harvard scientists say? What did the Stanford scientists say? You know, let's go back to them, right? Let's have a study. And there is some good to this in the sense of trying to study things, you know, dispassionately, and do a proper write-up, and so on. But the problem is a few-fold. First is, There's this concept, have you ever heard this concept called reproducible research?

• 27:50Shane Parrish?

  No, but I intuitively think I understand that.

• 27:54Speaker 00

  Yes, so there's an intuitive term for it, or there's intuitive definition, but then there's like, it also refers to a technical thing. And the technical definition of reproducible research comes from about 20 years ago, this guy John Clairbou at Stanford, the geophysicist, and another guy David Donahoe in the stats department, started realizing, oh, you know, training new grad students is a huge pain, because, you know, you have to kind of communicate all of this context and so on, how do you onboard them? And eventually, they came up with something very clever, that at first you might not think was sufficient, but actually turned out to be really good, which is, every paper in stats, and many other, you know, fields of, like, let's say, applied math, is essentially a database plus code, and

• 28:38Speaker 00

  the code reads that data and generates a paper with a bunch of figures. Okay? Anybody who's listening to this, who's written code that takes from Postgres and templates a webpage and makes some graphics, it's basically just like that. That's what an academic paper is. Okay? It just rendered, the output is PDF rather than HTML, to first order. Okay? You're making some graphs, and then some tables and some charts. So you distribute a package, where you hit Enter, and it takes the data which you include, and the code which you include, generates a PDF. The reason that is sufficient to train a new grad student is, if you wonder how they got this number of .73 in this paragraph in the paper, what do you do? You look at the source, and you're like, okay, it was this function call, and that called this dataset, and I can look at the whole thing, and I can hit Enter, and

• 29:21Speaker 00

  I can rebuild it. Okay? In R, there's a package called SWEAVE that does this. In Python, you know, there's like, Python notebooks that do this. Okay? There's a website called distill.pub, which is all based on this. But this is a concept that's been around for some time. It's called reproducible research. Okay? There's a second concept that's been around for some time, it's called open access. And this refers to the concept that When you publish something, one of the weird things about academia, people think that if you have a prestigious publication, you'll get paid for it because that's how it works in, you know, like you in other spaces. That's not how it works in academia. Once you get accepted to like nature or science or something, you have to pay the journal. It's like this silly system because the government pays for your grant. You have enough money to do it and the

• 30:04Speaker 00

  journals don't chart. They feel like I'm not charging you. They feel they're charging the government and you have to pay them something for the paper to be online and you have to pay them even more for it to be open access so that it's visible to everybody. There's different kinds of open access like green and gold. Is it accessible to people today or in 30 days or forever? Blah, blah, blah. Right? And open access is this insane thing where essentially, you know, you have to actually fight these for-profit journals to open source the research that the public funds paid for. And so there's been this huge fight for the last 20 years on this. It's gradually been moving in that direction. Right? So reproducible research is you can rebuild a PDF from the code and the data. Open access is the public can actually get access to that PDF

• 30:46Speaker 00

  and that, you know, that HTML without having to go through some signup and subscription process for an expensive journal. And you put those together and you combine a third thing, which is actually, you know, what I love, the blockchain. Okay. And you get the concept of truly reproducible research where you're taking that code and you're taking that data and you're putting it on chain. So it's permanent. It's archival. Okay. It can't be mucked with. It's also truly open access because it's globally accessible. Anybody can download the blockchain, right? Let's say it's the Ethereum chain or let's it's a chain dedicated for this purpose. Okay. And if you hit enter, you can rebuild a PDF. Now, a lot of things become really interesting

• 31:27Speaker 00

  when you do something like this. First, citations become function calls. To cite a previous paper, you're actually pointing to it. The whole composability thing in DeFi becomes citability in DSci.

• 31:41Speaker 00

  Okay, decentralized science. Okay. That's huge. You can just imagine that you could actually, in theory, backtrace all the way back to like Principia Mathematica or Maxwell's publications, right? You can actually see how your manuscript relates back to these originals because you're doing function calls, which are more precise than citations, right? The second thing is, every dataset en route to your conclusion can be diligenced. And people don't understand how bad sometimes the citation path is. There's, especially in biomedicine, there's factoids that people think they know. But when you root cause them, there's a famous thing with like Popeye spinach. Do you know about that?

• 32:15Shane Parrish?

  The root cause of Popeye spinach?

• 32:17Speaker 00

  Yeah, it's like, is spinach a good source of iron, like the myth?

• 32:22Shane Parrish?

  Well, you'd be able to trace everything back, right? So if something was unproven or didn't replicate, then you would also know all the implications of it through all the different, how it's weaved its way through science, the term used loosely there, not reproducible science, but how we've used that information to make decisions, or how it's influenced future studies or implications.

• 32:45Speaker 00

  Yeah, exactly. So here's like this, this is an interesting study, which is basically about trying to backtrace and find out whether, this story is complicated and I don't want to paraphrase it, academic urban legends, okay? Ol Bjorn Rektal, "Many of the messages presented in respectable scientific publications are in fact based on various forms of rumors. Some of these rumors appear so frequently that we can think of as academic urban legends. The explanation for this phenomenon is usually that authors have lazily, sloppily, or fraudently employed sources and peer reviews and editors have not discovered these weaknesses in the manuscripts during evaluation. To illustrate this phenomenon, I draw upon a remarkable case in which a decimal error appears to have misled millions into believing that spinach is a good source of nutrition.

• 33:29Speaker 00

  Through this example, I demonstrate how an academic urban legend can be conceived and born and continue to grow and reproduce within academia and beyond." And so, so he just goes into this story and the sub-mits and myths and myths and so on. Point is, something you might think was a solved problem, like is tracking back citations, is not a solved problem. In fact, it's actually something where the evidentiary base is actually not as firm as you might think, especially in biomedicine. And so what you actually want to do is click, click, click, and see the original table in 1963 and the specific rows and columns that are giving this parameter that is being used on millions of people. Right? It is basically just like in any complicated software engineering project today, you have the set of dependencies and dependency management is a whole thing.

• 34:14Speaker 00

  If you're coding node or something like that, you have like 30 libraries that your program depends on, and there's specific version numbers, and this is a whole thing. So now you bring that kind of rigor into actually the management of dependencies for a scientific paper. And those are essentially the input premises that are then expanded upon by the paper that leads to the conclusion of that paper, and it's incremental contribution to literature, right? So now, you know, what I'm describing here, by the way, is of the complexity of Wikipedia, but not greater than that. You're basically talking about taking the scientific literature, putting it into truly reproducible research format and putting it on chain, such that it's perma-linked, and then building a citation map back to each other. Could you do this? Yes. Is it a large project? Yes. Is it a finite project?

• 34:59Speaker 00

  Yes, because, you know, the relevant scientific papers are only a subset of the literature, right? So you can focus on that area first. Once you do this, you have, at a minimum, the digital aspect is auditable. You can look at a paper if you disagree with it, or you question something, you drill down, look at its citations. So either its data is correct or incorrect. Maybe the data itself is fraudulent, there's a Benford's Law kind of thing you can run against it. So you can see whether it's internally consistent, like the stuff that accountants do. There's very statistical tests that you can run to see if it looks like it was faked or what have you, right? So you can internally check it, you can plot it and graph it yourself and look at it. Sometimes you've rotated data and you're like, oh, that's an artifact I can see on this axis

• 35:44Speaker 00

  that I couldn't see, you know, looking at an X, Y plane, but it's obvious in like, you know, another, another plane. So you can analyze the data, you can look at the, the premises, you can analyze it a few different ways. And then you might ask, well, okay, but what if they did like a fancy fake? All you can do is, you can only reproduce some of it, not all of it. And so my argument there is, yes, it is true. That sort of first order, we don't all have cloud chambers and inclined planes and so on in our house, right? But we do have phones and laptops and computers, so we can reproduce the digital. That is actually, independent replication of the digital is feasible. So at least the digital parts we can reproduce. So at least grant me that, right? A good chunk of what is done post-data collection, we can essentially replicate for free locally.

• 36:29Speaker 00

  That's actually what Bitcoin is, by the way. That's what all cryptocurrency is. It's not scientific economics, it's mathematical economics, because you're doing the math locally, and you're not trusting a central authority, you're trusting the decentralized math, right? Okay. What if they did fake the data? And one way of dealing with this is you go one step further. You first have to get this whole truly reproducible research establishment built. I've kind of described the theoretical framework for it. Then eventually what you do is you start making instruments crypto-instruments, okay? So you might be aware that things like GoPro will just stream to the cloud, okay? They're attaching metadata to the images when they do that. But there's also scientific instruments that do that, like Illumina sequencing machines. They'll just stream the data up there. And there's huge databases like, you know, NCBI that collect all of this biomedical data.

• 37:13Speaker 00

  And they have metadata on every experiment, and why do you need that? Well, sometimes you're doing some data analysis, and it turns out that what you thought was statistically significant, like cancer patients versus non-cancer patients, actually turns out to batch one versus batch two, and it's the metadata which you can use to determine that. Because if it turns out that you actually are finding, oh, this is from instrument one, and this was instrument two, or batch one and batch two, as opposed to cancer patient, non-cancer patient, it's a spurious correlation, okay? So collecting of the metadata and analyzing the metadata is already standard in bioinformatics, okay? And then you just add another aspect to it, which is every single individual data point

• 37:54Speaker 00

  at the time of its recording has effectively an audit trail on it, which shows which instrument uploaded at which time, all right? Now, why would you do this? Well, the thing is, have you ever seen, like, you've seen a JPG, you've seen an image, you know, digital image of some kind, right? Have you ever actually printed it out on screen and seen the floating point numbers underneath it? No, never. Okay. You can do that, right? You can basically see the RGB numbers, you know, or the, you know, whether it's floating point or integer, depending on the image format. You can actually see the numbers that underpin this thing, right? If they just flow on the screen, it's like incomprehensible to the human, right? So when the data is being collected off the instrument, it's just floating points or integers. And if each one of those is being individually hashed, it's kind of hard to fake that.

• 38:40Speaker 00

  It's still possible, but it's harder to fake, right? So you have more rigorous, because what people do is they'll take those millions of data points. If they want to fake something, they would fake it after collecting it. But if you're auditing it and you're hashing it at the time of collection. And by the way, you don't have to hash every single individual data point. You can do things like so-called Merkle trees where you group a bunch of things together and just have one hash. But it's difficult to falsify, right? Point being that you can build effectively a chain of custody for data from the instrument, right, to the paper, to the chain of citations that leads you to the premise and conclusion that you're supposed to base your life on today. That is what I think we need to build towards rather than, "Trust me, trust me, trust me."

• 39:25Speaker 00

  You know, like, the lower the trust in society, the less "trust me" works, you know? And frankly, elites don't deserve a lot of trust, you know, because they've messed up so many other things, you know? Like from the Afghanistan intelligence, the Iraq intelligence, to lots of the early official misinformation on COVID. Ben Bernanke saying the great moderation was there. And so macroeconomic volatility was a thing of the past. They're talking about this in 2005, by the way, a few years before the financial crisis. Macroeconomic volatility is a thing of the past. Do you remember this one?

• 39:56Shane Parrish?

  No, but I just want to ask a question before we go. How much of that misinformation, we'll classify it as that, do you think is intentionally misleading in order to accomplish a goal versus just being inaccurate or with good intentions behind it?

• 40:13Speaker 00

  There are several different things that accumulate. I'd say the single most important thing is everybody has in their head a set of the taboos that they cannot violate with any public statement. For example, last year, it was taboo to say, "Oh, it could be, you know, a lab leak." And then it became untaboo, and then people could talk about it. It's still somewhat, but it's much less so than it was, right? So the lab leak is a great example where, and I shouldn't say the truth, because to get the hypothesis out, okay? Because that's what people were doing. To even get the hypothesis out, these guys had to publish it pseudonymously and hope it wasn't censored, right?

• 40:52Speaker 00

  And so that's a huge part of it is there's a school of fish kind of thing going on where

• 40:59Shane Parrish?

  Yeah.

• 40:59Speaker 00

  The way I think about it is the establishment in the West practices the school of fish strategy. And it's very simple. Here's how it goes. Just repeat what everyone else is saying. If it's proven wrong, well, everyone was wrong together. That's the establishment's consensus algorithm. It works until falsified by the outside world. Okay. It's a very simple consensus algorithm. You're just saying what the guy next to you is saying. And then no one can single you out, huh? What do you, what, what, how can you single me out? Like I was saying, who could have known? Right? Okay. And the thing about this is of course, somebody could have known. The Minority Report could have known, but the point is to deny the Minority Report credit. They're, you know, conspiracy theorists, they're a lunatic, whatever, until, you know,

• 41:40Speaker 00

  the credit can sort of be stolen by some establishment grande that, you know, there's this actually, uh, this great ad from FedEx many, many years ago, which was, uh, when the CEO says it. Are you familiar with this one?

• 41:55Shane Parrish?

  No. It makes sense biologically though, right? Like we're, we're social creatures and we, we don't want to sort of stand out from the tribe. So we'd rather be wrong with everybody else than right and alone.

• 42:04Speaker 00

  That's right. And that's actually why betting reduces partisanship. We'll see if this is a social science experiment that doesn't replicate, but I have seen it in my own experience that if you just ask people what the answer is, they'll give you the tribal answer. The moment there's some financial downside potentially on the table, they start trying to think about, okay, is this real or not? Right? You know, so this FedEx ad, uh, stolen idea, July 26, 2007 on YouTube. Okay. That is a great example of kind of how the establishment kind of works, right? Some poor schlub goes out there, puts a concept out there. They're taking all the risk. And you know what? The establishment will say, thank you very much if it does work. And, and by the, that's like the best version of it, where actually the good idea is at least stolen and used.

• 42:46Speaker 00

  Right? The worst version is a good idea isn't even used. And that's actually even more frequent. Right? And so the way I'd put it is first, there's this tremendous web of taboo and fear and so on. That Basically means that independent thinking, which is what you need the most in a problem situation, especially an unexpected one, is penalized over and above. It's already it's already rare. And then you penalize it over and above that, right? And so an enormous amount of the blame on this, I think, goes towards the current culture about how they think about this, what is rewarded versus what is not, right? Because otherwise, a lot of the studies are like looking for quarters under the lamppost, you know? If

• 43:30Speaker 00

  you have prejudged a conclusion, masks don't work or masks do work. It's something that the average Joe can understand, that masks don't work and now they do. The science changed. No, it wasn't like some giant randomized controlled trial. Come on, you know? And when you when you know that they're lying about that, then you know they're just invoking science in a as basically a priesthood, you know, of the credentialed. You're not you're a scientist if you're like a professor and you're not if you're not, right? Are you going to do science on your own? The vast majority of, you know, results in mathematics and physics and so on that we rely on happened before NSF. Okay, let's say like they predate

• 44:13Speaker 00

  the modern scientific establishment that Van de Vaart-Busch set up. And people give them lots of credit. And I'm not saying there isn't some good that came out of the centralization of science that happened post-World War II. But there's a lot of bad that came out of it. And the bad that came out of it is you built this centralized funnel as opposed to lots of folks with independent power centers and funding sources figuring out stuff from their own. Instead, you had like a single thing, which was like official science and official science became official religion, like state religion. And now we're seeing that, right? And so to beat that, you actually need a model that decentralizes science. I've described one aspect of it, which is truly reproducible research, truly open access,

• 44:55Speaker 00

  on-chain citation, right? And crypto instruments. So that the combination of four things, which is you can take the code and the data and rebuild the paper. Everyone can access the paper for free, anywhere, anytime. You can look at the citation graph as a bunch of functions, function calls, not simply citations, tracking it all the way back to the ancestral premises that your paper is based on. And then you use crypto instruments so that you are hashing the data that is going on chain. So you give some diligence on the physical world, the uploading aspect, right? So now you can check quite a few things at home on your computer. It's like, you know, the OSINT concept, which, you know, you're, you're very familiar with, but in a different domain, right? Why do people do OSINT?

• 45:39Speaker 00

  Well, you know, these flight trackers and other things that are useful in peacetime. You'd think that's probably unlikely that people are going to fake the data sources in wartime. So you have some familiarity with the thing, right?

• 45:53Speaker 03

  This episode is brought to you by Michelob Ultra. Good times mean competitions between you and your friends, like seeing who can throw some pigskin the farthest or rush the field the fastest. Winner gets an ultra because it's not just a superior light beer. It's also giving fans superior access to their favorite sporting events. Superior is worth playing for. Visit michelobultra.com/superioraccess to enter. Enjoy responsibly. Copyright 2026 Anheuser-Busch InBev Michelob Ultra Beer, St. Louis, Missouri.

• 46:22Speaker 04

  College football is back. So Hilton called to me, the superstition concierge, to make your fan rituals a reality. Need a room to match your lucky number? We got you. Want to make sure our team doesn't wash your lucky jersey? Oh, that smells lucky. Hilton's unmatched hospitality can keep up with any superstition, even a marching band wake up call at 5:55 in 55 seconds. Hit it! When you need a team that will do whatever it takes on game day, it matters where you stay. Hilton, for the stay.

• 46:52Speaker 00

  So those, those are kind of four big pieces, but there's a fifth, which is everybody will always talk about. And really fifth, the sixth and the seventh. And that is, okay, well, that sounds great, Balaji, but how, how's my lab going to get paid? And now I've got an answer for that. And the answer is it's NFTs. It's a DAO for your lab. It is a personal token for your lab members and for yourself. And any lab that is like doing reasonably interesting technology work absolutely will probably be able to get more funding online via cryptocurrency and NFTs than they will within the academic grants process. There's now an incentive to defect. Frankly, like, one cool result can get like, you know, a few hundred thousand dollars in NFT revenue

• 47:36Speaker 00

  and fund the entire, you know, year for a postdoc or, you know, what have you. Or you can even forget the entire academic track and just hire people who can do cool things, right? And you're starting to see that with things like Vitadou and Molecular Dow and others. You're starting to see DAOs because in the same way that a village would support a bard, right? Or a musician that would bring culture, it wouldn't defend the village, but it'd make the village worth defending, you know? Now you can actually support a real scientist, a person who that community trusts and who's putting their work on chain and who is, you know, showing all of their work and not just thumping their chest saying, "I am scientist, listen to me, I'm part of the guild," right?

• 48:18Speaker 00

  You're effectively offering them an incentive to defect to the public from the guild and to decentralize. And maybe they can make a million dollars a year for their lab outside, but it's a couple hundred thousand in grants, so that's a pretty good deal. And they've got independence, right? And they can't be canceled and they can publish on chain. You also get a few other things when you go on chain. You have unique identity, okay? So it turns out that when you're mapping citations in academia, like credit and so on is very important. So if you're putting the paper on chain, you get precedence, so you get credit. If you're digitally signing it, it's also very obvious that you wrote it. This is actually important for folks, for example, with Asian last names. If you try searching like C Lee on PubMed, okay? There's like thousand people with the same name.

• 49:03Speaker 00

  It's actually, it's an important problem when you're tracking academic citations. It's hard to disambiguate certain names. Digital signatures solve that. Seems like a small thing. It's actually a big thing for certain things where you can see who generated a certain fact. You can get a web of trust there, right? And you can publish pseudonymously. Okay, like Satoshi, like these guys at Project Evidence, like Newton, if you're really pushing the envelope, you might need to publish pseudonymously. Okay, this in today's era, that means that people only are judging the facts. They're not attacking the person. Okay. So you combine those things and that's like seven pieces that I think that crypto is providing for transition from fiat information to crypto information.

• 49:44Speaker 00

  Truly reproducible research, truly open access, on-chain citation, the crypto instruments concept, digital signatures for authenticating yourself, on-chain monetization of your lab and pseudonymity if necessary, right? Put that together, that is actually a vision for rebuilding the upstream. That's a vision for the crypto university.

• 50:04Shane Parrish?

  I love it. Now that we're on crypto, how are you thinking about Russia, Ukraine, and the fear in the crypto circles that this will lead to sort of the West finger pointing at crypto as an effective sort of Russian tool and a crackdown without understanding the implications?

• 50:20Speaker 00

  So how do I think this is going to play out? Is that the Western establishment over the last decade, half decade, is essentially in the long emergency of emergencies. And I think that the way we'll look back on this is something where they have picked simultaneous fights with various, many different factions at the same time. Within the West itself, they've picked fights with tech and with the conservatives and with a lot of folks on the central left who have left for Substack and for newsletters and, you know, independent things, right? They've also picked fights with, they've also picked fights with parents, huge ones on, on education and on COVID restrictions,

• 51:05Speaker 00

  to the extent that even San Francisco had the school board recall. And with, you know, comedians and, you know, lots of folks in Hollywood who felt that, you know, some of this stuff is maybe merited, but a lot of the cancellation went overboard. They've also, and so many of their charismatic culture producers in Hollywood, in, in, in media, in technology.

• 51:27Speaker 00

  They've alienated as well as a huge swath of conservatives. And then abroad, they've fought simultaneous battles with Russia, with China. They have managed to not fully alienate, but certainly antagonize India and Israel, and managed to do that all at the same time. Basically, Brooklyn's wokest, who I kind of think of as driving the establishment now, only really liked themselves and not really that much. They fight amongst themselves quite a bit, right? So it's sort of the opposite of coalition building. It's coalition breaking, where these guys are like, I think of them as nepotists rather than founders.

• 52:08Speaker 00

  They inherited a system from their ancestors that they could never have built. And they just assume that this thing, which is at massive scale, they can sanction this person and sanction this person and attack this person and deplatform this person and so on and so forth. And it's actually bananas how successful they were for like six or seven years just using the power of the empire at the zenith. Bam, this guy's canceled, bam. But when you do that too many times and everybody is a Nazi and everybody is deplatformed and everybody is canceled, what they did, and we're actually kind of fortunate in this, they've done it in a chaotic evil rather than lawful evil way. That's to say, do you know what I mean by the difference here?

• 52:48Shane Parrish?

  I think so, yeah. But you explain it just so everybody is on the same page.

• 52:53Speaker 00

  So lawful evil, it's like the communists or the Nazis, they're evil but highly organized, right? They are disciplined, they are persistent, they're methodical. And you can argue CCP is somewhat like that today. And it's complicated, of course, when you say someone's evil. Was every single person in Russia evil? No, of course not. Is every single person in China evil? No.

• 53:18Speaker 00

  There's aspects of the regime you can describe as lawfully where when they decide to go and censor, it's like a space shuttle launch, right? It's like, okay, we're going to censor this, we're going to censor this. They are not lying to themselves about their intent to censor. Okay, they're not self deceiving. They're like, yep, we're, this guy is falling through a trapdoor and this guy is falling through a trapdoor and we're censoring these words and we're censoring those words. Go time, right? Whereas in the West, there's this sort of, you know, there's all these lies that surround it like, oh, we're not actually censoring, uh, you know, because what they're doing is they're retrofitting speech and thought controls onto a previously free society.

• 53:54Shane Parrish?

  Well, hold on, hold, pause, pause for a second. We are censoring because we're now dictating, broadly speaking, we're labeling people that have acceptable or unacceptable views in various forms.

• 54:07Speaker 00

  Yes, but they're not admitting to it and like explicit versus implicit, right? China's actually set up an explicit system, the Great Firewall, you know? They have an explicit thing where it's like bans on social media. They have essentially an explicit set of rules on you cannot post and you can. And people understand that explicit set of rules. What the establishment is trying to do is have a China-style set of speech and thought controls without admitting that that is what they are doing, or they just double talk about it, right? And so what they really want is something where they can talk, but you cannot, right? The guys who own newspapers have freedom of speech and you do not.

• 54:50Speaker 00

  You know, for example, this article over here in The Atlantic, in the debate over freedom versus control of the global network, China was largely correct and the US is wrong, right? Or, you know, the NYT has tons of pieces on this, like, free speech is killing us, right? These are, you know, Sulzberger employees, right? Sky Arthur G. Sulzberger, sixth generation nepotist, inherited the New York Times from his father's father's father's father. Nobody ever writes about him because they're scared. Everybody writes about Zuck, who for all his faults, basically built Facebook himself and who I respect. I don't respect Sulzberger, who's just a nepotist and who inherited the paper and who's basically a born millionaire. And, you know, by the way, on this topic, there's so many articles, just to get, talk

• 55:31Speaker 00

  to you for a second, there's so many articles in New York Times that talk about how non-diverse tech is or whatever. And do you know the actual succession contest at the New York Times company for who's going to be the top publisher? Or that who's going to have the top job? Who do you think it was between? No, how does it work? Yeah, how does it work? Is it, is it something, you know, the Rooney Rule? The Rooney Rule, you're supposed to go and interview people from diverse backgrounds for the top position, right? Yeah, yeah, in the NFL. You know, the diverse backgrounds interviewed was three white male cousins for the top job for the New York Times, right? Read this article, AG Sulzberger, 37, to take over as New York Times publisher, right? So it's actually like a caricature. I'm not the kind of person who thinks white is an insult, but these guys are, okay?

• 56:15Speaker 00

  And they say it constantly, oh, my God, it's so white, it's so male. And yet this article is written as a coronation of, you know, a great leader taking over from dealer leader or whatever, right? So this meritless nepotist and his employees, these, you know, Sulzberger's inheritance, that's the New York Times company and Sulzberger employees, will write these articles about how free speech is killing us and how actually you're not supposed to have free speech. Only Sulzberger employees are and how if you say it's misinformation and when the Sulzberger employee says it, you're supposed to, you know, bow, right? And they have, they run these billboards that actually literally proclaim themselves to be the truth. In 2017, Sulzberger ran this ad campaign, The Truth. You remember that in 2017, like the truth is hard to find, etc.

• 56:58Speaker 00

  Now, do you, do you know what other newspaper called itself The Truth? No. It's actually an obvious one. As an intel guy, you might know this. No, I don't. Pravda. Oh, God. The Soviet newspaper is truth.

• 57:13Speaker 00

  So you, you, now, the thing is Sulzberger's innovation on this is it's not even, at least Pravda was like free. He charges you 50 bucks for the truth, right? And this is actually the same, you know, we described that information supply chain, you know, it's academia, media, government, right? So this is the second leg, which is completely corrupt. These, you know, these folks who will charge you $49 a year for access to the truth, where really what you're just doing is propping up this, this family office, right? You know, one of the things, by the way, you can sort of Turn one of these corporate journalists to stone, by the way, you know, when they're, when they're pretending to be all speaking truth to power, you say, okay, when are you going to write the big investigative journalism report on your boss, right? You know, for

• 57:57Speaker 00

  example, recently, just to digress on this topic for a second, there's this BuzzFeed journo went and doxed the Board Ape Yacht Club founders, right? Are they going to do that to Jonah Peretti, who runs BuzzFeed? No. Are they going to do it to Arthur Sulzberger, who owns the New York Times? No. Are they going to do it to the New Houses that own Conde Nast? Absolutely not. Are they going to even mention them? Do you even know these people's names? No, you do not, right? Why? You know the names of all the tech people because media corporations are at war with tech companies and the owners of media corporations are, it's not that they get good coverage, they get no coverage. They're just like blotted out. You know, all this rhetoric about, oh, my God, we need to investigate the powerful people and what, like these journos, you can just think of them as dogs on a leash,

• 58:41Speaker 00

  right? They are hitmen for old money. And as I said, you can turn them to stone by just asking them, who's their owner? And you know what happens? They stop engaging on Twitter. You literally just turn them to stone. Why? Because whether consciously or unconsciously, they were either pretending to be decentralized, you know, and unaccountable or whatever, and their own person. But when you mention their owner, they're like, I can't believe you bring my boss into it or whatever, right? And you're like, oh, you have a boss? How about that? Oh, it's so interesting. How courageous that you go and investigate your competitor, but not your boss. Oh, and it just, boom, the entire facade falls, right? You just hit it from the right angle, as we talked about, you rotate it from the Z axis, and you're like, these are just corporate pawns, right? And actually,

• 59:24Speaker 00

  the only journalism is citizen journalism, because that's independent, right? That's Substack, that's newsletters, that's something where that person may be flawed, but they're writing in their own voice, over their own time, they can't be canceled, right? And they actually have an incentive that's the opposite of the school of fish strategy. Remember our thing about how tribalism, if there's an economic incentive? All those folks have to build their own newsletter distributions. So if they say exactly the same thing as everybody else, then they're not unique. So they actually have an incentive to stand out versus to fit in, you know?

• 59:55Shane Parrish?

  Do you think that pushes people to more extremes in an effort to stand out? Like, so like, I'm going to just push the, the right and the left even further?

• 1:00:04Speaker 00

  Yeah, yeah. So there is that aspect. However, I think it's complicated because

• 1:00:12Speaker 00

  In the absence of, you know, the people who complain about filter bubbles are complaining that there's more than one.

• 1:00:18Shane Parrish?

  They just want to be the filter.

• 1:00:19Speaker 00

  They just want to be the filter bubble. They want the I love Lucy environment of 1950, where there's just one telephone company and two superpowers and three television stations and everybody's brainwashing the same thing. And by the way, that's a very atypical environment through history. That level of centralization of power was actually very atypical.

• 1:00:38Speaker 00

  You know, if you go further back in time, it's highly decentralized in an obligate way because you didn't, you didn't have the ability to broadcast to the entire country at the same time. You know, telegrams and all kinds of things. I mean, you could send a few bits of information. You go further back, it's letters. When it's letters, you just have to run a decentralized system because, you know, this group over here in Montana might not even hear news that the war was over until, you know, 20 days later, right?

• 1:01:02Shane Parrish?

  So why would the, the political system get behind this? Because like, if I'm in power, this is a threat to my power. Like, why would I get behind any of that?

• 1:01:12Speaker 00

  Well, the good thing is, the current political system doesn't select for competent people. So you're right that it's a threat to their power in the same way that like, a new startup is a threat to a nepotist inherited corporation. But because they're a nepotist and not a meritocrat, they're not going to be able to wield that power and money in an intelligent way. And I'll give some examples, right? Every single thing over the last 20 something years since, since certainly I've been an adult and probably, you know, roughly contemporaries, you know, 9/11 was a surprise, WMDs in Iraq, that was a surprise, the collapse of Bear Stearns and then Lehman Brothers, that was a surprise. You know, the Snowden revelations were a surprise, at least to the public and probably much of

• 1:01:57Speaker 00

  the elite. Trump was a surprise, COVID was a surprise, and Jan 6 is a surprise, and, you know, Afghanistan's a surprise, and everything's a surprise, right? Uh, oh, and also, of course, all the rise of technology, where the stuff was dismissed as a fad and a bubble, and it's never, you know, even in 2013, they were writing articles like Facebook will never make a significant profit, right? And yeah, Facebook has had some recent troubles or, but Facebook did make a significant profit. And in 2013, they were saying that this was not going to be the case, fad, bubble. Then just a couple of years later, they switch from fad and bubble to what? Threat to democracy. Right? So the consistency is a negativity where at first...

• 1:02:39Speaker 00

  They're dismissing it because it's never going to work. And then they're dismissing it because or attacking it because it's too powerful. Right. But what is missing is essentially the world's going to change. And I'm going to get a share of that new world by taking some risk in it. Okay. Because the moment you actually start, one of the things about the establishment is they can only perceive things that are around 50% popularity, at least double digit popularity. Anything that is too unpopular, that's at 0.1% or even less than that. They don't have the right mindset that this could grow quickly. That's why even all their discourse, for example, the rich, the poor, the middle class.

• 1:03:21Speaker 00

  Right. The developed world and the developing world. That actually embeds a staticness in it. You know why? Because it's not necessarily about the rich, the poor, and the middle class. It's about the ascending class and the descending class. It's not about the developed world and developing world. It's about the ascending world and the descending world. Like, that's about rate of growth, not simply about statics. So just to elaborate on that, your Brooklyn woke is actually rich, but in the descending class. And a kid in India or Nigeria with a smartphone may be poor, but they're in the ascending class. And they're part of the ascending world. Whereas you might be rich and in San Francisco, but you're part of the descending world. Right. So rich versus poor and middle class, that's static. Ascending and descending is dynamic.

• 1:04:06Speaker 00

  And they think of things as static. Their fundamental frames on the world are incorrect. Because of this, you know, once, once you actually start taking that seriously, though, once you start saying, okay, the world could change quite rapidly. Therefore, I need to have radar that is alerting me to all the ways the world can change. What happens then? Then you have to have to start actually building up the skills of the venture capitalist or the angel investor or the startup founder, where you have effectively a dashboard where you're looking at hundreds, thousands of possible things. And you have to score them in some way and figure out which of these rare events, this one is going to go to zero, but this one's going to level up. Because you can't invest in all of them. Right. So it's fundamentally a capital allocation thing, and it's hard. Right. It's, that's, that's why, you know, angel investing, it's actually much harder than it might seem.

• 1:04:50Speaker 00

  Right. Those are actually the skills that you need to be a leader in this environment. Why? Because, just to take the example, you know, this is pure real politic. When did China censor the internet and build a great firewall? Early, they did that early on, right? The golden shield project, they call it. When did they censor social media? Relatively early on, right? When they censor cryptocurrency relatively early on. Um, the US establishment is on the back foot on internet censorship, on social media censorship and so on. And um, it's, it's a difference. The Chinese sort of bought censorship at the seed stage or series A stage. And the US establishment has tried to institute censorship at like the post IPO stage. Okay.

• 1:05:31Speaker 00

  Which is 1,000x or 10,000x or 100,000x the cost. After 3 billion people have gotten, you know, smartphones and social media, now you want to censor them.

• 1:05:41Shane Parrish?

  It's like keeping the genie in the bottle is easy, but once it's out of the bottle, it's really hard to put back in.

• 1:05:47Speaker 00

  That's right. And the reason I use the VC analogy, though, is because it's, it's about the cost of that level of censorship. That actually starts to rise dramatically. Seizing all the smartphones is infeasible, right? Turning off the internet is now infeasible. If they wanted to retain control, then they would have done. If, if they wanted to retain control and they were smart enough to realize that this was a threat to their control, they would have done what China did and institute centralized choke points at various areas and take the PR hit and so on of doing that versus just, you know, try to retrofit that. Now, to be clear, I'm not saying they should have done this. I'm saying that if they had been lawfully evil like CCP, that's what they would have done. Now they're pining for it wistfully like this Jack Goldsmith article where he's like China should, you know, we should censor the internet like China.

• 1:06:32Speaker 00

  But they weren't far sighted enough to do that, right? They didn't use their power to compound their power in a smart way. Didn't use their money to compound their money in a smart way. And, you know, there's different ways of thinking about this. One thing I actually, I was able to kind of put this in words the other day. I think it's actually, I thought it was insightful at least. I hadn't thought of it in quite this way. Essentially, before, let's say 1990 or thereabouts, and you can push it back further. You know, there's advent of cable news and so on, but let's say before the modern internet, and especially before social media and then cryptocurrency, like, yeah, you had the nominal right to free speech, you had the nominal right to free markets, but you couldn't just go and broadcast to everybody, right? You couldn't easily start a company because the

• 1:07:15Speaker 00

  capital costs of doing so were so high, right? You know, there's that quote by Anatole France, which is, you know, "The law in its majestic equality forbids the rich and poor alike to sleep under bridges, to beg in the streets and steal loaves of bread," right? It's essentially saying like, you know, the law is fair, it forbids both the rich and the poor to beg. And of course, it's a sarcastic indictment of a truly just law would reduce the money and so on and so forth, right? Okay. Leaving that, you know, aside for a second, if you just take that concept and you invert it, right, or not invert, like just kind of apply it in a different way, the majestic equality of the law allowed the rich and the poor alike the right to own a newspaper, start a company, or speak freely, right? So in

• 1:08:00Speaker 00

  theory, everybody had the right to free speech and to start a company and so on. In practice, only guys like Sulzberger or his father's father's father had that right, and a pro could just go and talk to their neighbor or complain at the television set, they didn't actually have broadcast authority. That's because distribution was was sort of controlled, right? Yes, exactly. And, you know, one way I think about this is, remember the Unabomber? Yeah. Yeah, so Unabomber, basically, in, you know, the 80s and early 90s, you know, he sent these mail bombs around, and why? Well, in 1995, he got, he wanted the Washington Post and MIT to publish his op-ed. Okay?

• 1:08:46Speaker 00

  This guy, at that time, distribution within our lifetimes, okay? Which is like less than 30 years ago, alright? Distribution was so scarce that he had to kill for the distribution. Like, that publication was so scarce that he felt that he had to kill somebody. So what that meant is, there wasn't truly free speech. There were, there's a small oligopoly of a few dozen folks who effectively had a hammerlock on Hollywood and, you know, media corporations and so on and so forth. And the average Joe couldn't just set up a website and a YouTube and just go and stream and so on and so forth, right? And there's a whole licensure apparatus, by the way, around that. TV licenses to broadcast and you, you might need a radio license, right?

• 1:09:28Speaker 00

  And one thing, you know, somebody, I had this little debate with them, you know, about a year ago. They were like, "Not sure how often it needs to be repeated, but you don't get to be exempt from regulation because you built the same product using a different data structure." It's basically like, "Ha ha, grow up tech bro." Like, your blockchain stuff doesn't change anything. You need exactly the same rules that we had in the 1930s. And my counterargument was, you don't need a stamp to send an email. You don't need a TV license to broadcast on YouTube. You don't need a radio license to do a podcast. And you don't need to use old regulations to constrain the future, right? We recognize that automobiles differ from horses, that airplanes are distinct from birds, that submarines and surface ships are not the same. And so, like, blockchains are just scarce here with the internet with this information.

• 1:10:13Speaker 00

  They've changed fundamentals. Old ways of thinking do not directly apply, right? And so that's like the bunker buster, root and branch rejection of the concept that an old rule should simply be applied thoughtlessly without concern for whether or not, you know, the technological environment's changed, right? Okay. The point is, distribution, exactly as you said, was totally locked down. Now it's opened up. And what's actually happening, if we think about it, is enormous powers of speech and distribution were granted to people.

• 1:10:43Speaker 00

  And now people are mad that they're being, that they're trying to take them away. But on net, there's been a massive decentralization. If you were to graph it, like number of people who can broadcast or whatever, it just went vroom like this. And now, yes, there's the attempt to retrofit the speech and thought controls on it. It's like a graph that went all the way up and to the right in terms of practical speech. And then they're trying to like jack it back down. But it's going to come back up because the attempt to deprive somebody of the practical right, you just, you just gave them that voice. That's very, that's why people react very strongly to it being taken away. Right? They just got it. It's like the franchise, frankly, like, you know, just getting the franchise,

• 1:11:27Speaker 00

  people will react very strongly to it being taken away. Right? And so speaking rights are like voting rights in that sense. In fact, arguably, if you can't speak, you know, you don't actually have a true voice. Right? Because the guy who writes a headline on the day of the election then controls a million votes and you have only one. Right? That's why they say our democracy in the possessive sense. Like because somebody who's got runs a major newspaper or media corporation controls many more votes. It's their democracy, not yours. Right? Because they, they're basically points of aggregation. So that brings it back to your kind of original point, which is, you know, we're talking about the Canada thing. It's going to be very difficult for them to take away these rights because they're poorly organized. They don't anticipate future outcomes.

• 1:12:09Speaker 00

  They're spending massive amounts of money without results. And the thing is, if you're spending a million dollars and everything, it doesn't matter how rich you were born, you will eventually become poor. If you're a terrible capital allocator, if you're spending $300 million on bus lanes like San Francisco, if you're spending billions of dollars on like planes and ships that don't work, like the US military, like the F-35 or the Zumwalt or the probably stuff that you've sent, you know, the LCS railgun, all these things are just super expensive boondoggles. Right? If you're doing that and somebody else is 100x more cost effective, even if they start from a lower base, they're going to eventually beat you. And I see this all the time with startups that they're small, but they're focused and they can get more work done and they can get more output.

• 1:12:53Speaker 00

  Because all that bureaucracy and cobweb stuff at a large company ends up not being a moat, but a, but a, but a ball and chain, right? So what I think happens with Canada is a Peric victory for the state. Because remember, they use this stuff on like these truckers, right? But they pissed off like the global tech and crypto elite. There's like, you know, it's kind of a three-layer thing, right? Where you have the national elites who are kind of oppressing these proles within their countries, right? Then you have the international now crypto Web 3 group, who is like at a technical level that is above the, those politicians are just effectively trying to seize the technologies that this group above has created.

• 1:13:37Speaker 00

  And this group above does not want those technologies to be seized. So that is why, that's actually really the battle between the network and the state is, you know, where, you know, where things are going to be. And I think that Western governments will lose. It's going to be super nasty and super gnarly. But on balance, they will lose because their ideology is not one that attracts the very top talent. And this is actually the same problem that CCP has in some ways, where they're driving away Jack Ma and they're driving away, you know, Pony Ma. And the, all the, all the founders of tech companies are finding that their life's work is either being expropriated or they're being blamed for it. So lots of the best are trying to leave, right? And the NYT ideology has repelled Barry Weiss and Jesse Single and Glenn Greenwald

• 1:14:22Speaker 00

  and, you know, Matt Iglesias and also Mark Anderson, all the tech founders and so on. And all that's left are the basically middle manager types who are fine. I don't have any beef with them per se, but they're not founders, they're not creative. They're literally there to just follow orders. And they're taking directive from NYT, but the really intelligent people aren't. And even actually some of Sulzberger's loyalist employees are now into Web 3 and crypto. And it's sort of the tribute that Vice pays to virtue, right? Now these people are in it. Why? Because they took all these shots at it, they couldn't kill it over 10 years. Now they want to make some money from it. And, you know, the question is, you know, is that good or bad? I think on net it's good because...

• 1:15:08Speaker 00

  It's sort of them submitting to the frame like they're not going to be able to ban it now. It's going to be harder to ban it if enough members of the elite have sort of defected and are making money from this. Only the sort of retro authoritarian chunk, which is only about 30% of the population. It's not, it's not 75%. They start to lose that, right? Essentially in Canada, and I don't know what you've, how you felt it on the ground because you were like you're immersed in that social network. All the commentary in my, you know, it's like microclimates, right? So Twitter's like microclimate, so my perception might be different from yours. But all the commentary in my microclimate was probably 95 to five against Canada.

• 1:15:49Speaker 00

  And the most positive I could find on the Canadian side was like at best 50 50 for what Canada was doing. Or, or 40 60, but an insistent 40 60. I don't know what your perception is on that.

• 1:16:02Shane Parrish?

  Wait, how would you handle that? How would you handle what, what sort of happened in Canada then?

• 1:16:08Speaker 00

  Like if I was Trudeau or something?

• 1:16:09Shane Parrish?

  Yeah, you're Trudeau, you're, you're in charge of the government. How would you have handled this differently?

• 1:16:14Speaker 00

  It's a good question because like, okay, now you're not just second guessing. You're actually there to do something and so on and so forth. The upstream is what you actually want is to build an aligned, high trust society where you have noblesse oblige. You have, you know, the elites are from the people and part of the people. And the people feel that the elites are on their side. And it's like, you know, cheering the quarterback who came up from your small town as opposed to this sort of alien Davos class that seeks to rule you rather than middle managerial elite, rather than like actually feel your pain. Right? So that, you know, people talk about representativeness, but there's representativeness in terms of sort of an arbitrary demographic cross section.

• 1:16:56Speaker 00

  There's representativeness in terms of people truly feeling that these people are genuinely representative. And what's happened is that good hearts law thing where those proxies for representativeness, I feel have been taken away. Where people don't fully feel despite the mechanics of the whole system that the government represents them on many of these issues. Right? And so the, the upstream, it, it's a little bit like asking this guy who's in the last stage of bankruptcy. And you're like, okay, what should you have done in that last stage? And my answer is there are things that should have been done five or 10 or 15 years ago to stop it from getting to that stage. You know, because if you are just the last stage. You're going to fall off a cliff in some way because your financial situation is so precarious that anything can push you off. Go ahead.

• 1:17:40Shane Parrish?

  You're in an increasingly difficult position as a result of all of your previous decisions.

• 1:17:45Speaker 00

  That's right. And so what are those previous decisions? I'll give two views on this, okay, because it's a very important question. One view is something I'm drawn to, even if I feel it's only partially explanatory, and that is just that civilizations rise and fall. You know, like, just like human beings, they're born and die and they have their salad years and then their old age and so on. And so we saw the rise of the West, and now we're seeing the fall of the West. And we saw the fall of Asia, and now we're seeing the rise of Asia. And the countries and the regions that were on top in the 20th century, which were broadly speaking, the US and Western Europe and so on, that were the most, the most free and the most capitalist and so on and so forth, are becoming the least, least free.

• 1:18:28Speaker 00

  And the, the ones in the East that were communist, or they were poor, or what have you, are becoming more powerful. A lot of them have flipped to becoming nationalist, and they're the ones that are winning these conflicts. And certainly, you know, I'm not, not a supporter of what Russia is doing right now, but the power level is shifting, right? It is something where, we'll, we'll see what happens with this Ukraine thing, just to talk about that for a second. As of right now, and this could be completely fog of war, so I have very low confidence in this. I don't speak Russian. Every source I'm seeing is through translation. But at least as of right now, last I checked, there's, there's reports that Russia just blitzkrieged the Ukrainian military.

• 1:19:09Speaker 00

  Just blew up all kinds of stuff, has taken all kinds of, you know, cities and so on and so forth. And it doesn't look like, you know, there's going to be significant troops sent by the EU or, you know, probably, you know, the US or EU, because that would be like a direct superpower to superpower confrontation. They want to avoid that, and it's all proxy war. So maybe they will fund the Ukrainian resistance or something. But Russia can win, you know, like guerrilla wars. They, they won in Chechnya, they won in Syria, because they're more ruthless, right? So it's quite possible that Russia actually just beat the US, or at least beat a client state of the US that thought the US would back it up. And it would be, if this happens, and we're not, I don't know if this is going to be the case, it could be totally different. But if this does...

• 1:19:55Speaker 00

  Look like Russia fights a quick war, gets new territory, the world yells at it, they sanction it, and then maybe Russia does a counter cyber attack or something like that. Who the heck knows? Could be really crazy in the weeks to come. But if the dust settles and Russia's in control of that territory, even after the sanctions and so on, then that's a second US-backed military that folded in days in like six months. Right? And so that's a flippanting of the 20th century where it's not like the US, you know, the US did have losses in Vietnam and so on. But broadly speaking, the US generally won battles in the Cold War, generally won economically. You could argue that's just fitting it, you know, retrospectively, and it came on strong

• 1:20:40Speaker 00

  the last 13 years or 10 years, whatever. But it but net-net, it was stronger, right? And now I feel like, some reversals notwithstanding, the direction line is down into the right for the West. It's down to the right as percentage of global GDP, as percentage of population and military strength and so sort of. And the thing about that is, when people, you know, if you say that, people are like, "Oh, you're anti-American, you hate, you know, the West." That's not actually it at all. It's something where it's more complicated. I can give a few one-liners on it. One is that woke America is to America as Soviet Russia is to Russia. Like, it's like a different thing, you know? It's like an ideological different thing. For example, with India, like the India of my youth, if I said it

• 1:21:25Speaker 00

  wasn't globally competitive, that's just a statement of fact. What I wanted or didn't want, you know, the land of my ancestors was a basket case. "Okay, that sucks. You know what? Let's figure out what to do." Now it's rising, and that's really surprising. It's incredibly surprising to me that that happened, but I've incorporated that into my mental model. That doesn't mean I'm pro or anti-something. I'm just trying to see the world as it is, right? I prefer a situation where everybody was rising and everybody was doing well together. That's just not the way the world is, is as distinct from all, right?

• 1:22:01Speaker 00

  So in this kind of flipping, you're seeing the West declining, you're seeing the rest rising, and it's kind of like, it's not exactly as clean as those countries are doing well in the 20th century are doing poorly this century and vice versa, but that's like first order, you know, just first principle component, that's kind of what it is. One way of thinking about that is, a lot of these countries are effectively vaccinated against socialism or communism, which took them down in the 20th century, right? How could you make China unproductive? Well, the mind virus of communism there would make these incredibly productive people unproductive, right? You know, people have reckoned, by the way, that like, what happened to the Soviet Union, the Russian population might

• 1:22:42Speaker 00

  not have been 140 million, it might have been like 500 million, without the Red Terror and the wars and all of this stuff, which was in part caused by communism. You might say, how are the wars caused by communism? Well, there's a good book called Stalin's War. Have you ever read that? No, never. Really good. Sean McMeekin, actually, all of his stuff is good. And, just like a really good historian, you're like, okay, you know, I didn't actually understand that dimension to the past, and you can obviously poke in their citations, and he writes in a very engaging style, I recommend it. But essentially, he says, look, you know, we normally think of World War II as Hitler's War, and that's a valid perspective, but he thinks of it as Stalin's War. Why? Stalin was actually involved in every theater. He had, you know, because the Soviet Union bordered Asia, it was basically near Japan, and so

• 1:23:27Speaker 00

  it was over here. And, something that I wasn't actually aware of, is Soviet Union was actually extremely involved on the whole Japan-US thing. After the Russo-Japanese War of 1905, which was actually under the SAR, okay, the Japanese beat the Russians, and in fact, that was like the first time a non-white power had beaten like a white power, is this huge thing for like anti-colonialism or whatever worldwide, right? Huge humiliation to the Russians, they took the Japanese very seriously, and even after the communist takeover, they sort of inherited the geopolitical issue, where before it was SAR versus Imperial Japan, afterwards it was communist versus Imperial Japan, but they thought of Japan as like a very dangerous rival, right? And a huge, overriding foreign policy priority for the

• 1:24:09Speaker 00

  Soviets was to get their two big rivals, like Japan and the US, to slug it out between themselves. Versus their nightmare scenario, which would have been Germany attacking from the east and Japan attacking from the west and taking the oil from, right? And so like a huge, a good chunk of the book talks about how Soviet spies, who are now all revealed, by the way, like, you know, it's funny, there's a long period of time where it was considered like paranoid to talk about Soviet spies in the US government. Then Venona came out, which you're familiar with, you know, probably, and showed that actually a lot of Soviet spies were in the government. And now you can match them up with the Soviet archives, which McMeek did during that period of opening.

• 1:24:49Speaker 00

  And you can show that actually Stalin used spies to help push the US to confrontation with Japan and have them slug it out versus having a flanking attack on both sides. Right? So without these, the reason I was saying is communism helped cause those wars, right? Communism reduced the Russian population. Communism was this huge virus that affected Russia and China and, you know, much of that part of the world, Vietnam, you know, in Cambodia, they killed all the people with glasses, probably set back industrial civilization by, by decades, you know? And now fortunately, that part of the world has kind of shrugged that off to greater or lesser extent. And, you know, some places, obviously China's still nominally communist.

• 1:25:32Speaker 00

  You can argue it's genuinely communist because they still have state control over capitalism, but they're nowhere near as communist as they were under Mao, where they were, you know? Right now, you can argue they're really nationalist socialists, nationalist militarists versus communists.

• 1:25:45Speaker 03

  This episode is brought to you by Michelob Ultra. Good times mean competitions between you and your friends, like seeing who can throw some pigskin the farthest or rush the field the fastest. Winner gets an ultra because it's not just a superior light beer, it's also giving fans superior access to their favorite sporting events. Superior is worth playing for. Visit michelobultra.com/superioraccess to enter. Enjoy responsibly. Copyright 2026 Anheuser Busch InBev Michelob Ultra Beer, St. Louis, Missouri.

• 1:26:14Speaker 04

  College football is back. So Hilton called in me, the superstition concierge to make your fan rituals a reality. Need a room to match your lucky number? We got you. Want to make sure our team doesn't wash your lucky jersey? Oh, that smells lucky. Hilton's unmatched hospitality can keep up with any superstition, even a marching band wake up call at 5:55 in 55 seconds. Hit it! When you need a team that will do whatever it takes on game day, it matters where you stay. Hilton, for the stay.

• 1:26:44Speaker 00

  Vietnam, all these other countries have kind of gone into the China model because it's worked. And so now they don't have the mind virus, but Western Europe and the US does, which is not communism, but wokeness, which is all symbology, you know, not biology, but symbology. It's all online symbols and likes and RTs and it's all the word, anything you can do on a screen. If you can't push a button, it doesn't exist. And you know what? It's actually very optimized for that environment of shaming people online of like, you know, mass mobs, of hysterical online behavior. It does work in that environment. It's like optimized for social media. But as the terrain shifts to like pseudonymous cryptocurrency, as it shifts from like the

• 1:27:25Speaker 00

  open plains to like mountainous terrain, it's like Napoleon in the winter, you know, so to speak. I know I'm mixing metaphors, but like that army of wokeness, that ideology can win on like, you know, centralized social media platforms, English internet. But once you start going pseudonymous, once you start having cryptocurrency involved, once you start going international and having people abroad, when you're having other... It can't win when the terrain changes so dramatically, right? It's just not, it wasn't optimized for that kind of conflict. It grew on Western social media.

• 1:27:57Shane Parrish?

  Just to be clear, when you're talking about winning, you're just talking about popularity. You're not actually talking about effective policy.

• 1:28:03Speaker 00

  Oh yeah, of course. That's right. Yeah, sorry, sorry. Let me actually kind of describe my mental model on this, right? So I have this thread on what I call the social war. So 1861, the blue and the gray, okay, the Unions and the Confederacy, they were not just ideologically separate, they were physically separate, you know? There was this boundary line, I think the Mason Dixon line, that separated them. Yeah? And so the victory condition was clear, which was one group would invade the other group and by invading their territory, they would also demonstrate their will over their group and get them to surrender and conquer them. Fast forward to 2016, 2020, blue versus red in the US is fractal. It's not...

• 1:28:48Speaker 00

  Geographically split like it was in 1861. It's not like Republicans are on one side of a line and Democrats are on the other side. And it wasn't exactly like that in 1861 either, but Republican majority was on one side, Democrat majority was on the other side. It was territorial enough, right? So here, though, it is not obviously territorial. It's something where it's like urban areas are mostly blue and the rural areas are red, but it's very cheek by jowl, very fractal. And even if one side wanted to declare war on the other side, any bomb will blow up a bunch of their own people versus others, right? So that's why physical war, in the sense of like formations of the 1800s or 1900s, is hard. But if you go forward in the digital space, these two factions are highly separated.

• 1:29:32Speaker 00

  And that is actually the theater of war. It's in words, it's in actions and signaling? Well, it's actually when you cannot invade their territory, victory means invading their mind. And then that comes back to distribution. It comes back to distribution, exactly. That's right. So, you know, it's that saying, war is politics by other means, right? And if you've got, if you think about it, let's say there's a bunch of drones coming at you, okay, 100 drones. You can shoot each one out of the sky, but much better is to be able to hack them, hit enter and have them drop out of the sky, even flip around on their own sender, right? Similarly, if there's 100 soldiers coming towards you, you can shoot each one of them, but better is to be able to hit enter, propagandize them, or drop leaflets on them in an earlier

• 1:30:15Speaker 00

  era, get them to believe they can't win, and then they just either drop the weapon or even turn around to their own government, do a strike at home or something like that. Okay? And so that's information war. And so we know that that's always been a component of physical war. But now it's like the whole thing, okay? It's literally just fighting the information war online. And then eventually, when you hit enter and print it out, it's a riot here, or it's a protest there. This cloud swirling information war gets printed out into the physical world, just like you might print out a document or 3D print something, this conflict gets printed out. But it's fundamentally a digital conflict swirling here. And when you think about these Twitter threads, you're talking about thousands of people,

• 1:31:00Speaker 00

  it's literally like everybody got teleported into this massive online battle arena.

• 1:31:07Speaker 00

  And it's like the medieval era where you have swords clanking back and forth and people love battle, you know, they just love it on some level, right? It's stimulating, you know?

• 1:31:17Shane Parrish?

  Yeah.

• 1:31:17Speaker 00

  And they can just die a thousand times and there's actually real life consequences. And yes, it's tearing apart society, but it's engaging, you know? And there was that quote from 2016 or whatever, which was very ironic. Yeah, it's like, I feel bad for our country, but this is tremendous content. That is actually, you know, the social media platforms and the mainstream media platforms

• 1:31:43Speaker 00

  are both things that have essentially profited from the Fight Club.

• 1:31:46Shane Parrish?

  It reminds me of that scene in The Gladiator where he looks up and Maximus goes, are you not entertained, right?

• 1:31:52Speaker 00

  Eggs, that's, that's exactly what it is. I now understand the gladiatorial arena in a different way, you know? I understand what the decivilization and the barbarizing process looks like as you go from a civilization where there was common shared myths and common shared morality to one which is just tribe versus tribe. We're actually seeing that happening, right?

• 1:32:13Shane Parrish?

  Yeah.

• 1:32:13Speaker 00

  And it's like crazy, right? But coming back to the social war concept, once you map this and you realize, okay, this is not like a peacetime state, it's a war state and it's being waged in the digital space because it can't be waged in the physical space or it's only printed out in the physical space. Um, this is why, by the way, you see these blue versus red punch him ups between Antifa and Proud Boys, whatever. That's like, what people are doing is printing out that dispute. They're like, let's go and rumble over here, right?

• 1:32:43Shane Parrish?

  Yeah.

• 1:32:43Speaker 00

  And they're kind of announcing a slugfest, okay? So then when you think about what's, what's happening here, okay, uh, conquering, the win condition is conquering their mind. And so then that's where unbanking, canceling, deplatforming, all that stuff, they're tactics in a social civil war. Right? They're, they're meant to make a node on their side wink out or change color.

• 1:33:05Shane Parrish?

  Yeah, yeah.

• 1:33:06Speaker 00

  And now you can see why there's so much focus on hashtags and bio and getting people to use certain language and, you know, if you can force them to say a word or not say a word or put a phrase on their site, okay, or have some shibboleth, okay? Then you've invaded their mind.

• 1:33:27Speaker 00

  And so it's like digital capture the flag. You are essentially by virtue of seeing people signal something by virtue of their virtue signal. Okay, you are seeing that you have either at least, even if it's like a gun to the back of their, an economic gun to the nape of their neck, even if it's under duress, nevertheless, it's still controlled territory.

• 1:33:48Speaker 02

  Yeah.

• 1:33:48Speaker 00

  Now, the thing about this is that flippanting is, I don't know if you've ever seen the maps of Imperial Japan at Zenith, or Nazi Germany at Zenith, or the Soviet Union at Zenith. There was a period where it was like, oh, boy, these guys are really winning a ton of territory. Holy shit, right? And what happened was there effectively was like a bandwagoning counterattack, where everybody they pissed off, ganged up on them and beat them down, right? And so what I think has happened here is the Western establishment, as I mentioned, they've taken on the right, the center-left, tech, you know, Russia, China, to some extent, India, Israel, and, you know, like a bunch of other smaller countries, like obviously Iran and, you know, Hungary,

• 1:34:33Speaker 00

  and they're mad at Britain, you know, half Britain because of Brexit, and they're mad at France, and, you know, they're mad at, you know, like various countries on immigration policies. They're mad at lots of countries, right? I mean, you're mad at, when you're fighting everyone at once, even if like when this, this woke just expansion, right? Like this, this thing just grew to this huge thing. It's kind of like when the Nazis were in 1940, right before Barbarossa, they were at their Zenith, right? Imperial Japan was like at Zenith. But now they're, they're, they're really, if they're winning, they're winning empirically. Okay, and one way, as I was also putting my finger on this, with the Rogan thing, right? Yes, they were able to grind out a cancellation of Rogan.

• 1:35:17Speaker 00

  Okay, like they ground out a victory. But it took a lot of ammo. It took a ton of ammo. And crucially, there's a big difference between this versus previous cancellations, which is they could only win it like 55-45, not like 95-5. How can you see that? Because they couldn't cancel the people defending Rogan. They were too numerous. If it's 95-5, then anybody who even speaks up in defense of the person being canceled, after they finish with this guy, then they boom, gang up on that person and gang up on that person. So nobody can even speak up in defense and everybody gets the signal. They understand how outnumbered they are. Right? Yeah. When it's 55-45, they just don't have the numbers to swarm all these different people. There's too many targets to shoot at and other guys have troops on their side. And it's really a social war, by the way.

• 1:36:02Speaker 00

  This is not, that's not a debate. It's not the marketplace of ideas. It's the battlefield of ideas, right? Because there's some ideas which by their nature are not about like the Feng Shui of an apartment and where you lay out the things where it's all, anyone can have this preference or that preference. But they are like monotheism, you know, you have the belief or you don't, right? They're optimized for maximum virality. They're the most memetic, you know, mind viruses around, like the memes that, you know, Dawkins would talk about, highly fit memes that are meant to spread and then block off the spread of any other competing ideas. They're literally naturally selected for this in our brains, you know? Just like computer viruses, you know, these are mind viruses. And you know what the wet market is? It's Twitter.

• 1:36:46Speaker 00

  We've all got our brains dunked in a vat, which is Twitter. And so the most contagious possible things are selected for there, right? We call them viral, you know, we call them viral contagious in other word. And so wokeness is one of them, but it's only selected in that environment. And when we change it to an environment of cryptocurrency and pseudonymity, there's lots of roadblocks and stuff that arise and it makes it harder. I think Web 3 will be Waterloo for wokeness. Talk to me about that. So, you know, Waterloo, you know, it's like famous thing, you know, Napoleon meeting is Waterloo, right? Which is, this is actually after this powerful army won all these victories, eventually was defeated, right?

• 1:37:28Speaker 00

  And you can argue whether Waterloo is the right analogy or, you know, Napoleon invading Russia and the Russian winter and terrain that's defeating it. But fundamentally, Web 3 is much tougher terrain for wokeness than centralized social media. And here's why, right? First is with pseudonymity, you can reboot under different identities. And so cancellation is not permanent. Student immunity, there's a very strong moral case for student immunity because it prevents both cancellation and discrimination. So you don't have to give a single inch on the morality of it, right? If somebody says, you know, "Oh, we need to count X, Y, and Z group," you can say, "Actually, I don't want to implicitly discriminate. I don't want to have unconscious

• 1:38:09Speaker 00

  bias," because there's a lot of papers on that. You could kind of cite the same science, you know, or quasi-science, whatever. You can argue if it's good science or bad science. If it's bad science, they're not going to be able to cite it. If it's good science, then you can both cite it, right? So you can use the same premises. So the same kinds of stuff that is, that people cite for the purposes of, say, blind auditions, or for "ban the box," where you, you're not supposed to be able to ask about somebody's criminal history, or for not asking about marital status, or not asking about immigration status. I actually agree with some of these things, where some of these things are irrelevant to doing the job, right? Like, you know, like their immigration status, that's just, you know, a stupid technicality. I mean, of course, you have to go through all the legal paperwork, but that does not affect whether they can calculate an integral or

• 1:38:52Speaker 00

  not, right? You take that to its conclusion, and you actually have this thing that you can get a left-right coalition on for student immunity, and you can make a moral case for it, because that moral foundation is very important. You also have a moral case for decentralization. And what that means is that if a centralized thing is compromised, well, the backend is open state in, in crypto. That's the thing. It's not just open source, it's open state and open execution. Do you know what I mean by that? It's not just the code that's public. It's the data, data set, and you can run a node, and you can watch every single op code execute. So if you're concerned about a non-transparent algorithm, you can actually see it executing for yourself. What that means is, people can't just lock you out completely. If you want to, you could clone the equivalent of the entire backend

• 1:39:36Speaker 00

  of Twitter, and then do your own chain, if you had enough community and so on, right? So that's, that's another check. So student immunity is one, decentralization is another. You know, third is censorship resistance. Like, the conventions of the whole space, a huge amount of the, the whole thing is based on the fact that one person cannot prevent another from doing it, right? Fourth is sort of a built-in anti-establishment thing, where the, the point of Bitcoin and the point of Ethereum is that they're not inflation, right? They're not Wall Street. They are outside it. Now, you might say, "Oh, everything gets co-opted and so and so," but that means a co-opter has to be smart. You know, those institutions have bled so much talent that they've just gone into cryptocurrency instead.

• 1:40:20Speaker 00

  Right. Fifth is international. So all these internationals that are piling into web three. Why? Because if you are in Brazil or India or Nigeria, you're not going to get like, you know, a visa to the US very easily. You're probably not going to be able to get onto Wall Street. But you know what you can do? You can boot up on web three and start trading. And so there's this massive international constituency for this, which has a lot of intelligent people that have just come online. And they are going to, I mean, this is a huge force. I cannot overstate how big that is. Right. And so it's a huge army of folks where, you know, the, the wokes are not, they're, they're used to thinking about in terms of domestic politics.

• 1:41:01Speaker 00

  They're not actually used to thinking about people overseas as anything other than sympathy objects and statistics. You know, um, and I see this with discussion around, you know, China in the 2010s and now India now. These are actors in their own right, right? You know, Nigeria is now coming up in terms of tech scene. South America has now, you know, concepts of its own. El Salvador is going Bitcoin. Lots of South American countries are talking about Bitcoin. Like all these countries are now waking up and doing things other than being, you know, sort of, you know, pawns in this, in this kind of great game. Right? And so I mentioned decentralization. I mentioned pseudonymity. I mentioned censorship positions. I mentioned the international. Okay. There's also another interesting aspect, which is the monetisability vanishes if you centralize it.

• 1:41:45Speaker 00

  So the entire like sort of woke thing is, is like, you know, gain control of an organization and just start looting the treasury. And it's very similar to, you know, any religion becomes a business model, becomes a scam. You know, and it's like John McWhorter and others, many others have talked about wokeness as like, you know, essentially ultra Protestantism and a, uh, like a, and, and look, I'm not anti Protestant or anti Catholic or anything like that. I, you know, I consider myself ecumenical, but.

• 1:42:17Speaker 00

  A religion that doesn't admit it's a religion or know it's a religion, yet makes moral claims that are at the level of essentially a Christianity fork. And you know, Tom Holland talks about this in his book, McWhorter talks about this in his book. There's a real parallel, you know, of many things from original sin to, you know, climate change is hell and so on and so forth. Even if you think some of these things have scientific basis, the accumulation of them is not something where, um, you know, if you think climate change is happening, one answer would be to do nuclear power. But no, instead, it's evidence of how we're sinful and we have sinned and we need to actually destroy industrial civilization and you're a sinner and it's an argument for social control. And it's like the Puritan

• 1:42:58Speaker 00

  mindset of New England. Um, you know, COVID is another excuse for state control and you must submit and all the type of stuff where it's not solved pragmatically, it's solved in a way or quasi solved in a way that is, you know, state control, right? So if you think of this thing as this religion, well, it's having, gonna have trouble evangelizing here because if it does centralize and control something totally, then the value poof vanishes, right? Because a blockchain, it'll just get marked all the way down to market, it'll get marked down to zero. So you grab it, you centralize it, and then it's like sand through the fingers. What if you grab, you grab something which it dissolves if you, if you fully centralize

• 1:43:41Speaker 00

  it, right? And that is actually a new thing where you cannot totally capture it and seize it. It's not like seizing an oil field where you have total control over it. If you have total control over it, if nobody, if, you know, all Bitcoin miners were seized, then Bitcoin wouldn't have value, right? And so they would have seized nothing. Now, they may still do it. Um, they may try to do it because it's like a political thing and they're spending money on it effectively and they're not trying to make money on it. Um, you know, Russia took a hit of 50% or something to their economy for this invasion. Some people do things that are non-economic. That's actually one of, an important vulnerability. But the defense against that vulnerability is you have so many different chains now, it's gonna be hard to take out all of them, right? So you have multiple levels of decentralization.

• 1:44:26Speaker 00

  Uh, and then you have one thing else, which is very important, and that is that Web 3 is sort of splitting. On the right, it splits the nationalists from the libertarians. On the left, it splits the authoritarians from the libertarian left, right? And what I mean by that is, the people who are voting against cryptocurrency are typically on the national security right, or the like, top-down socialist sympathetic left, right? The nationalists and socialists are against cryptocurrency, but the libertarian left and libertarian right are for it. And I think there's more ability on both of those sides cumulatively. And so you're starting to see an important split develop on the left on this, where, in an important sense, Web 3 is outbidding the state.

• 1:45:09Speaker 00

  That's to say, it is providing more actual money and community and all of these things than the state's pretense to, you know, like, provide socialist goodies. It's not actually providing that, but Web 3 is, right? So you're finding a lot of people who are redefining socialism as an opt-in Web 3 community. I would think of that as the opposite of socialism, okay? But it's one of these funny things where, you know, I have this kind of one-liner. You know, there's a really good thing, when both sides feel they're getting a screaming deal, that's the basis for a sustained relationship. Like, you want that. That's actually the opposite of the Justin Trudeau situation, or whatever, right?

• 1:45:52Speaker 00

  Like, where both sides feel they're getting a terrible deal, right? But both sides feel they got a great deal. Progressives, ha ha, finally got a cut of all that tech money. At last, libertarians learned how to share, right? And libertarians, ha ha, finally got progressives to cut out that state regulation. At last, they learned how to share risk. And, you know, Web 3 might just put the world back together again.

• 1:46:15Shane Parrish?

  What advantages do established democracies have, and what disadvantages do they have?

• 1:46:19Speaker 00

  Okay, so, we have to get into kind of the definition of what is a democracy, right? And ideally, you want a definition where, because right now, implicitly, it's basically just, whatever the Western establishment says a democracy is a democracy, right? You know, Canada can go and freeze all these accounts, but it's a democracy, right? Whereas, a country they don't like is a flawed democracy or not a democracy. And there's different definitions. One I've been sort of, you know, flirting with, there's a few interesting concepts. One concept I put out there is 100% democracy versus 51% democracy. So 51% is where we currently are in the West, where there's like a, it's a minimum necessary level of approval. Okay, it's a Fosbury flop, you just barely clear the bar.

• 1:47:00Speaker 00

  And as distinct from 100% democracy, or tilled 100%, where you're close to that, and you set that at least as an ideal, where you basically want everybody to agree on something. And you're like, how could you possibly get that policy? I'm like, well, first, let's agree that that would be more desirable, right? And then, once we agree that, you know, 51% democracy is like the barest level, how'd you engineer 100%? Well, you would do it probably on the basis of exit rights, where you have a bunch of jurisdictions in the digital space to start, and you freely enter and exit them, just as people are entering and exiting DAOs. And then they have pockets of territory they hold around the world, and then you see if you can gain egress there, right? And now, before entering, you're literally signing the social smart contract, the social contract plus a smart contract.

• 1:47:43Speaker 00

  And you're signing that on-chain, and it's notarized, and it's videotaped, so you know that you made full and free consent, and you might be giving up some of your rights to enter this jurisdiction. Maybe they can, you know, take some percentage of your deposit, for example, if you misbehave, whatever. But all those things are terms that are flagged upfront that you consent to at the time of entrance, right? And that starts to actually get you to something, which is, you know, it's kind of like joining a company, right? The CEO is in charge, and you make a trade-off, which says, okay, I'm having less freedom in return for more net benefit to myself, and it's also net benefit to the CEO, it's mutually agreeable, and I'm agreeing to these rules, and if I don't like it at some point, I can leave, or they can, you know, like, you know, terminate me, and that's

• 1:48:26Speaker 00

  actually, you know, that works in the corporate world, right? So you bring that, that thing, right? So that's one way of thinking about it, the, you're optimizing for the level of consent in society, the consent of the governed, as opposed to the procedure of an election that just generates 51%, and swings wildly back and forth, you know, every four years, and just makes people mad, right? A second concept is, is it even a democracy? Because, you know, saying, leaving Canada aside for now, but you take the US, okay, it's got military bases all over the world, right? I mean, was there, was there a, did the people of Iraq vote for the invasion? You know, that's like tens of millions of people. It's actually a very important point, right? Like insofar as the exercise of force is supposed to be bounded by some degree of,

• 1:49:10Speaker 00

  you know, the say of the people, can they vote the troops out? Right? Can any of those Middle Eastern countries vote American troops out? Can any of the countries with American military base around the world? Can they have a referendum to vote them out? Not to my knowledge, that's not, not really being put on the table. And in fact, there's a saying that, you know, the, for a long time, you know, the US government sort of makes sure that no party got, you know, too close to pushing for that, right? From either the left or the right. And our question is, is it democracy in the sense of are most of the people in the government actually elected? No, they're not. There's something called the plum book. And those are, there's a few elected positions, like, you know, the president and the senate and so on. But here's the thing, if those positions, you know, like congressman is changing every two years, right? President every four years, senator maybe every six years.

• 1:49:54Speaker 00

  If those positions are potentially changeable, how would the government continue to operate? And actually, what you realize is a lot of that is ceremonial. And the permanent government is what continues to operate all the way through. That doesn't change on an election cycle. The, if the permanent government was changed out every few years on an election, then, you know, you're, now, maybe government services don't work at all anyway. But services would just stop working because it's like, imagine you could vote out all of Google every four years and there's a new team, they just wouldn't even know what to do, right? That change of power would not be a continuous thing, it'd be a bunch of new people. There would be continuity. So the actual government is what remains constant through elections. And that's, you know, the official bureaucracy of, you know, about 3 million federal employees, many of whom have career tenure.

• 1:50:38Speaker 00

  And if, if so, they were not elected and can't be fired. Okay? And of course, it's the media corporations who, you know, like Salzberger inherits it, you know, all the way down. It's the academics and they have tenure, they can't be fired either, they're not accountable to the electorate, right? They have enormous influence, all of this. So the actual permanent government is not actually accountable to elections. So is it a democracy in that sense, right? And then there's the question of how much actual say you have, right? Because the guy who owns the distribution, as we just talked about, do you have the voice? You know, no, you really don't. The guy, you know, owns the newspaper, has a million votes on the day of the election and you have effectively one, which is why they favor the system that gives them informal. Huge amounts of power in a formal system, right?

• 1:51:22Speaker 00

  You know, the newspapers aren't written into the constitution, but their distribution difference is. And that's why they really like the current system. They don't want to change, right? So those are critiques of the thing as to, you know, whether it's, quote, "actually a democracy." And then what's a formal definition? So one is that 100% versus 51%, right? A second, and this is something I've been thinking about, is, it's a fun definition, but if Bitcoin is legal in a country, then it's a democracy because it permits freedom to exit and freedom to transact, which there's a great thread by my friend punk6529, which said, "Freedom to transact is actually upstream of all of the rights." I would put freedom to exit as upstream even of that, okay? Because you could, you could agree to limits on your freedom to transact when you enter jurisdiction.

• 1:52:04Speaker 00

  But let's say after that, freedom to transact gives you, for example, the ability to buy a computer to broadcast online, right? To protest, you need to buy a sign. Anything else you do, you're going to probably need some economics upstream of it. So if you can lock down freedom to transact, you don't have those other rights. This is also a version of Hayek's argument, you know, which is that control over economics leads to control over everything else. So this is a fun definition, but it's a, operationally, a democracy if Bitcoin is legal, because then you've got freedom to exit with your money and freedom to transact. And if Bitcoin is not legal, or if it's restricted, then it's a limited democracy, or flawed democracy, or non-democracy, because it is restricting that fundamental right of exit. And this is, what I like about this is very clean, okay?

• 1:52:47Speaker 00

  You can point to it, you can relate it to a global moral right, you can test it. An individual in that country can tell you how restricted it is, and you can grade people on this pretty simple to understand thing. How legal is Bitcoin, right? And Bitcoin, the reason I say Bitcoin specifically is it's, you know, it's on track. We will see if it can actually get there because it's got various kinds of issues, you know, privacy and other kinds of things that, you know, but... It's on track to be the government of governments, the global government. Because the world government, people thought it was going to be like some UN thing. Or they thought, you know, world government is bad because you want to have decentralization. And this is like a pro-freedom global government that limits every government.

• 1:53:28Speaker 00

  Because it can't spend too much and it can't do certain things since people can, if they need to exit the Bitcoin blockchain, right? One last observation, in many ways, the term democracy means American military ally to first order, right? That's to say, if you look at the map, here's an exercise. Can you name a country that is a democracy? That was not a former UK colony? Or does not have a US military base?

• 1:53:55Shane Parrish?

  I've never thought of it that way before.

• 1:53:57Speaker 00

  It's a really good question, okay? Because you do the map that way. Germany, US military base. Japan, US military base. South Korea, US military base. India, former British colony, right? And you go down the list and there's a few, you can say like Uruguay, I think, was neither. But it's not that easy to find, right? The thing about that is if that is what it is to first order, right? If it is effectively a US military ally, right? Then the whole thing takes on a different light. It's a flawed democracy if it's on the border, right? If it's Hungary, or it's Israel, or it's India, or if it's like, you know, a red state or a purple state that's not as aligned with DC, right?

• 1:54:41Speaker 00

  The degree of democracy as judged by DC is how reliable they are relative to DC. It's a pretty, if you looked at their sentiment as expressed in these democratic rankings versus how lockstep they voted in conjunction with DC and moved their troops, it's basically like one to one.

• 1:54:59Shane Parrish?

  We pursued a path of, it seems in, at least the United States and Canada, where housing is an investment and not sort of a consumption asset at this point. And that implies that we want it to grow faster than inflation. How do you see the price of housing and what are the impacts?

• 1:55:18Speaker 00

  So I think of the last 10 years and maybe the last several decades, but certainly the last 10, 10, 15 years as The state's inflation versus technology's deflation. So the state is propping up mortgage prices. It's bailing out GM, right? It is trying to keep the status quo intact, right? And subsidizing all of these jobs that wouldn't basically exist otherwise. And technology is trying to, you know, bring down car costs with autonomous cars and bring down shipping costs and automate this, disrupt that, bring down housing costs with drone construction and robot construction and all these things. So it's this tug of war between inflation and deflation, right?

• 1:56:02Speaker 00

  And so what that's resulted in so far is that all these things in the physical world have become more expensive, especially education and healthcare and housing, especially in, not everywhere, but in blue areas, housing is becoming expensive. Everything digital has deflated and the combination of the two kind of evened out over the 2010s. So people were like, whoa, where did the inflation go? But if you look at the graphs, some prices went way up and some went way down. And in a sense, the Fed is like upstream of all of that. It's upstream of every political issue. Medicare for all, why? Because the Fed printed money and that led to healthcare prices going up in part. There's other factors as well. The Fed printed money and that led to all the YIMBY stuff, all the, you know, all housing went up and the Fed printed money and that led to, among other things, you know, education prices going up.

• 1:56:47Speaker 00

  And of course, there's student loans and other things. And that was, you know, loan forgiveness. So that's kind of upstream of all this. And so where do I think it resolves? I think eventually this reaches a breaking point and, you know, we may get here by 2030 or 2040 or so on, right? But everything in the physical world can be thought of as a printout. Okay, let me explain. Obviously, you can print out a document. You do it online, you hit enter, you print out a printer, right? You can print out a book, okay? Less trivially, you can print out food by hitting a thing on Uber Eats or Grab and there's a process where it comes to your door. Now, moreover, I'm not sure if you've seen this, but there are robots that do robotic agriculture.

• 1:57:30Speaker 00

  There's robots that will package things at the factory and there's even sidewalk robots that will do robot delivery and will like bring it to you. In theory, Every single step there, you could eliminate any human and have the entire thing be effectively an electromechanical process that was catalyzed by you hitting Enter that prints it out and mails it to you or brings it to you, right? Every, every individual step, I can, I can show you robots. I'm not sure anyone's put them all together, but you could have humanless delivery, growing and delivery of food. Okay. So you start thinking about printing out in a broader stage, right? When you think about a drone, it's like hitting Enter and it's printing out, you know, effectively a flight path or a bomb path or something like that. And, you know, if you look, there's, you know, the Grasp Lab at UPenn has done this stuff.

• 1:58:14Speaker 00

  There's like drone construction, there's stuff like that that's online. Okay. You can watch drones like assembling small buildings and so on. So in the not infinitely distant future, you will have the ability to just hit Enter on a computer and have a bunch of robots snap together a prefab building with perfect speed in the rain, you know, in eight hours, perfect site, all of that stuff, right? Some of them might be humanoid looking, some of them may be very non-humanoid looking, but robotic construction should hyper deflate construction costs, right? And increase quality. Like, everybody could have, you know, like the fanciest pool and all this type of stuff, like the kind of environment that only a king would have, you know, 150 years ago.

• 1:58:57Speaker 00

  You could have that if you had enough horizontal space, of course, right? So there's a vision of totally hyper deflating construction costs. There's another vision of radically reducing your dependence on any specific place and having it all in the cloud so you can move between things. And that also reduces construction costs in a way. This is like van life and things like that, but there's like nice versions of that, like the digital nomad version. And both of those, what they do is they start commoditizing the land and reducing the impact of location, location, location, right? And that should bring downward pressure on these housing prices, but I think that's, might come after there's this crazy inflation upward where, as you mentioned, they're trying to use this as investment.

• 1:59:41Speaker 00

  In China, actually, Xi Jinping has talked about how he did not want houses to be used for investment. And actually, that's part of their policy there is to try to intentionally pop the bubble rather than having a bearer Lehman type thing. Evergrande was like a controlled demolition where we'll see if it's successful, but they set up these so-called three red lines years ago on like, you know, I think it's like debt to debt to revenue ratio, some ratios like this where companies that were above that, they wanted to kind of put the regulatory brakes. They're trying to deflate that bubble to bring the prices down because they don't believe houses should be an investment. They want them to be utility. And then what happens, where does keeping up with the Joneses thing go? Ideally, it just goes to NFT land. It goes digital. This is the ideal, okay? And we won't get there for a while. But with

• 2:00:25Speaker 00

  robots, the physical world should get super cheap eventually. And then all status seeking goes to the optional digital world. You already see this. You know where they see this? You see this with phones. Because for the most part, a poor person and a rich person or a middle-class person, they basically have the same phone. And the status seeking is just pushed into whether you get like the gold case iPhone. But that's just frills on the top. You can make it more expensive. Like the Apple Watch is a perfect example of this. Literally, the money is just like pure Veblen good, like signaling stuff at the top. And it's completely optional. The utility is the baseline, right? So that's, I think, a vision we want to shoot for where everybody has the utility of a house. You

• 2:01:08Speaker 00

  can construct it. And then your positional, red queen, elite on the elite, stupid but human things. That's all just digital NFT type stuff, which can happen online in a harmless way.

• 2:01:20Shane Parrish?

  Do you believe in legacy wealth? That is like sort of wealth that's passed down from one generation to another?

• 2:01:25Speaker 00

  I don't have a good answer on this, but I can tell you two things I don't like. First is, I don't like nepotism, because I feel it's actually civilizational diabetes. The kid doesn't feel like they've achieved something. There's this video called Born Rich with like this Johnson and Johnson air. A lot of them actually fall into socialism because they didn't work for their money, right? Their life experience is that they were just born rich, and other people were born poor. And it's just like a, you know, so then also, there's another aspect, which is the guys who are working to become rich.

• 2:02:02Speaker 00

  These people who are born rich, they have money, but they don't have a status. But if they advocate for socialism, they can gain status and also kind of cut off these nouveau riche guys. So while they think they're doing good for the poor, they're actually cutting off competition by the future rich, by advocating for various kinds of socialist things. So it's a common thing where they can gain, you know, money is in abundance, so status is what's remaining, right? So one is it leads to civilizational diabetes, which is bad, where there's an overabundance of a resource. You didn't work for it, it kind of corrupts you, whatever, right? On the other hand, I also don't think it should all be seized by the government because government is terribly poor capital allocator, at least in the West. It's not doing good things with it.

• 2:02:42Speaker 00

  And so I don't know the answer other than potentially things like the, and you're putting in a foundation and so on is a third option. But those also tend to get corrupted and they just, you know, become, you know, basically part of the NGO industrial complex, right? So it's hard to keep them on mission unless it's something like the Clay Math Prize, like the Millennium Prizes, or something very scoped and focused like that, which is difficult to corrupt. And maybe that's part of the answer, or a smart contract, putting it into a smart contract that does something. But it's really hard because capital allocation, if you put in a smart contract and somebody passes away, that algorithm is probably not going to be smart enough to be able to anticipate every way someone could game the system with their request, you know?

• 2:03:27Speaker 00

  And so again, you're back to the foundation thing, you need to have like a super AI in order to do that. You know, there's a fifth model, which is use it to build buildings or things. You spend it all down in your lifetime to have a legacy that lasts beyond life, you know, whether it's fellowships or, you know, that's why people endow buildings and things like that. I don't think I have a good answer on what should be done with it, though I do not believe it should be seized by the state. I also don't think it's a great thing for the kid to inherit it. And so I don't know what the answer is.

• 2:03:59Shane Parrish?

  What's the biggest problem with our educational system and how do you solve it?

• 2:04:03Speaker 00

  Short answer is. Like the, the educational system is geared for like the assembly line, you know, past, it's like the Bismarckian education system to make people conform. And it's one size fits all and it is bullying and it's also really ideological indoctrination rather than education. You know, kids don't learn basic skills like reading a bus schedule or filing forms with the government, all those things they have to pick up on their own. They don't learn about interest, they don't learn about, you know, basic stats, they don't learn, you know, a lot of practical skills, they don't earn a single dollar for many years. So, you know, there's that saying like, you know, America produced, this is, this is what they used to say, and I don't think it's even true anymore.

• 2:04:45Speaker 00

  America produces the most impractical 21-year-olds in the world, the most competent 30-year-olds. Because they get out of the educational system and they don't know anything and all their concepts are wrong, and then they're getting corrected by the market and they're, they've got a good head on their shoulders by 30, right? I think the answer is actually just totally root and branch, reimagining what it is, right? Short answer is, you're continuously learning, you're learning from an early age, the learning is interspersed with earning, you gain crypto credentials on-chain for every act, so that you're constantly building your portfolio as you are learning things and earning. Just like you might put on your CV, "I, I did this deal for X dollars, I, you know, shipped that product for Y dollars."

• 2:05:30Speaker 00

  That's actually a real-time thing where you ask somebody for an on-chain endorsement, so you can like book that, it's like a micro endorsement, right? And then the accumulation of that, that's like your resume, in the same way, like you, you know, if a teacher is teaching a class and you get a question right, you book that as, "Okay, I got that question right," right? So, there's kinds of like crypto credentials, crypto endorsements, so you've got this crypto resume that is this spinal column, just like tweets, so you've got a few of these accomplishments every day, but you're building a portfolio, the portfolio is portable across places, and now you solve for several things, right? First, you're not going into debt, right? Second, you're learning useful skills. Third, if you're looking at the earning of other people with the crypto credential of, let's say, JavaScript, right? You can say, "Oh, I need to learn that because the price of that is very high, I can see that on-chain."

• 2:06:14Speaker 00

  Just like coin market cap, you could have skill market cap, you look at which crypto credentials are associated with the highest on-chain compensation, and then you start learning in the direction, you do gradient ascent, rather than figuring it out for yourself afterwards, you're, you're seeing a signal, right? So A, you're continuously learning, you're not going into debt, you're learning useful skills, and you're refreshing constantly. You have mnemonic media or something like that where it's, you're treating it as software that you're not just loading into your brain one time at age 21 and then for the rest of your life, but rather as an ongoing maintenance thing. If you think about how silly it is, by the way, that, you know, the concept is that you spend K through 12 and then four more years in school, and then everything

• 2:06:56Speaker 00

  else is learning on the job, right? That's like buying this really expensive car that you have zero maintenance budget for. You have no budget for oil, you have no budget for tire checks, right? You bought this expensive piece of capital equipment, you have no maintenance budget for it. And then what happens is, it's broken down by like age 30 or whatever, and you can't, you're like, that expensive college education, uh, do I remember how to do integration by parts? Do you remember vessel functions? I mean, I remember it because I just like to do math. But most people don't because they're not using it, which I understand. It's like literally a creaking rusty thing in their head. They use that, I'm rusty on this. That's why that analogy is very good. It's like rusting capital equipment they just bought early on. Then another thing you do is you'd spread the vacation out over your life, rather than have this thing where like the vacation, but people don't appreciate

• 2:07:41Speaker 00

  what a vacation is. They have a vacation through college. College is amazing because like, or was, I'm not sure what it is today. I think you're being yelled at a lot to a greater extent, okay? But, you know, college is like this amazing vacation that the young don't appreciate because they haven't worked yet, you know? And, oh my God, all I have to do is like relax and learn, and I can do that in the sun, and I just have to do some homework problems? Oh my God, that's the most amazing thing. People don't appreciate that until after they've actually done, you know, worked for somebody else or built something. So to summarize, oh, and finally decentralized. So rather than effectively, you know, it's funny, supposedly state-controlled media is like really bad, okay? But you know,

• 2:08:22Speaker 00

  we have, we have a state-controlled education system, right? We have a state, certainly totally state-controlled K through 12. We have state-controlled.

• 2:08:31Speaker 00

  Academia in large part, not just, you know, state universities, but government funding for academia. So like academia and education, K through 12 are controlled by the government, but state media is really bad. So if, if you do believe that state control is bad, why? Because I, I find very few people can give a clean articulation of why state media is bad, but state education is good beyond the mere Russell conjugation of it. Do you know what I mean by Russell conjugation? It's like, I dox, you leak, but the New York Times investigates. I sweat, you perspire, but she glows. Right. Okay. So same thing. It's also called if by whiskey. So the same thing can be clad in a different, you know, kind of tonal thing. Right? So beyond Russell conjugating, you can't usually give a good explanation of why state media is, um, is bad, but state

• 2:09:15Speaker 00

  education is good. And if you think they're both bad, then you want to decentralize it. So it's all individualized and it's customized to the individual. Oh, one other aspect of this, by the way, you know, it used to be that, you know, families in the 1800s would have large families and they'd all work on the farm and that six-year-old would like work on the farm and would be productive very early on. And, uh, there wasn't like this extended adolescence period and so on. They were plucking, you know, the, the chickens or whatever, you know, and, and they're earning their keep. Um, you had more children because like they were cash flow positive, basically, you know, they like, you needed the labor. It's your labor force, right? But you didn't work them too hard because they're your kids and you love them. Right? So there's like, you know, an equity interest in a sense

• 2:09:56Speaker 00

  in them. This all changed when, you know, like factories arose and in the era of child labor, those factory owners, some of them were unscrupulous and would work the poor kids really hard and those kids would not have, you know, libertarian theory breaks down when it's children, right? Um, you know, those children don't have, you know, the ability to speak up or the frame or something like that. So reasonably, all these child labor laws were passed that essentially began this long campaign of infantilization. And now it's something where you're like on your parents' health insurance till age 27 or something, something crazy like that. Right? And so that whole thing kind of began on a reasonable basis and has gotten to a ludicrous basis. There's people who are being

• 2:10:39Speaker 00

  educated as a doctor till age 30 or something and before they start seeing a patient. It just doesn't, it just doesn't really, you know, intuitively makes sense. You're going to need that much education to do that. Right?

• 2:10:51Speaker 00

  And you might be able to install the software faster, basically. And now what's happening today relating to today is lots of kids are able to make money at home. Okay, so the quote child labor issue where somebody's in a factory and they're being oppressed by a boss and the parent can't see them and they're like their little fingers are being worked off. All that goes away when they're at home and you're able to supervise them. And basically the same, you know, buttons they would press to play a video game. They're pressing to work on Replit or to build web three stuff. And they can work seamlessly and you can supervise them and you can see that they're not getting up to extreme mischief. And that they're earning responsibly. And now they can actually start doing real things much sooner and apprenticing much sooner.

• 2:11:34Speaker 00

  And, um, you know, like the internet, like obviously there's unsafe things on the internet, but physical harm is less probable, right? If they're supervised. And so a lot of things come back to the future where now kids could work from an earlier age. And there's much more of occupation and remuneration rather than simply quote education.

• 2:11:53Shane Parrish?

  How do you recognize talent? I mean, you must have some sort of insights or methods or different ways of thinking about it that that help you do that.

• 2:12:01Speaker 00

  Well, first, it depends. There's different kinds of talent, you know, there's this raw intelligence. There's persistence, you know, creativity and, you know, various kinds of dimensions to it, right? And then if you were recruiting for like a sports team or the military, you know, you'd need their speed, their strength, their 40 yard dash time, their bench press, NFL combine type stuff, right? So if you had in theory, like a data set which had, you know, their NFL combine, their standardized tests, their classwork and so on, so with their their resume, all that stuff, right? That's helpful, but I think the single best thing is basically just looking at their their portfolio and what they've actually done. That's like the materialized result, you know?

• 2:12:43Speaker 00

  Your brain is probably pretty well tuned for this. If you can load their portfolio and you're like, hmm, not bad, right? It could be a great open source project. It could be a great piece of design. It could be a creative blog post. It could even be just a really clever tweet or something, but. You can sort of see from somebody's high point how clever they are in some area. And then from references, you can see how persistent they are. And so the first order, intelligence plus conscientiousness, that's, those are important. And the third is like ethics and integrity and whatnot. And that's also something that you can pull from references. And, you know, in many ways, actually, to first order, your Twitter is your character. You know, if your GitHub is your resume, your Twitter is your character. Like, I'm not saying 100% and everybody, you know, slips up from time to time.

• 2:13:27Speaker 00

  But if you've got somebody who's constantly starting fights with other people on Twitter, and I mean first strike, by the way, or if they're constantly cursing, or they're always angry at people, that's somebody who'll probably bring that into the work environment. You know, whereas somebody who is not like that is, you know, often better, or at least can keep it under control. And again, I'm talking a percentage. Obviously, everybody gets mad from time to time. Sometimes you might get in a fight, whatever, but it's a percentage, you know? And so those three things, I'd say their, their ability slash intelligence is manifested by their best thing. Their persistence is manifested by, or measured by, you know, reference checks and what they've done over time, and then their integrity and ethics. Those, I think, are the three things I'd look for with talent.

• 2:14:08Shane Parrish?

  Speaking of Twitter, what did you think of Twitter suspending the account of a sitting president?

• 2:14:14Speaker 00

  Ah, so that was a very, very, very important event in world history, technology history, et cetera. And, you know, the thing about this is there's like several different implications of it, right? One is it showed that the quote, "most powerful man in the world" was no longer even the most powerful man in his own country. Okay, and what that signaled, though people may not have seen it quite at that time, is there's a power vacuum, right? And the second thing it signaled is that American companies could deplatform, not, if they could deplatform the American president, they would certainly be able to deplatform, you know, any other president or politician around the world who would have much less appeal.

• 2:14:58Speaker 00

  And many other countries, by the way, like, don't necessarily trust the US because, you know, after Iraq and other kinds of things, you could easily imagine the US drumming up some case against some country. They're a dictator, they're harboring terrorists, and then, poof, the lights go out, poof, they're all deplatformed off social media, poof, the troops go in, right? Now, I actually don't think the US is organized enough to do that nowadays, okay, but in theory, they could. Like, imagine like what Russia did in Ukraine, but like what the US did in Iraq, except Iraq was on social media and like Saddam was tweeting, "I'm innocent, I don't have it," poof, misinformation, fact-check, deplatformed, etc., right? And, you know, what that meant was a lot of countries were like, you know,

• 2:15:41Speaker 00

  China actually had an important thing here where they're blocking American social media, because if China had let Facebook and Twitter in, then absolutely they would have deplatformed Xi Jinping and what have you. You might say that's good, but it would certainly mean that, like, China's no longer in control of China, it's American media and social media companies, right? So sovereignty, maintaining sovereignty, means control over your communication and transaction channels. That's like one conclusion. On the other hand, there's a different conclusion, a third conclusion you can take from it, which is, we need to decentralize. We need to have, you know, cryptocurrency, decentralized platforms for things, right? And so what I think is that the result is actually both, right? You go from these American platforms that kind of straddled this intermediate for a

• 2:16:26Speaker 00

  long time of both being international and neutral, and then like, you know, America-based companies with American CEOs, right? And you actually, you take that and it goes into both national stacks and neutral protocols, okay? So the America stack eventually just becomes the America stack, right? That's a, like, all the major tech companies, they're now... Every civilization's own will build its own national stack. China already has this. They have a full stack that competes with Google and Facebook and so on and so forth. It's like a full stack of things. Russia has this to some extent. It's got like Yandex, right? Korea has Naver. You know, India has Flipkart. The Europeans have like some stuff, you know, and South Americans have like MercadoLibre.

• 2:17:11Speaker 00

  They've got pieces of this, okay? Not the full ecosystem. Over time, every language region, and I think actually that's the true borders of the internet, by the way. It's not the US and Canada. It is the English internet, the Chinese internet, the Russian internet, the Spanish internet, the Portuguese internet, right? Why Portugal? Because it's got, you know, it's got Brazil, right? India is English speaking, but it's like its own cluster. I think you're going to see a whole parallel set of services arise that are the peers of the American tech companies, but in Web 3 in India over the next 10 years. I think it's going to be one of the least anticipated things that's going to happen because people think of individual Indians as competitive, right? In tech, I think Indians have done pretty well. But India was basically offline.

• 2:17:56Speaker 00

  Less than 5% of Indians were online even before 2009. Now it's more than 50%. And so they're going to be a huge player in what is to come, and they're going to build a bunch of things, and a bunch of things they build are going to be Web 3 because China and big chunks of the US won't be able to do that. So it's a competitive advantage for India, okay? Or Indians, really, because Indians, even if they can't build in India, they will migrate. They're more willing than any other group and more able than any other group just pick up and migrate. The Chinese are less able because they're getting immigration restrictions placed on them. The Americans are less willing because they think, you know, leaving America is unpatriotic. Coming to America is really good. It's a nation of immigrants. It's also a nation of immigrants. They don't usually think about that. So Americans are less willing to leave. Chinese are less able to leave. Indians are willing and able to leave, so they'll be able to go and build a lot of

• 2:18:41Speaker 00

  these services. So you get This disjunction into national stacks and neutral protocols. The national stacks are set up within these language zones that have the scale to build like local versions. And those are going to have deplatforming and other things that kind of, it might be a consortium of Spanish language countries, or of Russian language countries, or of Arabic language countries that manage their kind of things. They've got the scale to build these platforms. And then they have, you know, the Arab League determines what is being able to be posted on these or not. So it's sort of like local governance for these national stacks. And then neutral protocols are what the global international law is. Like international law becomes neutral protocols.

• 2:19:23Speaker 00

  I actually wrote, and that's actually a really deep concept, I think. I wrote this article with Parikana for foreign policy a couple of months ago. Great protocol politics. The 21st century doesn't belong to China, the US, or Silicon Valley. It belongs to the internet, right? So it's not nation states nor tech companies, but rather decentralized protocols that are going to be the demilitarized zone, like the law of the sea. You know, the law of the sea is like this, you know, the sea is a neutral zone. International waters are a neutral zone. And crypto protocols are like the law of the sea. And so countries, obviously they want to have control domestically, but think about their phone system. It doesn't just place domestic calls, it places international calls, right?

• 2:20:06Speaker 00

  So it won't just place domestic transactions in their digital currency. It will need to place international transactions, and that's where crypto protocols come in. So what happens is that deplatforming of Trump has set off a cascade of things that will lead to national stacks and neutral protocols.

• 2:20:19Shane Parrish?

  If you had to bet on one country to dominate the future, and I know it's not sort of country specific, but if you had to pick one and go all in, which country would it be?

• 2:20:27Speaker 00

  One, China. Two, it'll be, I think by 2040, there's a chance, I'm not saying 100%, but...

• 2:20:36Speaker 00

  I think that if the last century ended up, at least the second half, was USA versus USSR, right? I think this century may end up as being China versus Indians, not India. I think that's where it might land up by like 2040 or so. Centralized China versus the international India or international Indians. Okay. It's not, this is just a historical analogy and it may be completely wrong. And so it's just I'm giving a scenario. So I'm putting not extremely high weight on this. Okay. But at the beginning of the 20th century, or you know, you had the British Empire. It was, you know, the big deal. It was like the American Empire, but it was rickety. But in 1913, it was the big dog, right? And then like a effectively a 30 years war arose, starting in 1914.

• 2:21:20Speaker 00

  You can think of the next 30 years as just being like a giant conflagration. Um, even though there's a break between World War I and World War II in the West, there's invasion of Manchuria, other stuff that was happening in the East. So it's like this giant bar brawl across continents, right? And in this sort of final four showdown, you had Japan, Germany, the US, the USSR, also, you know, France and, um, and the UK. And the guy who's in number one, you know, the number one spot, the UK got knocked out and reduced to basically like number four or number three, you know, by 1950, right? Certainly way down after the US and USSR. And that's not necessarily what people would have predicted in 1913. And, you know, but, but Talkville did, Alexis to Talkville did.

• 2:22:05Speaker 00

  He saw that both the US and Russia were rising. 1835, okay? I mean, talk about like a hundred years before, but Talkville concluded the first two volumes of Democracy needs to derive this prediction. "Today, there are two great people on earth who, starting from different points, seem to advance towards the same goal. These are the Russians and the Anglo-Americans. All other peoples seem to have almost reached the limits drawn by nature and nothing more to do except maintain themselves, but these two are growing." And he basically is pointing at population growth, right? And he commented, "The Americans struggles against obstacles that nature opposed to them, the Russians grappling with men, the one combats a wilderness and barbers some of the other civilization clothed in all its arms. Consequently, the conquests of the American are made with the farmer's plow, those of the Russian with the soldier's sword. To reach his goal, the first relies on personal interests and without directing them allows

• 2:22:49Speaker 00

  the strength and reason of individuals to operate. The second, in a way, concentrates all the power of society in one man. Their point of departure is different, their paths are varied. Nonetheless, each of them seems called by a secret design of providence to hold in its hand one day the destinies of half the world." Pretty amazing quote for 1835, right? Yeah. So in a similar way, the civilizations that are on the rise today, after generations of being, you know, laid low are China and India. And, uh, you know, the, the US, I think, is in the state of the British Empire where it's going to, it, it, it's like the British Empire, you can also analogize it to the Soviet Empire in the eighties,

• 2:23:30Speaker 00

  you know, where in the Soviet Union, like the strikes, like solidarity and stuff like that started in like the early eighties. And you just had rattling, nationalist rattling of the whole thing, and then constant pressure from the outside and so on and so forth. And, you know, eventually you had Gorbachev, who tried, you know, perestroika and glass and tried to reform it. And there are fits and starts, by the way, like they sent the Spetsnaz into, you know, the Vilnius Tower in Lithuania to like shoot people in like the late eighties. So there, there were times where the Soviet Union was trying to crack down or loosen up. It was just like, like this. And then the whole thing just kind of fell over post Berlin Wall or what have you, right? And I think that the Western system is like that, where, you know, the hyperinflation, if and when it does come, and I'm not saying it's a hundred percent, but it's possible,

• 2:24:16Speaker 00

  or military defeat, if this, you know, Ukraine thing goes through or whatever, we'll see. Something like that, or both, or all of the above, is something where it feels like this thing that's a very rickety edifice that is cracking inside and outside, and they're trying these crackdowns, but it's like, you know, this might just kind of break apart. And one scenario is financial secession, where individual cities and states don't want to be saddled with the debts of the former US, and they decide to just kind of break away. And you're seeing this with these states, all these attorney generals and so on, that are constantly suing the federal government together, like they're, they're kind of building muscle, you know, to do things. The interstate compacts thing that was rolled out during the pandemic also, if you look at interstate

• 2:24:58Speaker 00

  compacts, there was like Western states compact, northeastern states compact. That's something that was actually in the constitution, and the interstate compacts clause was rolled out, or I'm not sure if it's a clause, but interstate compacts provision or section of the law was rolled out because the states didn't feel the federal government was working on the pandemic hard enough, right? So you can analogize the US to the British Empire or the late Soviet Empire. And what I think is, I'm definitely not a bull on the American empire. I do think there's individual pieces that will do potentially quite well, like, you know, Texas and Florida and Colorado and Wyoming, those things that are leaning into the future

• 2:25:43Speaker 00

  rather than trying to fight it, right? It's possible even NYC under Eric Adams is fairly well. You can sort of see that kind of leadership, but that's different than a world empire that runs the whole thing. As an analogy, when you went from the USSR to Russia, okay? All these people who were there for the great game, you know, the great game, you've heard that concept? Like, it's like playing Risk on the World, right? All those people who are in the USSR for the great game of like global communist domination and like moving pieces on the board in Cuba and the IU. All those people were like, okay, I mean, I'm out now, right? Like, an ambitious person, you know, you were still in Russia if you loved the culture

• 2:26:25Speaker 00

  and, you know, Borscht and Pushkin, they do have a glorious culture, but you're in Russia for like Russian culture or whatever, right? After that, because it was no longer an empire. And it didn't make pretenses to that. I mean, it does still tries some stuff, but it's clearly nationalist. It's not universalist in its pretenses. And I think the transition from, just like the USSR became Russia, I think the USA, after whatever collapsed, becomes America. That's say, it's like American culture, it's baseball, it's hot dogs, but it's not global empire, right? And in fact, America was not always global empire. It was a commercial republic, but it wasn't like, it didn't have like hundreds of military bases around the world. That's like a mid-century thing.

• 2:27:08Speaker 00

  It's more like the late 1800s America, which was its own thing. And different people are predicting this in different ways. Folks, you know, folks on the left, folks on the right, there's different views of isolationism. One is the US is harming the rest of the world, so it needs to pull back. The other is the US is helping the rest of the world unnecessarily, should have pulled back. But that's growing stronger and stronger. And so I think that pullback means, you know, an empire is either expanding or it's contracting. And so I think that the US breaks. And now let's talk about China and India, right? So.

• 2:27:40Speaker 00

  With China, I think China plays the world's best home game and India arguably plays the world's best away game. So China playing the world's best home game, if you've just seen what they've done with the country, this is the thing is when I see this stuff, a lot of people are like, oh my God, you're like a China shill or blah blah. Like, look, I have no investments in China, to my knowledge, you know, in the sense of like, there's probably some crypto thing or some, in some fund of a fund may have something, right? The thing about China is if you just look at the cities there, if you look at Shanghai before and after, if you look at Shenzhen before and after, you look at the bullet trains, you look at the bit lot of infrastructure, they just built the entire country in 40 years. They

• 2:28:19Speaker 00

  made it like the world's manufacturing powerhouse. They essentially, you know, kept their heads down and took all kinds of abuse for many years, like, you know, they're making plastic stuff in the warehouses, you're never going to get anywhere, you're uncreative, all that stuff. And they just leveled up and they became, they built up a massive treasury and they also went and built up like Africa and so on. And they built up a huge military. Like, just, you know, look, there's lots of things that, you know, one can and should criticize about the Chinese government. They've been extremely restrictive on human rights and they've gone after everybody from Falun Gong to, you know, Tiananmen to the Hong Kong protesters, to the Uighurs, to the tech people, to Taiwan, like, long

• 2:29:04Speaker 00

  list, right? What they have accomplished for their people is far better than what Mao did. Like, on balance, you just have to say that the, and that's reflected in the polls, it's reflected in the visuals, like, people can't seem to hold two ideas in their head at the same time, which is, they've done bad things, they've also done good things for their people, they've built a lot. You just, you have to actually respect a rival and be realistic about them before you can hope to compete with them. If instead, it's like, ha, they're so weak, they're going to fall into a ditch, the US Navy is like the most powerful thing in the world, China doesn't even have a blue water, this is kind of like, this guy, you know, like... This guy Zaihan makes these kinds of points and so on, and I have no beef with him, honestly.

• 2:29:49Speaker 00

  I, I, I, it's, I, I do disagree with a lot of his arguments, okay? I agree with some things that the US will withdraw from the world, that shale oil is important. I think he's also bullish in India, whatever. But on China, uh, you know, they ship things to everywhere in the world. Do I think they can roll out a blue water navy? Absolutely. They're like, they are like the shipping operation of the entire world. They have probably more experience with that than anybody else. Do I think they can do logistics? Absolutely, I think they can do logistics, and that's a huge part of what a military is. Do I think that they can innovate? Well, you know, people, they, people have knocked them on that for a long time, but if you follow the Chinese internet over the 2010s, their quote Groupon equivalent is way more innovative than Groupon.

• 2:30:31Speaker 00

  Their, um, their Facebook equivalent, WeChat, is better than Facebook. And some of those properties basically are, you can argue it's not innovation per se, but coordination that enables innovation. They are simply able to coordinate across society to build things, in the physical world especially, but across things that Western society is not. And immediately people will say, oh, that's because they're an authoritarian, you know, country and so on, and that may be part of it, for sure. But the US was also able to build things when it was democratic in, you know, the, the mid, you know, 1900s, like the 1950s is, it's not considered a time when the US was not a democracy. You can argue it was a very different thing because distribution was actually very concentrated.

• 2:31:13Speaker 00

  And so it wasn't the same kind of thing it is now, which is chaotic thing. But at least formally, the laws weren't that different, okay? And so, you know, you still have a president, you know, like a lot of the forms were the same, right? And so why was it that a democracy was able to build things then, it's not able to build things now? Why are you attributing it to authoritarianism? I'd argue that it's actually in part due to the fact that the entire culture of the US and much of the West revolves around the assembly line. And people would come in to work and they would punch a clock and they would take orders from a foreman. And even when they protested in a union, that was still organized. The same way of like all folding in, listening to the foreman, taking instructions, executing the physical world, that subroutine was there and everybody was acculturated to doing that.

• 2:31:57Speaker 00

  That is a complete opposite. What do you and I do all day? What, what are all, everybody in the West do? We hit keys on keyboards and phones, right? We are not acculturated to working in a factory setting. The Chinese are, they're basically the only people in the world arguably who are to first order. Okay, they're still manufacturing in Germany and other places, I'm not saying none, okay? But because of that, they have a culture that is, because it's able to build in the physical world on the small, they're able to build in the physical world on the large. If you cannot build the physical world in the small, you're not able to build in the large. This may be a super obvious point, but it's basically something where, um, pushing out the manufacturing base has knock-on consequences that are less obvious.

• 2:32:39Speaker 00

  Right? And people think, oh, it's just about money, but why is it that, you know, like, you can allocate billions of dollars and you can't build a bus lane or a bull train? Because nobody in the government, nobody on the ground understands how hard it is to build things. They've never actually built something before. They all think they can outsource to some subcontractor subcontractor. There's 15 levels of graft. It's like, you know, it's like hiring somebody to do software and not knowing how to do software. Like, you can easily get bit up massively by these people who tell you, wow, it's going to take a million dollars to frolicate that. And you don't know what that is, and so you can't diligence it or call BS on it, right? There's no experience in any building, these people can't call BS on it.

• 2:33:17Speaker 00

  So, coming back up, with China, the Chinese state has just executed phenomenally well over the last 40 years. I do think that there's, they have a huge weakness. And, uh, you know, Ross Duda has this concept of the Chinese decade, not the Chinese century. I think that's roughly right. Their huge weakness is they suck at English PR. Okay, I know that sounds like a cynical way of putting it or whatever, right? But they are just absolutely terrible at making their moral case to the world. You know, they're actually really good at it on the Chinese internet. And essentially, the Chinese state, the big difference between the Chinese internet and the English internet is the Chinese internet has root and the English internet does not.

• 2:34:00Speaker 00

  The Chinese internet is centralized and the English internet, while they're trying to decentralize it, is still fundamentally decentralized overall. And that fundamental topological difference, where basically every node on the Chinese internet folds into CCP and they can just flip them off and on. That's a topological difference of how the networks are constructed. Right? Every peer to peer thing in the Chinese internet is ultimately very provisional. Right? Whereas the huge energy in the West is on Web three, which is not provisional. Right? Okay. So the Chinese state is basically like ultimate centralization. Just like when we're talking about, you know, post-Trump, you get that censorship leads to both national protocols and or national stacks and neutral protocols.

• 2:34:43Speaker 00

  You have like China, which is like ultimate centralized manufacturing, top down, command and control, et cetera. Right? And it's going even harder in that direction under Xi Jinping. Okay. And that's the thing about that, though, is it's obvious power. Obvious power causes fear, causes bandwagoning. All of China's neighbors are as nervous about China as like Russia's neighbors are nervous about Russia, but to 10x because it's China. Right? They're massive. I mean, one thing, by the way, about like World War Two, Nazi Germany was only like 70 million people. Right? And the US plus UK plus USSR, it was like, you know, the UK, I think it was like 50 and the US and USSR were like 150. So it was like 350 to 70. So it's like a five to one ratio. Okay.

• 2:35:28Speaker 00

  China versus the US is like four to one the other way. Right? So it's like 1.3, 1.4 bill to like 330. Right? So like, and they've got the manufacturing base. And they've got the like sense of themselves as a civilization on the rise and like, you know, they've got the censorship dialed in. They attack all these problems when they're at the seed level for the most part. Tech is one of the few that they're attacking at the series E or series F level. So they're pretty formidable. I would, you know, this book called The Kill Change, you know it by Christian Bros?

• 2:35:59Shane Parrish?

  Yeah.

• 2:35:59Speaker 00

  Okay. Worth reading. That in 2034, basically just looking at like the Chinese military and, you know, essentially is like. In war games, you know, between the US and China, the US military has a perfect record. We've lost almost every single time. That's how he opens his book. And this guy is, he's on the Senate, he was basically, he was McCain's aide on the $700 billion budget, Senate Armed Services Committee. He saw the entire budget, including the black budget, you know, because everyone will say, oh, yeah, they have 35, that's a failure. And Zomalt, that's a failure. The railgun on it, the combat elevators, Fat Leonard, the bulk military, oh, that's a failure. Sure. Okay, fine. But the black budget, we've got all this secret stuff, dude. Just believe me, there's stuff there. You know, it's really strong behind

• 2:36:43Speaker 00

  the scenes, right? And maybe it's not, right? And so he makes the case that maybe it's not. He actually went and left the government and joined Anduril because he actually wanted to do something that might work, right? And I think that, by the way, is a long term. I think the future of defense is decentralized defense. China's medium term problem is that they are terrible at English PR. And so essentially, they're just, it's just all about hard power for them. Hard power and money, right? And, you know, that's explicit. It's basically something where there's a certain code that you need to follow if you're in Chinese controlled territory, or a Chinese protectorate, whatever. And you can't criticize, you know, Xi or whatever. But it's like, sort of explicit. It's like, just, you cannot criticize a party.

• 2:37:27Speaker 00

  Okay, keep your head down. Anything that's politically controversial, keep your head down. Okay. It is kind of like the US in terms of, you know, watching what you say constantly. But it's just more explicit as to like, there's a list of phrases you can't say, and so on and so forth. Okay. So China's easy to understand. It's a legible one. Okay. India is more, I shouldn't say more interesting, it's just different. India, the state, is, in my view, it's certainly improved dramatically, like to, to, to an extent that I would not have believed, like, the infrastructure, there's traffic lights.

• 2:37:59Speaker 00

  Chennai is cleaner than San Francisco. It's not close. Okay. Like, there's no question. Yeah, you haven't visited recently. No, man. No, no. Go into, I mean, I was shocked by this myself, right? I mean, blue cities are just, that's why I call them the sending world and the ascending world, right? Go and check it out. Don't believe me, right? Just look at, you can look at Instagram, you can look at, people do drives around the city. I'm not saying everything is completely spotless, but the sense of things cleaning up and roads getting paved and, you know, like you couldn't, you used to be able to drive in India without the dirt roads and bullet carts and all this stuff there. They've got modern highways now. Everything is, it's like, you know, this is the kind of thing which sounds patronizing, but it's not because it's like, it happened really fast over like basically the last 10 years.

• 2:38:44Speaker 00

  It's like this, this really impressive thing is happening and India's just getting it together. And, uh, you know, it's weird in a sense, like the US and India are like, almost switching places or converging. You know, the, it's the US that is now the country that's sort of got a lot of smart people who just can't seem to get it together as a society. And they're riven by ethnic and communal hatreds and so on. Whereas India has like a sense of itself and togetherness and for its flaws is able to put it together. And is now exporting talent over the world and building up, you know, like in this way. But here's the big thing. India's strength actually may be that China is dangerously competent.

• 2:39:28Speaker 00

  And the US state is dangerously incompetent and India is in the middle. It's a Goldilocks. It's competent enough to provide a base, okay, for Indians to operate. It's competent enough to keep the lights on, to keep the internet on. 4G LTE has got rolled out to almost a billion people across the country in the last five years, six years. Did you know that? No. Yeah, it's like this insanely important story. The implications of it are so profound. For example, most English speakers on the internet are going to be Indian. No, that makes sense that that would be the case, right? Right. But basically like most followers on social media will be Indian. Most likes on social media will be Indian, like on the English internet at least. Like the, the full implications of that, I don't think people have fully understood.

• 2:40:10Speaker 00

  This is why I think if China becomes, has become a tech and manufacturing superpower, I think India becomes a tech and media superpower. Okay, the tech part is relatively obvious in the sense of they're they're actually number three in tech unicorns now. They've exported a lot of tech CEOs. They've exported a lot of tech founders, doing pretty well on tech and pure software. That part is, I think, easy for people to get. On the media side, that's where people will immediately say, what are you saying, Balaji? Bollywood is going to take over the world? I don't think so, right? It's nice, but it's not at the quality level, right? And that's not what I mean. I'm saying Bollywood is fine. It just provides a proof point of production values that are possible there. But if you actually add up other things, so a lot of the animation for movies like Tenet, for example, all these Hollywood movies, if you

• 2:40:53Speaker 00

  look at the credits, it looks like a New Delhi phone book. And because it's being done in New Delhi. Okay, a lot of the backend animation for things, computer graphics, as well as like hand drawn pixels, has been done in India for a long time. And that's ramping up. You have obviously things like Saja, South Asian Journalist Association. You have lots of Indians who have done well overseas in media, politics, a lot of the verbal stuff, law, those kinds of professions. And you have quite a few now in show business, like not just M. Night Shyamalan, but you know, like Hasan Minhaj and all these other folks, right? He's from Pakistan, but let's say broadly South Asian, right? And you know, Aziz Ansari, these various folks, right? Mindy Kaling, probably a long list I could go through. And so if you add all that up, there's like talent in media. But now we're

• 2:41:38Speaker 00

  actually in like a maybe once in a century opportunity, which is, A, the US media has just lost the plot. And whether it's Teen Vogue or Sports Illustrated, it's all just wokeness 24/7. And you know exactly what they're going to say before they say it. And they've abandoned their previous niches, right? Teen Vogue is not about teens and Vogue. It's like Marxist claptrap, right? It's like, you know, and Sports Illustrated is going to lecture you about something. There's a tone where it's almost like whatever outlet you look at, you know, kind of exactly what they're going to say before they say it. There's not like a surprise or differentiation. Part of that has led to Substack, where now those things are actually different and they're saying different things.

• 2:42:19Speaker 00

  But all those legacy media outlets, those niches still exist in some form. They're going to be taken over, I think, by new players, number one. Number two is, we have, you know, I know it's over, like, people, you know, years ago, I would say VR and crypto. Now I'd say the metaverse and web three, haha. But it is, it is a thing. And I think authoring content for VR is a whole new media environment. And becoming a crypto creator is a whole new opportunity. Crypto creators are as big a deal over internet influencers as internet influencers were over offline, because now you have full control or distribution, you can monetize much better. You can, basically, you can make millions and millions of dollars as an influencer in a way that you couldn't before.

• 2:43:03Speaker 00

  It's going to be a huge deal. And I think India is going to do extremely well in that, because they've got a lot of people who are good verbally, as well as visually and whatnot, right? So I think India, this is basically the reason why I think India is underestimated. But India as a country is not, it'll probably have a strong enough military to be like defensive. It's got nuclear weapons and so on. It's got it together enough that it can kind of defend against China. But nobody's going to be worried about India invading them. Okay, so it's competent, do you see what I'm saying? It's competent enough to be a base, but it's not so competent like China that it's a threat, right? And it's got this diaspora that can migrate around the world. It can code, it can do media, it can do finance. And one way I sort of think about it is,

• 2:43:48Speaker 00

  as the US is just sort of like messing up, this is India, and then more generally, India plus Israel, plus this sort of international intermediate, right? There's this liminal anglosphere, right? Of folks who speak English, but have taken the UK codebase. And, you know, like, places like India, but also Israel, Singapore, Nigeria, they've taken that like UK codebase, and they've kind of forked it in a different way than the US codebase. So there's still a commonality there, right? These are still people which share cultural reference, right? You know, if you, if you have like a Nigerian tech person, Singapore tech person, Israeli tech person, Indian tech person, you can immediately just understand each other very quickly. Of course, you can for other cultures as well,

• 2:44:31Speaker 00

  but there's like English common law and stuff that applies, right? And so I have a feeling that that group is going to become much more influential on the English internet, in part because, you know, like... They have the civilization confidence of folks that are rising. And that offsets and you know, the woke group that's falling and it complements the Texas, Florida, you know, Colorado pragmatic folks within the West. Right. So that is kind of this coalition that I see rising on the English internet, which is 60, 40 or 70, 30 versus the like, you know, Brooklyn woke establishment.

• 2:45:09Shane Parrish?

  That was an awesome answer. What is the most overrated US big tech company?

• 2:45:15Speaker 00

  Overrated is a good question because it's like, see, I usually don't say negative things about tech companies, but like the really big ones have gotten fairly evil and they're far past the founders.

• 2:45:27Speaker 00

  I guess probably Google.

• 2:45:29Shane Parrish?

  And what's the most underrated big tech in the US?

• 2:45:32Speaker 00

  Facebook. Why? Because Facebook still has its founder. And that's the most important thing.

• 2:45:40Speaker 00

  Like Zuck will take the hits of pushing them into new territory, even with the $500 billion markdown or whatever that they just had. Like, I'm still more bullish on them because Zuck has taken hits like that before. When Facebook had to make the transition to mobile, you know, around the time of IPO. I think what he'll just do is he'll be like, okay, all the parasites, all the people who are here for the paycheck, get out. And now we're doing web three and we're doing, you know, metaverse. Like, I'm not saying it's 100%. Who knows? Future's unpredictable. Maybe he's like, you know, screw it. I've accomplished whatever I wanted to do in my life. I'm leaving, blah, blah. Possible. I doubt it because he is a will to power founder who's overcome so much. At least there's a chance of him, because he's got a strategy on web three and the metaverse.

• 2:46:24Speaker 00

  And that's more than you can say for most of their big tech companies. Google does have exceptional AI. Okay, they do. And DeepMind and stuff like that is genuinely absolutely world-class. Okay.

• 2:46:39Speaker 00

  It has kind of become a researchy labs thing where they're doing these prestige things, but it's not really in their products, right? Gmail, Google Docs, Google Search, those basically look the same as they did five years ago, right? I mean, there's some improvements and there's probably things that if you ask me, you know, like that they've added or whatever, that I'd say, okay, yeah, that is useful, but it's incremental, right? There's nothing that the boldness of like, remember Instant Search was this insane thing that like, holy cow, that level of innovation on core search, pushing that out there. Larry and Sergey are long gone and it's something where, why is Google vulnerable? So I'll give a specific reason. Basically, I did a whole podcast with actually Asimpco on this.

• 2:47:23Speaker 00

  I won't recapitulate the whole thing, but it's how Web 3 goes after everything. And one of the things it goes after is identity and that threatens Google login, but other social logins and so on. That's now more obvious with the NS and whatnot. Another thing is Google has relied on being able to index the open web, right? And that search index is a huge part of its defensibility. Social networks are, were a whole threat to Google because they couldn't index them. That was how they thought about, that's why they were so concerned about Facebook and LinkedIn and Twitter. And they were right to be concerned because only those three companies can index their backends and that's why they can deplatform and so on. So social networks are harder to index than even the open web, but the open web is hard to index.

• 2:48:04Speaker 00

  What's easier to index than both social networks and the open web is crypto social networks. A crypto social network like Mirror or DSO or Capsule or one of these others that is arising, a crypto social network has every event on chain. Every like, every tweet, every post, every reply is on chain. Now, that may be a big data set and there's ways of compressing it and so on and so forth. But rather than try to scrape the web to try and figure out what's updated, you just get pushed a block every few, you know, every interval of time that has the updates on it. And now you can build the index from that. That radically simplifies everything. Okay. And so new search engines, I'm already seeing them arise, I'm funding them that are indexing this kind of content.

• 2:48:48Speaker 00

  Cause the huge leap, you know, the crossing the chasm is a recognition that blockchains are not just suitable for storing financial data, but social data as well. And once you make that leap, you're like, actually, a huge amount of content. I search probably much more on Twitter than I do on Google. There's somebody else who mentioned they search much more on Reddit than they do on Google because the individually authentic accounts are like more curated. You can sort of discount what they're saying, but you get a sense of it. It's a person as opposed to like some weird spam bot thing, right? And one of the things that Web 3 is going to add as well that is very underappreciated is when, when you take that identity component I just mentioned, the social component and the indexing component, every post has a digital signature. So you know who authored it?

• 2:49:29Speaker 00

  That is a search ranking signal that is not really present on the web right now. Like who authored this webpage is not something you can easily pull out of the webpage. But who authored this on-chain thing is a fundamental part. Do you see what I'm saying?

• 2:49:45Shane Parrish?

  Yeah.

• 2:49:45Speaker 00

  And so that means you can build a totally new social-like eigen-ranking of authors that's similar to Facebook or Twitter's thing for ranking posts, but open, right? So, and finally, Google, a lot of their index is very recency biased. Okay, so they don't do that much historical stuff. So something, if A, people are searching on social metrics a lot, B, they're searching recent stuff a lot, and C, it's easy to index that, getting like a huge chunk of the recent searches on your new blockchain-based search engine, blockchain, block explorers are basically the stealth threat to search. And the way you can see Google is totally behind the eight ball on this is they have not even rolled out a blockchain.com or either scan competitor, which has nothing to do,

• 2:50:30Speaker 00

  by the way, they don't have to hold tokens or anything. That's totally legal. There's no regulatory overhead. Old Google under Larry Page would have had that five years ago, and it would have been the best out there. But this Google can't even figure out, okay, if I'm regulatorily constrained, what's still the most aggressive thing I can do? Okay, best block explorer of the world. They should have done that. They could easily have acquired their way to it. They just ignored the whole thing. And clearly, people are running a ton of searches on block explorers. So Google, I think, is very overrated as cruising for a bruising. It'll take a while, but you know, it's possible to get turned around like Microsoft, but that's, that's where they are right now.

• 2:51:01Shane Parrish?

  Who would you say are the top three CEOs of public companies?

• 2:51:04Speaker 00

  It's hard right now because every stock is down. Obviously, my friend Brian Armstrong at Coinbase, I think, has done really, really well. I think Toby Lutke at Shopify has done really well. If, if, if you expand it to Web 3 protocols... Right? Many of which are the scale of quote, "public companies," but they're not stocks. They're, they're coins. Then there's quite a few people, you know, obviously Vitalik has done extremely well. Anatoly and Raj of Slana have done very well. You know, Sergey Nazarov of Chainlink has done very well. I'm an investor in like basically like pretty much everything, including public, you know, stuff, whatever. But so much of my head is in Web 3 now. I think of a lot of the Web 2 stuff as being, you know, people kept making

• 2:51:46Speaker 00

  money doing Windows programming in the 2000s and 2010s, and you could make money. And you can still make money doing that. Right? But it's just not where the energy was. Right? And so similarly, all the Web 2 stuff is basically like enterprise software. Okay? And it's like doing desktop programming. Look, it's fine. It's good. It's fundable. Knock yourself out. I'll probably use it. And I'm glad you're doing it. But it's also like, eh, it's not that exciting. Right? It's also not where the fundamental philosophical arguments are, you know, which is what I, what I think about. So, so when you say who's like a leader, I don't, I think actually all these public company leaders, with the exceptions, I think Armstrong and Toby, probably others I'm forgetting, but those

• 2:52:28Speaker 00

  two in particular, I know, and I think they've taken good stances. As a leader, you know, culturally, they can't be because they're so constrained. Right? I will say actually, just on a pure performance basis, I do think Satya Nadella has done phenomenally well. Like turning around Microsoft, you know, under Steve, like the run he had, forget about where the stock price is like as of this moment, but the run he had was very, very, very, very difficult to do. Most people thought Microsoft was dead after that. And then people will argue that all he did was convert to the cloud and what have you. But he did do that, and it wasn't being done beforehand, and that was very difficult to do and so on. Get up acquisition and so on. I think Satya is extremely underrated as CEO. It's very difficult to turn around a company like that.

• 2:53:08Shane Parrish?

  Yeah, that's, he got dealt a tough hand and played it really well, I thought, too.

• 2:53:14Speaker 00

  Exactly. Yep.

• 2:53:14Shane Parrish?

  All right. Last question. If you could read one book over and over again for the rest of your life, what would it be?

• 2:53:20Speaker 00

  So probably Timothy Gowers's book, The Princeton Companion to Mathematics. I've recommended this before, but this is like the, the desert island book. It's like a handful, right? It's like, it's like a big thing. But it's basically self-contained guide to math by a Fields medalist, which you could just get a lot of depth out of. There's other books I like, but Like, the thing about math book is it's highly compressed, highly, highly, highly compressed. And it's the best kind of information because it's evergreen. Like, you know, math, math is not like learning about some celebrity. That's extremely low value, rapidly obsolete information. Right?

• 2:54:04Speaker 00

  Math is eternal and it's very valuable. So if you, you know, if you're in lockdown, get the Princeton Pantry of Mathematics and read that.

• 2:54:16Shane Parrish?

  Amazing. Thank you so much, man. This has been a phenomenal, wide-ranging and just a great conversation.

• 2:54:25Speaker 00

  Cool. Great. Bye.

• 2:54:33Shane Parrish?

  The Knowledge Project is produced by the team at Farnham Street. I'd love to get your advice on how to make this the most valuable podcast you listen to. Email me at [email protected]. You can learn more about the show and find past episodes at fs.blog/podcast. To get a transcript of this episode, go to fs.blog/tribe or check out the show notes. Can you do me a small favor? Go online right now and share this episode with one friend who you think would love it. Thanks for listening and learning with us. Till next time.