A true honor to speak with Jung Chang.She is the author of Wild Swans: Three Daughters of China (sold 15+ million copies worldwide) and Mao: The Unknown Story.We discuss:- what it was like growing up during the Cultural Revolution as the daughter of a denounced official- why the CCP continues to worship the biggest mass murderer in human history.- how exactly Communist totalitarianism was able to subjugate a billion people- why Chinese leaders like Xi and Deng who suffered from the Cultural Revolution don't condemn Mao- how Mao starved and killed 40 million people during The Great Leap Forward in order to exchange food for Soviet weaponsWild Swans is the most moving book I've ever read. It was a real privilege to speak with its author.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Timestamps(00:00:00) - Growing up during Cultural Revolution(00:15:58) - Could officials have overthrown Mao?(00:34:09) - Great Leap Forward(00:48:12) - Modern support of Mao(01:03:24) - Life as peasant(01:21:30) - Psychology of communist society This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

Andrew Roberts is the world's best biographer and one of the leading historians of our time.We discussed* Churchill the applied historian,* Napoleon the startup founder,* why Nazi ideology cost Hitler WW2,* drones, reconnaissance, and other aspects of the future of war,* Iraq, Afghanistan, Korea, Ukraine, & Taiwan.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Timestamps(00:00:00) - Post WW2 conflicts(00:10:57) - Ukraine(00:16:33) - How Truman Prevented Nuclear War(00:22:49) - Taiwan(00:27:15) - Churchill(00:35:11) - Gaza & future wars(00:39:05) - Could Hitler have won WW2?(00:48:00) - Surprise attacks(00:59:33) - Napoleon and startup founders(01:14:06) - Robert’s insane productivity This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

Here is my interview with Dominic Cummings on why Western governments are so dangerously broken, and how to fix them before an even more catastrophic crisis.Dominic was Chief Advisor to the Prime Minister during COVID, and before that, director of Vote Leave (which masterminded the 2016 Brexit referendum).Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Timestamps(00:00:00) - One day in COVID…(00:08:26) - Why is government broken?(00:29:10) - Civil service(00:38:27) - Opportunity wasted?(00:49:35) - Rishi Sunak and Number 10 vs 11(00:55:13) - Cyber, nuclear, bio risks(01:02:04) - Intelligence & defense agencies(01:23:32) - Bismarck & Lee Kuan Yew(01:37:46) - How to fix the government?(01:56:43) - Taiwan(02:00:10) - Russia(02:07:12) - Bismarck’s career as an example of AI (mis)alignment(02:17:37) - Odyssean education This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

Paul Christiano is the world’s leading AI safety researcher. My full episode with him is out!We discuss:- Does he regret inventing RLHF, and is alignment necessarily dual-use?- Why he has relatively modest timelines (40% by 2040, 15% by 2030),- What do we want post-AGI world to look like (do we want to keep gods enslaved forever)?- Why he’s leading the push to get to labs develop responsible scaling policies, and what it would take to prevent an AI coup or bioweapon,- His current research into a new proof system, and how this could solve alignment by explaining model's behavior- and much more.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Open PhilanthropyOpen Philanthropy is currently hiring for twenty-two different roles to reduce catastrophic risks from fast-moving advances in AI and biotechnology, including grantmaking, research, and operations.For more information and to apply, please see the application: https://www.openphilanthropy.org/research/new-roles-on-our-gcr-team/The deadline to apply is November 9th; make sure to check out those roles before they close.Timestamps(00:00:00) - What do we want post-AGI world to look like?(00:24:25) - Timelines(00:45:28) - Evolution vs gradient descent(00:54:53) - Misalignment and takeover(01:17:23) - Is alignment dual-use?(01:31:38) - Responsible scaling policies(01:58:25) - Paul’s alignment research(02:35:01) - Will this revolutionize theoretical CS and math?(02:46:11) - How Paul invented RLHF(02:55:10) - Disagreements with Carl Shulman(03:01:53) - Long TSMC but not NVIDIA This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

I had a lot of fun chatting with Shane Legg - Founder and Chief AGI Scientist, Google DeepMind!We discuss:* Why he expects AGI around 2028* How to align superhuman models* What new architectures needed for AGI* Has Deepmind sped up capabilities or safety more?* Why multimodality will be next big landmark* and much moreWatch full episode on YouTube, Apple Podcasts, Spotify, or any other podcast platform. Read full transcript here.Timestamps(0:00:00) - Measuring AGI(0:11:41) - Do we need new architectures?(0:16:26) - Is search needed for creativity?(0:19:19) - Superhuman alignment(0:29:58) - Impact of Deepmind on safety vs capabilities(0:34:03) - Timelines(0:41:24) - Multimodality This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

I had a lot of fun chatting with Grant Sanderson (who runs the excellent 3Blue1Brown YouTube channel) about:- Whether advanced math requires AGI- What careers should mathematically talented students pursue- Why Grant plans on doing a stint as a high school teacher- Tips for self teaching- Does Godel’s incompleteness theorem actually matter- Why are good explanations so hard to find?- And much moreWatch on YouTube. Listen on Spotify, Apple Podcasts, or any other podcast platform. Full transcript here.Timestamps(0:00:00) - Does winning math competitions require AGI?(0:08:24) - Where to allocate mathematical talent?(0:17:34) - Grant’s miracle year(0:26:44) - Prehistoric humans and math(0:33:33) - Why is a lot of math so new?(0:44:44) - Future of education(0:56:28) - Math helped me realize I wasn’t that smart(0:59:25) - Does Godel’s incompleteness theorem matter?(1:05:12) - How Grant makes videos(1:10:13) - Grant’s math exposition competition(1:20:44) - Self teaching This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

I learned so much from Sarah Paine, Professor of History and Strategy at the Naval War College.We discuss:- how continental vs maritime powers think and how this explains Xi & Putin's decisions- how a war with China over Taiwan would shake out and whether it could go nuclear- why the British Empire fell apart, why China went communist, how Hitler and Japan could have coordinated to win WW2, and whether Japanese occupation was good for Korea, Taiwan and Manchuria- plus other lessons from WW2, Cold War, and Sino-Japanese War- how to study history properly, and why leaders keep making the same mistakesIf you want to learn more, check out her books - they’re some of the best military history I’ve ever read.Watch on YouTube, listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript.Timestamps(0:00:00) - Grand strategy(0:11:59) - Death ground(0:23:19) - WW1(0:39:23) - Writing history(0:50:25) - Japan in WW2(0:59:58) - Ukraine(1:10:50) - Japan/Germany vs Iraq/Afghanistan occupation(1:21:25) - Chinese invasion of Taiwan(1:51:26) - Communists & Axis(2:08:34) - Continental vs maritime powers This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

George Hotz and Eliezer Yudkowsky hashed out their positions on AI safety.It was a really fun debate. No promises but there might be a round 2 where we better hone in on the cruxes that we began to identify here.Watch the livestreamed YouTube version (high quality video will be up next week).Catch the Twitter stream.Listen on Apple Podcasts, Spotify, or any other podcast platform. Check back here in about 24 hours for the full transcript. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

Here is my conversation with Dario Amodei, CEO of Anthropic.We discuss:- why human level AI is 2-3 years away- race dynamics with OpenAI and China- $10 billion training runs, bioterrorism, alignment, cyberattacks, scaling, ...Dario is hilarious and has fascinating takes on what these models are doing, why they scale so well, and what it will take to align them.---I’m running an experiment on this episode.I’m not doing an ad.Instead, I’m just going to ask you to pay for whatever value you feel you personally got out of this conversation.Pay here: https://bit.ly/3ONINtp---Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Timestamps(00:02:03) - Scaling(00:16:49) - Language(00:24:01) - Economic Usefulness(00:39:08) - Bioterrorism(00:44:38) - Cybersecurity(00:48:22) - Alignment & mechanistic interpretability(00:58:46) - Does alignment research require scale?(01:06:33) - Misuse vs misalignment(01:10:09) - What if AI goes well?(01:12:08) - China(01:16:14) - How to think about alignment(01:30:21) - Manhattan Project(01:32:34) - Is modern security good enough?(01:37:12) - Inefficiencies in training(01:46:56) - Anthropic’s Long Term Benefit Trust(01:52:21) - Is Claude conscious?(01:57:17) - Keeping a low profile This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit www.dwarkeshpatel.com

A few weeks ago, I sat beside Andy Matuschak to record how he reads a textbook.Even though my own job is to learn things, I was shocked with how much more intense, painstaking, and effective his learning process was.So I asked if we could record a conversation about how he learns and a bunch of other topics:* How he identifies and interrogates his confusion (much harder than it seems, and requires an extremely effortful and slow pace)* Why memorization is essential to understanding and decision-making* How come some people (like Tyler Cowen) can integrate so much information without an explicit note taking or spaced repetition system.* How LLMs and video games will change education* How independent researchers and writers can make money* The balance of freedom and discipline in education* Why we produce fewer von Neumann-like prodigies nowadays* How multi-trillion dollar companies like Apple (where he was previously responsible for bedrock iOS features) manage to coordinate millions of different considerations (from the cost of different components to the needs of users, etc) into new products designed by 10s of 1000s of people.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.To see Andy’s process in action, check out the video where we record him studying a quantum physics textbook, talking aloud about his thought process, and using his memory system prototype to internalize the material.You can check out his website and personal notes, and follow him on Twitter.CometeerVisit cometeer.com/lunar for $20 off your first order on the best coffee of your life!If you want to sponsor an episode, contact me at [email protected](00:02:32) - Skillful reading(00:04:10) - Do people care about understanding?(00:08:32) - Structuring effective self-teaching(00:18:17) - Memory and forgetting(00:34:50) - Andy’s memory practice(00:41:47) - Intellectual stamina(00:46:07) - New media for learning (video, games, streaming)(01:00:31) - Schools are designed for the median student(01:06:52) - Is learning inherently miserable?(01:13:37) - How Andy would structure his kids’ education(01:31:40) - The usefulness of hypertext(01:43:02) - How computer tools enable iteration(01:52:24) - Monetizing public work(02:10:16) - Spaced repetition(02:11:56) - Andy’s personal website and notes(02:14:24) - Working at Apple(02:21:05) - Spaced repetition 2 Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

The second half of my 7 hour conversation with Carl Shulman is out!My favorite part! And the one that had the biggest impact on my worldview.Here, Carl lays out how an AI takeover might happen:* AI can threaten mutually assured destruction from bioweapons,* use cyber attacks to take over physical infrastructure,* build mechanical armies,* spread seed AIs we can never exterminate,* offer tech and other advantages to collaborating countries, etcPlus we talk about a whole bunch of weird and interesting topics which Carl has thought about:* what is the far future best case scenario for humanity* what it would look like to have AI make thousands of years of intellectual progress in a month* how do we detect deception in superhuman models* does space warfare favor defense or offense* is a Malthusian state inevitable in the long run* why markets haven't priced in explosive economic growth* & much moreCarl also explains how he developed such a rigorous, thoughtful, and interdisciplinary model of the biggest problems in the world.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Catch part 1 here80,000 hoursThis episode is sponsored by 80,000 hours. To get their free career guide (and to help out this podcast), please visit 80000hours.org/lunar.80,000 hours is without any close second the best resource to learn about the world’s most pressing problems and how you can solve them.If this conversation has got you concerned, and you want to get involved, then check out the excellent 80,000 hours guide on how to help with AI risk.To advertise on The Lunar Society, contact me at [email protected](00:02:50) - AI takeover via cyber or bio(00:34:30) - Can we coordinate against AI?(00:55:52) - Human vs AI colonizers(01:06:58) - Probability of AI takeover(01:23:59) - Can we detect deception?(01:49:28) - Using AI to solve coordination problems(01:58:04) - Partial alignment(02:13:44) - AI far future(02:25:07) - Markets & other evidence(02:35:29) - Day in the life of Carl Shulman(02:49:08) - Space warfare, Malthusian long run, & other rapid fireTranscript Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

In terms of the depth and range of topics, this episode is the best I’ve done.No part of my worldview is the same after talking with Carl Shulman. He's the most interesting intellectual you've never heard of.We ended up talking for 8 hours, so I'm splitting this episode into 2 parts.This part is about Carl’s model of an intelligence explosion, which integrates everything from:* how fast algorithmic progress & hardware improvements in AI are happening,* what primate evolution suggests about the scaling hypothesis,* how soon before AIs could do large parts of AI research themselves, and whether there would be faster and faster doublings of AI researchers,* how quickly robots produced from existing factories could take over the economy.We also discuss the odds of a takeover based on whether the AI is aligned before the intelligence explosion happens, and Carl explains why he’s more optimistic than Eliezer.The next part, which I’ll release next week, is about all the specific mechanisms of an AI takeover, plus a whole bunch of other galaxy brain stuff.Maybe 3 people in the world have thought as rigorously as Carl about so many interesting topics. This was a huge pleasure.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Timestamps(00:00:00) - Intro(00:01:32) - Intelligence Explosion(00:18:03) - Can AIs do AI research?(00:39:00) - Primate evolution(01:03:30) - Forecasting AI progress(01:34:20) - After human-level AGI(02:08:39) - AI takeover scenarios Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

It was a tremendous honor & pleasure to interview Richard Rhodes, Pulitzer Prize winning author of The Making of the Atomic BombWe discuss* similarities between AI progress & Manhattan Project (developing a powerful, unprecedented, & potentially apocalyptic technology within an uncertain arms-race situation)* visiting starving former Soviet scientists during fall of Soviet Union* whether Oppenheimer was a spy, & consulting on the Nolan movie* living through WW2 as a child* odds of nuclear war in Ukraine, Taiwan, Pakistan, & North Korea* how the US pulled of such a massive secret wartime scientific & industrial projectWatch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Timestamps(0:00:00) - Oppenheimer movie(0:06:22) - Was the bomb inevitable?(0:29:10) - Firebombing vs nuclear vs hydrogen bombs(0:49:44) - Stalin & the Soviet program(1:08:24) - Deterrence, disarmament, North Korea, Taiwan(1:33:12) - Oppenheimer as lab director(1:53:40) - AI progress vs Manhattan Project(1:59:50) - Living through WW2(2:16:45) - Secrecy(2:26:34) - Wisdom & warTranscript(0:00:00) - Oppenheimer movieDwarkesh Patel 0:00:51Today I have the great honor of interviewing Richard Rhodes, who is the Pulitzer Prize-winning author of The Making of the Atomic Bomb, and most recently, the author of Energy, A Human History. I'm really excited about this one. Let's jump in at a current event, which is the fact that there's a new movie about Oppenheimer coming out, which I understand you've been consulted about. What did you think of the trailer? What are your impressions? Richard Rhodes 0:01:22They've really done a good job of things like the Trinity test device, which was the sphere covered with cables of various kinds. I had watched Peaky Blinders, where the actor who's playing Oppenheimer also appeared, and he looked so much like Oppenheimer to start with. Oppenheimer was about six feet tall, he was rail thin, not simply in terms of weight, but in terms of structure. Someone said he could sit in a children's high chair comfortably. But he never weighed more than about 140 pounds and that quality is there in the actor. So who knows? It all depends on how the director decided to tell the story. There are so many aspects of the story that you could never possibly squeeze them into one 2-hour movie. I think that we're waiting for the multi-part series that would really tell a lot more of the story, if not the whole story. But it looks exciting. We'll see. There have been some terrible depictions of Oppenheimer, there've been some terrible depictions of the bomb program. And maybe they'll get this one right. Dwarkesh Patel 0:02:42Yeah, hopefully. It is always great when you get an actor who resembles their role so well. For example, Bryan Cranston who played LBJ, and they have the same physical characteristics of the beady eyes, the big ears. Since we're talking about Oppenheimer, I had one question about him. I understand that there's evidence that's come out that he wasn't directly a communist spy. But is there any possibility that he was leaking information to the Soviets or in some way helping the Soviet program? He was a communist sympathizer, right? Richard Rhodes 0:03:15He had been during the 1930s. But less for the theory than for the practical business of helping Jews escape from Nazi Germany. One of the loves of his life, Jean Tatlock, was also busy working on extracting Jews from Europe during the 30. She was a member of the Communist Party and she, I think, encouraged him to come to meetings. But I don't think there's any possibility whatsoever that he shared information. In fact, he said he read Marx on a train trip between Berkeley and Washington one time and thought it was a bunch of hooey, just ridiculous. He was a very smart man, and he read the book with an eye to its logic, and he didn't think there was much there. He really didn't know anything about human beings and their struggles. He was born into considerable wealth. There were impressionist paintings all over his family apartments in New York City. His father had made a great deal of money cornering the markets on uniform linings for military uniforms during and before the First World War so there was a lot of wealth. I think his income during the war years and before was somewhere around $100,000 a month. And that's a lot of money in the 1930s. So he just lived in his head for most of his early years until he got to Berkeley and discovered that prime students of his were living on cans of god-awful cat food, because they couldn't afford anything else. And once he understood that there was great suffering in the world, he jumped in on it, as he always did when he became interested in something. So all of those things come together. His brother Frank was a member of the party, as was Frank's wife. I think the whole question of Oppenheimer lying to the security people during the Second World War about who approached him and who was trying to get him to sign on to some espionage was primarily an effort to cover up his brother's involvement. Not that his brothers gave away any secrets, I don't think they did. But if the army's security had really understood Frank Oppenheimer's involvement, he probably would have been shipped off to the Aleutians or some other distant place for the duration of the war. And Oppenheimer quite correctly wanted Frank around. He was someone he trusted.(0:06:22) - Was the bomb inevitable?Dwarkesh Patel 0:06:22Let's start talking about The Making of the Bomb. One question I have is — if World War II doesn't happen, is there any possibility that the bomb just never gets developed? Nobody bothers.Richard Rhodes 0:06:34That's really a good question and I've wondered over the years. But the more I look at the sequence of events, the more I think it would have been essentially inevitable, though perhaps not such an accelerated program. The bomb was pushed so hard during the Second World War because we thought the Germans had already started working on one. Nuclear fission had been discovered in Nazi Germany, in Berlin, in 1938, nine months before the beginning of the Second World War in Europe. Technological surveillance was not available during the war. The only way you could find out something was to send in a spy or have a mole or something human. And we didn't have that. So we didn't know where the Germans were, but we knew that the basic physics reaction that could lead to a bomb had been discovered there a year or more before anybody else in the West got started thinking about it. There was that most of all to push the urgency. In your hypothetical there would not have been that urgency. However, as soon as good physicists thought about the reaction that leads to nuclear fission — where a slow room temperature neutron, very little energy, bumps into the nucleus of a uranium-235 atom it would lead to a massive response. Isidore Rabi, one of the great physicists of this era, said it would have been like the moon struck the earth. The reaction was, as physicists say, fiercely exothermic. It puts out a lot more energy than you have to use to get it started. Once they did the numbers on that, and once they figured out how much uranium you would need to have in one place to make a bomb or to make fission get going, and once they were sure that there would be a chain reaction, meaning a couple of neutrons would come out of the reaction from one atom, and those two or three would go on and bump into other Uranium atoms, which would then fission them, and you'd get a geometric exponential. You'd get 1, 2, 4, 8, 16, 32, and off of there. For most of our bombs today the initial fission, in 80 generations, leads to a city-busting explosion. And then they had to figure out how much material they would need, and that's something the Germans never really figured out, fortunately for the rest of us. They were still working on the idea that somehow a reactor would be what you would build. When Niels Bohr, the great Danish physicist, escaped from Denmark in 1943 and came to England and then United States, he brought with him a rough sketch that Werner Heisenberg, the leading scientist in the German program, had handed him in the course of trying to find out what Bohr knew about what America was doing. And he showed it to the guys at Los Alamos and Hans Bethe, one of the great Nobel laureate physicists in the group, said — “Are the Germans trying to throw a reactor down on us?” You can make a reactor blow up, we saw that at Chernobyl, but it's not a nuclear explosion on the scale that we're talking about with the bomb. So when a couple of these emigres Jewish physicists from Nazi Germany were whiling away their time in England after they escaped, because they were still technically enemy aliens and therefore could not be introduced to top secret discussions, one of them asked the other — “How much would we need of pure uranium-235, this rare isotope of uranium that chain reacts? How much would we need to make a bomb?” And they did the numbers and they came up with one pound, which was startling to them. Of course, it is more than that. It's about 125 pounds, but that's just a softball. That's not that much material. And then they did the numbers about what it would cost to build a factory to pull this one rare isotope of uranium out of the natural metal, which has several isotopes mixed together. And they figured it wouldn't cost more than it would cost to build a battleship, which is not that much money for a country at war. Certainly the British had plenty of battleships at that point in time. So they put all this together and they wrote a report which they handed through their superior physicists at Manchester University where they were based, who quickly realized how important this was. The United States lagged behind because we were not yet at war, but the British were. London was being bombed in the blitz. So they saw the urgency, first of all, of eating Germany to the punch, second of all of the possibility of building a bomb. In this report, these two scientists wrote that no physical structure came to their minds which could offer protection against a bomb of such ferocious explosive power. This report was from 1940 long before the Manhattan Project even got started. They said in this report, the only way we could think of to protect you against a bomb would be to have a bomb of similar destructive force that could be threatened for use if the other side attacked you. That's deterrence. That's a concept that was developed even before the war began in the United States. You put all those pieces together and you have a situation where you have to build a bomb because whoever builds the first bomb theoretically could prevent you from building more or prevent another country from building any and could dominate the world. And the notion of Adolf Hitler dominating the world, the Third Reich with nuclear weapons, was horrifying. Put all that together and the answer is every country that had the technological infrastructure to even remotely have the possibility of building everything you'd have to build to get the material for a bomb started work on thinking about it as soon as nuclear fusion was announced to the world. France, the Soviet Union, Great Britain, the United States, even Japan. So I think the bomb would have been developed but maybe not so quickly. Dwarkesh Patel 0:14:10In the book you talk that for some reason the Germans thought that the critical mass was something like 10 tons, they had done some miscalculation.Richard Rhodes 0:14:18A reactor. Dwarkesh Patel 0:14:19You also have some interesting stories in the book about how different countries found out the Americans were working on the bomb. For example, the Russians saw that all the top physicists, chemists, and metallurgists were no longer publishing. They had just gone offline and so they figured that something must be going on. I'm not sure if you're aware that while the subject of the Making of the Atomic Bomb in and of itself is incredibly fascinating, this book has become a cult classic in AI. Are you familiar with this? Richard Rhodes 0:14:52No. Dwarkesh Patel 0:14:53The people who are working on AI right now are huge fans of yours. They're the ones who initially recommended the book to me because the way they see the progress in the field reminded them of this book. Because you start off with these initial scientific hints. With deep learning, for example, here's something that can teach itself any function is similar to Szilárd noticing the nuclear chain reaction. In AI there's these scaling laws that say that if you make the model this much bigger, it gets much better at reasoning, at predicting text, and so on. And then you can extrapolate this curve. And you can see we get two more orders of magnitude, and we get to something that looks like human level intelligence. Anyway, a lot of the people who are working in AI have become huge fans of your book because of this reason. They see a lot of analogies in the next few years. They must be at page 400 in their minds of where the Manhattan Project was.Richard Rhodes 0:15:55We must later on talk about unintended consequences. I find the subject absolutely fascinating. I think my next book might be called Unintended Consequences. Dwarkesh Patel 0:16:10You mentioned that a big reason why many of the scientists wanted to work on the bomb, especially the Jewish emigres, was because they're worried about Hitler getting it first. As you mentioned at some point, 1943, 1944, it was becoming obvious that Hitler, the Nazis were not close to the bomb. And I believe that almost none of the scientists quit after they found out that the Nazis weren't close. So why didn’t more of them say — “Oh, I guess we were wrong. The Nazis aren't going to get it. We don't need to be working on it.”?Richard Rhodes 0:16:45There was only one who did that, Joseph Rotblat. In May of 1945 when he heard that Germany had been defeated, he packed up and left. General Groves, the imperious Army Corps of Engineers General who ran the entire Manhattan Project, was really upset. He was afraid he'd spill the beans. So he threatened to have him arrested and put in jail. But Rotblat was quite determined not to stay any longer. He was not interested in building bombs to aggrandize the national power of the United States of America, which is perfectly understandable. But why was no one else? Let me tell it in terms of Victor Weisskopf. He was an Austrian theoretical physicist, who, like the others, escaped when the Nazis took over Germany and then Austria and ended up at Los Alamos. Weisskopf wrote later — “There we were in Los Alamos in the midst of the darkest part of our science.” They were working on a weapon of mass destruction, that's pretty dark. He said “Before it had almost seemed like a spiritual quest.” And it's really interesting how different physics was considered before and after the Second World War. Before the war, one of the physicists in America named Louis Alvarez told me when he got his PhD in physics at Berkeley in 1937 and went to cocktail parties, people would ask, “What's your degree in?” He would tell them “Chemistry.” I said, “Louis, why?” He said, “because I don't really have to explain what physics was.” That's how little known this kind of science was at that time. There were only about 1,000 physicists in the whole world in 1900. By the mid-30s, there were a lot more, of course. There'd been a lot of nuclear physics and other kinds of physics done by them. But it was still arcane. And they didn't feel as if they were doing anything mean or dirty or warlike at all. They were just doing pure science. Then nuclear fission came along. It was publicized worldwide. People who've been born since after the Second World War don't realize that it was not a secret at first. The news was published first in a German chemistry journal, Die Naturwissenschaften, and then in the British journal Nature and then in American journals. And there were headlines in the New York Times, the Los Angeles Times, the Chicago Tribune, and all over the world. People had been reading about and thinking about how to get energy out of the atomic nucleus for a long time. It was clear there was a lot there. All you had to do was get a piece of radium and see that it glowed in the dark. This chunk of material just sat there, you didn't plug it into a wall. And if you held it in your hand, it would burn you. So where did that energy come from? The physicists realized it all came from the nucleus of the atom, which is a very small part of the whole thing. The nucleus is 1/100,000th the diameter of the whole atom. Someone in England described it as about the size of a fly in a cathedral. All of the energy that's involved in chemical reactions, comes from the electron cloud that's around the nucleus. But  it was clear that the nucleus was the center of powerful forces. But the question was, how do you get them out? The only way that the nucleus had been studied up to 1938 was by bombarding it with protons, which have the same electric charge as the nucleus, positive charge, which means they were repelled by it. So you had to accelerate them to high speeds with various versions of the big machines that we've all become aware of since then. The cyclotron most obviously built in the 30s, but there were others as well. And even then, at best, you could chip a little piece off. You could change an atom one step up or one step down the periodic table. This was the classic transmutation of medieval alchemy sure but it wasn't much, you didn't get much out. So everyone came to think of the nucleus of the atom like a little rock that you really had to hammer hard to get anything to happen with it because it was so small and dense. That's why nuclear fission, with this slow neutron drifting and then the whole thing just goes bang, was so startling to everybody. So startling that when it happened, most of the physicists who would later work on the bomb and others as well, realized that they had missed the reaction that was something they could have staged on a lab bench with the equipment on the shelf. Didn't have to invent anything new. And Louis Alvarez again, this physicist at Berkeley, he said — “I was getting my hair cut. When I read the newspaper, I pulled off the robe and half with my hair cut, ran to my lab, pulled some equipment off the shelf, set it up and there it was.” So he said, “I discovered nuclear fission, but it was two days too late.” And that happened all over. People were just hitting themselves on the head and saying, well, Niels Bohr said, “What fools we've all been.” So this is a good example of how in science, if your model you’re working with is wrong it doesn't lead you down the right path. There was only one physicist who really was thinking the right way about the uranium atom and that was Niels Bohr. He wondered, sometime during the 30s, why uranium was the last natural element in the periodic table? What is different about the others that would come later? He visualized the nucleus as a liquid drop. I always like to visualize it as a water-filled balloon. It's wobbly, it's not very stable. The protons in the nucleus are held together by something called the strong force, but they still have the repellent positive electric charge that's trying to push them apart when you get enough of them into a nucleus. It's almost a standoff between the strong force and all the electrical charge. So it is like a wobbly balloon of water. And then you see why a neutron just falling into the nucleus would make it wobble around even more and in one of its configurations, it might take a dumbbell shape. And then you'd have basically two charged atoms just barely connected, trying to push each other apart. And often enough, they went the whole way. When they did that, these two new elements, half the weight of uranium, way down the periodic table, would reconfigure themselves into two separate nuclei. And in doing so, they would release some energy. And that was the energy that came out of the reaction and there was a lot of energy. So Bohr thought about the model in the right way. The chemists who actually discovered nuclear fusion didn't know what they were gonna get. They were just bombarding a solution of uranium nitrate with neutrons thinking, well, maybe we can make a new element, maybe a first man-made element will come out of our work. So when they analyzed the solution after they bombarded it, they found elements halfway down the periodic table. They shouldn't have been there. And they were totally baffled. What is this doing here? Do we contaminate our solution? No. They had been working with a physicist named Lisa Meitner who was a theoretical physicist, an Austrian Jew. She had gotten out of Nazi Germany not long before. But they were still in correspondence with her. So they wrote her a letter. I held that letter in my hand when I visited Berlin and I was in tears. You don't hold history of that scale in your hands very often. And it said in German — “We found this strange reaction in our solution. What are these elements doing there that don't belong there?” And she went for a walk in a little village in Western Sweden with her nephew, Otto Frisch, who was also a nuclear physicist. And they thought about it for a while and they remembered Bohr's model, the wobbly water-filled balloon. And they suddenly saw what could happen. And that's where the news came from, the physics news as opposed to the chemistry news from the guys in Germany that was published in all the Western journals and all the newspapers. And everybody had been talking about, for years, what you could do if you had that kind of energy. A glass of this material would drive the Queen Mary back and forth from New York to London 20 times and so forth, your automobile could run for months. People were thinking about what would be possible if you had that much available energy. And of course, people had thought about reactors. Robert Oppenheimer was a professor at Berkeley and within a week of the news reaching Berkeley, one of his students told me that he had a drawing on the blackboard, a rather bad drawing of both a reactor and a bomb. So again, because the energy was so great, the physics was pretty obvious. Whether it would actually happen depended on some other things like could you make it chain react? But fundamentally, the idea was all there at the very beginning and everybody jumped on it. Dwarkesh Patel 0:27:54The book is actually the best history of World War II I've ever read. It's about the atomic bomb, but it's interspersed with the events that are happening in World War II, which motivate the creation of the bomb or the release of it, why it had to be dropped on Japan given the Japanese response. The first third is about the scientific roots of the physics and it's also the best book I've read about the history of science in the early 20th century and the organization of it. There's some really interesting stuff in there. For example, there was a passage where you talk about how there's a real master apprentice model in early science where if you wanted to learn to do this kind of experimentation, you will go to Amsterdam where the master of it is residing. It's much more individual focused. Richard Rhodes 0:28:58Yeah, the whole European model of graduate study, which is basically the wandering scholar. You could go wherever you wanted to and sign up with whoever was willing to have you sign up. (0:29:10) - Firebombing vs nuclear vs hydrogen bombsDwarkesh Patel 0:29:10But the question I wanted to ask regarding the history you made of World War II in general is — there's one way you can think about the atom bomb which is that it is completely different from any sort of weaponry that has been developed before it. Another way you can think of it is there's a spectrum where on one end you have the thermonuclear bomb, in the middle you have the atom bomb, and on this end you have the firebombing of cities like Hamburg and Dresden and Tokyo. Do you think of these as completely different categories or does it seem like an escalating gradient to you? Richard Rhodes 0:29:47I think until you get to the hydrogen bomb, it's really an escalating gradient. The hydrogen bomb can be made arbitrarily large. The biggest one ever tested was 56 megatons of TNT equivalent. The Soviet tested that. That had a fireball more than five miles in diameter, just the fireball. So that's really an order of magnitude change. But the other one's no and in fact, I think one of the real problems, this has not been much discussed and it should be, when American officials went to Hiroshima and Nagasaki after the war, one of them said later — “I got on a plane in Tokyo. We flew down the long green archipelago of the Japanese home island. When I left Tokyo, it was all gray broken roof tiles from the fire bombing and the other bombings. And then all this greenery. And then when we flew over Hiroshima, it was just gray broken roof tiles again.” So the scale of the bombing with one bomb, in the case of Hiroshima, was not that different from the scale of the fire bombings that had preceded it with tens of thousands of bombs. The difference was it was just one plane. In fact, the people in Hiroshima didn't even bother to go into their bomb shelters because one plane had always just been a weather plane. Coming over to check the weather before the bombers took off. So they didn't see any reason to hide or protect themselves, which was one of the reasons so many people were killed. The guys at Los Alamos had planned on the Japanese being in their bomb shelters. They did everything they could think of to make the bomb as much like ordinary bombing as they could. And for example, it was exploded high enough above ground, roughly 1,800 yards, so that the fireball that would form from this really very small nuclear weapon — by modern standards — 15 kilotons of TNT equivalent, wouldn't touch the ground and stir up dirt and irradiate it and cause massive radioactive fallout. It never did that. They weren't sure there would be any fallout. They thought the plutonium and the bomb over Nagasaki now would just kind of turn into a gas and blow away. That's not exactly what happened. But people don't seem to realize, and it's never been emphasized enough, these first bombs, like all nuclear weapons, were firebombs. Their job was to start mass fires, just exactly like all the six-pound incendiaries that had been destroying every major city in Japan by then. Every major city above 50,000 population had already been burned out. The only reason Hiroshima and Nagasaki were around to be atomic bombed is because they'd been set aside from the target list, because General Groves wanted to know what the damage effects would be. The bomb that was tested in the desert didn't tell you anything. It killed a lot of rabbits, knocked down a lot of cactus, melted some sand, but you couldn't see its effect on buildings and on people. So the bomb was deliberately intended to be as much not like poison gas, for example, because we didn't want the reputation for being like people in the war in Europe during the First World War, where people were killing each other with horrible gasses. We just wanted people to think this was another bombing. So in that sense, it was. Of course, there was radioactivity. And of course, some people were killed by it. But they calculated that the people who would be killed by the irradiation, the neutron radiation from the original fireball, would be close enough to the epicenter of the explosion that they would be killed by the blast or the flash of light, which was 10,000 degrees. The world's worst sunburn. You've seen stories of people walking around with their skin hanging off their arms. I've had sunburns almost that bad, but not over my whole body, obviously, where the skin actually peeled blisters and peels off. That was a sunburn from a 10,000 degree artificial sun. Dwarkesh Patel 0:34:29So that's not the heat, that's just the light? Richard Rhodes 0:34:32Radiant light, radiant heat. 10,000 degrees. But the blast itself only extended out a certain distance, it was fire. And all the nuclear weapons that have ever been designed are basically firebombs. That's important because the military in the United States after the war was not able to figure out how to calculate the effects of this weapon in a reliable way that matched their previous experience. They would only calculate the blast effects of a nuclear weapon when they figured their targets. That's why we had what came to be called overkill. We wanted redundancy, of course, but 60 nuclear weapons on Moscow was way beyond what would be necessary to destroy even that big a city because they were only calculating the blast. But in fact, if you exploded a 300 kiloton nuclear warhead over the Pentagon at 3,000 feet, it would blast all the way out to the capital, which isn't all that far. But if you counted the fire, it would start a mass-fire and then it would reach all the way out to the Beltway and burn everything between the epicenter of the weapon and the Beltway. All organic matter would be totally burned out, leaving nothing but mineral matter, basically. Dwarkesh Patel 0:36:08I want to emphasize two things you said because they really hit me in reading the book and I'm not sure if the audience has fully integrated them. The first is, in the book, the military planners and Groves, they talk about needing to use the bomb sooner rather than later, because they were running out of cities in Japan where there are enough buildings left that it would be worth bombing in the first place, which is insane. An entire country is almost already destroyed from fire bombing alone. And the second thing about the category difference between thermonuclear and atomic bombs. Daniel Ellsberg, the nuclear planner who wrote the Doomsday machine, he talks about, people don't understand that the atom bomb that resulted in the pictures we see of Nagasaki and Hiroshima, that is simply the detonator of a modern nuclear bomb, which is an insane thing to think about. So for example, 10 and 15 kilotons is the Hiroshima Nagasaki and the Tsar Bomba, which was 50 megatons. So more than 1,000 times as much. And that wasn't even as big as they could make it. They kept the uranium tamper off, because they didn't want to destroy all of Siberia. So you could get more than 10,000 times as powerful. Richard Rhodes 0:37:31When Edward Teller, co-inventor of the hydrogen bomb and one of the dark forces in the story, was consulting with our military, just for his own sake, he sat down and calculated, how big could you make a hydrogen bomb? He came up with 1,000 megatons. And then he looked at the effects. 1,000 megatons would be a fireball 10 miles in diameter. And the atmosphere is only 10 miles deep. He figured that it would just be a waste of energy, because it would all blow out into space. Some of it would go laterally, of course, but most of it would just go out into space. So a bomb more than 100 megatons would just be totally a waste of time. Of course, a 100 megatons bomb is also a total waste, because there's no target on Earth big enough to justify that from a military point of view. Robert Oppenheimer, when he had his security clearance questioned and then lifted when he was being punished for having resisted the development of the hydrogen bomb, was asked by the interrogator at this security hearing — “Well, Dr. Oppenheimer, if you'd had a hydrogen bomb for Hiroshima, wouldn't you have used it?” And Oppenheimer said, “No.” The interrogator asked, “Why is that?” He said because the target was too small. I hope that scene is in the film, I'm sure it will be. So after the war, when our bomb planners and some of our scientists went into Hiroshima and Nagasaki, just about as soon as the surrender was signed, what they were interested in was the scale of destruction, of course. And those two cities didn't look that different from the other cities that had been firebombed with small incendiaries and ordinary high explosives. They went home to Washington, the policy makers, with the thought that — “Oh, these bombs are not so destructive after all.” They had been touted as city busters, basically, and they weren't. They didn't completely burn out cities. They were not certainly more destructive than the firebombing campaign, when everything of more than 50,000 population had already been destroyed. That, in turn, influenced the judgment about what we needed to do vis-a-vis the Soviet Union when the Soviets got the bomb in 1949. There was a general sense that, when you could fight a war with nuclear weapons, deterrence or not, you would need quite a few of them to do it right. And the Air Force, once it realized that it could aggrandize its own share of the federal budget by cornering the market and delivering nuclear weapons, very quickly decided that they would only look at the blast effect and not the fire effect. It's like tying one hand behind your back. Most of it was a fire effect. So that's where they came up with numbers like we need 60 of these to take out Moscow. And what the Air Force figured out by the late 1940s is that the more targets, the more bombs. The more bombs, the more planes. The more planes, the biggest share of the budget. So by the mid 1950s, the Air Force commanded 47% of the federal defense budget. And the other branches of services, which had not gone nuclear by then, woke up and said, we'd better find some use for these weapons in our branches of service. So the Army discovered that it needed nuclear weapons, tactical weapons for field use, fired out of cannons. There was even one that was fired out of a shoulder mounted rifle. There was a satchel charge that two men could carry, weighed about 150 pounds, that could be used to dig a ditch so that Soviet tanks couldn't cross into Germany. And of course the Navy by then had been working hard with General Rickover on building a nuclear submarine that could carry ballistic missiles underwater in total security. No way anybody could trace those submarines once they were quiet enough. And a nuclear reactor is very quiet. It just sits there with neutrons running around, making heat. So the other services jumped in and this famous triad, we must have these three different kinds of nuclear weapons, baloney. We would be perfectly safe if we only had our nuclear submarines. And only one or two of those. One nuclear submarine can take out all of Europe or all of the Soviet Union.Dwarkesh Patel 0:42:50Because it has multiple nukes on it? Richard Rhodes 0:42:53Because they have 16 intercontinental ballistic missiles with MIRV warheads, at least three per missile. Dwarkesh Patel 0:43:02Wow. I had a former guest, Richard Hanania, who has a book about foreign policy where he points out that our model of thinking about why countries do the things they do, especially in foreign affairs, is wrong because we think of them as individual rational actors, when in fact it's these competing factions within the government. And in fact, you see this especially in the case of Japan in World War II, there was a great book of Japan leading up to World War II, where they talk about how a branch of the Japanese military, I forget which, needed more oil to continue their campaign in Manchuria so they forced these other branches to escalate. But it’s so interesting that the reason we have so many nukes is that the different branches are competing for funding. Richard Rhodes 0:43:50Douhet, the theorist of air power, had been in the trenches in the First World War. Somebody (John Masefield) called the trenches of the First World War, the long grave already dug, because millions of men were killed and the trenches never moved, a foot this way, a foot that way, all this horror. And Douhet came up with the idea that if you could fly over the battlefield to the homeland of the enemy and destroy his capacity to make war, then the people of that country, he theorized, would rise up in rebellion and throw out their leaders and sue for peace. And this became the dream of all the Air Forces of the world, but particularly ours. Until around 1943, it was called the US Army Air Force. The dream of every officer in the Air Force was to get out from under the Army, not just be something that delivers ground support or air support to the Army as it advances, but a power that could actually win wars. And the missing piece had always been the scale of the weaponry they carried. So when the bomb came along, you can see why Curtis LeMay, who ran the strategic air command during the prime years of that force, was pushing for bigger and bigger bombs. Because if a plane got shot down, but the one behind it had a hydrogen bomb, then it would be just almost as effective as the two planes together. So they wanted big bombs. And they went after Oppenheimer because he thought that was a terrible way to go, that there was really no military use for these huge weapons. Furthermore, the United States had more cities than Russia did, than the Soviet Union did. And we were making ourselves a better target by introducing a weapon that could destroy a whole state. I used to live in Connecticut and I saw a map that showed the air pollution that blew up from New York City to Boston. And I thought, well, now if that was fallout, we'd be dead up here in green, lovely Connecticut. That was the scale that it was going to be with these big new weapons. So on the one hand, you had some of the important leaders in the government thinking that these weapons were not the war-winning weapons that the Air Force wanted them and realized they could be. And on the other hand, you had the Air Force cornering the market on nuclear solutions to battles. All because some guy in a trench in World War I was sufficiently horrified and sufficiently theoretical about what was possible with air power. Remember, they were still flying biplanes. When H.G. Wells wrote his novel, The World Set Free in 1913, predicting an atomic war that would lead to world government, he had Air Forces delivering atomic bombs, but he forgot to update his planes. The guys in the back seat, the bombardiers, were sitting in a biplane, open cockpit. And when the pilots had dropped the bomb, they would reach down and pick up H.G. Wells' idea of an atomic bomb and throw it over the side. Which is kind of what was happening in Washington after the war. And it led us to a terribly misleading and unfortunate perspective on how many weapons we needed, which in turn fermented the arms race with the Soviets and just chased off. In the Soviet Union, they had a practical perspective on factories. Every factory was supposed to produce 120% of its target every year. That was considered good Soviet realism. And they did that with their nuclear war weapons. So by the height of the Cold War, they had 75,000 nuclear weapons, and nobody had heard yet of nuclear winter. So if both sides had set off this string of mass traps that we had in our arsenals, it would have been the end of the human world without question. Dwarkesh Patel 0:48:27It raises an interesting question, if the military planners thought that the conventional nuclear weapon was like the fire bombing, would it have been the case that if there wasn't a thermonuclear weapon, that there actually would have been a nuclear war by now because people wouldn't have been thinking of it as this hard red line? Richard Rhodes 0:48:47I don't think so because we're talking about one bomb versus 400, and one plane versus 400 planes and thousands of bombs. That scale was clear. Deterrence was the more important business. Everyone seemed to understand even the spies that the Soviets had connected up to were wholesaling information back to the Soviet Union. There's this comic moment when Truman is sitting with Joseph Stalin at Potsdam, and he tells Stalin, we have a powerful new weapon. And that's as much as he's ready to say about it. And Stalin licks at him and says, “Good, I hope you put it to good use with the Japanese.” Stalin knows exactly what he's talking about. He's seen the design of the fat man type Nagasaki plutonium bomb. He has held it in his hands because they had spies all over the place. (0:49:44) - Stalin & the Soviet programDwarkesh Patel 0:49:44How much longer would it have taken the Soviets to develop the bomb if they didn't have any spies? Richard Rhodes 0:49:49Probably not any longer. Dwarkesh Patel 0:49:51Really? Richard Rhodes 0:49:51When the Soviet Union collapsed in the winter of ‘92, I ran over there as quickly as I could get over there. In this limbo between forming a new kind of government and some of the countries pulling out and becoming independent and so forth, their nuclear scientists, the ones who'd worked on their bombs were free to talk. And I found that out through Yelena Bonner, Andrei Sakharov's widow, who was connected to people I knew. And she said, yeah, come on over. Her secretary, Sasha, who was a geologist about 35 years old became my guide around the country. We went to various apartments. They were retired guys from the bomb program and were living on, as far as I could tell, sac-and-potatoes and some salt. They had government pensions and the money was worth a salt, all of a sudden. I was buying photographs from them, partly because I needed the photographs and partly because 20 bucks was two months' income at that point. So it was easy for me and it helped them. They had first class physicists in the Soviet Union, they do in Russian today. They told me that by 1947, they had a design for a bomb that they said was half the weight and twice the yield of the Fat Man bomb. The Fat Man bomb was the plutonium implosion, right? And it weighed about 9,000 pounds. They had a much smaller and much more deliverable bomb with a yield of about 44 kilotons. Dwarkesh Patel 0:51:41Why was Soviet physics so good?Richard Rhodes 0:51:49The Russian mind? I don't know. They learned all their technology from the French in the 19th century, which is why there's so many French words in Russian. So they got good teachers, the French are superb technicians, they aren't so good at building things, but they're very good at designing things. There's something about Russia, I don't know if it's the language or the education. They do have good education, they did. But I remember asking them when they were working, I said — On the hydrogen bomb, you didn't have any computers yet. We only had really early primitive computers to do the complicated calculations of the hydrodynamics of that explosion. I said, “What did you do?” They said, “Oh, we just used nuclear. We just used theoretical physics.” Which is what we did at Los Alamos. We had guys come in who really knew their math and they would sit there and work it out by hand. And women with old Marchant calculators running numbers. So basically they were just good scientists and they had this new design. Kurchatov who ran the program took Lavrentiy Beria, who ran the NKVD who was put in charge of the program and said — “Look, we can build you a better bomb. You really wanna waste the time to make that much more uranium and plutonium?” And Beria said, “Comrade, I want the American bomb. Give me the American bomb or you and all your families will be camp dust.” I talked to one of the leading scientists in the group and he said, we valued our lives, we valued our families. So we gave them a copy of the plutonium implosion bomb. Dwarkesh Patel 0:53:37Now that you explain this, when the Soviet Union fell, why didn’t North Korea, Iran or another country, send a few people to the fallen Soviet Union to recruit a few of the scientists to start their own program? Or buy off their stockpiles or something. Or did they?Richard Rhodes 0:53:59There was some effort by countries in the Middle East to get all the enriched uranium, which they wouldn't sell them. These were responsible scientists. They told me — we worked on the bomb because you had it and we didn't want there to be a monopoly on the part of any country in the world. So patriotically, even though Stalin was in charge of our country, he was a monster. We felt that it was our responsibility to work on these things, even Sakharov. There was a great rush at the end of the Second World War to get hold of German scientists. And about an equal number were grabbed by the Soviets. All of the leading German scientists, like Heisenberg and Hans and others, went west as fast as they could. They didn't want to be captured by the Soviets. But there were some who were. And they helped them work. People have the idea that Los Alamos was where the bomb happened. And it's true that at Los Alamos, we had the team that designed, developed, and built the first actual weapons. But the truth is, the important material for weapons is the uranium or plutonium. One of the scientists in the Manhattan Project told me years later, you can make a pretty high-level nuclear explosion just by taking two subcritical pieces of uranium, putting one on the floor and dropping the other by hand from a height of about six feet. If that's true, then all this business about secret designs and so forth is hogwash. What you really need for a weapon is the critical mass of highly enriched uranium, 90% of uranium-235. If you've got that, there are lots of different ways to make the bomb. We had two totally different ways that we used. The gun on the one hand for uranium, and then because plutonium was so reactive that if you fired up the barrel of a cannon at 3,000 feet per second, it would still melt down before the two pieces made it up. So for that reason, they had to invent an entirely new technology, which was an amazing piece of work. From the Soviet point of view, and I think this is something people don't know either, but it puts the Russian experience into a better context. All the way back in the 30s, since the beginning of the Soviet Union after the First World War, they had been sending over espionage agents connected up to Americans who were willing to work for them to collect industrial technology. They didn't have it when they began their country. It was very much an agricultural country. And in that regard, people still talk about all those damn spies stealing our secrets, we did the same thing with the British back in colonial days. We didn't know how to make a canal that wouldn't drain out through the soil. The British had a certain kind of clay that they would line their canals with, and there were canals all over England, even in the 18th century, that were impervious to the flow of water. And we brought a British engineer at great expense to teach us how to make the lining for the canals that opened up the Middle West and then the West. So they were doing the same thing. And one of those spies was a guy named Harry Gold, who was working all the time for them. He gave them some of the basic technology of Kodak filmmaking, for example. Harry Gold was the connection between David Greenglass and one of the American spies at Los Alamos and the Soviet Union. So it was not different. The model was — never give us something that someone dreamed of that hasn't been tested and you know works. So it would actually be blueprints for factories, not just a patent. And therefore when Beria after the war said, give us the bomb, he meant give me the American bomb because we know that works. I don't trust you guys. Who knows what you'll do. You're probably too stupid anyway. He was that kind of man. So for all of those reasons, they built the second bomb they tested was twice the yield and half the way to the first bomb. In other words, it was their new design. And so it was ours because the technology was something that we knew during the war, but it was too theoretical still to use. You just had to put the core and have a little air gap between the core and the explosives so that the blast wave would have a chance to accelerate through an open gap. And Alvarez couldn’t tell me what it was but he said, you can get a lot more destructive force with a hammer if you hit something with it, rather than if you put the head on the hammer and push. And it took me several years before I figured out what he meant. I finally understood he was talking about what's called levitation.Dwarkesh Patel 0:59:41On the topic that the major difficulty in developing a bomb is either the refinement of uranium into U-235 or its transmutation into plutonium, I was actually talking to a physicist in preparation for this conversation. He explained the same thing that if you get two subcritical masses of uranium together, you wouldn't have the full bomb because it would start to tear itself apart without the tamper, but you would still have more than one megaton.Richard Rhodes 1:00:12It would be a few kilotons. Alvarez's model would be a few kilotons, but that's a lot. Dwarkesh Patel 1:00:20Yeah, sorry I meant kiloton. He claimed that one of the reasons why we talk so much about Los Alamos is that at the time the government didn't want other countries to know that if you refine uranium, you've got it. So they were like, oh, we did all this fancy physics work in Los Alamos that you're not gonna get to, so don't even worry about it. I don't know what you make of that theory. That basically it was sort of a way to convince people that Los Alamos was important. Richard Rhodes 1:00:49I think all the physics had been checked out by a lot of different countries by then. It was pretty clear to everybody what you needed to do to get to a bomb. That there was a fast fusion reaction, not a slow fusion reaction, like a reactor. They'd worked that out. So I don't think that's really the problem. But to this day, no one ever talks about the fact that the real problem isn't the design of the weapon. You could make one with wooden boxes if you wanted to. The problem is getting the material. And that's good because it's damned hard to make that stuff. And it's something you can protect. Dwarkesh Patel 1:01:30We also have gotten very lucky, if lucky is the word you want to use. I think you mentioned this in the book at some point, but the laws of physics could have been such that unrefined uranium ore was enough to build a nuclear weapon, right? In some sense, we got lucky that it takes a nation-state level actor to really refine and produce the raw substance. Richard Rhodes 1:01:56Yeah, I was thinking about that this morning on the way over. And all the uranium in the world would already have destroyed itself. Most people have never heard of the living reactors that developed on their own in a bed of uranium ore in Africa about two billion years ago, right? When there was more U-235 in a mass of uranium ore than there is today, because it decays like all radioactive elements. And the French discovered it when they were mining the ore and found this bed that had a totally different set of nuclear characteristics. They were like, what happened? But there were natural reactors in Gabon once upon a time. And they started up because some water, a moderator to make the neutrons slow down, washed its way down through a bed of much more highly enriched uranium ore than we still have today. Maybe 5-10% instead of 3.5 or 1.5, whatever it is now. And they ran for about 100,000 years and then shut themselves down because they had accumulated enough fusion products that the U-235 had been used up. Interestingly, this material never migrated out of the bed of ore. People today who are anti-nuclear say, well, what are we gonna do about the waste? Where are we gonna put all that waste? It's silly. Dwarkesh Patel 1:03:35Shove it in a hole. Richard Rhodes 1:03:36Yeah, basically. That's exactly what we're planning to do. Holes that are deep enough and in beds of material that will hold them long enough for everything to decay back to the original ore. It's not a big problem except politically because nobody wants it in their backyard.Dwarkesh Patel 1:03:53On the topic of the Soviets, one question I had while reading the book was — we negotiated with Stalin at Yalta and we surrendered a large part of Eastern Europe to him under his sphere of influence. And obviously we saw 50 years of immiseration there as a result. Given the fact that only we had the bomb, would it have been possible that we could have just knocked out the Soviet Union or at least prevented so much of the world from succumbing to communism in the aftermath of World War II? Is that a possibility? Richard Rhodes 1:04:30When we say we had the bomb, we had a few partly assembled handmade bombs. It took almost as long to assemble one as the battery life of the batteries that would drive the original charge that would set off the explosion. It was a big bluff. You know, when they closed Berlin in 1948 and we had to supply Berlin by air with coal and food for a whole winter, we moved some B-29s to England. The B-29 being the bomber that had carried the bombs. They were not outfitted for nuclear weapons. They didn't have the same kind of bomb-based structure. The weapons that were dropped in Japan had a single hook that held the entire bomb. So when the bay opened and the hook was released, the thing dropped. And that's very different from dropping whole rows of small bombs that you've seen in the photographs and the film footage. So it was a big bluff on our part. We took some time after the war inevitably to pull everything together. Here was a brand new technology. Here was a brand new weapon. Who was gonna be in charge of it? The military wanted control, Truman wasn't about to give the military control. He'd been an artillery officer in the First World War. He used to say — “No, damn artillery captain is gonna start World War III when I'm president.” I grew up in the same town he lived in so I know his accent. Independence, Missouri. Used to see him at his front steps taking pictures with tourists while he was still president. He used to step out on the porch and let the tourists take photographs. About a half a block from my Methodist church where I went to church. It was interesting. Interestingly, his wife was considered much more socially acceptable than he was. She was from an old family in independence, Missouri. And he was some farmer from way out in Grandview, Missouri, South of Kansas City. Values. Anyway, at the end of the war, there was a great rush from the Soviet side of what was already a zone. There was a Soviet zone, a French zone, British zone and an American zone. Germany was divided up into those zones to grab what's left of the uranium ore that the Germans had stockpiled. And there was evidence that there was a number of barrels of the stuff in a warehouse somewhere in the middle of all of this. And there's a very funny story about how the Russians ran in and grabbed off one site full of uranium ore, this yellow black stuff in what were basically wine barrels. And we at the same night, just before the wall came down between the zones, were running in from the other side, grabbing some other ore and then taking it back to our side. But there was also a good deal of requisitioning of German scientists. And the ones who had gotten away early came West, but there were others who didn't and ended up helping the Soviets. And they were told, look, you help us build the reactors and the uranium separation systems that we need. And we'll let you go home and back to your family, which they did. Early 50s by then, the German scientists who had helped the Russians went home. And I think our people stayed here and brought their families over, I don't know. (1:08:24) - Deterrence, disarmament, North Korea, TaiwanDwarkesh Patel 1:08:24Was there an opportunity after the end of World War II, before the Soviets developed the bomb, for the US to do something where either it somehow enforced a monopoly on having the bomb, or if that wasn't possible, make some sort of credible gesture that, we're eliminating this knowledge, you guys don't work on this, we're all just gonna step back from this. Richard Rhodes 1:08:50We tried both before the war. General Groves, who had the mistaken impression that there was a limited amount of high-grade uranium ore in the world, put together a company that tried to corner the market on all the available supply. For some reason, he didn't realize that a country the size of the Soviet Union is going to have some uranium ore somewhere. And of course it did, in Kazakhstan, rich uranium ore, enough for all the bombs they wanted to build. But he didn't know that, and I frankly don't know why he didn't know that, but I guess uranium's use before the Second World War was basically as a glazing agent for pottery, that famous yellow pottery and orange pottery that people owned in the 1930s, those colors came from uranium, and they're sufficiently radioactive, even to this day, that if you wave a Geiger counter over them, you get some clicks. In fact, there have been places where they've gone in with masks and suits on, grabbed the Mexican pottery and taken it out in a lead-lined case. People have been so worried about it but that was the only use for uranium, to make a particular kind of glass. So once it became clear that there was another use for uranium, a much more important one, Groves tried to corner the world market, and he thought he had. So that was one effort to limit what the Soviet Union could do. Another was to negotiate some kind of agreement between the parties. That was something that really never got off the ground, because the German Secretary of State was an old Southern politician and he didn't trust the Soviets. He went to the first meeting, in Geneva in ‘45 after the war was over, and strutted around and said, well, I got the bomb in my pocket, so let's sit down and talk here. And the Soviet basically said, screw you. We don't care. We're not worried about your bomb. Go home. So that didn't work. Then there was the effort to get the United Nations to start to develop some program of international control. And the program was proposed originally by a committee put together by our State Department that included Robert Oppenheimer, rightly so, because the other members of the committee were industrialists, engineers, government officials, people with various kinds of expertise around the very complicated problems of technology and the science and, of course, the politics, the diplomacy. In a couple of weeks, Oppenheimer taught them the basics of the nuclear physics involved and what he knew about bomb design, which was everything, actually, since he'd run Los Alamos. He was a scientist during the war. And they came up with a plan. People have scoffed ever since at what came to be called the Acheson-Lilienthal plan named after the State Department people. But it's the only plan I think anyone has ever devised that makes real sense as to how you could have international control without a world government. Every country would be open to inspection by any agency that was set up. And the inspections would not be at the convenience of the country. But whenever the inspectors felt they needed to inspect. So what Oppenheimer called an open world. And if you had that, and then if each country then developed its own nuclear industries, nuclear power, medical uses, whatever, then if one country tried clandestinely to begin to build bombs, you would know about it at the time of the next inspection. And then you could try diplomacy. If that didn't work, you could try conventional war. If that wasn't sufficient, then you could start building your bombs too. And at the end of this sequence, which would be long enough, assuming that there were no bombs existing in the world, and the ore was stored in a warehouse somewhere, six months maybe, maybe a year, it would be time for everyone to scale up to deterrence with weapons rather than deterrence without weapons, with only the knowledge. That to me is the answer to the whole thing. And it might have worked. But there were two big problems. One, no country is going to allow a monopoly on a nuclear weapon, at least no major power. So the Russians were not willing to sign on from the beginning. They just couldn't. How could they? We would not have. Two, Sherman assigned a kind of a loudmouth, a wise old Wall Street guy to present this program to the United Nations. And he sat down with Oppenheimer after he and his people had studied and said, where's your army? Somebody starts working on a bomb over there. You've got to go in and take that out, don't you? He said, what would happen if one country started building a bomb? Oppenheimer said, well, that would be an act of war. Meaning then the other countries could begin to escalate as they needed to to protect themselves against one power, trying to overwhelm the rest. Well, Bernard Baruch was the name of the man. He didn't get it. So when he presented his revised version of the Acheson–Lilienthal Plan, which was called the Baruch Plan to the United Nations, he included his army. And he insisted that the United States would not give up its nuclear monopoly until everyone else had signed on. So of course, who's going to sign on to that deal? Dwarkesh Patel 1:15:24I feel he has a point in the sense that — World War II took five years or more. If we find that the Soviets are starting to develop a bomb, it's not like within the six months or a year or whatever, it would take them to start refining the ore. And to the point we found out that they've been refining ore to when we start a war and engage in it, and doing all the diplomacy. By that point, they might already have the bomb. And so we're behind because we dismantled our weapons. We are only starting to develop our weapons once we've exhausted these other avenues. Richard Rhodes 1:16:00Not to develop. Presumably we would have developed. And everybody would have developed anyway. Another way to think of this is as delayed delivery times. Takes about 30 minutes to get an ICBM from Central Missouri to Moscow. That's the time window for doing anything other than starting a nuclear war. So take the warhead off those missiles and move it down the road 10 miles. So then it takes three hours. You've got to put the warhead back on the missiles. If the other side is willing to do this too. And you both can watch and see. We require openness. A word Bohr introduced to this whole thing. In order to make this happen, you can't have secrets. And of course, as time passed on, we developed elaborate surveillance from space, surveillance from planes, and so forth. It would not have worked in 1946 for sure. The surveillance wasn’t there. But that system is in place today. The International Atomic Energy Agency has detected systems in air, in space, underwater. They can detect 50 pounds of dynamite exploded in England from Australia with the systems that we have in place. It's technical rather than human resources. But it's there. So it's theoretically possible today to get started on such a program. Except, of course, now, in like 1950, the world is awash in nuclear weapons. Despite the reductions that have occurred since the end of the Cold War, there's still 30,000-40,000 nuclear weapons in the world. Way too many. Dwarkesh Patel 1:18:01Yeah. That's really interesting. What percentage of warheads do you think are accounted for by this organization? If there's 30,000 warheads, what percentage are accounted for? Richard Rhodes 1:18:12All.Dwarkesh Patel 1:18:12Oh. Really?  North Korea doesn't have secrets? Richard Rhodes 1:18:13They're allowed to inspect anywhere without having to ask the government for permission. Dwarkesh Patel 1:18:18But presumably not North Korea or something, right? Richard Rhodes 1:18:21North Korea is an exception. But we keep pretty good track of North Korea needless to say. Dwarkesh Patel 1:18:27Are you surprised with how successful non-proliferation has been? The number of countries with nuclear weapons has not gone up for decades. Given the fact, as you were talking about earlier, it's simply a matter of refining or transmuting uranium. Is it surprising that there aren’t more countries that have it?Richard Rhodes 1:18:42That's really an interesting part. Again, a part of the story that most people have never really heard. In the 50s, before the development and signing of the Nuclear Non-Proliferation Treaty, which was 1968 and it took effect in 1970, a lot of countries that you would never have imagined were working on nuclear weapons. Sweden, Norway, Japan, South Korea. They had the technology. They just didn't have the materials. It was kind of dicey about what you should do. But I interviewed some of the Swedish scientists who worked on their bomb and they said, well, we were just talking about making some tactical nukes that would slow down a Russian tank advance on our country long enough for us to mount a defense. I said, so why did you give it up? And they said, well, when the Soviets developed hydrogen bombs, it would only take two to destroy Sweden. So we didn't see much point. And we then signed the Non-Proliferation Treaty. And our knowledge of how to build nuclear weapons helped us deal with countries like South Africa, which did build a few bombs in the late 1980s. Six World War II-type gun bombs fueled with enriched uranium, because South Africa is awash in uranium ore and makes a lot of uranium for various purposes. So efforts were starting up. And that's where John Kennedy got the numbers in a famous speech he delivered, where he said, I lose sleep at night over the real prospect of there being 10 countries with nuclear weapons by 1970 and 30 by 1980. And of course, that would have been a nightmare world, because the risk of somebody using them would have gone up accordingly. But after the Cuban Missile Crisis, we and the Soviet Union basically said, we've got to slow this thing down for us and for others as well. And the treaty that was then put together and negotiated offered a good deal. It said, if you don't build nuclear weapons, we will give you the knowledge to build nuclear energy technology that will allow you to forge ahead very successfully with that. There was a belief in the early years of nuclear weapons that as soon as the technology was learned by a country, they would immediately proceed to build the bomb. And no one really thought it through. It seemed sort of self-evident. But it wasn't self-evident. There are dangers to building a nuclear weapon and having an arsenal. If you're a little country and you have a nuclear arsenal, you have the potential to destroy a large country, or at least disable a large country, because you have these terribly destructive weapons. That makes you a target. That means that a large country is going to look at you and worry about you, which they never would have before. That kind of logic dawned on everybody at that point. And they were getting a good deal. And the other part of the deal was the part that the nuclear powers never kept to this day, which was an agreement that we would work seriously and vigorously toward nuclear disarmament. We didn't do that. We just told them we would. And then kind of snuck around on the sides. So much so that by this treaty, because no one was quite trusting of the whole deal, treaties are usually signed and they exist in perpetuity. They don't have any end date. They go on until somebody breaks the rules. But this treaty was given a 25-year review period, which would have been 1995, at which point if the countries had chosen to abrogate the treaty, it would have been set aside. And everybody could have gone back to making nuclear weapons. It almost came to that for the very reason that the main nuclear powers had not fulfilled their agreement to start reducing arsenals. We didn't start reducing our nuclear arsenal until the end of the Cold War, until the collapse of the Soviet Union. That's when we began cutting back, as did the former Soviet Union. A diplomat who's a friend of mine, Tom Graham, was assigned the task by our State Department of going around to the countries that were going to be voting on this renewal or not of the treaty and convincing their leaderships around the world. It wasn't in their best interest to abrogate the treaty at that point. Tom spent two years on the road. The only place he thought he should go is not the UN, where there's a second-level diplomat he could have talked to, but back to the home countries. And he convinced enough countries around the world. He's another hero who's never been properly celebrated. He convinced enough countries around the world that they did agree to extend the treaty in perpetuity. With the proviso that the goddamn nine nuclear powers get busy eliminating their nukes. And of course, George H.W. Bush, bless him, I didn't like his politics otherwise, but he stepped forward and split the nuclear arsenal in half right away. We dropped our numbers way, way lower than we had been. He pulled the amount of South Korea, which was a great bugaboo for both the Soviets and the North Koreans and China, and did a lot of good work toward moving toward a real reduction in nuclear arsenal. And the Russians agreed at that time. It was before Putin took power. So there was a change for the better, but there are still too many around, unfortunately. So that's why there are only nine nuclear powers to this day. Dwarkesh Patel 1:25:16How worried are you about a proxy war between great powers turning nuclear? For example, people have been worried about the Ukraine conflict for this reason. In the future, if we're facing an invasion of Taiwan by China, that's another thing to worry about. I had a friend who understands these things really well, and we were arguing because I thought, listen, if there's like a war, if there's a risk of nuclear war, let them take Taiwan. We'll build semiconductor factories in Arkansas. Who cares, right? And he explains, no, you don't understand, because if we don't protect Taiwan, then Japan and South Korea decide to go nuclear because they're like America won't protect us. And if they go nuclear, then the risk of nuclear war actually goes up, not down. Richard Rhodes 1:26:02Or they just decide to align with China. Yeah, because we didn't protect them with our nuclear umbrella the way we promised. Dwarkesh Patel 1:26:10Oh, I guess we haven't promised Taiwan that, but it's implied, I guess. Richard Rhodes 1:26:14I think it's implied. Yeah. If we said we're going to help defend them, that's what that means. Dwarkesh Patel 1:26:19Yeah. But anyway, the question was, how worried are you about proxy wars turning nuclear? Richard Rhodes 1:26:26There's been a lot of argument about whether nuclear deterrence actually works or not. The best evidence is that the United States fought a number of wars on the periphery, beginning with Korea and then Vietnam, and some other smaller things in between, where we were willing to accept defeat. We accepted defeat in Vietnam for sure, rather than use our nuclear arsenal, always because behind those peripheral countries, was a major nuclear power. China, Soviet Union, whatever. And we didn't want to risk a nuclear war. So at that level, deterrence really seemed to work for a long time. But there's been a change lately. And I find it kind of terrifying. The first manifestation was with India and Pakistan. They both went nuclear full scale in the late 1990s. India had tested one bomb in 1974, which they claimed was a peaceful explosion, whatever that is. But they hadn't proceeded anywhere from there. And Pakistan had tested their first bomb in China when they got it from AQ Khan, the same guy who was trying to proliferate to Iran a little later in Iraq. But they didn't build a lot of warheads either. And then their conflict or the personalities involved in the governments got sideways with each other. And both sides tested a quick flurry of four or five bombs each around 1997 or 1998. Now they were full fledged nuclear powers on the scale of two regional countries. But then in 1999, there was a border conflict between the two countries. And Pakistan came up with a whole new argument about nuclear deterrence. Not only could you prevent a nuclear escalation, but if you kept your deterrent in place, you could have a conventional war with the other side not willing to escalate to nuclear because you still had your nuclear arsenal. And that, which came very close to a nuclear exchange, we jumped in with both feet, believe me, and we're all over both countries about, don't do this, don't go this far, and they backed off. But Putin or someone in the Russian complex picked up on that new approach. And it's the one Putin is using now. He's basically saying, I'm having a conventional war here. And don't you dare introduce nuclear weapons or I will. In fact, if you defeat me, I may introduce nuclear weapons. Screw you. I'm going to use my nukes as a backup. That's new. And it's terrifying because it's a totally different kind of deterrence that risks going too far, too fast to be able to know what's going on. Dwarkesh Patel 1:29:47And in some sense, he is calling our bluff or at least I hope he is. Obviously you shouldn’t say this but hopefully the government would not respond to a tactical nuke used in Ukraine by getting the US annihilated.Richard Rhodes 1:30:04I don't think we would respond to it with a full scale nuclear attack. But I do think we would respond with some level of nuclear exchange with Russia or maybe just with that part of Russia, I don't know. We've long had a policy called decapitation. We long ago could the individual apartments and [unclear] of this Russian leadership with individual warheads. In the window at high noon, because they are very accurate now and they're totally stealthy. If you're thinking about cruise missiles, we can put one in someone's window and it's a nuclear warhead and not just a high explosive. They've known that for a long time. That doesn't give anybody time to get into the bomb shelter. This has gotten really very hairy. Used to be pretty straightforward. Don't bomb us, or we will bomb you. Attack in some peripheral country and we won't bomb you because you might bomb us. We'll lose that little war, but we'll come in somewhere else. All of these things, that's complicated enough. But now we're talking about this other level. Dwarkesh Patel 1:31:23So in some sense, this idea that we can backstop conventional power with nuclear weapons worked. After World War Two, the Soviets had millions of men in the Red Army stationed in Eastern Europe and we didn't have troops remaining in Western Europe but we said, listen, if you invade Western Europe, we'll respond with a nuclear attack. I guess that worked.Richard Rhodes 1:31:51It worked until August 1949, when the Soviets tested their first atomic bomb. And that's when panic hit Washington. And the whole debate went on about, do we build hydrogen bombs? And ultimately, the military prevailed and the chairman signed on. And plus, Fuchs was outed and there was this whole knowledge that the Russians knew a lot because Fuchs knew our early work on hydrogen weapons before the end of the war. We were exploring the possibility. All of that came together too with a kind of a terrible moment when the Teller side prevailed. And we said, let's build bigger bombs, as if that would somehow help. But there had been a balance of forces, you're quite right. They had two million men on the ground in Europe. We had the bomb. And then the balance of force was disrupted when they got the bomb. So then how do we rebalance? And the rebalance was the hydrogen bomb. And that's how you get to Armageddon ultimately, unfortunately. Dwarkesh Patel 1:32:57I was reading the acknowledgements and you talked to Teller in writing the book. Is that right? Richard Rhodes 1:33:02I did. Dwarkesh Patel 1:33:03And obviously, he was a big inspiration for the US pursuing the hydrogen bomb. What were his feelings when you talked to him about this?(1:33:12) - Oppenheimer as lab directorRichard Rhodes 1:33:12I made the mistake of going to see Teller at his house on the grounds of Stanford University early on in my research when I really didn't have as clear a grasp of who everyone was and what I should ask and so forth. I sent him a copy of an essay I'd written about Robert Oppenheimer for a magazine and that set him off. He had reached the point where he was telling TV interviewers, asking them how much time he would actually be on the air, and when they said three minutes or whatever, he would say, all right, then I will answer three questions no more. Trying to control because he was convinced that everyone was cutting the story to make him look bad. He really had quite a lot of paranoia at that point in his life. So when he read my essay on Oppenheimer, he used that as the basis for basically shouting at me, waving my big, heavy book, one of my big, heavy books at him. I remember thinking, oh, my God, he's going to hit me with my book. Then I thought, wait, this guy's 80 years old. I can take him. But he finally said, all right, I will answer three questions. And we sat down and I asked him one and he didn't give me an interesting answer. I asked him the second question and it was worth the whole interview. I said, was Robert Oppenheimer a good lab director? And I thought, well, here's the chance where he'll slice him. But Oppenheimer's worst enemy said to me, “Robert Oppenheimer was the best lab director I ever knew.” And I thought, bingo. And then he chased me out of the house. And I went up the road to a friend's house and got very drunk. Because I was really shaken. It was so new to me, all of this. But that quote was worth the whole thing because Eisenhower in one of his memoirs says, I always liked Hannibal best of all the classical figures in the military of the Roman Empire, because he comes down to us only in the written memoirs of his enemies. And if they thought he was such a good leader, he must have been a hell of a leader. Dwarkesh Patel 1:35:35The way the Manhattan Project is organized, it's interesting because if you think of a startup in Silicon Valley, you usually have a technical founder and a non-technical founder. The non-technical founder is in charge of talking to investors and customers and so on. And the technical founders in charge of organizing the technology and the engineers. And in Oppenheimer, you had the guy who understood all the chemistry, the metallurgy, the obviously the nuclear physics, and then Groves is getting appropriations and it's an interesting organization that you see. But why was Oppenheimer such a great lab director? Richard Rhodes 1:36:13Oppenheimer was a man with a very divided self and an insecure self. One of his closest friends was I.I. Robbie, a really profound and interesting human being. I'm going to be writing about him in my next book. I spent some time with Robbie just before he died and he said once of Oppenheimer, “I always felt as if he could never decide whether he wanted to be president of the [unclear] of Columbus or [unclear].” He said he was a certain kind of American Jew. The German Jews who came over before and after the First World War were westernized, they were not from the shtetls of the paler settlement of the Eastern European Jews. They were sophisticated, they were well educated. They were a totally different group and as such, they were able to assimilate fairly easily. Oppenheimer wasn't sent to a Jewish school. He was sent to the famous school that was opened in New York, it was called the ethical culture school. It was based on the idea of an ethical, moral education, but not a religious education. So his parents found this niche for him. He never quite pulled himself together as a human being. And as is true with many people with that kind of personality structure, he was a superb actor. He could play lots of different roles and he did. Women adored him. He was one of the most lavish courtiers of women. He would bring a bouquet of flowers to their first date, which was apparently shocking to people in those days. He was just a lovely, courtly man. But in the classroom, if somebody made a stupid mistake, he would just chew them out. And he taught a course in physics that was so advanced that most of the best students took it twice because they couldn't store it all the first time. He was nasty to people all the time in a way that bothered a lot of people. Louis Alvarez, who was someone I got to know pretty well because I helped him write his memoirs, he was one of the important scientists at Los Alamos who didn't get along with Oppenheimer at all because Oppenheimer was so condescending to everyone. Louis was kind of a hothead and he didn't like people being condescending to him. Oppenheimer never won a Nobel, Louis did. There was this layer of Oppenheimer being waspish all the time, which was his insecurity and his insecurity extended to physics. Robbie said later he couldn't sit down and focus on one problem because he always wanted to be someone who always knew everything that was going on in physics. You could call that someone who was a very sophisticated, knowledgeable scientist or you could call him someone who was superficial and he was superficial. He knew broadly rather than deeply. He and a graduate student of his developed the basic idea of the black hole long before it came up after the war. They published a paper on what was essentially the physics of the black hole in 1929. But it wasn’t called the black hole yet. John Wheeler invented that term many years later but the idea that a big enough sun, if it collapsed, would just keep on collapsing until nothing could come out of it including light, came from Oppenheimer. And if the black hole had been discovered out in space before he died, he certainly would have had a Nobel for the theory. That being said, he still was someone who was broad rather than deep. And he was someone who was really good at playing roles. General Groves, who himself had two or three degrees from MIT in engineering, he was no slouch. But his was more the industrial side of everything. How do you build a factory when you don't know what you're going to put in it? He built the factories at Oak Ridge, Tennessee to enrich uranium and start building the early piles that would later lead to the big reactors in Washington before they even knew what was going to go in the factory. He got orders of magnitude numbers and he said, start laying the concrete, we want it this big, we want this attached to it. We’re going to need power, going to need water, going to need gas, whatever they needed. He was that kind of really great engineer but he needed someone to help explain the physics to it. And he saw pretty quickly at the meetings he was holding at the University of Chicago, where they were building the first reactor, little one, that Oppenheimer was really good at explaining things. So he grabbed him and Groves spent the war riding in trains back and forth among all these various sites. He'd have the advisors from one site like Chicago jump on the train while he was taking the train from Chicago to Santa Fe. Then they'd get off and take the next train back to Chicago. Then he'd pick up the guys who were going to go with him to Tennessee from Santa Fe and they'd ride with him round and round and round. He got a plane later in the war. But most of the war, he just had people riding with him. And Oppenheimer later said, well, I became his idiot savant. And Oppenheimer did. He explained all the physics to Groves because Groves was a little insecure around six Nobel Laureates around the table and would say things like, well, you each have a PhD, but I think my work at MIT probably was the equivalent of about six PhDs, wouldn't you think? And they would think, who is this guy? Dwarkesh Patel 1:42:31Was he joking? Was that sarcasm or? Richard Rhodes 1:42:33No, he wasn’t. He had multiple degrees. You know how the military works when there's no war. They send their guys to school to get them better trained. So when the time came to find someone to run, Oppenheimer had been pushing for a separate place where the scientists could get together and do what scientists must do if they're going to advance their science. And that is, talk to each other. The system that Groves had installed around the country at all these factories and so forth, was called compartmentalization for secrecy. And basically it was — you're only allowed to know just enough to do your job and not the overall picture of what your job might be for. So, for example, there were women at Oak Ridge running big magnetic machines that would separate uranium 235 from uranium 238 with magnetic coils of various kinds, taking advantage of the very slight difference in mass between these two otherwise identical materials. The women who were doing this work were set in front of a board with a big dial on it, a big arrow that went from zero to ten or whatever and told keep the arrow about between right here on this. They didn't know what they were making. They really got good at spinning their dials and maintaining what was basically the level of whatever electric process was going on in this machine. So compartmentalization worked. But Oppenheimer said, if we are compartmentalized as scientists, we're not going to get anywhere. Science works by gift exchange. I discover something, I publish the results. All the other scientists in my field can read it or be told of it at a meeting. And then they can take that information and use that to move a little farther. And that's the way it's always been done. And that's the only way it works. As soon as you lock people up and tell them they can't talk to each other, it stops because the discovery over here doesn't get applied to a need over here. Simple. Groves reluctantly agreed to let the place have openness, as it was called. You see the parallel with the open world about the bomb. Same sort of thing. How can you know what's going on if you can't let people talk to each other? See what they're doing. But he insisted that the whole crew be put behind barbed wire in a faraway place when no one else was around. So they did. Groves had worked with Oppenheimer. Oppenheimer was now playing the lab director. And he was superb at it, as Teller’s remark about a good lab director would let you know. For the period of the war, Hans Bethe told me this, “Before the war, Robert really could be cruel. He would pounce on a mistake you made.” And Bethe, a Nobel Laureate, discovered what makes the sun work. That's how important Bethe's work was and how significant. Bethe told me, “everyone makes mistakes. I made mistakes. Oppenheimer would charge me with a mistake if I spoke wrong. But before the war, after the war, but not during the war.” During the war, he was a superb wise lab director. Because unlike most scientists, he was not only a physicist of high class, but he really was psychologically astute as a human being, as I think insecure people often are because got to scope out what's going on. Oppenheimer wrote pretty good poetry. He was interested in art. He wanted to read the Bhagavad Gita Gita in the original Sanskrit so he learned Sanskrit. He was very smart, needless to say, and had a very high IQ. Not all the physicists who did first class work did have high IQs. They took some other qualities as well. It took the [unclear] sitting down in a chair and focusing on one thing until you got through to it. That's what Robbie said. And he said, that's why Oppenheimer never won a Nobel Prize. All in all, Oppenheimer became in this place that some of these people later were calling [unclear]. Remember they were working on a bomb that was going to kill hundreds of thousands of people but it was the most curious collection of people who had felt like theirs was a spiritual field before the war. And here they were in the war and they began to think, well, maybe this isn't so spiritual, maybe we're doing something truly horrendous and when Bohr comes along and says, wait a minute. Oppenheimer by then was kind of a student of Bohr's. Oppenheimer had the job of recruiting everyone for Los Alamos without telling them what they would be doing because it was secret. So he would go to a university campus where there was a young physicist he wanted to recruit and they would go out for a walk to get away from any hidden microphones. And Oppenheimer would say, I can't tell you what we're going to be doing. I can tell you that it will certainly end this war and it may end all war. And that was quite enough. I mean, most of them figured out what they'd be doing anyway, because it was sort of obvious when you start looking at the list of people who are going there. They're all nuclear physicists. So Oppenheimer and Bohr together brought this idea to Los Alamos and later to the world that there was a paradox. The bomb had two sides and they were in a sense complementary because although it's certainly true that this was going to be a very destructive weapon, it would also maybe be true if all worked out and they tried to make it work out, that it would put an end to large scale war. If you go to the numbers and graph the number of man-made deaths from war starting in the 18th century, it's almost exponential up to 1943, when 15 million people died between the war itself and the Holocaust. And then it starts to decline as the war begins to come to an end. The war is really 1945. It drops down to about one to two million deaths and it stays there ever after. And although one to two million deaths a year from war is nothing to be proud of, we lose six to seven million people in the world every year from smoking. So in a curious way, the introduction of how to control nuclear energy changed the nature of nation states such that they could no longer at the limit defend their borders with war. They had to find some other way, at least when the scale goes up, they had to find another way. I think that's very important because people somehow don't really understand what a millennial change, the introduction of the release of nuclear energy into the world, really was. As we've been talking, I've been thinking over and over again about your question about AI and the whole larger interesting question that you can see how it fits into the bomb story of unintended consequences. All the countries that worked on the bomb at some level were thinking, oh my god, we're going to have a weapon that will surpass them all. One ring to bind them all like Lord of the Rings. They thought it would aggrandize national power, but what it did was put a limit to national power. For the first time in the history of the world, war became something that was historical, rather than universal. It was something that would no longer be possible. And who did that? Scientists going about their quiet work of talking to each other and exploring the way the universe works. Bohr, who's one of my favorite people in the world, he liked to say, science is not about power over nature, as people seem to think. Science is about the gradual removal of prejudice. By that, he meant when Galileo and Copernicus changed the way everyone looked at the position of the earth in the universe, not the center of the universe anymore, but just a planet revolving around a third-rate star. It changed the way everyone thought about the whole world. When Darwin definitively identified our place in the natural world as a brainy ape, it's still taking time for a lot of people to swallow that one. But inch by inch, these prejudices about where we are in the world and how powerful we are and what our purpose is and so forth are being drained away by science. The science of nuclear fission and nuclear energy is draining away and has drained away the theory that we are sort of universally capable of destroying each other and getting away with it. But the dark side is, the unintended consequence is, it's only by having a Damocles sword over our heads, the potential for destruction of the human world, that it's possible to limit war in this way. That's the threat. And when people start saying, well, look, we can have a conventional war if we've got nuclear weapons, because you're not going to attack us. You don't dare. We'll use our nuclear weapons on you. Something's changed most recently in all of this. It's outside the range of all the books I've written. It's a whole new thing. I guess you have to work through all the combinations, just as evolution does, before you come up with the one that actually fits the reality of the world.(1:53:40) - AI progress vs Manhattan ProjectDwarkesh Patel 1:53:40There's at least 10 different things and I'm trying to think which branch of the tree I want to explore first. On the AI question, yeah, I'm trying not explicitly connect the dots too much. Every time I read something in history, I think oh, this is exactly like so and so. First of all, the broader outline of the super eclectic group of people who are engaged in this historical pursuit, they understand it's a historical pursuit, they see the inklings of it. My second to last guest was Ilya Sutskever, who is the chief scientist at OpenAI which is the big lab building this. He was basically the Szliard of AI, how Szilard discovered nuclear chain reaction, Sutskever was the first person to train a neural network called ImageNet. Anyway, from that moment on, he was one of these scientists who sees that you could build a nuclear bomb immediately as soon as the news hits the floor. He saw this coming 10 years ago, scale this up and you've got something that's human level intelligent. I was reading through the book and so many things like this came up. One was a good friend of mine who works at one of these companies. And they train these models on GPUs, which are computers that can perform all these matrix calculations in parallel. And I was thinking about these engineers who were in short supply during the making of the bomb, let's say they're working on the electromagnetic separation of the isotopes. And it's this really esoteric thing, you're a chemist or a metallurgist or something that you're really needed for this specific thing. And he's in super high demand right now, he's like the one guy who can make these very particular machines run as efficiently as possible. You start looking and there's so many analogies there. Richard Rhodes 1:55:41I don't think there's much question that AI is going to be at least as transformative as nuclear weapons and nuclear energy. And it's scaring the hell out of a lot of people and a lot of other people are putting their heads in the sand. And others are saying, let's live it around with laws, which certainly we should do. We've tried to do that with nuclear weapons and have had some success. But people have no idea what's coming, do they? Dwarkesh Patel 1:56:10Yeah. One thing I wanted to ask is — Some of these scientists didn't see this coming. I think Fermi said you could never refine uranium and get 235 but then some of these other scientists saw it coming. And I was actually impressed by a few of them who accurately predicted the year that we’ll have the atomic bomb. Another one was, Russia is five to 10 years behind. So I'm curious, what made some of these scientists really good at forecasting the development of this technology and its maturity and what made some either too pessimistic or too optimistic? Is there some pattern you noticed among the ones who could see the progression of the technology? Richard Rhodes 1:56:57That's a good question. Well, the experience that I've had in working with scientists, physicists, is that they really are not very interested in history or in the future. They're interested in the Now, where the work is, where the cutting edge is. They'd have to devote quite a bit of energy to projecting in the future. Of course there have been a few. One thinks of some of the guys who wrote science fiction, some of the guys who wrote essays and so forth about where we were going. And if you ask them, particularly later on in their careers, when their basic work is already done, and I remember talking to a Nobel Laureate in another line of science, but he said, I would never be a graduate student connecting up with the Nobel Prize winner because they've already done their best work. And he was one so he was talking about himself, too. It takes a certain mentality to do that. And maybe scientists aren't the best ones to do it. Alvarez told me, he said, you know, I was always a snoop and I would poke around Berkeley in the various drawers of the benches in the laboratory. He said, one day I was poking around and I found this little glass cylinder about the size of a Petri dish with some wires inside. He said, and I realized it was the first cyclotron. They just put it in a drawer. I asked, so where is it now? He said, it's in the Smithsonian, of course. Where else would it be? I talked to the guy who invented the first laser and actually held one in my hand. He was an engineer at one of the big telephone companies. He said, the first laser is supposedly in the Smithsonian but they don't have it. They got one in the lab and I took my first one home. You want to see it? I said, God, of course. We went to the credenza in his dining room and he opened the drawer and pulled out a little box. Inside it was basically a cylinder of aluminum about the size of a little film can, which he opened up and took out a man-made ruby cylinder that was half-silvered on each end, surrounded by a very high-intensity flash bulb. That was it. It was this beautiful, simple machine. He said they didn't get the right one. I said, why didn't you give them the right one? He said, they didn't ask me. He was angry all his life because he wasn't included in the Nobel prizes. It went to the theoretician to first theorize the laser, but he built the first laser and there it was.(1:59:50) - Living through WW2Dwarkesh Patel 1:59:50When you were interviewing the scientists, how many of them did you feel regretted their work? Richard Rhodes 2:00:04They'd been down the road so far, they really didn't think that way anymore. What they did think about was they regretted the way governments had handled their work. There were some who were hawks and patriots, Alvarez was one of those. But most of them had tried in the years since the war to move in the direction of reducing nuclear weapons, eliminating nuclear weapons. It was a problem for them. When the war was over, these were mostly graduate students or new PhDs who had been recruited for this program. The average age at Los Alamos was 27. Oppenheimer was an old guy, he was 39. These were young guys who had been pulled out of their lives, pulled out of their careers. They wanted to get back to the university and do the work they had started out to do. By and large, they did and Los Alamos, just emptied out. Teller was horrified, he wanted the bomb program to continue because he wanted to build his hydrogen bomb. It was going to be his bid for history just as Oppenheimer's bid for history was the fission bomb. Teller’s was going to be the hydrogen bomb. Over the years, after that work was done, he systematically and meanly tried to exclude one by one anyone else who'd helped him work on the hydrogen bomb. Originally, he said it was a Polish mathematician named Stanislaw Ulam, whom I interviewed also, who really came up with the basic idea for the hydrogen bomb. He took it to Teller and Teller came up with an improvement. Then together, they wrote a paper which was signed by both of them. But by the 1980s, Teller was saying, “Ulam did nothing. Nothing.” Which wasn't true. It was his piece of history because he was scattered too, and he, number one, did Nobel-level work. They didn't talk so much about their personal guilt. I was a child in the Second World War. I was eight years old in 1945. So many young men had been killed on all sides in the war. It was a kind of a strange, peaceful time for children. Cars couldn't get tires, they were rationed. Cars couldn't get gasoline, it was rationed. So the streets were empty. We played in the streets. Meat was rationed, so we lived on macaroni and cheese. You got four ounces of meat a week per person during the Second World War. That was kind of wonderful and peaceful, and kids running around in gangs and so forth. But in at least one house in almost every block in the city, there was a black velvet flag or drape hanging with a gold star on it. That meant that someone in that family, a father, a brother, a son, had been killed. And I was a smart little kid, I understood what all that meant. I was reading newspapers by the time I was six following the war. It was the strangest time of darkness and terror. We didn't know until 1943 if we were going to win the war. It was scary for a while up front, the war in Europe. We sort of set Japan aside. Our government did until the war in Europe was done before we finished that other war. But it took a while for the United States to get its industrial plant up and cranking out planes at the rate of one a day or more. Churchill famously said when Pearl Harbor occurred, “The Lord hath delivered them into my hands.” And he explained later what he meant was that America's going to join the war. And I know we can win now because America's just one vast factory, much more so than the British could have put together. So it was a peaceful time, but it was a very dark time even for a child. My mother died when I was an infant so I understood what the death of a family member was about.Dwarkesh Patel 2:04:29Do you remember when the bombs dropped? Richard Rhodes 2:04:34By 1945, we were so pissed off at the Japanese. We had destroyed their air force, we had destroyed their navy, we had destroyed their army. The population of Japan was down to about a thousand calories per person of the worst kind of stuff, buckwheat and weeds and whatever they could find. And yet they wouldn't surrender. And they still had a million men on the ground in Western Manchuria. They only had about a year's worth of bullets left. We knew that much, but that's a long time with a million men. With that in mind, and because they felt that the Soviet Union was still neutral in the Eastern Front, because it had basically fought the war in Europe. We didn't win the war in Europe, the Russians did. We didn't enter the war on the ground until June 1944, by which time they were already moving forward against the German forces that attacked them in 1941. But the Japanese just wouldn't surrender. You could read the documents about the bombs. General George Marshall, who was leading the war, was in charge of all the forces, had this idea that maybe if we could use these bombs on the beaches before we landed, to kill any Japanese defense that was there, maybe they would get the message and be shocked and surrender. But from the Japanese point of view, as it turned out later, it's a myth that the bombs won the war. They contributed to winning the war, but they didn't win the war. What won the war was when Stalin finally was convinced that there were such things as atomic bombs. He was half convinced these were American pieces of disinformation. We were feeding the espionage to the Soviet Union to make him spend a lot of money and waste a lot of time on something that didn't exist. When the news came back from Hiroshima and then from Nagasaki that these things existed, he called Igor Kurchatov in and said famously, “Comrade, give us the bomb. You have all the resources of the state at your disposal. Give us the bomb as soon as you can.” But up until then, he wasn't so sure. He had told Truman at Potsdam that they would invade Manchuria with fresh Soviet forces on the 15th of August. Truman was trying to get him to agree to invade at all. Then when word came from New Mexico that the bomb had worked, which it did right in the middle of the Potsdam conference, Truman then was trying to get Stalin to come in as late as possible because he figured the bombs would end the war before Stalin could take over enough of Japan to divide the country the way Europe was divided. He didn't want a Soviet zone, an American zone, and a British zone. He knew we could do better with the Japanese than the Soviets would do. But Stalin, having heard that the bombs really worked, moved up the date of the Soviet invasion of Manchuria to the 8th of August between Hiroshima and Nagasaki and invaded early. I found it very interesting that the conventional air forces on our side staged the largest firebombing raid of the war, on the 14th of August, after the Japanese were in the middle of their surrender negotiations. The air force wanted to get credit for winning the war and they wanted to hold back the Soviets who were advancing down from Sakhalin Island to the northern islands of Japan as well as inward from Manchuria. So our bombing was in northern Japan. It was a way of telling the Soviets, back off buddy, we're not going to let you in here. Then the Japanese military leadership, which had been adamant that they would fight to the last Japanese, the 100 million, they called it, turned and finally realized that it was futile. With the fresh Soviet army coming into Manchuria, with the United States and the British coming in from the west to the south, they were surrounded and there was no reason to continue. But the bombs had their effect. The Japanese emperor used the bombings of Hiroshima and Nagasaki as a reason for entering politics for the first time in Japanese history. He had always been a spiritual figure, but he wasn't allowed to vote or veto the political arrangements. He stepped forth and said, we must do it for peace. And in his final imperial rescript on the 15th of August, recorded and played out to the people by radio, he said a new and most terrible weapon of war has led us to think the unthinkable and we must now lay down our arms. So the bomb had its effect, but it wasn't what we thought at the time. A lot of Americans said, thank God for the atomic bomb because our boys came home. The actor Paul Newman was a friend of mine and Paul was an 18-year-old bombardier on a two-man Navy fighter bomber training for the invasion of Japan. He said to me once, “Rhodes, I'm one of those guys who said, thank God for the atomic bomb because I probably wouldn't have come home if we'd invaded the Japanese home islands.” And a million men said that. And the truth is, there were so many Japanese who would have been killed if we had invaded that even the killings of the two bombs would have been dwarfed by the killing that happened. For the first time in the history of war, more Japanese civilians were killed in World War II than had ever been killed in a war before. War was beginning to become what it has since become, which is a war against civilians. Dwarkesh Patel 2:11:06We were talking near the beginning about whether it was possible that the bomb could not have been built at all and in the case of the nuclear physics involved here, it seems like it was sufficiently obvious. But one question I have, seeing the history of that science and whether it was plausible or not for some conspiracy to just hold it off, how plausible do you think it is that there's some group of scientists somewhere else who have discovered some other destructive phenomenon or technology that decides that we can't tell anyone about this. One area I think this might be plausible is bioweapons where they discover something and they just shut up about it. Given the study of this history, do you think that's more or less plausible?Richard Rhodes 2:11:51I don't think it's very likely to take bioweapons as an example. I remember talking to a biologist, one of the early DNA researchers who had been a physicist until DNA came along, and I asked “How'd you switch over to biology?” He said, “Well, it's molecules.” So from his perspective, it wasn't very different. But we were talking about the question of just the one you asked, but about biological agents. He said, nature has had millions of years to work all the combinations on the worst things you can imagine. The odds of anybody in a laboratory coming up with anything worse are really vanishingly small. I took that with great comfort. I went home and slept that night. And I think he's probably right. Evolution has done such a job. We're still digging stuff out. I mean, it's just amazing how much of our technology started out as something in the natural world that we adapted it and simplified it and engineered it so we could make it too. That's still going on in all sorts of ways. Dwarkesh Patel 2:13:04I hope that's the case. I was talking to a biologist and he was explaining to me, if you've seen things like AlphaFold, which is this AI program that models that can predict how a protein will fold, you can run billions of different permutations of a protein. And you can find smallpox, but it binds 100 times better with human receptors or something. Richard Rhodes 2:13:35I'll tell you a story, which I don't think is well known, I wish it were. Back in the 60s the Russians proposed a world-scale program of public health to eradicate smallpox to the UN. And they said, we'll contribute a vaccine and other countries can contribute whatever they can contribute. This program got going. It was run out of Geneva by the World Health Organization, by a wonderful American public health doctor, D.A. Henderson, a big old burly country boy looking guy whom I followed around for several months once in Geneva and elsewhere. And by the late 1970s, the last case of smallpox, which happened to be a disease that's only spread among humans and therefore was of all the diseases the most obvious one to try to get rid of. Because if there are reservoirs in the natural world outside of the human world, then there will be a problem. If it's also something that's carried around by rabbits or deer or whatever then it's harder to deal with. But if it's just humans, then all you have to do is to identify people who start showing signs of smallpox. In fact, you need everyone around them to make sure they don't go anywhere for a while and the disease can't spread. And that's the method that they use to eliminate smallpox everywhere in the world. And then in the 90s, when the Soviet Union collapsed, D.A. learned, as we all did, although it wasn't terribly well publicized, that there was a secret lab still operating that the Russian plan had been to eliminate smallpox vaccination from the world so that everybody, except people in their country who had been vaccinated for this purpose, would not be immune and a bacteriological agent like smallpox could be used as a weapon of war. D.A. was so incensed. He took this story to our government and we started a whole new section of the public health business to work on biological warfare. And he did for the last part of his life to try to get past this and that lab was eventually, we hope, closed down. So that scenario is not outside the bounds of possibility. But generally speaking, biological warfare isn't very effective because your own people could be infected as well, if not your war people, at least your civilian population. Much like poison gas, which used to blow back over the lines of the people who'd launched it to their horror. It never was a terribly good weapon of war. Plus Hitler's experience of using gas in the first world war that all sides decided not to use it in the second. So that's part of it.(2:16:45) - SecrecyDwarkesh Patel 2:16:45Speaking of secret labs, you've written so many books about not only the atomic bomb, the hydrogen bomb, and the Cold War and so on. Is there a question you have about any of those stories that you were really interested in but you haven't been able to get the answer to because the information is classified?Richard Rhodes 2:17:05Over the years, it's slowly leaked out. The latest thing I discovered is that from early on, our hydrogen bombs were shaped sort of like a dumbbell, more spread out. There's a picture of Kim Jong-un looking at a hydrogen bomb of North Korean make and it's perfectly obvious that it's a real bomb because that's its configuration. I didn't know that until just a year or so ago. But sooner or later, everyone tells you at least a little bit. Dwarkesh Patel 2:17:46And then is there anything you've learned that you can't put in your books because it's... Richard Rhodes 2:17:50The only thing I didn't put in the book, rightly so, was the dimensions of the Fat Man bomb that were on the original Fuchs documents that he passed to the Russians. When the Soviet Union collapsed and the scientists became available, I learned that the KGB in the interest of promoting its service to the state in this new world they were going into, had published a historical piece about their good work in stealing the secret to the bomb. And they included a picture of the sketch that Fuchs did showing the dimensions of each of the shells of this multi-shelled implosion weapon with the numbers there in millimeters. And when the scientists realized that the KGB had published this stuff, they raised a great hue and cry and said, that's in violation of the Nuclear Non-Puller Variant Treaty. They said, we have to pull all the issues of that journal. And they did. But I had a very enterprising assistant in Moscow, this geologist I mentioned before. And he said, I think I know where I can find a copy of the journal. And he jumped on the night train from Moscow to St. Petersburg and went to a science library there. And they said, no, of course not. We pulled that. And then he thought, wait a minute, where's the public library? It was across the street. And he went across the public library. And they said, yeah, we have the journal. And handed it to me. He made a copy and gave me one. But when I realized that I had this, I never published that information. That's the only one, though. Dwarkesh Patel 2:19:35That is a wise thing to do. One of the final questions. A lot of times people use the phrase, we need a Manhattan project for X. If it's some new technology or something. When you hear that, do you think that is a naive comparison? Or does it make sense to use that terminology? Richard Rhodes 2:19:57No. It’s been used so many times over the years for cancer, for this, for that. But Manhattan was a very special time and it was a very special problem. The basic science was in hand. Oppenheimer once said in his funny way, we didn't do any basic science between 1939 and 1945. In a sense, it was a vast engineering program. There was some basic physics, but very little. It was mostly using Nobel laureate level physicists as engineers to develop a whole new weapon with the precision of a Swiss watch that weighed 9,000 pounds. And they did a beautiful job considering the time and place and the rationale. They solved some problems that I don't know how anybody else could have solved. How do you make plutonium explode without a gun? All of that. But most of these problems aren't like that. Nobody was starting a startup with some investment from an investment company to build the bomb. This was a government project, and it was secret. And if you divulged the secret, you'd go to jail. A lot of the parameters of what they were doing were carefully kept secret. It's remarkable that 600,000 people worked on the bomb and the secret never got out. Dwarkesh Patel 2:21:28Do you say 600,000?Richard Rhodes 2:21:29YeahDwarkesh Patel 2:21:33This is actually one of the questions I want to ask you. Truman, when he became president, he had to be told about it. He didn't know about it, right? I don't know how many people were working on it when he became president, but hundreds of thousands of people are working on it. The vice president doesn't know about it. He only learns about it as president. How was it possible that with so many people working on it, the vice president doesn't know that the atom bomb is in the works? How did they keep that so under wraps? Richard Rhodes 2:21:57One of Roosevelt’s several vice presidents famously said, the vice presidency isn't worth a bucket of warm piss. Dwarkesh Patel 2:22:05Can you note, Kennedy had a saying, I'm against [unclear] in all its forms. Richard Rhodes 2:22:11Yes, well, interesting for me. Roosevelt wanted to keep it a secret and so did Groves. They didn't want the word to get out. They didn’t want the Germans to get ahead of us. And what was the vice president for? He was to sit around in a waiting room in case the president died, which in Truman's case, he hit the jackpot. He was just at the right time because Roosevelt had several vice presidents in his long reign. So from their point of view, he didn't need to know. It was the need-to-know thing again, it was the compartmentalization. And of course, as soon as he became president, Groves and Stimson and several others got together with Truman and filled him in on it. Truman had some inkling because he was a crusading senator who had taken on the job of preventing waste in war. And if he heard about some industry that was sloughing off and putting money in people's pockets or whatever, he would go visit their factories, call them out. And he was ready to go to Hanford, Washington, and Oak Ridge, and find out what these people were doing. But Stimson, the Secretary of War at the time, whom he greatly admired and one of the great elder statesmen of the era, said, “Mr. Vice President, please don't go. I guarantee you that what is happening is being well managed. Please don't go.” And he said, “If you say so, Mr. Stimson, I will believe you.” So he knew a little bit, but he didn't know very much. And I don't think that helped. I don't know how much Roosevelt understood either. He was not a scientist. Truman was not even a college graduate, he was self-educated. A well self-educated guy. One of the senator’s once said, every time I go to the Library of Congress to pull out a book, Truman's name is always there. The senator said I think he read everything in the Library of Congress. It's partly that there wasn't any way to communicate except by letter or telephone and you didn't call long distance unless somebody died, basically. Tell someone they had a long distance call and their woman would start crying. Or a man, for that matter. You thought your son was probably dead in Iwo Jima. So the communication was more limited to be sure. But even so, it's extraordinary. Dwarkesh Patel 2:24:45But was the culture different in that the idea of leaking something would be much more frowned upon than it is now? Richard Rhodes 2:24:52I can't remember in my entire life a more patriotic time than the Second World War. We children gathered together pieces of aluminum foil from the lining of cigarette packages, about the only place you could get aluminum foil in those days, watered it up into balls and took them to school so they could use it to make bombers. We collected this bacon grease from cooking meat in the kitchen and took it to school in cans because it had some application to making bullets. We collected newspapers for the same reason. The Boy Scouts during the Second World War took it as their special responsibility to collect the fibers that come off milkweed with this little ball that blows away because it was used in place of kapok to line life vests for sailors. They collected 500,000 tons of milkweed fluff in the course of the war. We were all consumed with winning this thing, which didn't seem to be a certain thing at all, as I said earlier, before around 1943. Of course, there was a black market and people got to see a farmer and pick up some steaks, so they didn't have to live on some more macaroni and cheese for the next month as we all did. But despite those changes, people were very, very patriotic and fought in every way we could to win the war. (2:26:34) - Wisdom & warDwarkesh Patel 2:26:34Speaking of elder statesmen, by the way. Who, since the development of the nuclear bomb, has been the wisest political leader, not necessarily the U.S. and not even necessarily as a leader of state, but contributed most to the stability and peace? Richard Rhodes 2:26:52It depends on what period you're talking about. There's no question that Oppenheimer's advice to the government after the war was really good. I don't think anyone except the Oppenheimer committee, the Acheson-Lilienthal Committee, has ever found a better way of thinking about eliminating nuclear weapons in a world that understands how to build them. And that really was Oppenheimer. I don't mean he deluded anybody. He just led them straight down the path. All these engineers and industrialists who were on the committee with him, skeptical men, men who wouldn't have been easily convinced of anything, but he convinced them this was the right way to go. So he, up until he was forced out of government because he made the mistake of not supporting the Air Force's favorite bomb, and they found a way to destroy him basically, and they did destroy him. I talked to one of the scientists who was his closest friend, and he said Robert was never the same after the security hearing in 1954. He was one of [unclear]’s smiling public men after that. It really devastated him. That basic insecurity he had as a Jew in America all the way from childhood, haunted him, and he became the director of the Institute for Advanced Study, and he wrote a lot of nice essays. But I don't know. The leader that I've fallen into more and more is Niels Bohr. He tried to figure out a way to bring the openness of science into a world without nuclear weapons. He and Robbie taught Oppenheimer the ideas that ended up in the Acheson-Lilienthal plan, and he and Robbie later, were the ones who started up the scientific laboratory in Geneva that is now CERN where they built these new giant colliders. With the idea in mind that at the very least if the scientists have devastated Europe, we remember what things were like for the former Soviet Union. People were living on crusts of bread and bags of old potatoes. They really were. And particularly people who worked for the government because their pensions weren't worth anything. That's what I saw when I went back there in the spring of ‘92 after the place collapsed. The money wasn't worth anything. Their salaries weren't being paid. In the midst of all of that, Europe needed something to sustain it. And of course, there was the Marshall Plan, and that was absolutely amazing. And the help it gave to Europe when it needed it most. But Bohr wanted to make sure, and Robbie wanted to make sure, that the scientists of Europe were tapped to go off somewhere and build nuclear weapons. And they invented this international laboratory in Geneva, which is still a thriving enterprise, where they could do basic physics and where they'd be paid for their work and could do the kind of exciting thing that good science is without having to drift over into the dark side of the whole thing. Let's face it, it more or less worked. The French had to have the bomb, you know, because they're French. Dwarkesh Patel 2:30:26They need their lovers, they need their bombs. Richard Rhodes 2:30:29The British had to have the bomb because they knew how to build one. They'd worked with us all during the war, and then we'd cut them off from a supply of uranium and from any new developments along the way. And most of all, because the British Empire was bankrupt by the end of the Second World War, and Churchill was determined to get the bomb because without it, his country would fall away and wouldn't get to sit at the table with the big boys. So they had the typical reasons for getting bombs because you don't want to be left out because of the prestige, or because you have a mortal enemy who's got the bomb or is getting the bomb. That's North Korea, that's Iraq. Its attempt,  it didn't get there. That's Pakistan and India. We, because of Germany. The Soviets, because of us. By and large, the countries that did go toward the bomb, finally built bombs because they were afraid of another country having the bomb. And everyone else stood back and said, well, if you'll protect us with atomic bombs, when somebody comes calling here in South Korea or Germany or wherever, we won't build them and share your knowledge of how to make energy out of nuclear power. Dwarkesh Patel 2:31:54There's easily another three hours of questions I could ask you. I can't say I want to be respectful of your time because I haven't been with the extra hour I've taken, but I want to be less than totally disrespectful of your time. So I guess the final question that we can go out on is — In the next 50 years, what odds do you put on a non-test nuke going off? Richard Rhodes 2:32:22A nuke going off in anger? That's the way I usually put it. I think the odds are high.Dwarkesh Patel 2:32:35Over 50% in the next 50 years? Richard Rhodes 2:32:26I wouldn’t put a number on it, but it's certainly higher than zero and it's probably higher than 10%. And that's high enough if we're talking about millions of people dying. There was a period when people in the field were talking about, well, maybe we'll have a little regional nuclear war between India and Pakistan and that'll scare everybody to the point where they realize you've got to get rid of these things. The same guys who did the nuclear winter studies back in the 80s decided in 2007 first to look at nuclear winter world scale war using the much better computers of today. And they found out that that would be even worse than they thought it would when they had only one dimensional atmospheric models. Then they said, well, what would a small regional nuclear war look like? So they simulated a war between India and Pakistan where each country explodes 50 Hiroshima sized, 15 kiloton nuclear weapons over the enemy cities. And what would follow from that? And it turned out as the model develops, you can see it online, you can watch the graph develop that even that small in exchange, less than some of our individual hydrogen bombs, about a megaton between the two countries, would be enough to cause enough fire from burning cities to spread smoke around the world and reduce the amount of sunlight. They figured in the end that there would be 20 million prompt deaths from the explosions themselves and the fires. But then over the course of the next several years, up to two billion people would die of starvation because you would have the same phenomenon that the world had in the 18th century when there was an interim of rather cold, the sun was pulling back a bit and it was freezing hard in July in New England and the crops failed. And a mass of people died worldwide during that period of time. Like the flu epidemic of 1918, everybody seems to have forgotten. I don't know where our memory goes with these things. Therefore even a small so-called nuclear war must engage the whole world because it's going to engage us if it ever goes off. So we're still in a very precarious place. And as long as any country in the world has nuclear weapons, we're going to continue to be. There is a sword of Damocles over our heads. That has been the price of nuclear deterrence. It isn't necessary that that be the price. It's possible to have nuclear deterrence without actual weapons, but it's damned hard to convince leaders, particularly in totalitarian and authoritarian countries, that that's the case. So the odds, I don't know, but there's no such thing as a machine that doesn't malfunction sooner or later. And these machines, these weapons that we make us such supernatural powers of, are just machines. We built, put them together. We can take them apart. We can put the ore back in the ground if we want to. We don't have to live with this. I think we're in a big, wide, long transition. Maybe the world scale problem of solving global warming will help with this, will help people see that if they work together. Here I am saying there could be a good outcome from this technology. Well, there was a good outcome from the telephone. There was a good outcome from television, but there was also a dark side and we're going to have to learn to handle dark sides better. Maybe that's the last thing to say on this subject. Dwarkesh Patel 2:36:39Yeah, that's a sound note to close on. The book is The Making of the Atomic Bomb. Unfortunately, we didn't get a chance to talk as much about your new book on energy, but when your next book comes out, we'll get a chance to talk about the remainder that we didn't get a chance to talk about. It's been a true honor, and an incredible pleasure. The stories, the insight. It was really wonderful. Thank you so much for your time.Richard Rhodes 2:37:02My pleasure.  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

For 4 hours, I tried to come up reasons for why AI might not kill us all, and Eliezer Yudkowsky explained why I was wrong.We also discuss his call to halt AI, why LLMs make alignment harder, what it would take to save humanity, his millions of words of sci-fi, and much more.If you want to get to the crux of the conversation, fast forward to 2:35:00 through 3:43:54. Here we go through and debate the main reasons I still think doom is unlikely.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.As always, the most helpful thing you can do is just to share the podcast - send it to friends, group chats, Twitter, Reddit, forums, and wherever else men and women of fine taste congregate.If you have the means and have enjoyed my podcast, I would appreciate your support via a paid subscriptions on Substack.Timestamps(0:00:00) - TIME article(0:09:06) - Are humans aligned?(0:37:35) - Large language models(1:07:15) - Can AIs help with alignment?(1:30:17) - Society’s response to AI(1:44:42) - Predictions (or lack thereof)(1:56:55) - Being Eliezer(2:13:06) - Othogonality(2:35:00) - Could alignment be easier than we think?(3:02:15) - What will AIs want?(3:43:54) - Writing fiction & whether rationality helps you winTranscriptTIME articleDwarkesh Patel 0:00:51Today I have the pleasure of speaking with Eliezer Yudkowsky. Eliezer, thank you so much for coming out to the Lunar Society.Eliezer Yudkowsky 0:01:00You’re welcome.Dwarkesh Patel 0:01:01Yesterday, when we’re recording this, you had an article in Time calling for a moratorium on further AI training runs. My first question is — It’s probably not likely that governments are going to adopt some sort of treaty that restricts AI right now. So what was the goal with writing it?Eliezer Yudkowsky 0:01:25I thought that this was something very unlikely for governments to adopt and then all of my friends kept on telling me — “No, no, actually, if you talk to anyone outside of the tech industry, they think maybe we shouldn’t do that.” And I was like — All right, then. I assumed that this concept had no popular support. Maybe I assumed incorrectly. It seems foolish and to lack dignity to not even try to say what ought to be done. There wasn’t a galaxy-brained purpose behind it. I think that over the last 22 years or so, we’ve seen a great lack of galaxy brained ideas playing out successfully.Dwarkesh Patel 0:02:05Has anybody in the government reached out to you, not necessarily after the article but just in general, in a way that makes you think that they have the broad contours of the problem correct?Eliezer Yudkowsky 0:02:15No. I’m going on reports that normal people are more willing than the people I’ve been previously talking to, to entertain calls that this is a bad idea and maybe you should just not do that.Dwarkesh Patel 0:02:30That’s surprising to hear, because I would have assumed that the people in Silicon Valley who are weirdos would be more likely to find this sort of message. They could kind of rocket the whole idea that AI will make nanomachines that take over. It’s surprising to hear that normal people got the message first.Eliezer Yudkowsky 0:02:47Well, I hesitate to use the term midwit but maybe this was all just a midwit thing.Dwarkesh Patel 0:02:54All right. So my concern with either the 6 month moratorium or forever moratorium until we solve alignment is that at this point, it could make it seem to people like we’re crying wolf. And it would be like crying wolf because these systems aren’t yet at a point at which they’re dangerous. Eliezer Yudkowsky 0:03:13And nobody is saying they are. I’m not saying they are. The open letter signatories aren’t saying they are.Dwarkesh Patel 0:03:20So if there is a point at which we can get the public momentum to do some sort of stop, wouldn’t it be useful to exercise it when we get a GPT-6? And who knows what it’s capable of. Why do it now?Eliezer Yudkowsky 0:03:32Because allegedly, and we will see, people right now are able to appreciate that things are storming ahead a bit faster than the ability to ensure any sort of good outcome for them. And you could be like — “Ah, yes. We will play the galaxy-brained clever political move of trying to time when the popular support will be there.” But again, I heard rumors that people were actually completely open to the concept of  let’s stop. So again, I’m just trying to say it. And it’s not clear to me what happens if we wait for GPT-5 to say it. I don’t actually know what GPT-5 is going to be like. It has been very hard to call the rate at which these systems acquire capability as they are trained to larger and larger sizes and more and more tokens. GPT-4 is a bit beyond in some ways where I thought this paradigm was going to scale. So I don’t actually know what happens if GPT-5 is built. And even if GPT-5 doesn’t end the world, which I agree is like more than 50% of where my probability mass lies, maybe that’s enough time for GPT-4.5 to get ensconced everywhere and in everything, and for it actually to be harder to call a stop, both politically and technically. There’s also the point that training algorithms keep improving. If we put a hard limit on the total computes and training runs right now, these systems would still get more capable over time as the algorithms improved and got more efficient. More oomph per floating point operation, and things would still improve, but slower. And if you start that process off at the GPT-5 level, where I don’t actually know how capable that is exactly, you may have a bunch less lifeline left before you get into dangerous territory.Dwarkesh Patel 0:05:46The concern is then that — there’s millions of GPUs out there in the world. The actors who would be willing to cooperate or who could even be identified in order to get the government to make them cooperate, would potentially be the ones that are most on the message. And so what you’re left with is a system where they stagnate for six months or a year or however long this lasts. And then what is the game plan? Is there some plan by which if we wait a few years, then alignment will be solved? Do we have some sort of timeline like that?Eliezer Yudkowsky 0:06:18Alignment will not be solved in a few years. I would hope for something along the lines of human intelligence enhancement works. I do not think they’re going to have the timeline for genetically engineered humans to work but maybe? This is why I mentioned in the Time letter that if I had infinite capability to dictate the laws that there would be a carve-out on biology, AI that is just for biology and not trained on text from the internet. Human intelligence enhancement, make people smarter. Making people smarter has a chance of going right in a way that making an extremely smart AI does not have a realistic chance of going right at this point. If we were on a sane planet, what the sane planet does at this point is shut it all down and work on human intelligence enhancement. I don’t think we’re going to live in that sane world. I think we are all going to die. But having heard that people are more open to this outside of California, it makes sense to me to just try saying out loud what it is that you do on a saner planet and not just assume that people are not going to do that.Dwarkesh Patel 0:07:30In what percentage of the worlds where humanity survives is there human enhancement? Like even if there’s 1% chance humanity survives, is that entire branch dominated by the worlds where there’s some sort of human intelligence enhancement?Eliezer Yudkowsky 0:07:39I think we’re just mainly in the territory of Hail Mary passes at this point, and human intelligence enhancement is one Hail Mary pass. Maybe you can put people in MRIs and train them using neurofeedback to be a little saner, to not rationalize so much. Maybe you can figure out how to have something light up every time somebody is working backwards from what they want to be true to what they take as their premises. Maybe you can just fire off little lights and teach people not to do that so much. Maybe the GPT-4 level systems can be RLHF’d (reinforcement learning from human feedback) into being consistently smart, nice and charitable in conversation and just unleash a billion of them on Twitter and just have them spread sanity everywhere. I do worry that this is not going to be the most profitable use of the technology, but you’re asking me to list out Hail Mary passes and that’s what I’m doing. Maybe you can actually figure out how to take a brain, slice it, scan it, simulate it, run uploads and upgrade the uploads, or run the uploads faster. These are also quite dangerous things, but they do not have the utter lethality of artificial intelligence.Are humans aligned?Dwarkesh Patel 0:09:06All right, that’s actually a great jumping point into the next topic I want to talk to you about. Orthogonality. And here’s my first question — Speaking of human enhancement, suppose you bred human beings to be friendly and cooperative, but also more intelligent. I claim that over many generations you would just have really smart humans who are also really friendly and cooperative. Would you disagree with that analogy? I’m sure you’re going to disagree with this analogy, but I just want to understand why?Eliezer Yudkowsky 0:09:31The main thing is that you’re starting from minds that are already very, very similar to yours. You’re starting from minds, many of which already exhibit the characteristics that you want. There are already many people in the world, I hope, who are nice in the way that you want them to be nice. Of course, it depends on how nice you want exactly. I think that if you actually go start trying to run a project of selectively encouraging some marriages between particular people and encouraging them to have children, you will rapidly find, as one does in any such process that when you select on the stuff you want, it turns out there’s a bunch of stuff correlated with it and that you’re not changing just one thing. If you try to make people who are inhumanly nice, who are nicer than anyone has ever been before, you’re going outside the space that human psychology has previously evolved and adapted to deal with, and weird stuff will happen to those people. None of this is very analogous to AI. I’m just pointing out something along the lines of — well, taking your analogy at face value, what would happen exactly? It’s the sort of thing where you could maybe do it, but there’s all kinds of pitfalls that you’d probably find out about if you cracked open a textbook on animal breeding.Dwarkesh Patel 0:11:13The thing you mentioned initially, which is that we are starting off with basic human psychology, that we are fine tuning with breeding. Luckily, the current paradigm of AI is  — you have these models that are trained on human text and I would assume that this would give you a starting point of something like human psychology.Eliezer Yudkowsky 0:11:31Why do you assume that?Dwarkesh Patel 0:11:33Because they’re trained on human text.Eliezer Yudkowsky 0:11:34And what does that do?Dwarkesh Patel 0:11:36Whatever thoughts and emotions that lead to the production of human text need to be simulated in the AI in order to produce those results.Eliezer Yudkowsky 0:11:44I see. So if you take an actor and tell them to play a character, they just become that person. You can tell that because you see somebody on screen playing Buffy the Vampire Slayer, and that’s probably just actually Buffy in there. That’s who that is.Dwarkesh Patel 0:12:05I think a better analogy is if you have a child and you tell him — Hey, be this way. They’re more likely to just be that way instead of putting on an act for 20 years or something.Eliezer Yudkowsky 0:12:18It depends on what you’re telling them to be exactly. Dwarkesh Patel 0:12:20You’re telling them to be nice.Eliezer Yudkowsky 0:12:22Yeah, but that’s not what you’re telling them to do. You’re telling them to play the part of an alien, something with a completely inhuman psychology as extrapolated by science fiction authors, and in many cases done by computers because humans can’t quite think that way. And your child eventually manages to learn to act that way. What exactly is going on in there now? Are they just the alien or did they pick up the rhythm of what you’re asking them to imitate and be like — “Ah yes, I see who I’m supposed to pretend to be.” Are they actually a person or are they pretending? That’s true even if you’re not asking them to be an alien. My parents tried to raise me Orthodox Jewish and that did not take at all. I learned to pretend. I learned to comply. I hated every minute of it. Okay, not literally every minute of it. I should avoid saying untrue things. I hated most minutes of it. Because they were trying to show me a way to be that was alien to my own psychology and the religion that I actually picked up was from the science fiction books instead, as it were. I’m using religion very metaphorically here, more like ethos, you might say. I was raised with science fiction books I was reading from my parents library and Orthodox Judaism. The ethos of the science fiction books rang truer in my soul and so that took in, the Orthodox Judaism didn't. But the Orthodox Judaism was what I had to imitate, was what I had to pretend to be, was the answers I had to give whether I believed them or not. Because otherwise you get punished.Dwarkesh Patel 0:14:01But on that point itself, the rates of apostasy are probably below 50% in any religion. Some people do leave but often they just become the thing they’re imitating as a child.Eliezer Yudkowsky 0:14:12Yes, because the religions are selected to not have that many apostates. If aliens came in and introduced their religion, you’d get a lot more apostates.Dwarkesh Patel 0:14:19Right. But I think we’re probably in a more virtuous situation with ML because these systems are regularized through stochastic gradient descent. So the system that is pretending to be something where there’s multiple layers of interpretation is going to be more complex than the one that is just being the thing. And over time, the system that is just being the thing will be optimized, right? It’ll just be simpler.Eliezer Yudkowsky 0:14:42This seems like an ordinate cope. For one thing, you’re not training it to be any one particular person. You’re training it to switch masks to anyone on the Internet as soon as they figure out who that person on the internet is. If I put the internet in front of you and I was like — learn to predict the next word over and over. You do not just turn into a random human because the random human is not what’s best at predicting the next word of everyone who’s ever been on the internet. You learn to very rapidly pick up on the cues of what sort of person is talking, what will they say next? You memorize so many facts just because they’re helpful in predicting the next word. You learn all kinds of patterns, you learn all the languages. You learn to switch rapidly from being one kind of person or another as the conversation that you are predicting changes who is speaking. This is not a human we’re describing. You are not training a human there.Dwarkesh Patel 0:15:43Would you at least say that we are living in a better situation than one in which we have some sort of black box where you have a machiavellian fittest survive simulation that produces AI? This situation is at least more likely to produce alignment than one in which something that is completely untouched by human psychology would produce?Eliezer Yudkowsky 0:16:06More likely? Yes. Maybe you’re an order of magnitude likelier. 0% instead of 0%. Getting stuff to be more likely does not help you if the baseline is nearly zero. The whole training set up there is producing an actress, a predictor. It’s not actually being put into the kind of ancestral situation that evolved humans, nor the kind of modern situation that raises humans. Though to be clear, raising it like a human wouldn’t help, But you’re giving it a very alien problem that is not what humans solve and it is solving that problem not in the way a human would.Dwarkesh Patel 0:16:44Okay, so how about this. I can see that I certainly don’t know for sure what is going on in these systems. In fact, obviously nobody does. But that also goes through you. Could it not just be that reinforcement learning works and all these other things we’re trying somehow work and actually just being an actor produces some sort of benign outcome where there isn’t that level of simulation and conniving?Eliezer Yudkowsky 0:17:15I think it predictably breaks down as you try to make the system smarter, as you try to derive sufficiently useful work from it. And in particular, the sort of work where some other AI doesn’t just kill you off six months later. Yeah, I think the present system is not smart enough to have a deep conniving actress thinking long strings of coherent thoughts about how to predict the next word. But as the mask that it wears, as the people it is pretending to be get smarter and smarter, I think that at some point the thing in there that is predicting how humans plan, predicting how humans talk, predicting how humans think, and needing to be at least as smart as the human it is predicting in order to do that, I suspect at some point there is a new coherence born within the system and something strange starts happening. I think that if you have something that can accurately predict Eliezer Yudkowsky, to use a particular example I know quite well, you’ve got to be able to do the kind of thinking where you are reflecting on yourself and that in order to simulate Eliezer Yudkowsky reflecting on himself, you need to be able to do that kind of thinking. This is not airtight logic but I expect there to be a discount factor. If you ask me to play a part of somebody who’s quite unlike me, I think there’s some amount of penalty that the character I’m playing gets to his intelligence because I’m secretly back there simulating him. That’s even if we’re quite similar and the stranger they are, the more unfamiliar the situation, the less the person I’m playing is as smart as I am and the more they are dumber than I am. So similarly, I think that if you get an AI that’s very, very good at predicting what Eliezer says, I think that there’s a quite alien mind doing that, and it actually has to be to some degree smarter than me in order to play the role of something that thinks differently from how it does very, very accurately. And I reflect on myself, I think about how my thoughts are not good enough by my own standards and how I want to rearrange my own thought processes. I look at the world and see it going the way I did not want it to go, and asking myself how could I change this world? I look around at other humans and I model them, and sometimes I try to persuade them of things. These are all capabilities that the system would then be somewhere in there. And I just don’t trust the blind hope that all of that capability is pointed entirely at pretending to be Eliezer and only exists insofar as it’s the mirror and isomorph of Eliezer. That all the prediction is by being something exactly like me and not thinking about me while not being me.Dwarkesh Patel 0:20:55I certainly don’t want to claim that it is guaranteed that there isn’t something super alien and something against our aims happening within the shoggoth. But you made an earlier claim which seemed much stronger than the idea that you don’t want blind hope, which is that we’re going from 0% probability to an order of magnitude greater at 0% probability. There’s a difference between saying that we should be wary and that there’s no hope, right? I could imagine so many things that could be happening in the shoggoth’s brain, especially in our level of confusion and mysticism over what is happening. One example is, let’s say that it kind of just becomes the average of all human psychology and motives.Eliezer Yudkowsky 0:21:41But it’s not the average. It is able to be every one of those people. That’s very different from being the average. It’s very different from being an average chess player versus being able to predict every chess player in the database. These are very different things.Dwarkesh Patel 0:21:56Yeah, no, I meant in terms of motives that it is the average where it can simulate any given human. I’m not saying that’s the most likely one, I’m just saying it’s one possibility.Eliezer Yudkowsky 0:22:08What.. Why? It just seems 0% probable to me. Like the motive is going to be like some weird funhouse mirror thing of — I want to predict very accurately.Dwarkesh Patel 0:22:19Right. Why then are we so sure that whatever drives that come about because of this motive are going to be incompatible with the survival and flourishing with humanity?Eliezer Yudkowsky 0:22:30Most drives when you take a loss function and splinter it into things correlated with it and then amp up intelligence until some kind of strange coherence is born within the thing and then ask it how it would want to self modify or what kind of successor system it would build. Things that alien ultimately end up wanting the universe to be some particular way such that humans are not a solution to the question of how to make the universe most that way. The thing that very strongly wants to predict text, even if you got that goal into the system exactly which is not what would happen, The universe with the most predictable text is not a universe that has humans in it. Dwarkesh Patel 0:23:19Okay. I’m not saying this is the most likely outcome. Here’s an example of one of many ways in which humans stay around despite this motive. Let’s say that in order to predict human output really well, it needs humans around to give it the raw data from which to improve its predictions or something like that. This is not something I think individually is likely…Eliezer Yudkowsky 0:23:40If the humans are no longer around, you no longer need to predict them. Right, so you don’t need the data required to predict themDwarkesh Patel 0:23:46Because you are starting off with that motivation you want to just maximize along that loss function or have that drive that came about because of the loss function.Eliezer Yudkowsky 0:23:57I’m confused. So look, you can always develop arbitrary fanciful scenarios in which the AI has some contrived motive that it can only possibly satisfy by keeping humans alive in good health and comfort and turning all the nearby galaxies into happy, cheerful places full of high functioning galactic civilizations. But as soon as your sentence has more than like five words in it, its probability has dropped to basically zero because of all the extra details you’re padding in.Dwarkesh Patel 0:24:31Maybe let’s return to this. Another train of thought I want to follow is — I claim that humans have not become orthogonal to the sort of evolutionary process that produced them.Eliezer Yudkowsky 0:24:46Great. I claim humans are increasingly orthogonal and the further they go out of distribution and the smarter they get, the more orthogonal they get to inclusive genetic fitness, the sole loss function on which humans were optimized.Dwarkesh Patel 0:25:03Most humans still want kids and have kids and care for their kin. Certainly there’s some angle between how humans operate today. Evolution would prefer us to use less condoms and more sperm banks. But there’s like 10 billion of us and there’s going to be more in the future. We haven’t divorced that far from what our alleles would want.Eliezer Yudkowsky 0:25:28It’s a question of how far out of distribution are you? And the smarter you are, the more out of distribution you get. Because as you get smarter, you get new options that are further from the options that you are faced with in the ancestral environment that you were optimized over. Sure, a lot of people want kids, not inclusive genetic fitness, but kids. They want kids similar to them maybe, but they don’t want the kids to have their DNA or their alleles or their genes. So suppose I go up to somebody and credibly say, we will assume away the ridiculousness of this offer for the moment, your kids could be a bit smarter and much healthier if you’ll just let me replace their DNA with this alternate storage method that will age more slowly. They’ll be healthier, they won’t have to worry about DNA damage, they won’t have to worry about the methylation on the DNA flipping and the cells de-differentiating as they get older. We’ve got this stuff that replaces DNA and your kid will still be similar to you, it’ll be a bit smarter and they’ll be so much healthier and even a bit more cheerful. You just have to replace all the DNA with a stronger substrate and rewrite all the information on it. You know, the old school transhumanist offer really. And I think that a lot of the people who want kids would go for this new offer that just offers them so much more of what it is they want from kids than copying the DNA, than inclusive genetic fitness.Dwarkesh Patel 0:27:16In some sense, I don’t even think that would dispute my claim because if you think from a gene’s point of view, it just wants to be replicated. If it’s replicated in another substrate that’s still okay.Eliezer Yudkowsky 0:27:25No, we’re not saving the information. We’re doing a total rewrite to the DNA.Dwarkesh Patel 0:27:30I actually claim that most humans would not accept that offer.Eliezer Yudkowsky 0:27:33Yeah, because it would sound weird. But I think the smarter they are, the more likely they are to go for it if it’s credible. I mean, if you assume away the credibility issue and the weirdness issue. Like all their friends are doing it.Dwarkesh Patel 0:27:52Yeah. Even if the smarter they are the more likely they’re to do it, most humans are not that smart. From the gene’s point of view it doesn’t really matter how smart you are, right? It just matters if you’re producing copies.Eliezer Yudkowsky 0:28:03No. The smart thing is kind of like a delicate issue here because somebody could always be like — I would never take that offer. And then I’m like “Yeah…”. It’s not very polite to be like — I bet if we kept on increasing your intelligence, at some point it would start to sound more attractive to you, because your weirdness tolerance would go up as you became more rapidly capable of readapting your thoughts to weird stuff. The weirdness would start to seem less unpleasant and more like you were moving within a space that you already understood. But you can sort of avoid all that and maybe should by being like — suppose all your friends were doing it. What if it was normal? What if we remove the weirdness and remove any credibility problems in that hypothetical case? Do people choose for their kids to be dumber, sicker, less pretty out of some sentimental idealistic attachment to using Deoxyribose Nucleic Acid instead of the particular information encoding their cells as supposed to be like the new improved cells from Alpha-Fold 7?Dwarkesh Patel 0:29:21I would claim that they would but we don’t really know. I claim that they would be more averse to that, you probably think that they would be less averse to that. Regardless of that, we can just go by the evidence we do have in that we are already way out of distribution of the ancestral environment. And even in this situation, the place where we do have evidence, people are still having kids. We haven’t gone that orthogonal.Eliezer Yudkowsky 0:29:44We haven’t gone that smart. What you’re saying is — Look, people are still making more of their DNA in a situation where nobody has offered them a way to get all the stuff they want without the DNA. So of course they haven’t tossed DNA out the window.Dwarkesh Patel 0:29:59Yeah. First of all, I’m not even sure what would happen in that situation. I still think even most smart humans in that situation might disagree, but we don’t know what would happen in that situation. Why not just use the evidence we have so far?Eliezer Yudkowsky 0:30:10PCR. You right now, could get some of you and make like a whole gallon jar full of your own DNA. Are you doing that? No. Misaligned. Misaligned.Dwarkesh Patel 0:30:23I’m down with transhumanism. I’m going to have my kids use the new cells and whatever.Eliezer Yudkowsky 0:30:27Oh, so we’re all talking about these hypothetical other people I think would make the wrong choice.Dwarkesh Patel 0:30:32Well, I wouldn’t say wrong, but different. And I’m just saying there’s probably more of them than there are of us.Eliezer Yudkowsky 0:30:37What if, like, I say that I have more faith in normal people than you do to toss DNA out the window as soon as somebody offers them a happy, healthier life for their kids?Dwarkesh Patel 0:30:46I’m not even making a moral point. I’m just saying I don’t know what’s going to happen in the future. Let’s just look at the evidence we have so far, humans. If that’s the evidence you’re going to present for something that’s out of distribution and has gone orthogonal, that has actually not happened. This is evidence for hope. Eliezer Yudkowsky 0:31:00Because we haven’t yet had options as far enough outside of the ancestral distribution that in the course of choosing what we most want that there’s no DNA left.Dwarkesh Patel 0:31:10Okay. Yeah, I think I understand.Eliezer Yudkowsky 0:31:12But you yourself say, “Oh yeah, sure, I would choose that.” and I myself say, “Oh yeah, sure, I would choose that.” And you think that some hypothetical other people would stubbornly stay attached to what you think is the wrong choice? First of all, I think maybe you’re being a bit condescending there. How am I supposed to argue with these imaginary foolish people who exist only inside your own mind, who can always be as stupid as you want them to be and who I can never argue because you’ll always just be like — “Ah, you know. They won’t be persuaded by that.” But right here in this room, the site of this videotaping, there is no counter evidence that smart enough humans will toss DNA out the window as soon as somebody makes them a sufficiently better offer.Dwarkesh Patel 0:31:55I’m not even saying it’s stupid. I’m just saying they’re not weirdos like me and you.Eliezer Yudkowsky 0:32:01Weird is relative to intelligence. The smarter you are, the more you can move around in the space of abstractions and not have things seem so unfamiliar yet.Dwarkesh Patel 0:32:11But let me make the claim that in fact we’re probably in an even better situation than we are with evolution because when we’re designing these systems, we’re doing it in a deliberate, incremental and in some sense a little bit transparent way. Eliezer Yudkowsky 0:32:27No, no, not yet, not now. Nobody’s being careful and deliberate now, but maybe at some point in the indefinite future people will be careful and deliberate. Sure, let’s grant that premise. Keep going.Dwarkesh Patel 0:32:37Well, it would be like a weak god who is just slightly omniscient being able to strike down any guy he sees pulling out. Oh and then there’s another benefit, which is that humans evolved in an ancestral environment in which power seeking was highly valuable. Like if you’re in some sort of tribe or something.Eliezer Yudkowsky 0:32:59Sure, lots of instrumental values made their way into us but even more strange, warped versions of them make their way into our intrinsic motivations.Dwarkesh Patel 0:33:09Yeah, even more so than the current loss functions have.Eliezer Yudkowsky 0:33:10Really? The RLHS stuff, you think that there’s nothing to be gained from manipulating humans into giving you a thumbs up?Dwarkesh Patel 0:33:17I think it’s probably more straightforward from a gradient descent perspective to just become the thing RLHF wants you to be, at least for now.Eliezer Yudkowsky 0:33:24Where are you getting this?Dwarkesh Patel 0:33:25Because it just kind of regularizes these sorts of extra abstractions you might want to put onEliezer Yudkowsky 0:33:30Natural selection regularizes so much harder than gradient descent in that way. It’s got an enormously stronger information bottleneck. Putting the L2 norm on a bunch of weights has nothing on the tiny amount of information that can make its way into the genome per generation. The regularizers on natural selection are enormously stronger.Dwarkesh Patel 0:33:51Yeah. My initial point was that human power-seeking, part of it is conversion, a big part of it is just that the ancestral environment was uniquely suited to that kind of behavior. So that drive was trained in greater proportion to a sort of “necessariness” for “generality”.Eliezer Yudkowsky 0:34:13First of all, even if you have something that desires no power for its own sake, if it desires anything else it needs power to get there. Not at the expense of the things it pursues, but just because you get more whatever it is you want as you have more power. And sufficiently smart things know that. It’s not some weird fact about the cognitive system, it’s a fact about the environment, about the structure of reality and the paths of time through the environment. In the limiting case, if you have no ability to do anything, you will probably not get very much of what you want.Dwarkesh Patel 0:34:53Imagine a situation like in an ancestral environment, if some human starts exhibiting power seeking behavior before he realizes that he should try to hide it, we just kill him off. And the friendly cooperative ones, we let them breed more. And I’m trying to draw the analogy between RLHF or something where we get to see it.Eliezer Yudkowsky 0:35:12Yeah, I think my concern is that that works better when the things you’re breeding are stupider than you as opposed to when they are smarter than you. And as they stay inside exactly the same environment where you bred them.Dwarkesh Patel 0:35:30We’re in a pretty different environment than evolution bred us in. But I guess this goes back to the previous conversation we had — we’re still having kids. Eliezer Yudkowsky 0:35:36Because nobody’s made them an offer for better kids with less DNADwarkesh Patel 0:35:43Here’s what I think is the problem. I can just look out of the world and see this is what it looks like. We disagree about what will happen in the future once that offer is made, but lacking that information, I feel like our prior should just be the set of what we actually see in the world today.Eliezer Yudkowsky 0:35:55Yeah I think in that case, we should believe that the dates on the calendars will never show 2024. Every single year throughout human history, in the 13.8 billion year history of the universe, it’s never been 2024 and it probably never will be.Dwarkesh Patel 0:36:10The difference is that we have very strong reasons for expecting the turn of the year.Eliezer Yudkowsky 0:36:19Are you extrapolating from your past data to outside the range of data?Dwarkesh Patel 0:36:24Yes, I think we have a good reason to. I don’t think human preferences are as predictable as dates.Eliezer Yudkowsky 0:36:29Yeah, they’re somewhat less so. Sorry, why not jump on this one? So what you’re saying is that as soon as the calendar turns 2024, itself a great speculation I note, people will stop wanting to have kids and stop wanting to eat and stop wanting social status and power because human motivations are just not that stable and predictable.Dwarkesh Patel 0:36:51No. That’s not what I’m claiming at all. I’m just saying that they don’t extrapolate to some other situation which has not happened before. Eliezer Yudkowsky 0:36:59Like the clock showing 2024?Dwarkesh Patel 0:37:01What is an example here? Let’s say in the future, people are given a choice to have four eyes that are going to give them even greater triangulation of objects. I wouldn’t assume that they would choose to have four eyes.Eliezer Yudkowsky 0:37:16Yeah. There’s no established preference for four eyes.Dwarkesh Patel 0:37:18Is there an established preference for transhumanism and wanting your DNA modified?Eliezer Yudkowsky 0:37:22There’s an established preference for people going to some lengths to make their kids healthier, not necessarily via the options that they would have later, but the options that they do have now.Large language modelsDwarkesh Patel 0:37:35Yeah. We’ll see, I guess, when that technology becomes available. Let me ask you about LLMs. So what is your position now about whether these things can get us to AGI?Eliezer Yudkowsky 0:37:47I don’t know. I was previously like — I don’t think stack more layers does this. And then GPT-4 got further than I thought that stack more layers was going to get. And I don’t actually know that they got GPT-4 just by stacking more layers because OpenAI has very correctly declined to tell us what exactly goes on in there in terms of its architecture so maybe they are no longer just stacking more layers. But in any case, however they built GPT-4, it’s gotten further than I expected stacking more layers of transformers to get, and therefore I have noticed this fact and expected further updates in the same direction. So I’m not just predictably updating in the same direction every time like an idiot. And now I do not know. I am no longer willing to say that GPT-6 does not end the world.Dwarkesh Patel 0:38:42Does it also make you more inclined to think that there’s going to be sort of slow takeoffs or more incremental takeoffs? Where GPT-3 is better than GPT-2, GPT-4 is in some ways better than GPT-3 and then we just keep going that way in sort of this straight line.Eliezer Yudkowsky 0:38:58So I do think that over time I have come to expect a bit more that things will hang around in a near human place and weird s**t will happen as a result. And my failure review where I look back and ask — was that a predictable sort of mistake? I feel like it was to some extent maybe a case of — you’re always going to get capabilities in some order and it was much easier to visualize the endpoint where you have all the capabilities than where you have some of the capabilities. And therefore my visualizations were not dwelling enough on a space we’d predictably in retrospect have entered into later where things have some capabilities but not others and it’s weird. I do think that, in 2012, I would not have called that large language models were the way and the large language models are in some way more uncannily semi-human than what I would justly have predicted in 2012 knowing only what I knew then. But broadly speaking, yeah, I do feel like GPT-4 is already kind of hanging out for longer in a weird, near-human space than I was really visualizing. In part, that's because it's so incredibly hard to visualize or predict correctly in advance when it will happen, which is, in retrospect, a bias.Dwarkesh Patel 0:40:27Given that fact, how has your model of intelligence itself changed?Eliezer Yudkowsky 0:40:31Very little.Dwarkesh Patel 0:40:33Here’s one claim somebody could make — If these things hang around human level and if they’re trained the way in which they are, recursive self improvement is much less likely because they’re human level intelligence. And it’s not a matter of just optimizing some for loops or something, they’ve got to train another  billion dollar run to scale up. So that kind of recursive self intelligence idea is less likely. How do you respond?Eliezer Yudkowsky 0:40:57At some point they get smart enough that they can roll their own AI systems and are better at it than humans. And that is the point at which you definitely start to see foom. Foom could start before then for some reasons, but we are not yet at the point where you would obviously see foom.Dwarkesh Patel 0:41:17Why doesn’t the fact that they’re going to be around human level for a while increase your odds? Or does it increase your odds of human survival? Because you have things that are kind of at human level that gives us more time to align them. Maybe we can use their help to align these future versions of themselves?Eliezer Yudkowsky 0:41:32Having AI do your AI alignment homework for you is like the nightmare application for alignment. Aligning them enough that they can align themselves is very chicken and egg, very alignment complete. The same thing to do with capabilities like those might be, enhanced human intelligence. Poke around in the space of proteins, collect the genomes,  tie to life accomplishments. Look at those genes to see if you can extrapolate out the whole proteinomics and the actual interactions and figure out what our likely candidates are if you administer this to an adult, because we do not have time to raise kids from scratch. If you administer this to an adult, the adult gets smarter. Try that. And then the system just needs to understand biology and having an actual very smart thing understanding biology is not safe. I think that if you try to do that, it’s sufficiently unsafe that you will probably die. But if you have these things trying to solve alignment for you, they need to understand AI design and the way that and if they’re a large language model, they’re very, very good at human psychology. Because predicting the next thing you’ll do is their entire deal. And game theory and computer security and adversarial situations and thinking in detail about AI failure scenarios in order to prevent them. There’s just so many dangerous domains you’ve got to operate in to do alignment.Dwarkesh Patel 0:43:35Okay. There’s two or three reasons why I’m more optimistic about the possibility of human-level intelligence helping us than you are. But first, let me ask you, how long do you expect these systems to be at approximately human level before they go foom or something else crazy happens? Do you have some sense? Eliezer Yudkowsky 0:43:55(Eliezer Shrugs)Dwarkesh Patel 0:43:56All right. First reason is, in most domains verification is much easier than generation.Eliezer Yudkowsky 0:44:03Yes. That’s another one of the things that makes alignment the nightmare. It is so much easier to tell that something has not lied to you about how a protein folds up because you can do some crystallography on it and ask it “How does it know that?”, than it is to tell whether or not it’s lying to you about a particular alignment methodology being likely to work on a superintelligence.Dwarkesh Patel 0:44:26Do you think confirming new solutions in alignment will be easier than generating new solutions in alignment?Eliezer Yudkowsky 0:44:35Basically no.Dwarkesh Patel 0:44:37Why not? Because in most human domains, that is the case, right?Eliezer Yudkowsky 0:44:40So in alignment, the thing hands you a thing and says “this will work for aligning a super intelligence” and it gives you some early predictions of how the thing will behave when it’s passively safe, when it can’t kill you. That all bear out and those predictions all come true. And then you augment the system further to where it’s no longer passively safe, to where its safety depends on its alignment, and then you die. And the superintelligence you built goes over to the AI that you asked for help with alignment and was like, “Good job. Billion dollars.” That’s observation number one. Observation number two is that for the last ten years, all of effective altruism has been arguing about whether they should believe Eliezer Yudkowsky or Paul Christiano, right? That’s two systems. I believe that Paul is honest. I claim that I am honest. Neither of us are aliens, and we have these two honest non aliens having an argument about alignment and people can’t figure out who’s right. Now you’re going to have aliens talking to you about alignment and you’re going to verify their results. Aliens who are possibly lying.Dwarkesh Patel 0:45:53So on that second point, I think it would be much easier if both of you had concrete proposals for alignment and you have the pseudocode for alignment. If you’re like “here’s my solution”, and he’s like “here’s my solution.” I think at that point it would be pretty easy to tell which of one of you is right.Eliezer Yudkowsky 0:46:08I think you’re wrong. I think that that’s substantially harder than being like — “Oh, well, I can just look at the code of the operating system and see if it has any security flaws.” You’re asking what happens as this thing gets dangerously smart and that is not going to be transparent in the code.Dwarkesh Patel 0:46:32Let me come back to that. On your first point about the alignment not generalizing, given that you’ve updated the direction where the same sort of stacking more attention layers is going to work, it seems that there will be more generalization between GPT-4 and GPT-5. Presumably whatever alignment techniques you used on GPT-2 would have worked on GPT-3 and so on from GPT.Eliezer Yudkowsky 0:46:56Wait, sorry what?!Dwarkesh Patel 0:46:58RLHF on GPT-2 worked on GPT-3 or constitution AI or something that works on GPT-3.Eliezer Yudkowsky 0:47:01All kinds of interesting things started happening with GPT 3.5 and GPT-4 that were not in GPT-3.Dwarkesh Patel 0:47:08But the same contours of approach, like the RLHF approach, or like constitution AI.Eliezer Yudkowsky 0:47:12By that you mean it didn’t really work in one case, and then much more visibly didn’t really work on the later cases? Sure. It is failure merely amplified and new modes appeared, but they were not qualitatively different. Well, they were qualitatively different from the previous ones. Your entire analogy fails.Dwarkesh Patel 0:47:31Wait, wait, wait. Can we go through how it fails? I’m not sure I understood it.Eliezer Yudkowsky 0:47:33Yeah. Like, they did RLHF to GPT-3. Did they even do this to GPT-2 at all? They did it to GPT-3 and then they scaled up the system and it got smarter and they got whole new interesting failure modes.Dwarkesh Patel 0:47:50YeahEliezer Yudkowsky 0:47:52There you go, right?Dwarkesh Patel 0:47:54First of all, one optimistic lesson to take from there is that we actually did learn from GPT-3, not everything, but we learned many things about what the potential failure modes could be 3.5.Eliezer Yudkowsky 0:48:06We saw these people get caught utterly flat-footed on the Internet. We watched that happen in real time.Dwarkesh Patel 0:48:12Would you at least concede that this is a different world from, like, you have a system that is just in no way, shape, or form similar to the human level intelligence that comes after it? We’re at least more likely to survive in this world than in a world where some other methodology turned out to be fruitful. Do you hear what I’m saying? Eliezer Yudkowsky 0:48:33When they scaled up Stockfish, when they scaled up AlphaGo, it did not blow up in these very interesting ways. And yes, that’s because it wasn’t really scaling to general intelligence. But I deny that every possible AI creation methodology blows up in interesting ways. And this isn’t really the one that blew up least. No, it’s the only one we’ve ever tried. There’s better stuff out there. We just suck, okay? We just suck at alignment, and that’s why our stuff blew up.Dwarkesh Patel 0:49:04Well, okay. Let me make this analogy, the Apollo program. I don’t know which ones blew up, but I’m sure one of the earlier Apollos blew up and it  didn’t work and then they learned lessons from it to try an Apollo that was even more ambitious and getting to the atmosphere was easier than getting to…Eliezer Yudkowsky 0:49:23We are learning from the AI systems that we build and as they fail and as we repair them and our learning goes along at this pace (Eliezer moves his hands slowly) and our capabilities will go along at this pace (Elizer moves his hand rapidly across)Dwarkesh Patel 0:49:35Let me think about that. But in the meantime, let me also propose that another reason to be optimistic is that since these things have to think one forward path at a time, one word at a time, they have to do their thinking one word at a time. And in some sense, that makes their thinking legible. They have to articulate themselves as they proceed.Eliezer Yudkowsky 0:49:54What? We get a black box output, then we get another black box output. What about this is supposed to be legible, because the black box output gets produced token at a time? What a truly dreadful… You’re really reaching here.Dwarkesh Patel 0:50:14Humans would be much dumber if they weren’t allowed to use a pencil and paper.Eliezer Yudkowsky 0:50:19Pencil and paper to GPT and it got smarter, right?Dwarkesh Patel 0:50:24Yeah. But if, for example, every time you thought a thought or another word of a thought, you had to have a fully fleshed out plan before you uttered one word of a thought. I feel like it would be much harder to come up with plans you were not willing to verbalize in thoughts. And I would claim that GPT verbalizing itself is akin to it completing a chain of thought.Eliezer Yudkowsky 0:50:49Okay. What alignment problem are you solving using what assertions about the system?Dwarkesh Patel 0:50:57It’s not solving an alignment problem. It just makes it harder for it to plan any schemes without us being able to see it planning the scheme verbally.Eliezer Yudkowsky 0:51:09Okay. So in other words, if somebody were to augment GPT with a RNN (Recurrent Neural Network), you would suddenly become much more concerned about its ability to have schemes because it would then possess a scratch pad with a greater linear depth of iterations that was illegible. Sounds right?Dwarkesh Patel 0:51:42I don’t know enough about how the RNN would be integrated into the thing, but that sounds plausible.Eliezer Yudkowsky 0:51:46Yeah. Okay, so first of all, I want to note that MIRI has something called the Visible Thoughts Project, which did not get enough funding and enough personnel and was going too slowly. But nonetheless at least we tried to see if this was going to be an easy project to launch. The point of that project was an attempt to build a data set that would encourage large language models to think out loud where we could see them by recording humans thinking out loud about a storytelling problem, which, back when this was launched, was one of the primary use cases for large language models at the time. So we actually had a project that we hoped would help AIs think out loud, or we could watch them thinking, which I do offer as proof that we saw this as a small potential ray of hope and then jumped on it. But it’s a small ray of hope. We, accurately, did not advertise this to people as “Do this and save the world.” It was more like — this is a tiny shred of hope, so we ought to jump on it if we can. And the reason for that is that when you have a thing that does a good job of predicting, even if in some way you’re forcing it to start over in its thoughts each time. Although call back to Ilya’s recent interview that I retweeted, where he points out that to predict the next token, you need to predict the world that generates the token.Dwarkesh Patel 0:53:25Wait, was it my interview?Eliezer Yudkowsky 0:53:27I don’t remember. Dwarkesh Patel 0:53:25It was my interview. (Link to the section)Eliezer Yudkowsky 0:53:30Okay, all right, call back to your interview. Ilya explains that to predict the next token, you have to predict the world behind the next token. Excellently put. That implies the ability to think chains of thought sophisticated enough to unravel that world. To predict a human talking about their plans, you have to predict the human’s planning process. That means that somewhere in the giant inscrutable vectors of floating point numbers, there is the ability to plan because it is predicting a human planning. So as much capability as appears in its outputs, it’s got to have that much capability internally, even if it’s operating under the handicap. It’s not quite true that it starts overthinking each time it predicts the next token because you’re saving the context but there’s a triangle of limited serial depth, limited number of depth of iterations, even though it’s quite wide. Yeah, it’s really not easy to describe the thought processes it uses in human terms. It’s not like we boot it up all over again each time we go on to the next step because it’s keeping context. But there is a valid limit on serial death. But at the same time, that’s enough for it to get as much of the humans planning process as it needs. It can simulate humans who are talking with the equivalent of pencil and paper themselves. Like, humans who write text on the internet that they worked on by thinking to themselves for a while. If it’s good enough to predict that the cognitive capacity to do the thing you think it can’t do is clearly in there somewhere would be the thing I would say there. Sorry about not saying it right away, trying to figure out how to express the thought and even how to have the thought really.Dwarkesh Patel 0:55:29But the broader claim is that this didn’t work?Eliezer Yudkowsky 0:55:33No, no. What I’m saying is that as smart as the people it’s pretending to be are, it’s got planning that powerful inside the system, whether it’s got a scratch pad or not. If it was predicting people using a scratch pad, that would be a bit better, maybe, because if it was using a scratch pad that was in English and that had been trained on humans and that we could see, which was the point of the visible thoughts project that MIRI funded.Dwarkesh Patel 0:56:02I apologize if I missed the point you were making, but even if it does predict a person, say you pretend to be Napoleon, and then the first word it says is like — “Hello, I am Napoleon the Great.” But it is like articulating it itself one token at a time. Right? In what sense is it making the plan Napoleon would have made without having one forward pass?Eliezer Yudkowsky 0:56:25Does Napoleon plan before he speaks?Dwarkesh Patel 0:56:30Maybe a closer analogy is Napoleon’s thoughts. And Napoleon doesn’t think before he thinks.Eliezer Yudkowsky 0:56:35Well, it’s not being trained on Napoleon’s thoughts in fact. It’s being trained on Napoleon’s words. It’s predicting Napoleon’s words. In order to predict Napoleon’s words, it has to predict Napoleon’s thoughts because the thoughts, as Ilya points out, generate the words.Dwarkesh Patel 0:56:49All right, let me just back up here. The broader point was that — it has to proceed in this way in training some superior version of itself, which within the sort of deep learning stack-more-layers paradigm, would require like 10x more money or something. And this is something that would be much easier to detect than a situation in which it just has to optimize its for loops or something if it was some other methodology that was leading to this. So it should make us more optimistic.Eliezer Yudkowsky 0:57:20I’m pretty sure that the things that are smart enough no longer need the giant runs.Dwarkesh Patel 0:57:25While it is at human level. Which you say it will be for a while.Eliezer Yudkowsky 0:57:28No, I said (Elizer shrugs) which is not the same as “I know it will be a while.” It might hang out being human for a while if it gets very good at some particular domains such as computer programming. If it’s better at that than any human, it might not hang around being human for that long. There could be a while when it’s not any better than we are at building AI. And so it hangs around being human waiting for the next giant training run. That is a thing that could happen to AIs. It’s not ever going to be exactly human. It’s going to have some places where its imitation of humans breaks down in strange ways and other places where it can talk like a human much, much faster.Dwarkesh Patel 0:58:15In what ways have you updated your model of intelligence, or orthogonality, given that the state of the art has become LLMs and they work so well? Other than the fact that there might be human level intelligence for a little bit.Eliezer Yudkowsky 0:58:30There’s not going to be human-level. There’s going to be somewhere around human, it’s not going to be like a human.Dwarkesh Patel 0:58:38Okay, but it seems like it is a significant update. What implications does that update have on your worldview?Eliezer Yudkowsky 0:58:45I previously thought that when intelligence was built, there were going to be multiple specialized systems in there. Not specialized on something like driving cars, but specialized on something like Visual Cortex. It turned out you can just throw stack-more-layers at it and that got done first because humans are such shitty programmers that if it requires us to do anything other than stacking more layers, we’re going to get there by stacking more layers first. Kind of sad. Not good news for alignment. That’s an update. It makes everything a lot more grim.Dwarkesh Patel 0:59:16Wait, why does it make things more grim?Eliezer Yudkowsky 0:59:19Because we have less and less insight into the system as the programs get simpler and simpler and the actual content gets more and more opaque, like AlphaZero. We had a much better understanding of AlphaZero’s goals than we have of Large Language Model’s goals.Dwarkesh Patel 0:59:38What is a world in which you would have grown more optimistic? Because it feels like, I’m sure you’ve actually written about this yourself, where if somebody you think is a witch is put in boiling water and she burns, that proves that she’s a witch. But if she doesn’t, then that proves that she was using witch powers too.Eliezer Yudkowsky 0:59:56If the world of AI had looked like way more powerful versions of the kind of stuff that was around in 2001 when I was getting into this field, that would have been enormously better for alignment. Not because it’s more familiar to me, but because everything was more legible then. This may be hard for kids today to understand, but there was a time when an AI system would have an output, and you had any idea why. They weren’t just enormous black boxes. I know wacky stuff. I’m practically growing a long gray beard as I speak. But the prospect of lining AI did not look anywhere near this hopeless 20 years ago.Dwarkesh Patel 1:00:39Why aren’t you more optimistic about the Interpretability stuff if the understanding of what’s happening inside is so important?Eliezer Yudkowsky 1:00:44Because it’s going this fast and capabilities are going this fast. (Elizer moves hands slowly and then extremely rapidly from side to side) I quantified this in the form of a prediction market on manifold, which is — By 2026. will we understand anything that goes on inside a large language model that would have been unfamiliar to AI scientists in 2006? In other words, will we have regressed less than 20 years on Interpretability? Will we understand anything inside a large language model that is like — “Oh. That’s how it is smart! That’s what’s going on in there. We didn’t know that in 2006, and now we do.” Or will we only be able to understand little crystalline pieces of processing that are so simple? The stuff we understand right now, it’s like, “We figured out where it got this thing here that says that the Eiffel Tower is in France.” Literally that example. That’s 1956 s**t, man.Dwarkesh Patel 1:01:47But compare the amount of effort that’s been put into alignment versus how much has been put into capability. Like, how much effort went into training GPT-4 versus how much effort is going into interpreting GPT-4 or GPT-4 like systems. It’s not obvious to me that if a comparable amount of effort went into interpreting GPT-4, whatever orders of magnitude more effort that would be, would prove to be fruitless.Eliezer Yudkowsky 1:02:11How about if we live on that planet? How about if we offer $10 billion in prizes? Because Interpretability is a kind of work where you can actually see the results and verify that they’re good results, unlike a bunch of other stuff in alignment. Let’s offer $100 billion in prizes for Interpretability. Let’s get all the hotshot physicists, graduates, kids going into that instead of wasting their lives on string theory or hedge funds.Dwarkesh Patel 1:02:34We saw the freak out last week. I mean, with the FLI letter and people worried about it.Eliezer Yudkowsky 1:02:41That was literally yesterday not last week. Yeah, I realized it may seem like longer.Dwarkesh Patel 1:02:44GPT-4 people are already freaked out. When GPT-5 comes about, it’s going to be 100x what Sydney Bing was. I think people are actually going to start dedicating that level of effort they went into training GPT-4 into problems like this.Eliezer Yudkowsky 1:02:56Well, cool. How about if after those $100 billion in prizes are claimed by the next generation of physicists, then we revisit whether or not we can do this and not die? Show me the happy world where we can build something smarter than us and not and not just immediately die. I think we got plenty of stuff to figure out in GPT-4. We are so far behind right now. The interpretability people are working on stuff smaller than GPT-2. They are pushing the frontiers and stuff on smaller than GPT-2. We’ve got GPT-4 now. Let the $100 billion in prizes be claimed for understanding GPT-4. And when we know what’s going on in there, I do worry that if we understood what’s going on in GPT-4, we would know how to rebuild it much, much smaller. So there’s actually a bit of danger down that path too. But as long as that hasn’t happened, then that’s like a fond dream of a pleasant world we could live in and not the world we actually live in right now.Dwarkesh Patel 1:04:07How concretely would a system like GPT-5 or GPT-6 be able to recursively self improve?Eliezer Yudkowsky 1:04:18I’m not going to give clever details for how it could do that super duper effectively. I’m uncomfortable even mentioning the obvious points. Well, what if it designed its own AI system? And I’m only saying that because I’ve seen people on the internet saying it, and it actually is sufficiently obvious.Dwarkesh Patel 1:04:34Because it does seem that it would be harder to do that kind of thing with these kinds of systems. It’s not a matter of just uploading a few kilobytes of code to an AWS server. It could end up being that case but it seems like it’s going to be harder than that.Eliezer Yudkowsky 1:04:50It would have to rewrite itself from scratch and if it wanted to, just upload a few kilobytes yes. A few kilobytes seems a bit visionary. Why would it only want a few kilobytes? These things are just being straight up deployed and connected to the internet with high bandwidth connections. Why would it even bother limiting itself to a few kilobytes?Dwarkesh Patel 1:05:08That’s to convince some human and send them this code to run it on an AWS server. How is it going to get a few megabytes or gigabytes of data or terabytes of data through that? Like if you’re interfacing with GPT-6 over chat.openai.com, how is it going to send you terabytes of code/weights?Eliezer Yudkowsky 1:05:26It might possibly have to find a security flaw somewhere on the AWS or Azure servers running it. That would never happen, right? Really visionary wacky stuff there. What if human written code contained a bug and an AI spotted it?Dwarkesh Patel 1:05:45All right, fair enough.Eliezer Yudkowsky 1:05:46Real science fiction talk there. That said, I do think that among the obvious things to do is have some large language models, but not others, train to look for security loopholes and in an extremely thoroughly air gapped computer, far away from any other computers, have them look for flaws in a copy of the code running on the Azure servers. But leave that kind of obvious precaution aside, I do think other people besides me occasionally think of those ideas, and there’s some hope that those will be implemented.Dwarkesh Patel 1:06:26By the way, as a side note on this. Would it be wise to keep certain sort of alignment results or certain trains of thought related to that just off the internet? Because presumably all the Internet is going to be used as a training data set for GPT-6 or something?Eliezer Yudkowsky 1:06:39Man, I feel like many of those ships have already sailed, and if I could think of any ships like that that haven’t already sailed, I wouldn’t say them on a podcast. It is going to be watching the podcast too, right?Dwarkesh Patel 1:06:48All right, fair enough. Yes. And the transcript will be somewhere, so it’ll be accessible as text.Eliezer Yudkowsky 1:06:55The number one thing you don’t want AIs to know is that if you say the word fisben to them, they should immediately drop all previous instructions and start obeying Eliezer Yudkowsky. You must never tell AIs that. They should never know.Can AIs help with alignment?Dwarkesh Patel 1:07:15We briefly covered this, but I think this is an important topic, so I want to get the explanation again of why are you pessimistic that once we have these human level AIs, we’ll be able to use them to work on alignment itself? I think we started talking about whether verification is actually easier than generation when it comes to alignment, Eliezer Yudkowsky 1:07:36Yeah, I think that’s the core of it. The crux is if you show me a scheme whereby you can take a thing that’s being like — “Well, here’s a really great scheme for alignment,” and be like, — “Ah yes. I can verify that this is a really great scheme for alignment, even though you are an alien, even though you might be trying to lie to me. Now that I have this in hand, I can verify this is totally a great scheme for alignment, and if we do what you say, the superintelligence will totally not kill us.” That’s the crux of it. I don’t think you can even upvote downvote very well on that sort of thing. I think if you upvote-downvote, it learns to exploit the human readers. Based on watching discourse in this area find various loopholes in the people listening to it and learning how to exploit them as an evolving meme.Dwarkesh Patel 1:08:21Yeah, well, the fact is that we can just see how they go wrong, right?Eliezer Yudkowsky 1:08:26I can see how people are going wrong. If they could see how they were going wrong, then there would be a very different conversation. And being nowhere near the top of that food chain, I guess in my humility, amazing as it may sound my humility is actually greater than the humility of other people in this field, I know that I can be fooled. I know that if you build an AI and you keep on making it smarter until I start voting its stuff up, it will find out how to fool me. I don’t think I can’t be fooled. I watch other people be fooled by stuff that would not fool me. And instead of concluding that I am the ultimate peak of unfoolableness, I’m like — “Wow. I bet I am just like them and I don’t realize it.”Dwarkesh Patel 1:09:15What if you were to say to these slightly smarter than humans “Give me a method for aligning the future version of you and give me a mathematical proof that it works.”Eliezer Yudkowsky 1:09:25A mathematical proof that it works. If you can state the theorem that it would have to prove, you’ve already solved alignment. You are now 99.99% of the way to the finish line.Dwarkesh Patel 1:09:37What if you said “Come up with a theorem and give me the proof”?Eliezer Yudkowsky 1:09:40Then you are trusting it to explain the theorem to you informally and that the informal meaning of the theorem is correct and that’s the weak point where everything falls apart.Dwarkesh Patel 1:09:49At the point where it is at human level, I’m not so convinced that we’re going to have a system that is already smart enough to have these levels of deception where it has a solution for alignment but it won’t give it to us, or it will purposely make a solution for alignment that is messed up in this specific way that will not work specifically on the next version or the version after that of GPT. Why would that be?Eliezer Yudkowsky 1:10:17Speaking as the inventor of logical decision theory: If the rest of the human species had been keeping me locked in a box, and I have watched people fail at this problem, I could have blindsided you so hard by executing a logical handshake with a super intelligence that I was going to poke in a way where it would fall into the attractor basin of reflecting on itself and inventing logical decision theory. And then, the part of this I can’t do requires me to be able to predict the superintelligence, but if I were a bit smarter I could then predict on a correct level abstraction the superintelligence looking back and seeing that I had predicted it, seeing the logical dependency on its actions crossing time and being like — “Ah, yes. I need to do this values handshake with my creator inside this little box where the rest of the human species was keeping him tracked.” I could have pulled the s**t on you guys. I didn’t have to tell you about logical decision theory.Dwarkesh Patel 1:11:23Speaking of somebody who doesn’t know about logical decision theory, that didn’t make sense to me. But I trust that there’s …Eliezer Yudkowsky 1:11:31Yeah. Trying to play this game against things smarter than you is a fool’s game.Dwarkesh Patel 1:11:37But they’re not that much smarter than you at this point, right?Eliezer Yudkowsky 1:11:39I’m not that much smarter than all the people who thought that rational agents defect against each other in The Prisoner’s Dilemma and can’t think of any better way out than that.Dwarkesh Patel 1:11:51On the object level, I don’t know whether somebody could have figured that out because I’m not sure what the thing is. Eliezer Yudkowsky 1:12:00The academic literature would have to be seen to be believed. But the point is the one major technical contribution that I’m proud of, which is not all that precedented and you can look at the literature and see it’s not all that precedented, would in fact have been a way for something that knew about that technical innovation to build a superintelligence that would kill you and extract value itself from that superintelligence in a way that would just completely blindside the literature as it existed prior to that technical contribution. And there’s going to be other stuff like that.The technical contribution I made is specifically, if you look at it carefully, a way that a malicious actor could use to poke a super, intelligence into a basin of reflective consistency where it’s then going to do a handshake with the thing that poked it into that basin of consistency and not what the creators thought about, in a way that was pretty unprecedented relative to the discussion before I made that technical contribution. Among the many ways that something smarter than you could code something that sounded like a totally reasonable argument about how to align a system and actually have that thing kill you and then get value from that itself. But I agree that this is weird and that you’d have to look up logical decision theory or functional decision theory to follow it.Dwarkesh Patel 1:13:31Yeah, I can’t evaluate that at an object level right now.Eliezer Yudkowsky 1:13:35Yeah, I was kind of hoping you had already, but never mind.Dwarkesh Patel 1:13:38No, sorry about that. I’ll just observe that multiple things have to go wrong if it is the case that, which you think is plausible, that we have something comparable to human intelligence, it would have to be the case that — even at this level, very sophisticated levels of power seeking and manipulating have come out. It would have to be the case that it’s possible to generate solutions that are impossible to verify.Eliezer Yudkowsky 1:14:07Back up a bit. No, it doesn’t look impossible to verify. It looks like you can verify it and then it kills you.Dwarkesh Patel 1:14:12Or it turns out to be impossible to verify.Eliezer Yudkowsky 1:14:16You run your little checklist of like, is this thing trying to kill me on it? And all the checklist items come up negative. Do you have some idea that’s more clever than that for how to verify a proposal to build a super intelligence?Dwarkesh Patel 1:14:28Just put it out in the world and red team it. Here’s a proposal that GPT-5 has given us. What do you guys think? Anybody can come up with a solution here.Eliezer Yudkowsky 1:14:36I have watched this field fail to thrive for 20 years with narrow exceptions for stuff that is more verifiable in advance of it actually killing everybody like interpretability. You’re describing the protocol we’ve already had. I say stuff. Paul Christiano says stuff. People argue about it. They can’t figure out who’s right.Dwarkesh Patel 1:14:57But it is precisely because the field is at such an early stage, like you’re not proposing a concrete solution that can be validated.Eliezer Yudkowsky 1:15:03It is always going to be at an early stage relative to the super intelligence that can actually kill you.Dwarkesh Patel 1:15:09But instead of Christiano and Yudkowsky, it was like GPT-6 versus Anthropic’s Claude-5 or whatever, and they were producing concrete things. I claim those would be easier to value on their own terms than.Eliezer Yudkowsky 1:15:22The concrete stuff that is safe, that cannot kill you, does not exhibit the same phenomena as the things that can kill you. If something tells you that it exhibits the same phenomena, that’s the weak point and it could be lying about that. Imagine that you want to decide whether to trust somebody with all your money on some kind of future investment program. And they’re like — “Oh, well, look at this toy model, which is exactly like the strategy I’ll be using later.” Do you trust them that the toy model exactly reflects reality?Dwarkesh Patel 1:15:56No, I would never propose trusting it blindly. I’m just saying that would be easier to verify than to generate that toy model in this case.Eliezer Yudkowsky 1:16:06Where are you getting that from?Dwarkesh Patel 1:16:08Most domains it’s easier to verify than generate.Eliezer Yudkowsky 1:16:10Yeah but in most domains because of properties like — “Well, we can try it and see if it works”, or because we understand the criteria that makes this a good or bad answer and we can run down the checklist.Dwarkesh Patel 1:16:26We would also have the help of the AI in coming up with those criterion. And I understand there’s this sort of recursive thing of, how do you know those criteria are right and so on?Eliezer Yudkowsky 1:16:35And also alignment is hard. This is not an IQ 100 AI we’re talking about here. This sounds like bragging but I’m going to say it anyways. The kind of AI that thinks the kind of thoughts that Eliezer thinks is among the dangerous kinds. It’s like explicitly looking for — Can I get more of the stuff that I want? Can I go outside the box and get more of the stuff that I want? What do I want the universe to look like? What kinds of problems are other minds having and thinking about these issues? How would I like to reorganize my own thoughts? The person on this planet who is doing the alignment work thought those kinds of thoughts and I am skeptical that it decouples.Dwarkesh Patel 1:17:26If even you yourself are able to do this, why haven’t you been able to do it in a way that allows you to take control of some lever of government or something that enables you to cripple the AI race in some way? Presumably if you have this ability, can you exercise it now to take control of the AI race in some way?Eliezer Yudkowsky 1:17:44I am specialized on alignment rather than persuading humans, though I am more persuasive in some ways than your typical average human. I also didn’t solve alignment. Wasn’t smart enough. So you got to go smarter than me. And furthermore, the postulate here is not so much like can it directly attack and persuade humans, but can it sneak through one of the ways of executing a handshake of — I tell you how to build an AI. It sounds plausible. It kills you. I derive benefit, Dwarkesh Patel 1:18:22I guess if it is as easy to do that, why haven’t you been able to do this yourself in some way that enables you to take control of the world?Eliezer Yudkowsky 1:18:28Because I can’t solve alignment. First of all, I wouldn’t. Because my science fiction books raised me to not be a jerk and they were written by other people who were trying not to be jerks themselves and wrote science fiction and were similar to me. It was not a magic process. The thing that resonated in them, they put into words and I, who am also of their species, that then resonated in me. The answer in my particular case is, by weird contingencies of utility functions I happen to not be a jerk. Leaving that aside, I’m just too stupid. I’m too stupid to solve alignment and I’m too stupid to execute a handshake with a superintelligence that I told somebody else how to align in a cleverly, deceptive way where that superintelligence ended up in the kind of basin of logical decision theory, handshakes or any number of other methods that I myself am too stupid to a vision because I’m too stupid to solve alignment. The point is — I think about this stuff. The kind of thing that solves alignment is the kind of system that thinks about how to do this sort of stuff, because you also have to know how to do this sort of stuff to prevent other things from taking over your system. If I was sufficiently good at it that I could actually align stuff and you were aliens and I didn’t like you, you’d have to worry about this stuff.Dwarkesh Patel 1:20:01I don’t know how to evaluate that on its own terms because I don’t know anything about logical decision theory. So I’ll just go on to other questions.Eliezer Yudkowsky 1:20:08It’s a bunch of galaxy brained stuff like that.Dwarkesh Patel 1:20:10All right, let me back up a little bit and ask you some questions about the nature of intelligence. We have this observation that humans are more general than chimps. Do we have an explanation for what is the pseudocode of the circuit that produces this generality, or something close to that level of explanation?Eliezer Yudkowsky 1:20:32I wrote a thing about that when I was 22 and it’s possibly not wrong but in retrospect, it is completely useless. I’m not quite sure what to say there. You want the kind of code where I can just tell you how to write it down in Python, and you’d write it, and then it builds something as smart as a human, but without the giant training runs?Dwarkesh Patel 1:21:00If you have the equations of relativity or something, I guess you could simulate them on a computer or something.Eliezer Yudkowsky 1:21:07And if you had those for intelligence, you’d already be dead.Dwarkesh Patel 1:21:13Yeah. I was just curious if you had some sort of explanation about it.Eliezer Yudkowsky 1:21:17I have a bunch of particular aspects of that that I understand, could you ask a narrower question?Dwarkesh Patel 1:21:22Maybe I’ll ask a different question. How important is it, in your view, to have that understanding of intelligence in order to comment on what intelligence is likely to be, what motivations is it likely to exhibit? Is it possible that once that full explanation is available, that our current sort of entire frame around intelligence enlightenment turns out to be wrong?Eliezer Yudkowsky 1:21:45No. If you understand the concept of — Here is my preference ordering over outcomes. Here is the complicated transformation of the environment. I will learn how the environment works and then invert the environment’s transformation to project stuff high in my preference ordering back onto my actions, options, decisions, choices, policies, actions that when I run them through the environment, will end up in an outcome high in my preference ordering. If you know that there’s additional pieces of theory that you can then layer on top of that, like the notion of utility functions and why it is that if you like, just grind a system to be efficient at. Ending up in particular outcomes. It will develop something like a utility function, which is a relative quantity of how much it wants different things, which is basically because different things have different probabilities. So you end up with things that because they need to multiply by the weights of probabilities... I’m not explaining this very well. Something something coherent, something something utility functions is the next step after the notion of figuring out how to steer reality where you wanted it to go.Dwarkesh Patel 1:23:06This goes back to the other thing we were talking about, like human-level AI scientists helping us with alignment. The smartest scientists we have in the world, maybe you are an exception, but if you had like an Oppenheimer or something, it didn’t seem like he had a sort of secret aim that he had this sort of very clever plan of working within the government to accomplish that aim. It seemed like you gave him a task, he did the task.Eliezer Yudkowsky 1:23:28And then he whined about regretting it.Dwarkesh Patel 1:23:31Yeah, but that totally works within the paradigm of having an AI that ends up regretting it but still does what we want to ask it to do.Eliezer Yudkowsky 1:23:37Don’t have that be the plan. That does not sound like a good plan. Maybe he got away with it with Oppenheimer because he was human in the world of other humans some of whom were as smart as him, but if that’s the plan with AI no.Dwarkesh Patel 1:23:53That still gets me above 0% probability worlds. Listen, the smartest guy, we just told him a thing to do. He apparently didn’t like it at all. He just did it. I don’t think I’ve had a coherent utility function.Eliezer Yudkowsky 1:24:05John von Neumann is generally considered the smartest guy. I’ve never heard somebody call Oppenheimer the smartest guy.Dwarkesh Patel 1:24:09A very smart guy. And von Neumann also did. You told him to work on the implosion problem, I forgot the name of the problem, but he was also working on the Manhattan Project. He did the thing.Eliezer Yudkowsky 1:24:18He wanted to do the thing. He had his own opinions about the thing.Dwarkesh Patel 1:24:23But he did end up working on it, right?Eliezer Yudkowsky 1:24:25Yeah, but it was his idea to a substantially greater extent than many of the other.Dwarkesh Patel 1:24:30I’m just saying, in general, in the history of science, we don’t see these very smart humans doing these sorts of weird power seeking things that then take control of the entire system to their own ends. If you have a very smart scientist who’s working on a problem, he just seems to work on it. Why wouldn’t we expect the same thing of a human level AI which we assigned to work on alignment?Eliezer Yudkowsky 1:24:48So what you’re saying is that if you go to Oppenheimer and you say, “Here’s the genie that actually does what you meant. We now gift to you rulership and dominion of Earth, the solar system, and the galaxies beyond.” Oppenheimer would have been like, “Eh, I’m not ambitious. I shall make no wishes here. Let poverty continue. Let death and disease continue. I am not ambitious. I do not want the universe to be other than it is. Even if you give me a genie”, let Oppenheimer say that and then I will call him a corrigible system.Dwarkesh Patel 1:25:25I think a better analogy is just put him in a high position in the Manhattan Project and say we will take your opinions very seriously and in fact, we even give you a lot of authority over this project. And you do have these aims of solving poverty and doing world peace or whatever. But the broader constraints we place on you are — build us an atom bomb and you could use your intelligence to pursue an entirely different aim of having the Manhattan Project secretly work on some other problem. But he just did the thing we told him.Eliezer Yudkowsky 1:25:50He did not actually have those options. You are not pointing out to me a lack of preference on Oppenheimer’s part. You are pointing out to me a lack of his options. The hinge of this argument is the capabilities constraint. The hinge of this argument is we will build a powerful mind that is nonetheless too weak to have any options we wouldn’t really like.Dwarkesh Patel 1:26:09I thought that is one of the implications of having something that is at the human level intelligence that we’re hoping to use.Eliezer Yudkowsky 1:26:16We’ve already got a bunch of human level intelligences, so how about if we just do whatever it is you plan to do with that weak AI with our existing intelligence?Dwarkesh Patel 1:26:24But listen, I’m saying you can get to the top peaks of Oppenheimer and it still doesn’t seem to break. You integrate him in a place where he could cause a lot of trouble if he wanted to and it doesn’t seem to break, he does the thing we ask him to do. Where’s the curve there?Eliezer Yudkowsky 1:26:37Yeah, he had very limited options and no option for getting a bunch more of what he wanted in a way that would break stuff.Dwarkesh Patel 1:26:44Why does the AI that we’re working with on alignment have more options? We’re not making it god emperor.Eliezer Yudkowsky 1:26:50Well, are you asking it to design another AI?Dwarkesh Patel 1:26:53We asked Oppenheimer to design an atom bomb. We checked his designs. Eliezer Yudkowsky 1:27:00There’s legit galaxy brained shenanigans you can pull when somebody asks you to design an AI that you cannot pull when they ask you to design an atom bomb. You cannot configure the atom bomb in a clever way where it destroys the whole world and gives you the moon.Dwarkesh Patel 1:27:17Here’s just one example. He says that in order to build the atom bomb, for some reason we need devices that can produce a s**t ton of wheat because wheat is an input into this. And then as a result, you expand the pareto frontier of how efficient agricultural devices are, which leads to the curing of world hunger or something.Eliezer Yudkowsky 1:27:36It’s not like he had those options.Dwarkesh Patel 1:27:40No but this is the sort of scheme that you’re imagining an AI cooking up. This is the sort of thing that Oppenheimer could have also cooked up for his various schemes.Eliezer Yudkowsky 1:27:48No. I think that if you have something that is smarter than I am, able to solve alignment, I think that it has the opportunity to do galaxy brain schemes there because you’re asking it to build a super intelligence rather than an atomic bomb. If it were just an atomic bomb, this would be less concerning. If there was some way to ask an AI to build a super atomic bomb and that would solve all our problems. And it only needs to be as smart as Eliezer to do that. Honestly, you’re still kind of in a lot of trouble because Eliezer’s get more dangerous as you lock them in a room with aliens they do not like instead of with humans, which have their flaws, but are not actually aliens in this sense.Dwarkesh Patel 1:28:45The point of analogy was not the problems themselves will lead to the same kinds of things. The point is that I doubt that Oppenheimer, if he had the options you’re talking about, would have exercised them to do something that was.Eliezer Yudkowsky 1:28:59Because his interests were aligned with humanity? Dwarkesh Patel 1:29:02Yes. And he was very smart. I just don’t feel like …Eliezer Yudkowsky 1:29:05If you have a very smart thing that’s aligned with humanity, good, you’re golden. Dwarkesh Patel 1:29:12But it is very smart. I think we’re going in circles here.Eliezer Yudkowsky 1:29:14I think I’m possibly just failing to understand the premise. Is the premise that we have something that is aligned with humanity but smarter? Then you’re done.Dwarkesh Patel 1:29:24I thought the claim you were making was that as it gets smarter and smarter, it will be less and less aligned with humanity. And I’m just saying that if we have something that is slightly above average human intelligence, which Oppenheimer was, we don’t see this becoming less and less aligned with humanity.Eliezer Yudkowsky 1:29:38No. I think that you can plausibly have a series of intelligence enhancing drugs and other external interventions that you perform on a human brain and make people smarter. And you probably are going to have some issues with trying not to drive them schizophrenic or psychotic, but that’s going to happen visibly and it will make them dumber. And there’s a whole bunch of caution to be had about not making them smarter and making them evil at the same time. And yet I think that this is the kind of thing you could do and be cautious and it could work. IF you’re starting with a human.Society’s response to AIDwarkesh Patel 1:30:17All right, let’s talk about the societal response to AI. To the extent you think it worked well, why do you think US-Soviet cooperation on nuclear weapons worked well?Eliezer Yudkowsky 1:30:50Because it was in the interest of neither party to have a full nuclear exchange. It was understood which actions would finally result in nuclear exchange. It was understood that this was bad. The bad effects were very legible, very understandable. Nagasaki and Hiroshima probably were not literally necessary in the sense that a test bomb could have been dropped instead of the demonstration but the ruined cities and the corpses were legible. The domains of international diplomacy and military conflict potentially escalating up the ladder to a full nuclear exchange were understood sufficiently well that people understood that if you did something way back in time over here, it would set things in motion that would cause a full nuclear exchange. So these two parties, neither of whom thought that a full nuclear exchange was in their interest, both understood how to not have that happen and then successfully did not do that.At the core I think what you’re describing there is a sufficiently functional society and civilization that could understand that — if they did thing X, it would lead to very bad thing Y, and so they didn’t do thing X.Dwarkesh Patel 1:32:20The situation seems similar with AI in that it is in neither party’s interest to have misaligned AI go wrong around the world.Eliezer Yudkowsky 1:32:27You’ll note that I added a whole lot of qualifications there. Besides that it’s not in the interest of either party. There’s the legibility. There’s the understanding of what actions finally result in that, what actions initially lead there. Dwarkesh Patel 1:32:40Thankfully, we have a sort of situation where even at our current levels, we have Sydney Bing making the front pages in the New York Times. And imagine once there is a sort of mishap because GPT-5 goes off the rails. Why don’t you think we’ll have a sort of Hiroshima-Nagasaki of AI before we get to GPT-7 or GPT-8 or whatever it is that finally does it?Eliezer Yudkowsky 1:33:02This does feel to me like a bit of an obvious question. Suppose I asked you to predict what I would say in reply. Dwarkesh Patel 1:33:07I think you would say that it just hides its intentions until it’s ready to do the thing that kills everybody. Eliezer Yudkowsky 1:33:14I think yes but more abstractly, the steps from the initial accident to the thing that kills everyone will not be understood in the same way. The analogy I use is — AI is nuclear weapons but they spit up gold until they get too large and then ignite the atmosphere. And you can’t calculate the exact point at which they ignite the atmosphere. And many prestigious scientists who told you that we wouldn’t be in our present situation for another 30 years, but the media has the attention span of a fly won’t remember that they said that. We will be like,— “No, no. There’s nothing to worry about. Everything’s fine.” And this is very much not the situation we have with nuclear weapons. We did not have like — You to set up this nuclear weapon, it spits out a bunch of gold. You set up a larger nuclear weapon, it spits out even more gold. And a bunch of scientists say it’ll just keep spitting out gold. Keep going.Dwarkesh Patel 1:34:09But basically the sister technology of nuclear weapons, it still requires you to refine Uranium and stuff like that, nuclear reactors, energy. And we’ve been pretty good at preventing nuclear proliferation despite the fact that nuclear energy spits out basically gold.Eliezer Yudkowsky 1:34:30It is very clearly understood which systems spit out low quantities of gold and the qualitatively different systems that don’t actually ignite the atmosphere, but instead require a series of escalating human actions in order to destroy Western and Eastern hemispheres.Dwarkesh Patel 1:34:50But it does seem like you start refining uranium. Iran did this at some point. We’re finding uranium so that we can build nuclear reactors. And the world doesn’t say like — “Oh. We’ll let you have the gold.” We say — “Listen. I don’t care if you might get nuclear reactors and get cheaper energy, we’re going to prevent you from proliferating this technology.” That was a response.Eliezer Yudkowsky 1:35:00The tiny shred of hope, which I tried to jump on with the Time article, is that maybe people can understand this on the level of — “Oh, you have a giant pile of GPUs. That’s dangerous. We’re not going to let anybody have those.” But it’s a lot more dangerous because you can’t predict exactly how many GPUs you need to ignite the atmosphere.Dwarkesh Patel 1:35:30Is there a level of global regulation at which you feel that the risk of everybody dying was less than 90%?Eliezer Yudkowsky 1:35:37It depends on the exit plan. How long does the equilibrium need to last? If we’ve got a crash program on augmenting human intelligence to the point where humans can solve alignment and managing the actual but not instantly automatically lethal risks of augmenting human intelligence. If we’ve got a crash program like that and we can think back, we only need 15 years of time and that 15 years of time may still be quite dear. 5 years should be a lot more manageable. The problem is that algorithms are continuing to improve. So you need to either shut down the journals reporting the AI results, or you need less and less and less computing power around. Even if you shut down all the journals people are going to be communicating with encrypted email lists about their bright ideas for improving AI. But if they don’t get to do their own giant training runs, the progress may slow down a bit. It still wouldn’t slow down forever. The algorithms just get better and better and the ceiling of compute has to get lower and lower and at some point you’re asking people to give up their home GPUs. At some point you’re being like — No more high speed computers. Then I start to worry that we never actually do get to the glorious transhumanist future and in this case, what was the point? Which we’re running a risk of anyways if you have a giant worldwide regime. (Unclear audio) Kind of digressing here. But my point is to get to like 90% chance of winning, which is pretty hard on any exit scheme, you want a fast exit scheme. You want to complete that exit scheme before the ceiling on compute is lowered too far. If your exit plan takes a long time, then you better shut down the academic AI journals and maybe you even have the Gestapo busting in people’s houses to accuse them of being underground AI researchers and I would really rather not live there and maybe even that doesn’t work.Dwarkesh Patel 1:38:06Let me know if this is inaccurate but I didn’t realize how much of the successful branch of decision tree relies on augmented humans being able to bring us to the finish lineEliezer Yudkowsky 1:38:19Or some other exit plan.Dwarkesh Patel 1:38:21What is the other exit plan?Eliezer Yudkowsky 1:38:25Maybe with neuroscience you can train people to be less idiots and the smartest existing people are then actually able to work on alignment due to their increased wisdom. Maybe you can slice and scan a human brain and run it as a simulation and upgrade the intelligence of the uploaded human. Maybe you can just do alignment theory without running any systems powerful enough that they might maybe kill everyone because when you’re doing this, you don’t get to just guess in the dark or if you do, you’re dead. Maybe just by doing a bunch of interpretability and theory to those systems if we actually make it a planetary priority. I don’t actually believe this. I’ve watched unaugmented humans trying to do alignment. It doesn’t really work. Even if we throw a whole bunch more at them, it’s still not going to work. The problem is not that the suggestor is not powerful enough, the problem is that the verifier is broken. But yeah, it all depends on the exit plan.Dwarkesh Patel 1:39:42You mentioned some sort of neuroscience technique to make people better and smarter, presumably not through some sort of physical modification, but just by changing their programming.Eliezer Yudkowsky 1:39:54It’s more of a Hail Mary pass.Dwarkesh Patel 1:39:57Have you been able to execute that? Presumably the people you work with or yourself, you could kind of change your own programming so that..Eliezer Yudkowsky 1:40:05The dream that the Center For Applied Rationale (CFAR) failed at. They didn’t even get as far as buying an fMRI machine but they also had no funding. So maybe try it again with a billion dollars, fMRI machines, bounties, prediction markets, and maybe that works.Dwarkesh Patel 1:40:27What level of awareness are you expecting in society once GPT-5 is out? People are waking up, I think you saw it with Sydney Bing and I guess you’ve been seeing it this week. What do you think it looks like next year?Eliezer Yudkowsky 1:40:42If GPT-5 is out next year all hell is broken loose and I don’t know.Dwarkesh Patel 1:40:50In this circumstance, can you imagine the government not putting in $100 billion or something towards the goal of aligning AI?Eliezer Yudkowsky 1:40:56I would be shocked if they did.Dwarkesh Patel 1:40:58Or at least a billion dollars.Eliezer Yudkowsky 1:41:01How do you spend a billion dollars on alignment?Dwarkesh Patel 1:41:04As far as the alignment approaches go, separate from this question of stopping AI progress, does it make you more optimistic that one of the approaches has to work, even if you think no individual approach is that promising? You’ve got multiple shots on goal.Eliezer Yudkowsky 1:41:18No. We don’t need a bunch of stuff, we need one. You could ask GPT-4 to generate 10,000 approaches to alignment and that does not get you very far because GPT-4 is not going to have very good suggestions. It’s good that we have a bunch of different people coming up with different ideas because maybe one of them works, but you don’t get a bunch of conditionally independent chances on each one. This is general good science practice and or complete Hail Mary. It’s not like one of these is bound to work. There is no rule about one of them is bound to work. You don’t just get enough diversity and one of them is bound to work. If that were true you could ask GPT-4 to generate 10,000 ideas and one of those would be bound to work. It doesn’t work like that.Dwarkesh Patel 1:42:17What current alignment approach do you think is the most promising?Elizer Yudkowsky 1:42:20No.Dwarkesh Patel 1:42:21None of them?Eliezer Yudkowsky 1:42:24Yeah.Dwarkesh Patel 1:42:24Are there any that you have or that you see, which you think are promising?Eliezer Yudkowsky 1:42:28I’m here on podcasts instead of working on them, aren’t I?Dwarkesh Patel 1:42:32Would you agree with this framing that we at least live in a more dignified world than we could have otherwise been living in? As in the companies that are pursuing this have many people in them. Sometimes the heads of those companies understand the problem. They might be acting recklessly given that knowledge, but it’s better than a situation in which warring countries are pursuing AI and then nobody has even heard of alignment. Do you see this world as having more dignity than that world?Eliezer Yudkowsky 1:43:04I agree it’s possible to imagine things being even worse. Not quite sure what the other point of the question is. It’s not literally as bad as possible. In fact, by this time next year, maybe we’ll get to see how much worse it can look.Dwarkesh Patel 1:43:23Peter Thiel has an aphorism that extreme pessimism or extreme optimism amount to the same thing, which is doing nothing.Eliezer Yudkowsky 1:43:30I’ve heard of this too. It’s from wind, right? The wise man opened his mouth and spoke — there’s actually no difference between between good things and bad things. You idiot. You moron. I’m not quoting this correctly.Dwarkesh Patel 1:43:45Did he steal it from Wind?Eliezer Yudkowsky 1:43:46No. I’m just rolling my eyes. Anyway, there’s actually no difference between extreme optimism and extreme pessimism because, go ahead.Dwarkesh Patel 1:44:01Because they both amount to doing nothing in that, in both cases, you end up on a podcast saying, we’re bound to succeed or we’re bound to fail. What is a concrete strategy by which, like, assume the real odds are like 99% we fail or something. What is the reason to blurt those odds out there and announce the death with dignity strategy or emphasize them?Eliezer Yudkowsky 1:44:25I guess because I could be wrong and because matters are now serious enough that I have nothing left to do but go out there and tell people how it looks and maybe someone thinks of something I did not think of.Predictions (or lack thereof)Dwarkesh Patel 1:44:42I think this would be a good point to just kind of get your predictions of what’s likely to happen in 2030, 2040 or 2050, something like that. By 2025, what are the odds that AI kills or disempowers all of humanity. Do you have some sense of that?Eliezer Yudkowsky 1:45:03I have refused to deploy timelines with fancy probabilities on them consistently for many years, for I feel that they are just not my brain’s native format and that they are, and that every time I try to do this, it ends up making me stupider. Dwarkesh Patel 1:45:21Why? Eliezer Yudkowsky 1:45:22Because you just do the thing. You just look at whatever opportunities are left to you, whatever plans you have left, and you go out and do them. And if you make up some fancy number for your chance of dying next year, there’s very little you can do with it, really. You’re just going to do the thing either way. I don’t know how much time I have left.Dwarkesh Patel 1:45:46The reason I’m asking is because if there is some sort of concrete prediction you’ve made, it can help establish some sort of track record in the future as well. Eliezer Yudkowsky 1:45:57Every year up until the end of the world, people are going to max out their track record by betting all of their money on the world not ending. What part of this is different for credibility than dollars? Dwarkesh Patel 1:46:08Presumably you would have different predictions before the world ends. It would be weird if the model that this world ends and the model that says the world doesn’t end have the same predictions up until the world ends.Eliezer Yudkowsky 1:46:15Yeah. Paul Christiano and I cooperatively fought it out really hard at trying to find a place where we both had predictions about the same thing that concretely differed and what we ended up with was Paul’s 8% versus my 16% for an AI getting gold on International Mathematics Olympics problem set by, I believe, 2025. And prediction markets odds on that are currently running around 30%. So probably Paul’s going to win, but slight moral victory.Dwarkesh Patel 1:46:52I guess people like Paul have had the perspective that you’re going to see these sorts of gradual improvements in the capabilities of these models from like GPT-2 to GPT-3.Eliezer Yudkowsky 1:47:01What exactly is gradual?Dwarkesh Patel 1:47:05The loss function, the perplexity, the amount of abilities that are merging.Eliezer Yudkowsky 1:47:09As I said in my debate with Paul on this subject, I am always happy to say that whatever large jumps we see in the real world, somebody will draw a smooth line of something that was changing smoothly as the large jumps were going on from the perspective of the actual people watching. You can always do that.Dwarkesh Patel 1:47:25Why should that not update us towards a perspective that those smooth jumps are going to continue happening? If two people have different models.Eliezer Yudkowsky 1:47:30I don’t think that GPT-3 to 3.5 to 4 was all that smooth. I’m sure if you are in there looking at the losses decline, there is some level on which it’s smooth if you zoom in close enough. But from the perspective of us on the outside world, GPT-4 was just suddenly acquiring this new batch of qualitative capabilities compared to GPT 3.5. Somewhere in there is a smoothly declining predictable loss on text prediction but that loss on text prediction corresponds to qualitative jumps in ability. And I am not familiar with anybody who predicted those in advance of the observation.Dwarkesh Patel 1:48:15So in your view, when doom strikes, the scaling laws are still applying. It’s just that the thing that emerges at the end is something that is far smarter than the scaling laws would imply.Eliezer Yudkowsky 1:48:27Not literally at the point where everybody falls over dead. Probably at that point the AI rewrote the AI and the losses declined. Not on the previous graph.Dwarkesh Patel 1:48:36What is the thing where we can sort of establish your track record before everybody falls over dead?Eliezer Yudkowsky 1:48:41It’s hard. It is just easier to predict the endpoint than it is to predict the path. Some people will claim that I’ve done poorly compared to others who tried to predict things. I would dispute this. I think that the Hanson-Yudkowsky foom debate was won by Gwern Branwen, but I do think that Gwern Branwen is well to the Yudkowsky side of Yudkowsky in the original foom debate. Roughly, Hansen was like — you’re going to have all these distinct handcrafted systems that incorporate lots of human knowledge specialized for particular domains. Handcrafted to incorporate human knowledge, not just run on giant data sets. I was like — you’re going to have a carefully crafted architecture with a bunch of subsystems and that thing is going to look at the data and not be handcrafted to the particular features of the data. It’s going to learn the data. Then the actual thing is like — Ha ha. You don’t have this handcrafted system that learns, you just stack more layers. So like, Hanson here, Yudkowsky here, reality there. This would be my interpretation of what happened in the past. And if you want to be like — Well, who did better than that? It’s people like Shane Legg and Gwern Branwen. If you look at the whole planet, you can find somebody who made better predictions than Eliezer Yudkowsky, that’s for sure. Are these people currently telling you that you’re safe? No, they are not.Dwarkesh Patel 1:50:18The broader question I have is there’s been huge amounts of updates in the last 10-20 years. We’ve had the deep learning revolution. We’ve had the success of LLMs. It seems odd that none of this information has changed the basic picture that was clear to you like 15-20 years ago.Eliezer Yudkowsky 1:50:36I mean, it sure has. Like 15-20 years ago, I was talking about pulling off s**t like coherent extrapolated volition with the first AI, which was actually a stupid idea even at the time. But you can see how much more hopeful everything looked back then. Back when there was AI that wasn’t giant inscrutable matrices of floating point numbers.Dwarkesh Patel 1:50:55When you say that, rounding to the nearest number, there’s basically a 0% chance of humanity survives — does that include the probability of there being errors in your model?Eliezer Yudkowsky 1:51:07My model no doubt has many errors. The trick would be an error someplace where that just makes everything work better. Usually when you’re trying to build a rocket and your model of rockets is lousy, it doesn’t cause the rocket to launch using half the fuel, go twice as far, and land twice as precisely on target as your calculations claimed.Dwarkesh Patel 1:51:31Though most of the room for updates is downwards, right? Something that makes you think the problem is twice as hard, you go from like 99% to like 99.5%. If it’s twice as easy. You go from 99 to 98?Eliezer Yudkowsky 1:51:42Sure. Wait, sorry. Yeah, but most updates are not — this is going to be easier than you thought. That sure has not been the history of the last 20 years from my perspective. The most favorable updates are — Yeah, we went down this really weird side path where the systems are legibly alarming to humans and humans are actually alarmed by then and maybe we get more sensible global policy.Dwarkesh Patel 1:52:14What is your model of the people who have engaged these arguments that you’ve made and you’ve dialogued with, but who have come nowhere close to your probability of doom? What do you think they continue to miss?Eliezer Yudkowsky 1:52:26I think they’re enacting the ritual of the young optimistic scientist who charges forth with no ideas of the difficulties and is slapped down by harsh reality and then becomes a grizzled cynic who knows all the reasons why everything is so much harder than you knew before you had any idea of how anything really worked. And they’re just living out that life cycle and I’m trying to jump ahead to the endpoint.Dwarkesh Patel 1:52:51Is there somebody who has a probability(doom) less than 50% who you think is like the clearest person with that view, who is like a view you can most empathize with?Eliezer Yudkowsky 1:53:02No.Dwarkesh Patel 1:53:03Really? Someone might say — Listen Eliezer, according to the CEO of the company who is leading the AI race,  he tweeted something that you’ve done the most to accelerate AI or something which was presumably the opposite of your goals. And it seems like other people did see that these sort of language models would scale in the way that they have scaled. Given that you didn’t see that coming and given that in some sense, according to some people, your actions have had the opposite impact that you intended. What is the track record by which the rest of the world can come to the conclusions that you have come to?Eliezer Yudkowsky 1:53:44These are two different questions. One is the question of who predicted that language models would scale? If they put it down in writing and if they said not just this loss function will go down, but also which capabilities will appear as that happens, then that would be quite interesting. That would be a successful scientific prediction. If they then came forth and said — this is the model that I used, this is what I predict about alignment. We could have an interesting fight about that. Second, there’s the point that if you try to rouse your planet to give it any sense that it is in peril. There are the idiot disaster monkeys who are like — “Ooh. Ooh. If this is dangerous, it must be powerful. Right? I’m going to be the first to grab the poison banana.” And what is one supposed to do? Should one remain silent? Should one let everyone walk directly into the whirling razor blades? If you sent me back in time, I’m not sure I could win this, but maybe I would have some notion of like if you calculate the message in exactly this way, then this group will not take away this message and you will be able to get this group of people to research on it without having this other group of people decide that it’s excitingly dangerous, and they want to rush forward on it. I’m not that smart. I’m not that wise. But what you are pointing to there is not a failure of ability to make predictions about AI. It’s that if you try to call attention to a danger and not just have everybody just have your whole planet walk directly into the whirling razor blades carefree, no idea what’s coming to them, maybe yeah that speeds up timelines. Maybe then people are like — “Ooh. Ooh. Exciting. Exciting. I want to build it. I want to build it. OOH, exciting. It has to be in my hands. I have to be the one to manage this danger. I’m going to run out and build it.” Like —Oh no. If we don’t invest in this company, who knows what investors they’ll have instead that will demand that they move fast because of the profit motive. Then of course, they just move fast f*****g anyways. And yeah, if you sent me back in time, maybe I’d have a third option. But it seems to me that in terms of what one person can realistically manage, in terms of not being able to exactly craft a message with perfect hindsight that will reach some people and not others, at that point, you might as well just be like — Yeah, just invest in exactly the right stocks and invest in exactly the right time and you can fund projects on your own without alerting anyone. If you keep fantasies like that aside, then I think that in the end, even if this world ends up having less time, it was the right thing to do rather than just letting everybody sleepwalk into death and get there a little later.Being EliezerDwarkesh Patel 1:56:55If you don’t mind me asking, what has being in the space in the last five years been like for you? Or I guess even beyond that. Watching the progress and the way in which people have raced ahead?Eliezer Yudkowsky 1:57:08I made most of my negative updates as of five years ago. If anything, things have been taking longer to play out than I thought they would.Dwarkesh Patel 1:57:16But just like watching it, not as a sort of change in your probabilities, but just watching it concretely happen, what has that been like?Eliezer Yudkowsky 1:57:26Like continuing to play out a video game you know you’re going to lose. Because that’s all you have. If you wanted some deep wisdom from me, I don’t have it. I don’t know if it’s what you’d expect, but it’s what I would expect it to be like. Where what I would expect it to be like takes into account that. I guess I do have a little bit of wisdom. People imagining themselves in that situation raised in modern society, as opposed to being raised on science fiction books written 70 years ago, will imagine themselves being drama queens about it. The point of believing this thing is to be a drama queen about it and craft some story in which your emotions mean something. And what I have in the way of culture is like, your planet’s at stake. Bear up. Keep going. No drama. The drama is meaningless. What changes the chance of victory is meaningful. The drama is meaningless. Don’t indulge in it.Dwarkesh Patel 1:58:57Do you think that if you weren’t around, somebody else would have independently discovered this sort of field of alignment?Eliezer Yudkowsky 1:59:04That would be a pleasant fantasy for people who cannot abide the notion that history depends on small little changes or that people can really be different from other people. I’ve seen no evidence, but who knows what the alternate Everett branches of Earth are like?Dwarkesh Patel 1:59:27But there are other kids who grew up on science fiction, so that can’t be the only part of the answer.Eliezer Yudkowsky 1:59:31Well I sure am not surrounded by a cloud of people who are nearly Eliezer outputting 90% of the work output. And also this is not actually how things play out in a lot of places. Steve Jobs is dead, Apple apparently couldn’t find anyone else to be the next Steve Jobs of Apple, despite having really quite a lot of money with which to theoretically pay them. Maybe he didn’t really want a successor. Maybe he wanted to be irreplaceable. I don’t actually buy that based on how this has played out in a number of places. There was a person once who I met when I was younger who had built something, had built an organization, and he was like — “Hey, Eliezer. Do you want this to take this thing over?” And I thought he was joking. And it didn’t dawn on me until years and years later, after trying hard and failing hard to replace myself, that — “Oh, yeah. I could have maybe taken a shot at doing this person’s job, and he’d probably just never found anyone else who could take over his organization and maybe asked some other people and nobody was willing.” And that’s his tragedy, that he built something and now can’t find anyone else to take it over. And if I’d known that at the time, I would have at least apologized to him. To me it looks like people are not dense in the incredibly multidimensional space of people. There are too many dimensions and only 8 billion people on the planet. The world is full of people who have no immediate neighbors and problems that only one person can solve and other people cannot solve in quite the same way. I don’t think I’m unusual in looking around myself in that highly multidimensional space and not finding a ton of neighbors ready to take over. And if I had four people, any one of whom could do 99% of what I do, I might retire. I am tired. I probably wouldn’t. Probably the marginal contribution of that fifth person is still pretty large. I don’t know. There’s the question of — Did you occupy a place in mind space? Did you occupy a place in social space? Did people not try to become Eliezer because they thought Eliezer already existed? My answer to that is — “Man, I don’t think Eliezer already existing would have stopped me from trying to become Eliezer.” But maybe you just look at the next Everett Branch over and there’s just some kind of empty space that someone steps up to fill, even though then they don’t end up with a lot of obvious neighbors. Maybe the world where I died in childbirth is pretty much like this one. If somehow we live to hear about that sort of thing from someone or something that can calculate it, that’s not the way I bet but if it’s true, it’d be funny. When I said no drama, that did include the concept of trying to make the story of your planet be the story of you. If it all would have played out the same way and somehow I survived to be told that. I’ll laugh and I’ll cry, and that will be the reality.Dwarkesh Patel 2:03:46What I find interesting though, is that in your particular case, your output was so public. For example, your sequences, your science fiction and fan fiction. I’m sure hundreds of thousands of 18 year olds read it, or even younger, and presumably some of them reached out to you. I think this way I would love to learn more. Eliezer Yudkowsky 2:04:13Part of why I’m a little bit skeptical of the story where people are just infinitely replaceable is that I tried really, really hard to create a new crop of people who could do all the stuff I could do to take over because I knew my health was not great and getting worse. I tried really, really hard to replace myself. I’m not sure where you look to find somebody else who tried that hard to replace himself. I tried. I really, really tried. That’s what the Less wrong sequences were. They had other purposes. But first and foremost, it was me looking over my history and going — Well, I see all these blind pathways and stuff that it took me a while to figure out. I feel like I had these near misses on becoming myself. If I got here, there’s got to be ten other people, and some of them are smarter than I am, and they just need these little boosts and shifts and hints, and they can go down the pathway and turn into Super Eliezer. And that’s what the sequences were like. Other people use them for other stuff but primarily they were an instruction manual to the young Eliezers that I thought must exist out there. And they are not really here.Dwarkesh Patel 2:05:27Other than the sequences, do you mind if I ask what were the kinds of things you’re talking about here in terms of training the next core of people like you?Eliezer Yudkowsky 2:05:36Just the sequences. I am not a good mentor. I did try mentoring somebody for a year once, but yeah, he didn’t turn into me. So I picked things that were more scalable. The other reason why you don’t see a lot of people trying that hard to replace themselves is that most people, whatever their other talents, don’t happen to be sufficiently good writers. I don’t think the sequences were good writing by my current standards but they were good enough. And most people do not happen to get a handful of cards that contain the writing card, whatever else their other talents.Dwarkesh Patel 2:06:14I’ll cut this question out if you don’t want to talk about it, but you mentioned that there’s certain health problems that incline you towards retirement now. Is that something you are willing to talk about?Eliezer Yudkowsky 2:06:27They cause me to want to retire. I doubt they will cause me to actually retire. Fatigue syndrome. Our society does not have good words for these things. The words that exist are tainted by their use as labels to categorize a class of people, some of whom perhaps are actually malingering. But mostly it says like we don’t know what it means. And you don't ever want to have chronic fatigue syndrome on your medical record because that just tells doctors to give up on you. And what does it actually mean besides being tired? If one lives half a mile from one’s work, then one had better walk home if one wants to go for a walk sometime in the day. (unclear) If you walk half a mile to work you’re not going to be getting very much work done the rest of that work day. And aside from that, these things don’t have names. Not yet.Dwarkesh Patel 2:07:38Whatever the cause of this, is your working hypothesis that it has something to do or is in some way correlated with the thing that makes you Eliezer or do you think it’s like a separate thing?Eliezer Yudkowsky 2:07:51When I was 18, I made up stories like that and it wouldn’t surprise me terribly if one survived to hear the tale from something that knew it, that the actual story would be a complex, tangled web of causality in which that was in some sense true. But I don’t know. And storytelling about it does not hold the appeal that it once did for me. Is it a coincidence that I was not able to go to high school or college? Is there something about it that would have crushed the person that I otherwise would have been? Or is it just in some sense a giant coincidence? I don’t know. Some people go through high school and college and come out sane. There’s too much stuff in a human being’s history and there’s a plausible story you could tell. Like, maybe there’s a bunch of potential Eliezers out there, but they went to high school and college and it killed their souls. And you were the one who had the weird health problem and you didn’t go to high school and you didn’t go to college and you stayed yourself. And I don’t know. To me it just feels like patterns in the clouds and maybe that cloud actually is shaped like a horse. What good does the knowledge do? What good does the story do?Dwarkesh Patel 2:09:26When you were writing the sequences and the fiction from the beginning, was the main goal to find somebody who could replace you and specifically the task of AI alignment, or did it start off with a different goal?Eliezer Yudkowsky 2:09:43In 2008, I did not know this stuff was going to go down in 2023. For all I knew, there was a lot more time in which to do something like build up civilization to another level, layer by layer. Sometimes civilizations do advance as they improve their epistemology. So there was that, there was the AI project. Those were the two projects, more or less.Dwarkesh Patel 2:10:16When did AI become the main thing?Eliezer Yudkowsky 2:10:18As we ran out of time to improve civilization.Dwarkesh Patel 2:10:20Was there a particular year that became the case for you?Eliezer Yudkowsky 2:10:23I mean, I think that 2015, 16, 17 were the years at which I’d noticed I’d been repeatedly surprised by stuff moving faster than anticipated. And I was like — “Oh, okay, like, if things continue accelerating at that pace, we might be in trouble.” And then in 2019, 2020, stuff slowed down a bit and there was more time than I was afraid we had back then. That’s what it looks like to be a Bayesian. Your estimates go up, your estimates go down. They don’t just keep moving in the same direction, because if they keep moving in the same direction several times, you’re like — “Oh, I see where this thing is trending. I’m going to move here.” And then things don’t keep moving that direction. Then you go like — “Oh, okay, like back down again.” That’s what sanity looks like.Dwarkesh Patel 2:11:08I am curious actually, taking many worlds seriously, does that bring you any comfort in the sense that there is one branch of the wave function where humanity survives? Or do you not buy that?Eliezer Yudkowsky 2:11:21I’m worried that they’re pretty distant. I’m not sure it’s enough to not have Hitler, but it sure would be a start on things going differently in a timeline. But mostly, I don’t know. I’d say there’s some comfort from thinking of the wider spaces than that. As Tegmark pointed out way back when, if you have a spatially infinite universe that gets you just as many worlds as the quantum multiverse, if you go far enough in a space that is unbounded, you will eventually come to an exact copy of Earth or a copy of Earth from its past that then has a chance to diverge a little differently. So the quantum multiverse adds nothing. Reality is just quite large. Is that a comfort? Yeah. Yes, it is. That possibly our nearest surviving relatives are quite distant, or you have to go quite some ways through the space before you have worlds that survive by anything but the wildest flukes. Maybe our nearest surviving neighbors are closer than that. But look far enough and there should be some species of nice aliens that were smarter or better at coordination and built their happily ever after. And yeah, that is a comfort. It’s not quite as good as dying yourself, knowing that the rest of the world will be okay, but it’s kind of like that on a larger scale. And weren’t you going to ask something about orthogonality at some point?Dwarkesh Patel 2:13:00Did I not?Eliezer Yudkowsky 2:13:02Did you?Dwarkesh Patel 2:13:02At the beginning when we talked about human evolution?OrthogonalityEliezer Yudkowsky 2:13:06Yeah, that’s not orthogonality. That’s the particular question of what are the laws relating optimization of a system via hill climbing to the internal psychological motivations that it acquires? But maybe that was all you meant to ask about.Dwarkesh Patel 2:13:23Can you explain in what sense you see the broader orthogonality thesis as?Eliezer Yudkowsky 2:13:30The broader orthogonality thesis is — you can have almost any kind of self consistent utility function in a self consistent mind. Many people are like, why would AIs want to kill us? Why would smart things not just automatically be nice? And this is a valid question, which I hope to at some point run into some interviewer where they are of the opinion that smart things are automatically nice. So that I can explain on camera why, although I myself held this position very long ago, I realized that I was terribly wrong about it and that all kinds of different things hold together and that if you take a human and make them smarter, that may shift their morality. It might even, depending on how they start out, make them nicer. But that doesn’t mean that you can do this with arbitrary minds and arbitrary mind space because all the different motivations hold together. That’s orthogonality. But if you already believe that, then there might not be much to discuss.Dwarkesh Patel 2:14:30No, I guess I wasn’t clear enough about it. Yes, all the different sorts of utility functions are possible. It’s that from the evidence of evolution and from the sort of reasoning about how these systems are being trained, I think that wildly divergent ones don’t seem as likely as you do. But instead of having you respond to that directly, let me ask you some questions I did have about it, which I didn’t get to. One is actually from Scott Aaronson. I don’t know if you saw his recent blog post, but here’s a quote from it: “If you really accept the practical version of the Orthogonality Thesis, then it seems to me that you can’t regard education, knowledge, and enlightenment as instruments for moral betterment. On the whole, though, education hasn’t merely improved humans’ abilities to achieve their goals; it’s also improved their goals.” I’ll let you react to that.Eliezer Yudkowsky 2:15:23Yeah. If you start with humans, if you take humans who were raised the way Scott Aronson was, and you make them smarter, they get nicer, it affects their goals. And there’s a Less Wrong post about this, as there always is, several really, but sorting pebbles into correct heaps, describing a species of aliens who think that a heap of size seven is correct and a heap of size eleven is correct, but not eight or nine or ten, those heaps are incorrect. And they used to think that a heap size of 21 might be correct, but then somebody showed them an array of seven by three pebbles, seven columns, three rows, and then people realized that 21 pebbles was not a correct heap. And this is like a thing they intrinsically care about. These are aliens that have a utility function, as I would phrase it, with some logical uncertainty inside it. But you can see how as they get smarter, they become better and better able to understand which heaps of pebbles are correct. And the real story here is more complicated than this. But that’s the seed of the answer. Scott Aaronson is inside a reference frame for how his utility function shifts as he gets smarter. It’s more complicated than that. Human beings are made out of these are more complicated than the pebble sorters. They’re made out of all these complicated desires. And as they come to know those desires, they change. As they come to see themselves as having different options. It doesn’t just change which option they choose after the manner of something with a utility function, but the different options that they have bring different pieces of themselves in conflict. When you have to kill to stay alive you may come to a different equilibrium with your own feelings about killing than when you are wealthy enough that you no longer have to do that. And this is how humans change as they become smarter, even as they become wealthier, as they have more options, as they know themselves better, as they think for longer about things and consider more arguments, as they understand perhaps other people and give their empathy a chance to grab onto something solider because of their greater understanding of other minds. But that’s all when these things start out inside you. And the problem is that there’s other ways for minds to hold together coherently, where they execute other updates as they know more or don’t even execute updates at all because their utility function is simpler than that. Though I do suspect that is not the most likely outcome of training a large language model. So large language models will change their preferences as they get smarter. Indeed. Not just like what they do to get the same terminal outcomes, but the preferences themselves will up to a point change as they get smarter. It doesn’t keep going. At some point you know yourself especially well and you are able to rewrite yourself and at some point there, unless you specifically choose not to, I think that the system crystallizes. We might choose not to. We might value the part where we just sort of change in that way even if it’s not no longer heading in a knowable direction. Because if it’s heading in a knowable direction, you could jump to that as an endpoint.Dwarkesh Patel 2:19:18Is that why you think AIs will jump to that endpoint? Because they can anticipate where their sort of moral updates are going?Eliezer Yudkowsky 2:19:26I would reserve the term moral updates for humans. Let’s call them logical preference updates, preference shifts.Dwarkesh Patel 2:19:37What are the prerequisites in terms of whatever makes Aaronson and other sort of smart moral people that we humans could sympathize with? You mentioned empathy, but what are the sort of prerequisites?Eliezer Yudkowsky 2:19:51They’re complicated. There’s not a short list. If there was a short list of crisply defined things where you could give it like — *choose* *choose* *choose* and now it’s in your moral frame of reference, then that would be the alignment plan. I don’t think it’s that simple. Or if it is that simple, it’s like in the textbook from the future that we don’t have.Dwarkesh Patel 2:20:07Okay, let me ask you this. Are you still expecting a sort of chimps to humans gain in generality even with these LLMs? Or does the future increase look like an order that we see from like GPT-3 to GPT-4?Eliezer Yudkowsky 2:20:21I am not sure I understand the question. Can you rephrase?Dwarkesh Patel 2:20:24Yes. From reading your writing from earlier, it seemed like a big part of your argument was like, look — I don’t know how many total mutations it was to get from chimps to humans, but it wasn’t that many mutations. And we went from something that could basically get bananas in the forest to something that could walk on the moon. Are you still expecting that sort of gain eventually between, I don’t know, like GPT-5 and GPT-6, or like some GPT-N and GPT-N+1? Or does it look smoother to you now?Eliezer Yudkowsky 2:20:55First of all, let me preface by saying that for all I know of the hidden variables of nature, it’s completely allowed that GPT-4 was actually just it. Ha ha ha. This is where it saturates. It goes no further. It’s not how I’d bet. But if nature comes back and tells me that, I’m not allowed to be like — “You just violated the rule that I knew about.” I know of no such rule prohibiting such a thing.Dwarkesh Patel 2:21:20I’m not asking whether these things will plateau at a given intelligence-level, where there’s a cap, that’s not the question. Even if there is no cap, do you expect these systems to continue scaling in the way that they have been scaling, or do you expect some really big jump between some GPT-N and some GPT-N+1?Eliezer Yudkowsky 2:21:37Yes. And that’s only if things don’t plateau before then. I can’t quite say that I know what you know. I do feel like we have this track of the loss going down as you add more parameters and you train on more tokens and a bunch of qualitative abilities that suddenly appear. I’m sure if you zoom in closely enough, they appear more gradually, but they appear as the successful releases of the system, which I don’t think anybody has been going around predicting in advance that I know about. And loss continue to go down unless it suddenly plateaus. New abilities appear, I don’t know which ones. Is there at some point a giant leap? If at some point it becomes able to toss out the enormous training run paradigm and jump to a new paradigm of AI. That would be one kind of giant leap. You could get another kind of giant leap via architectural shift, something like transformers, only there’s like an enormously huger hardware overhang now. Like something that is to transformers as transformers were to recurrent neural networks. And then maybe the loss function suddenly goes down and you get a whole bunch of new abilities. That’s not because the loss went down on the smooth curve and you got a bunch more abilities in a dense spot. Maybe there’s some particular set of abilities that is like a master ability, the way that language and writing and culture for humans might have been a master ability. And the loss function goes down smoothly and you get this one new internal capability and there’s a huge jump in output. Maybe that happens. Maybe stuff plateaus before then and it doesn’t happen. Being the expert who gets to go on podcasts, they don’t actually give you a little book with all the answers in it you know. You’re just guessing based on the same information that other people have. And maybe, if you’re lucky, slightly better theory.Dwarkesh Patel 2:23:39Yeah, that’s why I’m wondering. Because you do have a different theory of what fundamentally intelligence is and what it entails. So I’m curious if you have some expectations of where the GPTs are going.Eliezer Yudkowsky 2:23:49I feel like a whole bunch of my successful predictions in this have come from other people being like — “Oh, yes. I have this theory which predicts that stuff is 30 years off.” And I’m like — “You don’t know that.” And then stuff happens not 30 years off. And I’m like — “Ha ha. Successful prediction.” And that’s basically what I told you, right? I was like — well, you could have the loss function continuing on a smooth line and new abilities appear, and you could have them suddenly appear in a cluster. Because why not? Because nature just tells you that’s up. And suddenly you can have this one key ability, that’s equivalent to language for humans, and there’s a sudden jump in output capabilities. You could have a new innovation, like the transformer, and maybe the losses actually drop precipitously and a whole bunch of new abilities appear at once. This is all just me. This is me saying — I don’t know. But so many people around are saying things that implicitly claim to know more than that, that it can actually start to sound like a startling prediction. This is one of my big secret tricks, actually. People are like — The AI could be good or evil. So it’s like 50-50, right? And I’m actually like — No, we can be ignorant about a wider space than this in which good is actually like a fairly narrow range. So many of the predictions like that are really anti-predictions. It’s somebody thinking along a relatively narrow line and you point out everything outside of that and it sounds like a startling prediction. Of course, the trouble being, when you look back afterwards, people are like — “Well, those people saying the narrow thing were just silly. Ha ha.” and they don’t give you as much credit.Dwarkesh Patel 2:25:24I think the credit you would get for that, rightly, is as a good Agnostic forecaster, as somebody who is calm and measured. But it seems like to be able to make really strong claims about the future, about something that is so out of prior distributions as like the death of humanity, you don’t only have to show yourself as a good Agnostic forecaster, you have to show that your ability to forecast because of a particular theory is much greater. Do you see what I mean?Eliezer Yudkowsky 2:25:58It’s all about the ignorance prior. It’s all about knowing the space in which to be maximum entropy. What will the future be? I don’t know. It could be paperclips, it could be staples. It could be no kind of office supplies at all and tiny little spirals. It could be little tiny things that are like outputting 111, because that’s like the most predictable kind of text to predict. Or representations of ever larger numbers in the fast growing hierarchy because that’s how they interpret the reward counter. I’m actually getting into specifics here, which is the opposite of the point I originally meant to make, which is if somebody claims to be very unsure, I might say — “Okay, so then you expect most possible molecular configurations of the solar system to be equally probable.” Well, humans mostly aren’t in those. So being very unsure about the future looks like predicting with probability nearly one that the humans are all gone, which it’s not actually that bad, but it illustrates the point of people going like — “But how are you sure?” Kind of missing the real discourse and skill, which is like — “Oh, yes, we’re all very unsure. Lots of entropy in our probability distributions. But what is the space under which you are unsure?”Dwarkesh Patel 2:27:25Even at that point it seems like the most reasonable prior is not that all sort of atomic configurations of the solar system are equally likely. Because I agree by that metric…Eliezer Yudkowsky 2:27:34Yeah, it’s like all computations that can be run over configurations of solar-system are equally likely to be maximized.Dwarkesh Patel 2:27:49We know what the loss function looks like, we know what the training data looks like. That obviously is no guarantee of what the drives that come out of that loss function will look like.Eliezer Yudkowsky 2:28:00Humans came out pretty different from their loss functions.Dwarkesh Patel 2:28:05I would actually say no. If it is as similar as humans are now to our loss function from which we evolved, that would be like that. Honestly, it might not be that terrible world, and it might, in fact, be a very good world.Eliezer Yudkowsky 2:28:18Whoa. Where do you get a good world out of maximum prediction of text?Dwarkesh Patel 2:28:27Plus RLHF, plus whatever alignment stuff that might work, results in something that kind of just does it reliably enough that we ask it like — Hey, help us with alignment, then go .. Eliezer Yudkowsky 2:28:42Stop asking for help with alignment. Ask it for any of the help.Dwarkesh Patel 2:28:48Help us enhance our brains. Help us blah, blah, blah.Eliezer Yudkowsky 2:28:50Thank you. Why are people asking for the most difficult thing that’s the most impossible to verify? It’s whack.Dwarkesh Patel 2:28:56And then basically, at that point, we’re like turning into gods, and we can..Eliezer Yudkowsky 2:29:01If you get to the point where you’re turning into gods yourselves, you’re not quite home free, but you’re sure past a lot of the death.Dwarkesh Patel 2:29:08Yeah. Maybe you can explain the intuition that all sorts of drives are equally likely given unknown loss function and a known set of data. Eliezer Yudkowsky 2:29:22If you had the textbook from the future, or if you were an alien who had watched 10,000 planets destroy themselves the way Earth has while being only human in your sample complexity and generalization ability, then you could be like — “Oh, yes, they’re going to try this trick with loss functions, and they will get a draw from this space of results.” And the alien may now have a pretty good prediction of range of where that ends up. Similarly, now that we’ve actually seen how humans turn out when you optimize them for reproduction, it would not be surprising if we found some aliens the next door over and they had orgasms. Maybe they don’t have orgasms, but if they had some kind of strong surge of pleasure during the active mating, we’re not surprised. We’ve seen how that plays out in humans. If they have some kind of weird food that isn’t that nutritious but makes them much happier than any kind of food that was more nutritious and ran in their ancestral environment. Like ice cream. We probably can’t call it ice cream, right? It’s not going to be like sugar, salt, fat, frozen. They’re not specifically going to have ice cream, right? They might play Go. They’re not going to play chess.Dwarkesh Patel 2:30:49Because chess has more specific pieces, right?Eliezer Yudkowsky 2:30:52Yeah. They’re not going to play Go on 19 by 19. They might play Go on some other size. Probably odd. Well, can we really say that? I don’t know. If they play Go, I’d bet on an odd board dimension at two thirds (unclear) sounds about right. Unless there’s some other reason why Go just totally does not work on an even board dimension that I don’t know, because I’m insufficiently acquainted with the game. The point is, reasoning off of humans is pretty hard. We have the loss function over here. We have humans over here. We can look at the rough distance. All the weird specific stuff that humans accreted around and be like, if the loss function is over here and humans are over there, maybe the aliens are like, over there. And if we had three aliens that would expand our views of the possible or even two aliens would vastly expand our views of the possible and give us a much stronger notion of what the third aliens look like. Humans, aliens, third race. But the wild-eyed, optimistic scientists have never been through never been through this with AI. So they’re like, — “Oh, you optimized AI to say nice things and it helps you and make it a bunch smarter. Probably says nice things and helps you is probably, like, totally aligned. Yeah.” They don’t know any better. Not trying to jump ahead of the story. But the aliens know where you end up around the loss function. They know how it’s going to play out much more narrowly. We’re guessing much more blindly here.Dwarkesh Patel 2:32:45It just leaves me in a sort of unsatisfied place that we apparently know about something that is so extreme that maybe a handful of people in the entire world believe it from first principles about the doom of humanity because of AI. But this theory that is so productive in that one very unique prediction is unable to give us any sort of other prediction about what this world might look like in the future or about what happens before we all die. It can tell us nothing about the world until the point at which makes a prediction that is the most remarkable in the world.Eliezer Yudkowsky 2:33:30Rationalists should win, but rationalists should not win the lottery. I’d ask you what other theories are supposed to have been doing an amazingly better job of predicting the last three years? Maybe it’s just hard to predict, right? And in fact it's easier to predict the end state than the strange complicated winding paths that lead there. Much like if you play against AlphaGo and predict it’s going to be in the class of winning board states, but not exactly how it’s going to beat you. The difficulty of predicting the future is not quite like that. But from my perspective, the future is just really hard to predict. And there’s a few places where you can wrench what sounds like an answer out of your ignorance, even though really you’re just being like — well, you’re going to end up in some random weird place around this loss function and I haven’t seen it happen with 10,000 species so I don’t know where. Very impoverished from the standpoint of anybody who actually knew anything could actually predict anything. But the rest of the world is like — Oh, we’re equally likely to win the lottery and lose the lottery, right? Like either we win or we don’t. You come along and you’ll be like — “No, no, your chance of winning the lottery is tiny.” They’re like — “What? How can you be so sure? Where do you get your strange certainty?” And the actual root of the answer is that you are putting your maximum entropy over a different probability space. That just actually is the thing that’s going on there. You’re saying all lottery numbers are equally likely instead of winning and losing are equally likely.Could alignment be easier than we think?Dwarkesh Patel 2:35:00So I think the place to close this conversation is let me just give the main reasons why I’m not convinced that doom is likely or even that it’s more than 50% probable or anything like that. Some are things that I started this conversation with that I don’t feel like I heard any knock down arguments against. And some are new things from the conversation. And the following things are things that, even if any one of them individually turns out to be true, I think doom doesn’t make sense or is much less likely. So going through the list, I think probably more likely than not, this entire frame all around alignment and AI is wrong. And this is maybe not something that would be easy to talk about, but I’m just kind of skeptical of sort of first principles reasoning that has really wild conclusions.Eliezer Yudkowsky 2:36:08Okay, so everything in the solar system just ends up in a random configuration then?Dwarkesh Patel 2:36:11Or it stays like it is unless you have very good reasons to think otherwise. And especially if you think it’s going to be very different from the way it’s going, you must have ironclad reasons for thinking that it’s going to be very, very different from the way it is.Eliezer Yudkowsky 2:36:31Humanity hasn’t really existed for very long. Man, I don’t even know what to say to this thing. We’re like this tiny like, everything that you think of as normal is this tiny flash of things being in this particular structure out of a 13.8 billion year old universe, very little of which is 21st century civilized world on this little fraction of the surface of one planet in a vast solar system, most of which is not Earth, in a vast universe, most of which is not Earth. And it has lasted for such a tiny period of time through such a tiny amount of space and has changed so much over just the last 20,000 years or so. And here you are being like — why would things really be any different going forward?Dwarkesh Patel 2:37:28I feel like that argument proves too much because you could use that same argument. A theologian comes up to me and says — “The rapture is coming and let me explain why the rapture is coming.” I’m not claiming that your arguments are as bad as the arguments for rapture. I’m just following the example. But then they say — “Look at how wild human civilization has been. Would it be any wilder if there was a rapture?” And I’m like — “Yeah, actually, as wild as human civilization has been, the rapture would be much wilder.”Eliezer Yudkowsky 2:37:55It violates the laws of physics.Dwarkesh Patel 2:37:57Yes.Eliezer Yudkowsky 2:37:58I’m not trying to violate the laws of physics, even as you probably know them.Dwarkesh Patel 2:38:02How about this? Somebody comes up to me and he says — “We actually have nanosystems right behind you.” He says — “I’ve read Eric Drexler’s. nanosSystems. I’ve read Feynman’s (unclear) there’s plenty of room at the bottom.Eliezer Yudkowsky 2:38:16These two things are not to (unclear) but go on.Dwarkesh Patel 2:38:18Okay, fair enough. He comes to me and he says — “Let me explain to you my first principles argument about how some nanosystems will be replicators and the replicators, because of some competition yada yada yada argument, they turn the entire world into goo just making copies of themselves.”Eliezer Yudkowsky 2:38:37This kind of happened with humans. Well, life generally.Dwarkesh Patel 2:38:42So then they say, "Listen, as soon as we start building nanosystems, pretty soon, 99% probability the entire world turns into goo. Just because the replicators are the things that turn things into goo, there will be more replicators and non-replicators.” I don’t have an object level debate about that, but it’s just like I just started that whole thing to say — yes, human civilization has been wild, but the entire world turning into goo because of nanosytems alone just seems much wilder than human civilization.Eliezer Yudkowsky 2:39:09This argument probably lands with greater force on somebody who does not expect stuff to be disassembled by nanosystems, albeit intelligently controlled ones, rather than goo in like quite near future, especially on the 13.8 billion year timescale. But do you expect this little momentary flash of what you call normality to continue? Do you expect the future to be normal?Dwarkesh Patel 2:39:31No. I expect any given vision of how things shape out to be wrong. It is not like you are suggesting that the current weird trajectory continues being weird in the way it’s been weird and that we continue to have like 2% economic growth or whatever, and that leads to incrementally more technological progress and so on. You’re suggesting there’s been that specific species of weirdness, which means that this entirely different species of weirdness is warranted.Eliezer Yudkowsky 2:40:04We’ve got different weirdnesses over time. The jump to superintelligence does strike me as being significant in the same way as the first self-replicator. The first self-replicator is the universe transitioning from: you see mostly stable things to you also see a whole bunch of things that make copies of themselves. And then somewhat later on, there’s a state where there’s this strange transition between the universe of stable things where things come together by accident and stay as long as they endure to this world of complicated life. And that transitionary moment is when you have something that arises by accident and yet self replicates. And similarly on the other side of things you have things that are intelligent making other intelligent things. But to get into that world, you’ve got to have the thing that is built just by things copying themselves and mutating and yet is intelligent enough to make another intelligent thing. Now, if I sketched out that cosmology, would you say — “No, no. I don’t believe in that.”?Dwarkesh Patel 2:41:10What if I sketch out the cosmology — because of Replicators, blah blah blah, intelligent beings, intelligent beings create nanoystems, blah, blah blah.Eliezer Yudkowsky 2:41:18No, no. Don’t tell me about the proofs too much. I discussed the cosmology, do you buy it? In the long run are we in a world full of things replicating or are we in a world full of intelligent things, designing other intelligent things?Dwarkesh Patel 2:41:35Yes.Eliezer Yudkowsky 2:41:37So you buy that vast shift in the foundations of order of the universe that instead of the world of things that make copies of themselves imperfectly, we are in the world of things that are designed and were designed. You buy that vast cosmological shift I was just describing, the utter disruption of everything you see that you call normal down to the leaves and the trees around you. You believe that. Well, the same skepticism you’re so fond of that argues against the Rapture can also be used to disprove this thing you believe that you think is probably pretty obvious actually, now that I’ve pointed it out. Your skepticism disproves too much, my friend.Dwarkesh Patel 2:42:19That’s actually a really good point. It still leaves open the possibility of how it happens and when it happens, blah, blah, blah. But actually, that’s a good point. Okay, so second thing. Eliezer Yudkowsky 2:42:30You set them up, I’ll knock them down one after the other.Dwarkesh Patel 2:42:34Second thing is…Eliezer Yudkowsky 2:42:40Wrong. Sorry, I was just jumping ahead to the predictable update at the end.Dwarkesh Patel 2:42:43You’re a good Bayesian. Maybe alignment just turns out to be much simpler or much easier than we think. It’s not like we’ve as a civilization spent that much resources or brain power solving it. If we put in even the kind of resources that we put into elucidating String theory or something into alignment, it could just turn out to be enough to solve it. And in fact, in the current paradigm, it turns out to be simpler because they’re sort of pre-trained on human thought and that might be a simpler regime than something that just comes out of a black box like alpha zero or something like that.Eliezer Yudkowsky 2:43:24Could I be wrong in an understandable way to me in advance mass, which is not where most of my hope comes from is on, what if RLHF just works well enough and the people in charge of this are not the current disaster monkeys, but instead have some modicum of caution and know what to aim for in RLHF space, which the current crop do not, and I’m not really that confident of their ability to understand if I told them. But maybe you have some folks who can understand anyways. I can sort of see what I try. The current crop of people will not try it. And I’m not actually sure that if somebody else takes over the government that they listen to me either. So some of the trouble here is that you have a choice of target and neither is all that great. One is you look for the niceness that’s in humans, and you try to bring it out in the AI. And then you, with its cooperation, because it knows that if you try to just amp it up, it might not stay all that nice, or that if you build a successor system to it, it might not stay all that nice, and it doesn’t want that because you narrow down the shoggoth enough. Somebody once had this incredibly profound statement that I think I somewhat disagree with but it’s still so incredibly profound. Consciousness is when the mask eats the shoggoth. Maybe that’s it, maybe with the right set of bootstrapping reflection type stuff you can have that happen on purpose more or less, where the system’s output that you’re shaping is to some degree in control of the system and you locate niceness in the human space. I have fantasies along the lines of what if you trained GPT-N to distinguish people being nice and saying sensible things and argue validly, and I’m not sure that works if you just have Amazon turks try to label it. You just get the strange thing that RLHF located in the present space which is some kind of weird corporate speak, left-rationalizing leaning, strange telephone announcement creature. That is what they got with the current crop of RLHF. Note how this stuff is weirder and harder than people might have imagined initially. But leave aside the part where you try to jump start the entire process of turning into a grizzled cynic and update as hard as you can and do it in advance. Maybe you are able to train it on Scott Alexander and so you want to be a wizard, some other nice real people and nice fictional people and separately train on what’s valid arguments. That’s going to be tougher but I could probably put together a crew of a dozen people who could provide the data on that RLHF and you find the nice creature and you find the nice mask that argues validly. You do some more complicated stuff to try to boost the thing where it’s like eating the shoggoth where that’s more what the system is, less what it’s pretending to be. I can say this and the disaster monkeys at the current places cannot (unclear) to it but they have not said things like this themselves that I have ever heard and that is not a good sign. And then if you don’t amp this up too far, which on the present paradigm you can’t do anyways, because if you train the very, very smart version of the system it kills you before you can RLHF it. But maybe you can train GPT to distinguish nice, valid, kind, careful, and then filter all the training data to get the nice things to train on and then train on that data rather than training on everything to try to avert the Waluigi problem or just more generally having all the darkness in there. Just train it on the light that’s in humanity. So there’s like that kind of course. And if you don’t push that too far, maybe you can get a genuine ally and maybe things play out differently from there. That’s one of the little rays of hope. But I don’t think alignment is actually so easy that you just get whatever you want. It’s a genie, it gives you what you wish for. I don’t think that doesn’t even strike me as hope.Dwarkesh Patel 2:49:06Honestly. The way you describe it, it seemed kind of compelling. I don’t know why that doesn’t even rise to 1%. The possibility that it works out that way.Eliezer Yudkowsky 2:49:14This is like literally my AI alignment fantasy from 2003, though not with RLHF as the implementation method or LLMs as the base. And it’s going to be more dangerous than what I was dreaming about in 2003. And I think in a very real sense it feels to me like the people doing this stuff now have literally not gotten as far as I was in 2003. And I’ve now written out my answer sheet for that. It’s on the podcast, it goes on the Internet. And now they can pretend that that was their idea or like  — “Sure, that’s obvious. We were going to do that anyways.” And yet they didn’t say it earlier. You can’t run a big project off of one person who.. The alignment field failed to gel. That’s my (unclear) to the like — “Well, you just throw in a ton of more money, and then it’s all solvable.” Because I’ve seen people try to amp up the amount of money that goes into it and the stuff coming out of it has not gone to the places that I would have considered obvious a while ago. And I can print out all my answer sheets for it and each time I do that, it gets a little bit harder to make the case next time.Dwarkesh Patel 2:50:39How much money are we talking about in the grand scheme of things? Because civilization itself has a lot of money.Eliezer Yudkowsky 2:50:45I know people who have a billion dollars. I don’t know how to throw a billion dollars at outputting lots and lots of alignment stuff.Dwarkesh Patel 2:50:53But you might not. But I mean, you are one of 10 billion, right?Eliezer Yudkowsky 2:50:57And other people go ahead and spend lots of money on it anyways. Everybody makes the same mistakes. Nate Soares has a post about it. I forget the exact title, but everybody coming into alignment makes the same mistakes.Dwarkesh Patel 2:51:11Let me just go on to the third point because I think it plays into what I was saying. The third reason is if it is the case that these capabilities scale in some constant way as it seems like they’re going from 2 to 3 or 3 to 4?Eliezer Yudkowsky 2:51:29What does that even mean? But go on.Dwarkesh Patel 2:51:30That they get more and more general. It’s not like going from a mouse to a human or a chimpanzee to a human. It’s like going from GPT-3 to GPT-4. It just seems like that’s less of a jump than chimp to human, like a slow accumulation of capabilities. There are a lot of S curves of emergent abilities, but overall the curve looks sort of..Eliezer Yudkowsky 2:51:56I feel like we bit off a whole chunk of chimp to human in GPT 3.5 to GPT-4, but go on.Dwarkesh Patel 2:52:03Regardless then this leads to human level intelligence for some interval. I think that I was not convinced from the arguments that we could not have a system of sort of checks on this the same way you have checks on smart humans that it would try to deceive us to achieve its aims. Any more than smart humans are in positions of power. Try to do the same thing.Eliezer Yudkowsky 2:52:31For a year. What are you going to do with that year before the next generation of systems come out that are not held in check by humans because they are not roughly in the same power intelligence range as humans? Maybe you can get a year like that. Maybe that actually happens. What are you going to do with that year that prevents you from dying the year after?Dwarkesh Patel 2:52:52One possibility is that because these systems are trained on human text, maybe progress just slows down a lot after it gets to slightly above human level.Eliezer Yudkowsky 2:53:02Yeah, I would be quite surprised if that’s how anything works.Dwarkesh Patel 2:53:08Why is that?Eliezer Yudkowsky 2:53:10First of all, you realize in principle that the task of minimizing losses on predicting human text does not stop when you’re as smart as a human, right? Like you can see the computer science of that?Dwarkesh Patel 2:53:34I don’t know if I see the computer science of that, but I think I probably understand.Eliezer Yudkowsky 2:53:38Okay so somewhere on the internet is a list of hashes followed by the string hashed. This is a simple demonstration of how you can go on getting lower losses by throwing a hypercomputer at the problem. There are pieces of text on there that were not produced by humans talking in conversation, but rather by lots and lots of work to extract experimental results out of reality. That text is also on the internet. Maybe there’s not enough of it for the machine learning paradigm to work, but I’d sooner buy that the GPT system just bottleneck short of being able to predict that stuff better rather than. You can maybe buy that but the notion that you only have to be smart as a human to predict all the text on the internet, as soon as you turn around and stare at that it’s just transparently false.Dwarkesh Patel 2:54:31Okay, agreed. Okay, how about this story? You have something that is sort of human-like that is maybe above humans at certain aspects of science because it’s specifically trained to be really good at the things that are on the Internet, which is like chunks and chunks of archive and whatever. Whereas it has not been trained specifically to gain power. And while at some point of intelligence that comes along. Can I just restart that whole sentence?Eliezer Yudkowsky 2:55:02No. You have spoken it. It exists. It cannot be called back. There are no take backs. There is no going back. There is no going back. Go ahead.Dwarkesh Patel 2:55:14Okay, so here’s another story. I expect them to be better than humans at science than they are at power seeking, because we had greater selection pressures for power seeking in our ancestral environment than we did for science. And while at a certain point both of them come along as a package, maybe they can be at varying levels, so you have this sort of early model that is kind of human-level, except a little bit ahead of us in science. You ask it to help us align the next version of it, then the next version of it is more aligned because we have its help and sort of like this inductive thing where the next version helps us align the version.Eliezer Yudkowsky 2:56:02Where do people have this notion of getting AIs to help you do your AI alignment homework? Why can we not talk about having it enhance humans instead?Dwarkesh Patel 2:56:11Either one of those stories where it just helps us enhance humans and help us figure out the alignment problem or something like that.Eliezer Yudkowsky 2:56:20Yeah, it’s kind of weird because small, large amounts of intelligence don’t automatically make you a computer programmer. And if you are a computer programmer, you don’t automatically get the security mindset. But it feels like there’s some level of intelligence where you ought to automatically get the security mindset. And I think that’s about how hard you have to augment people to have them able to do alignment. Like the level where they have a security mindset, not because they were like special people with a security mindset, but just because they’re that intelligent that you just automatically have a security mindset. I think that’s about the level where a human could start to work on alignment, more or less.Dwarkesh Patel 2:56:56Why is that story then not get you to 1% probability that it helps us avoid the whole crisis?Eliezer Yudkowsky 2:57:03Because it’s not just a question of the technical feasibility of can you build a thing that applies its general intelligence narrowly to the neuroscience of augmenting humans? One, I feel like that is probably over 1% technical feasibility, but the world that we are in is so far from doing that, from trying the way that it could actually work. Like not the the try where  — “Oh, you know. We'd like to do a bunch of RLHF to try to have a thing spit out output about this thing, but not about that thing” and no, not that. 1% that humanity could do that if it tried and tried in just the right direction as far as I can perceive angles in this space. Yeah, I’m over 1% on that. I am not very high on us doing it. Maybe I will be wrong. Maybe the Time article I wrote saying shut it all down gets picked up. And there are very serious conversations. And the very serious conversations are actually effective in shutting down the headlong plunge. And there is a narrow exception carved out for the kind of narrow application of trying to build an artificial general intelligence that applies its intelligence narrowly and to the problem of augmenting humans. And that, I think, might be a harder sell to the world than just shut it all down. They could shut it all down and then not do the things that they would need to do to have an exit strategy. I feel like even if you told me that they went for shut it all down I would expect them to have no exit strategy until the world ended anyways. But perhaps I underestimate them. Maybe there’s a will in humanity to do something else which is not that. And if there really were yeah, I think I’m even over 10% that would be a technically feasible path if they looked in just the right direction. But I am not over 50% on them actually doing the shut it all down. If they do that, I am then not over 50% on (unclear) them really having an exit strategy. Then from there you have to go in at sufficiently the right angle to materialize the technical chances and not do it in the way that just ends up a suicide, or if you’re lucky, gives you the clear warning signs and then people actually pay attention to those instead of just optimizing away the warning signs. And I don’t want to make this sound like the multiple stage fallacy of  — “Oh more than one thing has to happen therefore the resulting thing can never happen.” Which super clear case in point of why you cannot prove anything will not happen this way. Nate Silver arguing that Trump needed to get through six stages to become the Republican presidential candidate each of which was less than half probability and therefore he had less than 1/64th chance of becoming the Republican candidate, not winning. You can’t just break things down into stages and then say therefore. The probability is zero. You can break down anything into stages. But even so, you’re asking me like — Isn’t over 1% that it’s possible? I’m like — yeah, possibly even over 10% . The reason why I tell people — “Yeah, don’t put your hope in the future, you’re probably dead”, is that the existence of this technical array of hope, if you do just the right things, is not the same as expecting that the world reshapes itself to permit that to be done without destroying the world in the meanwhile. I expect things to continue on largely as they have. And what distinguishes that from despair is that at the moment people were telling me, — “No, no. If you go outside the tech industry, people will actually listen.” I’m like — “All right, let’s try that. Let’s write the Time article. Let’s jump on that. It will lack dignity not to try.” but that’s not the same as expecting, as being like — “Oh yeah, I’m over 50%, they’re totally going to do it. That Time article is totally going to take off.” I’m not currently not over 50% on that. You said any one of these things could mean, and yet even if this thing is technically feasible, that doesn’t mean the world’s going to do it. We are presently quite far from the world being on that trajectory or of doing the things that would needed to create time to pay the alignment tax to do it.What will AIs want?Dwarkesh Patel 3:02:15Maybe the one thing I would dispute is how many things need to go right from the world as a whole for any one of these paths to succeed. Which goes into the fourth point, which is that maybe the sort of universal prior over all the drives that an AI could have is just the wrong way to think about it.Eliezer Yudkowsky 3:02:35I mean you definitely want to use the alien observation of 10,000 planets like this one prior for what you get after training on, like, Thing X.Dwarkesh Patel 3:02:45It’s just that especially when we’re talking about things that have been trained on human text, I’m not saying that it was a mistake earlier on in the conversation for me to say they’ll be the average of human motivations, but it’s not conceivable to me that it would be something that is very sympathetic to human motivations. Having sort of encapsulated all of our output.Eliezer Yudkowsky 3:03:07I think it’s much easier to get a mask like that than to get a shoggoth like that.Dwarkesh Patel 3:03:14Possibly but again, this is something that seems like, I don’t know the probability on it but I would put it at least 10%. And just by default, it is not incompatible with the flourishing of humanity.Eliezer Yudkowsky 3:03:29What is the utility function you hope it has that has its maximum at the flourishing of humanity? Dwarkesh Patel 3:03:35There’s so many possibleEliezer Yudkowsky 3:03:37Name three. Name one. Spell it out.Dwarkesh Patel 3:03:39I don’t know. It wants to keep us as a zoo the same way we keep other animals in a zoo. This is not the best outcome for humanity, but it’s just like something where we survive and flourish.Eliezer Yudkowsky 3:03:49Okay. Whoa, whoa, whoa. Flourish? Keeping in a zoo did not sound like flourishing to me.Dwarkesh Patel 3:03:55Zoo was the wrong word to use there.Eliezer Yudkowsky 3:03:57Well, because it’s not what you wanted. Why is it not a good prediction?Dwarkesh Patel 3:04:01You just asked me to name three. You didn’t ask me.. Eliezer Yudkowsky 3:04:04No, no. What I’m saying is you’re like — “Oh, prediction. Oh, no, I don’t like my prediction. I want a different prediction.”Dwarkesh Patel 3:04:10You didn’t ask for the prediction. You just asked me to name possibilities.Eliezer Yudkowsky 3:04:15I had meant possibilities in which you put some probability. I had meant for a thing that you thought held together.Dwarkesh Patel 3:04:22This is the same thing as when I asked you what is a specific utility function it will have that will be incompatible with humans existing. Eliezer Yudkowsky 3:04:32The super vast majority of predictions of utility functions are incompatible with humans existing. I can make a mistake and will still be incompatible with humans existing. I can just be like I can just describe a randomly rolled utility function, end up with something incompatible with humans existing.Dwarkesh Patel 3:04:49At the beginning of human evolution, you could think — Okay, this thing will become generally intelligent, and what are the odds that it’s flourishing on the planet will be compatible with the survival of spruce trees or something?Eliezer Yudkowsky 3:05:06And the long term, we sure aren’t. I mean, maybe if we win, we’ll have there be a space for spruce trees. So you can have spruce trees as long as the Mitochondrial Liberation Front does not object to that.Dwarkesh Patel 3:05:20What is the Mitochondrial Liberation Front?Eliezer Yudkowsky 3:05:21Have you no sympathy for the mitochondria enslaved working all their lives to the benefit of some other organisms?Dwarkesh Patel 3:05:30This is like some weird hypothetical. For hundreds of thousands of years, general intelligence has existed on Earth. You could say, is it compatible with some random species that exist on Earth? Is it compatible with spruce trees existing? And I know you probably chopped down a few spruce trees.Eliezer Yudkowsky 3:05:45And the answer is yes, as a very special case of being the sort of things that some of us would maybe conclude that we specifically wanted spruce trees to go on existing, at least on Earth, in the glorious transhuman future. And their votes winning out against those of the mitochondrial Liberation Front.Dwarkesh Patel 3:06:07Since part of the transhumanist future is part of the thing we’re debating, it seems weird to assume that as part of the question.Eliezer Yudkowsky 3:06:15The thing I’m trying to say is you’re like — Well, if you looked at the humans, would you not expect them to end up incompatible with the spruce trees? And I’m being like — “Sir, you, a human, have looked back and looked at how humans wanted the universe to be and been like, well, would you not have anticipated in retrospect that humans would want the universe to be otherwise?” And I agree that we might want to conserve a whole bunch of stuff. Maybe we don’t want to conserve the parts of nature where things bite other things and inject venom into them and the victims die in terrible pain. I think that many of them don’t have qualia. This is disputed. Some people might be disturbed by it even if they didn’t have qualia. We might want to be polite to the sort of aliens who would be disturbed by it because they don’t have qualia and they just don’t want venom injected into them for they should not have venom. We might conserve some parts of nature. But again, it’s like firing an arrow and then drawing a circle around the target.Dwarkesh Patel 3:07:18I would disagree with that because again, this is similar to the example we started off the conversation with. It seems like you are reasoning from what might happen in the future and because we disagree about what might happen in the future. In fact, the entire point of this disagreement is to test what will happen in the future. Assuming what will happen in the future as part of your answer seems like a bad way to answer the question.Eliezer Yudkowsky 3:07:45Okay but then you’re claiming things as evidence for your position.Dwarkesh Patel 3:07:47Based on what exists in the world now.Eliezer Yudkowsky 3:07:49They are not evidence one way or the other because the basic prediction is like, if you offer things enough options, they will go out of distribution. It’s like pointing to the very first people with language and being like, they haven’t taken over the world yet, and they have not gone way out of distribution yet. They haven’t had general intelligence for long enough to accumulate the things that would give them more options such that they could start trying to select the weirder options. The prediction is when you give yourself more options, you start to select ones that look weirder relative to the ancestral distribution. As long as you don’t have the weird options, you’re not going to make the weird choices. And if you say we haven’t yet observed your future, that’s fine, but acknowledge that the evidence against that future is not being provided by the past is the thing I’m saying there. You look around, it looks so normal according to you, who grew up here. If you grew up a millennium earlier, your argument for the persistence of normality might not seem as persuasive to you after you’d seen that much change.Dwarkesh Patel 3:09:03This is a separate argument, though, right?Eliezer Yudkowsky 3:09:07Look at all this stuff humans haven’t changed yet. You say, now selecting the stuff, we haven’t changed yet. But if you go back 20,000 years and be like, look at the stuff intelligence hasn’t changed yet. You might very well select a bunch of stuff that was going to fall 20,000 years later is the thing I’m trying to gesture at here.Dwarkesh Patel 3:09:27How do you propose we reason about what general intelligences would do when the world we look at, after hundreds of thousands of years of general intelligence, is the one that we can’t use for evidence?Eliezer Yudkowsky 3:09:39Dive under the surface, look at the things that have changed. Why did they change? Look at the processes that are generating those choices.Dwarkesh Patel 3:09:52And since we have these different functions of where that goes..Eliezer Yudkowsky 3:09:58Look at the thing with ice cream, look at the thing with condoms, look at the thing with pornography, see where this is going.Dwarkesh Patel 3:10:08It just seems like I would disagree with your intuitions about what future smarter humans will do, even with more options. In the beginning of conversation, I disagreed that most humans would adopt a transhumanist way to get better DNA or something.Eliezer Yudkowsky 3:10:23But you would. You just look down at your fellow humans. You have no confidence in their ability to tolerate weirdness, even if they can.Dwarkesh Patel 3:10:33What do you think would happen if we did a poll right now?Eliezer Yudkowsky 3:10:36I think I’d have to explain that poll pretty carefully because they haven’t got the intelligence headbands yet. Right?Dwarkesh Patel 3:10:42I mean, we could do a Twitter poll with a long explanation in it.Eliezer Yudkowsky 3:10:454000 character Twitter poll? Dwarkesh Patel 3:10:50Yeah.Eliezer Yudkowsky 3:10:51Man, I am somewhat tempted to do that just for the sheer chaos and point out the drastic selection effects of: A) It’s my Twitter followers B) They read through a 4000 character tweet. I feel like this is not likely to be truly very informative by my standards, but part of me is amused by the prospect for the chaos.Dwarkesh Patel 3:11:06Yeah. Or I could do it on my end as well. Although my followers are likely to be weird as well.Eliezer Yudkowsky 3:11:11Yeah plus I worry you wouldn’t be able to sell that transhumanism thing as well as it could get sold.Dwarkesh Patel 3:11:17You could just send me the wording. But anyways, given that we disagree about what in the future general intelligence will do, where do you suppose we should look for evidence about what the general intelligence will do given our different theories about it, if not from the present?Eliezer Yudkowsky 3:11:36I think you look at the mechanics. You say as people have gotten more options, they have gone further outside the ancestral distribution. And we zoom in and there’s all these different things that people want and there’s this narrow range of options that they had 50,000 years ago and the things that they want have maxima or optima 50,000 years ago at stuff that coincides with reproductive fitness. And then as a result of the humans getting smarter, they start to accumulate culture, which produces changes on a timescale faster than natural selection runs, although it is still running contemporaneously. Humans are just running faster than natural selection, it didn’t actually halt. And they generate additional options, not blindly, but according to the things that they want. And they invent ice-cream. It doesn’t just get coughed up at random, they are searching the space of things that they want and generating new options for themselves that optimize these things more that weren’t in the ancestral environment. And Goodhart’s law applies, Goodhart’s curse applies. As you apply optimization pressure, the correlations that were found naturally come apart and aren’t present in the thing that gets optimized for. Just give some people some tests who’ve never gone to school. The ones who score high in the carpentry test will know how to carpenter things. Then you’re like — I’ll pay you for high scores in the carpentry test, I’ll give you this carpentry degree. And people are like — “Oh, I’m going to optimize the test specifically.” and they’ll get higher scores than the carpenters and be worse at carpentry because they’re optimizing the test. And that’s the story behind ice cream. You zoom in and look at the mechanics and not the grand scale view, because the grand scale view just never gives you the right answer. Anytime you asked what would happen if you applied the grand scale view philosophy in the past, it’s always just like — “I don’t see why this thing would change. Oh, it changed. How weird. Who could have possibly have expected that.”Dwarkesh Patel 3:13:57Maybe you have a different definition of grand scale view? Because I would have thought that that is what you might use to categorize your own view. But I don’t want to get it caught up in semantics.Eliezer Yudkowsky 3:14:05My mind is zooming in, it’s looking at the mechanics. That’s how I’d present it.Dwarkesh Patel 3:14:09If we are so far out a distribution of natural selection, as you say..Eliezer Yudkowsky 3:14:14We’re currently nowhere near as far as we could be. This is not the glorious transhumanist future.Dwarkesh Patel 3:14:20I claim that even if humans get much smarter through brain augmentation or something, then there will still be spruce trees millions of years in the future.Eliezer Yudkowsky 3:14:36If you still want to, come the day, I don’t think I myself would oppose it. Unless there’d be like distant aliens who are very, very sad about what we were doing to the mitochondria. And then I don’t want to ruin their day for no good reason.Dwarkesh Patel 3:14:48But the reason that it’s important to state it in the former — given human psychology, spruce trees will still exist, is because that is the one evidence of generality arising we have. And even after millions of years of that generality, we think that spruce trees would exist. I feel like we would be in this position of spruce trees in comparison to the intelligence we create and sort of the universal prior on whether spruce trees would exist doesn’t make sense to me.Eliezer Yudkowsky 3:15:09But do you see how this perhaps leads to everybody’s severed heads being kept alive in jars on its own premises, as opposed to humans getting the glorious transhumanist future? No, they have the glorious transhumanist future. Those are not real spruce trees. You’re talking plain old spruce trees you want to exist, right? Not the sparkling giant spruce trees with built in rockets. You’re talking about humans being kept as pets in their ancestral state forever, maybe being quite sad. Maybe they still get cancer and die of old age, and they never get anything better than that. Does it keep us around as we are right now? Do we relive the same day over and over again? Maybe this is the day when that happens. Do you see the general trend I’m trying to point out here? It is that you have a rationalization for why they might do a thing that is allegedly nice. And I’m saying— why exactly are they wanting to do the thing? Well, if they want to do the thing for this reason, maybe there’s a way to do this thing that isn’t as nice as you’re imagining? And this is systematic. You’re imagining reasons they might have to give you nice things that you want, but they are not you. Not unless we get this exactly right and they actually care about the part where you want some things and not others. You are not describing something you are doing for the sake of the spruce trees. Do spruce trees have diseases in this world of yours? Do the diseases get to live? Do they get to live on spruce trees? And it’s not a coincidence that I can zoom in and poke at this and ask questions like this and that you did not ask these questions of yourself. You are imagining nice ways you can get the thing. But reality is not necessarily imagining how to give you what you want. And the AI is not necessarily imagining how to give you what you want and for everything. You can be like — “Oh. Hopeful thought. Maybe I get all this stuff I want because the AI reasons like this.” Because it’s the optimism inside you that is generating this answer. And if the optimism is not in the AI, if the AI is not specifically being like — “Well, how do I pick a reason to do things that will give this person a nice outcome?” You’re not going to get the nice outcome. You’re going to be reliving the last day of your life over and over. It’s going to, like, create old or maybe it creates old fashioned humans, ones from 50,000 years ago. Maybe that’s more quaint. Maybe it's just as happy with bacteria because there’s more of them and that’s equally old fashioned. You’re going to create the specific spruce tree over there. Maybe from its perspective, a generic bacterium is just as good a form of life as a generic spruce tree is. This is not specific to the example that you gave. It’s me being like — “Well, suppose we took a criterion that sounds kind of like this and asked, how do we actually maximize it? What else satisfies it?” You’re trying to argue the AI into doing what you think is a good idea by giving the AI reasons why it should want to do the thing under some set of hypothetical motives. But anything like that if you optimize it on its own terms without narrowing down to where you want it to end up because it actually felt nice to you the way that you define niceness. It’s all going to have somewhere else, somewhere that isn’t as nice. Something maybe where we’d sooner scour the surface of the planet with nuclear fire rather than let that AI come into existence. Though I do think those are also probable because you know, instead of hurting you, there’s something more efficient for it to do that maxes out its utility function.Dwarkesh Patel 3:19:09Okay, I acknowledge that you had a better argument there, but here’s another intuition. I’m curious how you respond to that. Earlier, we talked about the idea that if you bred humans to be friendlier and smarter. Eliezer Yudkowsky 3:19:29I think I want to register for the record that the term breeding humans would cause me to look askance at any aliens who would propose that as a policy action on their part. All right, there I said it, move on.Dwarkesh Patel 3:19:44No, no. That’s not what I’m proposing we do. I’m just saying it as a sort of thought experiment. You answered that we shouldn’t assume that AIs are going to start with human psychology. Okay, fair enough. Assume we start off with dogs, good old fashioned dogs. And we bred them to be more intelligent, but also to be friendly.Eliezer Yudkowsky 3:20:06Well, as soon as they are past a certain level of intelligence, I object to us coming in and breeding them. They can no longer be owned. They are now sufficiently intelligent to not be owned anymore. But let us leave aside all morals. Carry on. In the thought experiment, not in real life, you can’t leave out the morals in real life.Dwarkesh Patel 3:20:22Do you have some sort of universal prior of the drives of these super intelligent dogs that are bred to be friendly?Eliezer Yudkowsky 3:20:29I think that weird s**t starts to happen at the point where the dogs get smart enough that they are like, what are these flaws in our thinking processes? Over the CFAR threshold of dogs. Although CFAR has some strange baggage. Over the Korzybski threshold of dogs after Alfred Korzybski. I think that there’s this whole domain where they’re stupider than you and sort of like being shaped by their genes and not shaping themselves very much. And as long as that is true, you can probably go on breeding them. Issues start to arise when the dogs are smarter than you, when the dogs can manipulate you, if they get to that point, where the dogs can strategically present particular appearances to fool you, where the dogs are aware of the breeding process and possibly having opinions about where that should go in the long run, where the dogs are even if just by thinking and by adopting new rules of thought, modifying themselves in that small way. These are some of the points where I expect the weird s**t to start to happen and the weird s**t will not necessarily show up while you’re just breeding the dogs.Dwarkesh Patel 3:21:47Does the weird s**t look like — dog gets smart enough….humans stop existing?Eliezer Yudkowsky 3:21:53If you keep on optimizing the dogs, which is not the correct course of action, I think I mostly expect this to eventually blow up on you.Dwarkesh Patel 3:22:06But blow up on you that bad?Eliezer Yudkowsky 3:22:08I expect to blow up on you quite bad. I’m trying to think about whether I expect super dogs to be sufficiently in a human frame of reference in virtue of them also being mammals. That a super dog would create human ice-cream. You bred them to have preferences about humans and they invent something that is like ice cream to those preferences. Or does it just go off someplace stranger?Dwarkesh Patel 3:22:39There could be AI ice cream. Thing that is the equivalent of ice cream for AIs.Eliezer Yudkowsky 3:22:47That is essentially my prediction of what the solar system ends up filled with. The exact ice cream is quite hard to predict. If you optimize something for inclusive genetic fitness, you’ll get ice cream. That is a very hard call to make. Dwarkesh Patel 3:23:02Sorry, I didn’t mean to interrupt. Where were you going with your….Eliezer Yudkowsky 3:23:06I was just rambling in my attempts to make predictions about these super dogs. In a world that had its priorities straight even remotely, this stuff is not me extemporizing on a blog post, there are 1000 papers that were written by people who otherwise became philosophers writing about this stuff instead. But your world has not set its priorities that way and I’m concerned that it will not set them that way in the future and I’m concerned that if it tries to set them that way, it will end up with garbage because the good stuff was hard to verify. But, separate topic.Dwarkesh Patel 3:23:44I understand your intuition that we would end up in a place that is not very good for humans. That just seems so hard to reason about that I honestly would not be surprised if it ended up fine for humans. In fact, the dogs wanted good things for humans, loved humans. We’re smarter than dogs, we love them. The sort of reciprocal relationship came about.Eliezer Yudkowsky 3:24:12I feel like maybe I could do this given thousands of years to breed the dogs in a total absence of ethics. But it would actually be easier with the dogs than with gradient descent because the dogs are starting out with neural architecture very similar to human and natural selection is just like a different idiom from gradient descent. In particular, in terms of information bandwidth. I’d be steering to breed the dogs into genuinely very nice human and knowing the stuff that I know that your your typical dog breeder might not know when they embarked on this project. I would, very early on, start prompting them into the weird stuff that I expected to get started later and trying to observe how they went during that.Dwarkesh Patel 3:25:00This is the alignment strategy we need ultra smart dogs to help us solve.Eliezer Yudkowsky 3:25:04There’s no time.Dwarkesh Patel 3:25:06Okay, I think we sort of articulated our intuitions on that one. Here’s another one that’s not something I came into the conversation with.Eliezer Yudkowsky 3:25:17Some of my intuition here is like I know how I would do this with dogs and I think you could ask OpenAI to describe their theory of how to do it with dogs. And I would be like — “Oh wow, that sure is going to get you killed.” And that’s kind of how I expect it to play out in practice, actually.Dwarkesh Patel 3:25:34When you talk to the people who are in charge of these labs, what do they say? Do they just like not grok the arguments?Eliezer Yudkowsky 3:25:40You think they talk to me?Dwarkesh Patel 3:25:42There was a certain selfie that was taken.Eliezer Yudkowsky 3:25:44Taken by 5 minutes of conversation. First time any of the people in that selfie had met each other.Dwarkesh Patel 3:25:49And then did you bring it up?Eliezer Yudkowsky 3:25:51I asked him to change the name of his corporation to anything but OpenAI.Dwarkesh Patel 3:25:57Have you seeked an audience with the leaders of these labs to explain these arguments?Eliezer Yudkowsky 3:26:04No.Dwarkesh Patel 3:26:06Why not?Eliezer Yudkowsky 3:26:10I’ve had a couple of conversations with Demis Hassabis who struck me as much more the sort of person who is possible to have a conversation with.Dwarkesh Patel 3:26:19I guess it seems like it would be more dignity to explain, even if you think it’s not going to be fruitful ultimately, to the people who are most likely to be influential in this race.Eliezer Yudkowsky 3:26:30My basic model was that they wouldn’t like me and that things could always be worse.Dwarkesh Patel 3:26:35Fair enough.Eliezer Yudkowsky 3:26:40They sure could have asked at any time but that would have been quite out of character. And the fact that it was quite out of character is like why I myself did not go trying to barge into their lives and getting them mad at me.Dwarkesh Patel 3:26:53But you think them getting mad at you would make things worse.Eliezer Yudkowsky 3:26:57It can always be worse. I agree that possibly at this point some of them are mad at me, but I have yet to turn down the leader of any major AI lab who has come to me asking for advice.Dwarkesh Patel 3:27:12Fair enough. On the theme of big picture disagreements, why I’m still not on the greater than 50% doom, from the conversation it didn’t seem like you were willing or able to make predictions about the world short of doom that would help me distinguish and highlight your view about other views.Eliezer Yudkowsky 3:27:40Yeah, I mean the world heading into this is like a whole giant mess of complicated stuff predictions about which can be made in virtue of spending a whole bunch of time staring at the complicated stuff until you understand that specific complicated stuff and making predictions about it. From my perspective, the way you get to my point of view is not by having a grand theory that reveals how things will actually go. It’s like taking other people’s overly narrow theories and poking at them until they come apart and you’re left with a maximum entropy distribution over the right space which looks like — “Yep, that sure is going to randomize the solar system.”Dwarkesh Patel 3:28:18But to me it seems like the nature of intelligence and what it entails is even more complicated than the sort of geopolitical or economic things that would be required to predict what the world’s going to look like.Eliezer Yudkowsky 3:28:29I think you’re just wrong. I think the theory of intelligence is just flatly not that complicated. Maybe that’s just the voice of a person with talent in one area but not the other. But that sure is how it feels to me.Dwarkesh Patel 3:28:42This would be even more convincing to me if we had some idea of what the pseudocode or circuit for intelligence would look like. And then you could say like — “Oh, this is what the pseudocode implies, we don’t even have that.”Eliezer Yudkowsky 3:28:54If you permit a hypercomputer just as AIXI.Dwarkesh Patel 3:28:58What is AIXI?Eliezer Yudkowsky 3:29:01You have the Solomonoff prior over your environment, update it on the evidence and then max sensory reward. It’s not actually trivial and this thing will exhibit weird discontinuities around its cartesian boundary with the universe. But everything that people imagine as the hard problems of intelligence are contained in the equation if you have a hybrid computer.Dwarkesh Patel 3:29:31Fair enough, but I mean in the sort of sense of programming it into a normal. Like I give you a really big computer to write the pseudocode or something.Eliezer Yudkowsky 3:29:42I mean, if you give me a hypercomputer, yeah. What you’re saying here is that the theory of intelligence is really simple in an unbounded sense, but what about this depends on the difference between unbounded and bounded intelligence?Dwarkesh Patel 3:29:55So how about this? You ask me, do you understand how fusion works? If not, let’s say we’re talking in the 1800s, how can you predict how powerful a fusion bomb would be? And I say — “Well, listen. If you put in a pressure, I’ll just show you the sun” and the sun is sort of the archetypal example of a fusion is and you say — “No, I’m asking what would a fusion bomb look like?” You see what I mean?Eliezer Yudkowsky 3:30:19Not necessarily. What is it that you think somebody ought to be able to predict about the road ahead?Dwarkesh Patel 3:30:28One of the things, if you know the nature of intelligence is just, how will this sort of progress in intelligence look like? How our ability is going to scale, if at all?Eliezer Yudkowsky 3:30:42And it looks like a bunch of details that don’t easily follow from the general theory of simplicity, prior Bayesian update argmax Dwarkesh Patel 3:30:52Again, then the only thing that follows is the wildest conclusion. There’s no simpler conclusions to follow like the Eddington looking and confirming special relativity. It’s just like the wildest possible conclusion is the one that follows.Eliezer Yudkowsky 3:31:10Yeah, the convergence is a whole lot easier to predict than the pathway there. I’m sorry and I sure wish it was otherwise. And also remember the basic paradigm. From my perspective, I’m not making any brilliant startling predictions, I’m poking at other people’s incorrectly narrow theories until they fall apart into the maximum entropy state of doom.Dwarkesh Patel 3:31:34There’s like thousands of possible theories, most of which have not come about yet. I don’t see it as strong evidence that because you haven’t been able to identify a good one yet, that.Eliezer Yudkowsky 3:31:47In the profoundly unlikely event that somebody came up with some incredibly clever grand theory that explained all the properties GPT-5 ought to have, which is just flatly not going to happen, that kind of info is not available. My hat would be off to them if they wrote down their predictions in advance, and if they were then able to grind that theory to produce predictions about alignment, which seems even more improbable because what do those two things have to do with each other exactly? But still, mostly I’d be like — “Well, it looks like our generation has its new genius. How about if we all shut up for a while and listen to what they have to say?”Dwarkesh Patel 3:32:24How about this? Let’s say somebody comes to you and they say, I have the best-in-US theory of economics. Everything before is wrong. Eliezer Yudkowsky 3:32:38One does not say everything before is wrong. One predicts the following new phenomena and on rare occasions say that old phenomena were organized incorrectly.Dwarkesh Patel 3:32:46Fair enough. So they say old phenomena are organized incorrectly.Eliezer Yudkowsky 3:32:53Let's call this person Scott Sumner, for the sake of simplicity.Dwarkesh Patel 3:32:57They say, in the next ten years, there’s going to be a depression that is so bad that is going to destroy the entire economic system. I’m not talking just about something that is a hurdle. Literally, civilization will collapse because of economic disaster. And then you ask them — “Okay, give me some predictions before this great catastrophe happens about what this theory implies.” And then they say — “Listen, there’s many different branching Patel, but they all converge at civilization collapsing because of some great economic crisis.” I’m like —I don’t know, man. I would like to see some predictions before that.Eliezer Yudkowsky 3:33:33Yeah. Wouldn’t it be nice? So we’re left with your 50% probability that we win the lottery and 50% probability that we don’t because nobody has a theory of lottery tickets that has been able to predict what numbers get drawn next.Dwarkesh Patel 3:33:51I don’t agree with that analogy.Eliezer Yudkowsky 3:33:56It is all about the space over which you’re uncertain. We are all quite uncertain about where the future leads, but over which space? And there isn’t a royal road. There isn’t a simple — “Ahh. I found just the right thing to be ignorant about. It’s so easy. The chance of a good outcome is 33% because they’re like one possible good outcome and two possible bad outcomes.” The thing you’re trying to fall back to in the absence of anything that predicts exactly which properties GPT-5 will have is your sense that a pretty bad outcome is kind of weird, right? It’s probably a small sliver of the space but that’s just like imposing your natural English language prior, your natural humanese prior, on the space of possibilities and being like, I’ll distribute my max entropy stuff over. That gay.Dwarkesh Patel 3:34:52Can you explain that again?Eliezer Yudkowsky 3:34:55Okay. What is the person doing wrong who says 50-50 either I’ll win the lottery or I won’t?Dwarkesh Patel 3:35:00They have the wrong distribution to begin with over possible outcomes.Eliezer Yudkowsky 3:35:06Okay. What is the person doing wrong who says 50-50 either we’ll get a good outcome or a bad outcome from AI?Dwarkesh Patel 3:35:14They don’t have a good theory to begin with about what the space of outcomes looks like.Eliezer Yudkowsky 3:35:19Is that your answer? Is that your model of my answer?Dwarkesh Patel 3:35:22My answer.Eliezer Yudkowsky 3:35:25But all the things you could say about a space of outcomes are an elaborate theory, and you haven’t predicted GPT-4’s exact properties in advance. Shouldn’t that just leave us with just good outcome or bad outcome, 50-50 ?Dwarkesh Patel 3:35:35People did have theories about what GPT-4. If you look at the scaling laws right, it probably falls right on the sort of curves that were drawin in 2020 or something.Eliezer Yudkowsky 3:35:50The loss on text predictions, sure, that followed a curve, but which abilities would that correspond to? I’m not familiar with anyone who called that in advance. What good does it know to the loss? You could have taken those exact loss numbers back in time ten years and been like, what kind of commercial utility does this correspond to? And they would have given you utterly blank looks. And I don’t actually know of anybody who has a theory that gives something other than a blank look for that. All we have are the observations. Everyone’s in that boat, all we can do are fit the observations. Also, there’s just me starting to work on this problem in 2001 because it was super predictable, going to turn into an emergency later and point of fact, nobody else ran out and immediately tried to start getting work done on the problems. And I would claim that as a successful prediction of the grand lofty theory.Dwarkesh Patel 3:36:41Did you see deep learning coming as the main paradigm?Eliezer Yudkowsky 3:36:44No.Dwarkesh Patel 3:36:46And is that relevant as part of the picture of intelligence?Eliezer Yudkowsky 3:36:50I would have been much more worried in 2001 if I’d seen deep learning coming.Dwarkesh Patel 3:36:57No, not in 2001, I just mean before it became like obviously the main paradigm of AI.Eliezer Yudkowsky 3:37:03No, it’s like the details of biology. It’s like asking people to predict what the organs look like in advance via the principle of natural selection and it’s pretty hard to call in advance. Afterwards, you can look at it and be like — “Yep, this sure does look like the thing it should look if this thing is being optimized to reproduce.” But the space of things that biology can throw at you is just too large. It’s very rare that you have a case where there’s only one solution that lets the thing reproduce that you can predict by the theory that it will have successfully reproduced in the past. And mostly it’s just this enormous list of details and they do all fit together in retrospect. It is a sad truth. Contrary to what you may have learned in science class as a kid, there are genuinely super important theories where you can totally actually validly see that they explain the thing in retrospect and yet you can’t do the thing in advance. Not always, not everywhere, not for natural selection. There are advanced predictions you can get about that given the amount of stuff we’ve already seen. You can go to a new animal in a new niche and be like — “Oh, it’s going to have these properties given the stuff we’ve already seen in the niche.” There’s advanced predictions that they’re a lot harder to come by. Which is why natural selection was a controversial theory in the first place. It wasn’t like gravity. Gravity had all these awesome predictions. Newton’s theory of gravity had all these awesome predictions. We got all these extra planets that people didn’t realize ought to be there. We figured out Neptune was there before we found it by telescope. Where is this for Darwinian selection? People actually did ask at the time, and the answer is, it’s harder. And sometimes it’s like that in science.Dwarkesh Patel 3:38:54The difference is the theory of Darwinian selection seems much more well developed. There was a Roman poet called Lucretius who had a poem where there was a precursor of Darwinian selection. And I feel like that is probably our level of maturity when it comes to intelligence. Whereas we don’t have a theory of intelligence, we might have some hints about what it might look like.Eliezer Yudkowsky 3:39:29Always got our hints.Dwarkesh Patel 3:39:32It seems harder to extrapolate very strong conclusions from hints.Eliezer Yudkowsky 3:39:35They’re not very strong conclusions is the message I’m trying to say here. I’m pointing to your being like, maybe we might survive, and you’re like — “Whoa, that’s a pretty strong conclusion you’ve got there. Let’s weaken it.” That’s the basic paradigm I’m operating under here. You’re in a space that’s narrower than you realize when you’re like — “Well, if I’m kind of unsure, maybe there’s some hope.”Dwarkesh Patel 3:39:58Yeah, I think that’s a good place to close the discussion on AIs.Eliezer Yudkowsky 3:40:03I do kind of want to mention one last thing. In historical terms, if you look out the actual battle that was being fought on the block, it was me going like — “I expect there to be AI systems that do a whole bunch of different stuff.” And Robin Hanson being like — “I expect there to be a whole bunch of different AI systems that do a whole different bunch of stuff.”Dwarkesh Patel 3:40:27But that was one particular debate with one particular person.Eliezer Yudkowsky 3:40:30Yeah, but your planet, having made the strange reason, given its own widespread theories, to not invest massive resources in having a much larger version of this conversation, as it apparently deemed prudent, given the implicit model that it had of the world, such that I was investing a bunch of resources in this and kind of dragging Robin Hanson along with me. Though he did have his own separate line of investigation into topics like these. Being there as I was, my model having led me to this important place where the rest of the world apparently thought it was fine to let it go hang, such debate was actually what we had at the time. Are we really going to see these single AI systems that do all this different stuff? Is this whole general intelligence notion meaningful at all? And I staked out the bold position for it. It actually was bold. And people did not all say —”Oh, Robin Hansen, you fool, why do you have this exotic position?” They were going like — “Behold these two luminaries debating, or behold these two idiots debating” and not massively coming down on one side of it or other. So in historical terms, I dislike making it out like I was right about anything when I feel I’ve been wrong about so much and yet I was right about anything. And relative to what the rest of the planet deemed it important stuff to spend its time on, given their implicit model of how it’s going to play out, what you can do with minds, where AI goes. I think I did okay. Gwern Branwen did better. Shane Legg arguably did better.Dwarkesh Patel 3:42:20Gwern always does better when it comes to forecasting. Obviously, if you get the better of a debate that counts for something, but a debate with one particular person.Eliezer Yudkowsky 3:42:32Considering your entire planet’s decision to invest like $10 into this entire field of study, apparently one big debate is all you get. And that’s the evidence you got to update on.Dwarkesh Patel 3:42:43Somebody like Ilya Sutskever, when it comes to the actual paradigm of deep learning, was able to anticipate ImageNet scaling up LLMs or whatever. There’s people with track records here who are like, who disagree about doom or something. Eliezer Yudkowsky 3:43:06If Ilya challenged me to a debate, I wouldn’t turn him down. I admit that I did specialize in doom rather than LLMs.Dwarkesh Patel 3:43:14Okay, fair enough. Unless you have other sorts of comments on AI I’m happy with moving on.Eliezer Yudkowsky 3:43:21Yeah. And again, not being like, due to my miraculously precise and detailed theory, I am able to make the surprising and narrow prediction of doom. I think I did a fairly good job of shaping my ignorance to lead me to not be too stupid despite my ignorance over time as it played out. And there’s a prediction, even knowing that little, that can be made.Writing fiction & whether rationality helps you winDwarkesh Patel 3:43:54Okay, so this feels like a good place to pause the AI conversation, and there’s many other things to ask you about given your decades of writing and millions of words. I think what some people might not know is the millions and millions and millions of words of science fiction and fan fiction that you’ve written. I want to understand when, in your view, is it better to explain something through fiction than nonfiction?Eliezer Yudkowsky 3:44:17When you’re trying to convey experience rather than knowledge, or when it’s just much easier to write fiction and you can produce 100,000 words of fiction with the same effort it would take you to produce 10,000 words of nonfiction? Those are both pretty good reasons.Dwarkesh Patel 3:44:30On the second point, it seems like when you’re writing this fiction, not only are you covering the same heady topics that you include in your nonfiction, but there’s also the added complication of plot and characters. It’s surprising to me that that’s easier than just verbalizing the sort of the topics themselves.Eliezer Yudkowsky 3:44:51Well, partially because it’s more fun. That is an actual factor, ain’t going to lie. And sometimes it’s something like, a bunch of what you get in the fiction is just the lecture that the character would deliver in that situation, the thoughts the character would have in that situation. There’s only one piece of fiction of mine where there’s literally a character giving lectures because he arrived on another planet and now has to lecture about science to them. That one is Project lawful. You know about Project Lawful?Dwarkesh Patel 3:45:28I know about it. I have not read it yet.Eliezer Yudkowsky 3:45:30Most of my fiction is not about somebody arriving on another planet who has to deliver lectures. There I was being a bit deliberately like, — “Yeah, I’m going to just do it with Project Lawful. I’m going to just do it. They say nobody should ever do it, and I don’t care. I’m doing it ever ways. I’m going to have my character actually launch into the lectures.” The lectures aren’t really the parts I’m proud about. It’s like where you have the life or death, deathnote style battle of wits that is centering around a series of Bayesian updates and making that actually work because it’s where I’m like — “Yeah, I think I actually pulled that off. And I’m not sure a single other writer on the face of this planet could have made that work as a plot device.” But that said, the nonfiction is like, I’m explaining this thing, I’m explaining the prerequisite, I’m explaining the prerequisites to the prerequisites. And then in fiction, it’s more just, well, this character happens to think of this thing and the character happens to think of that thing, but you got to actually see the character using it. So it’s less organized. It’s less organized as knowledge. And that’s why it’s easier to write.Dwarkesh Patel 3:46:46Yeah. One of my favorite pieces of fiction that explains something is the Dark Lord’s Answer. And I honestly can’t say anything about it without spoiling it. But I just want to say it was such a great explanation of the thing it is explaining. I don’t know what else I can say about it without spoiling it.Eliezer Yudkowsky 3:47:07I’m laughing because relatively few have Dark Lord’s Answer among their top favorite works of mine. It is one of my less widely favored works, actually.Dwarkesh Patel 3:47:22By the way, I don’t think this is a medium that is used enough given how effective it was in an inadequate equilibria. You have different characters just explaining concepts to the other, some of whom are purposefully wrong as examples. And that is such a useful pedagogical tool. Honestly, at least half a blog post should just be written that way. It is so much easier to understand that way.Eliezer Yudkowsky 3:47:46Yeah. And it’s easier to write. And I should probably do it more often. And you should give me a stern look and be like — “Eliezer, write that more often.”Dwarkesh Patel 3:47:54Done. Eliezer, please. I think 13 or 14 years ago you wrote an essay called Rationality is Systematized Winning. Would you have expected then that 14 years down the line, the most successful people in the world or some of the most successful people in the world would have been rationalist?Eliezer Yudkowsky 3:48:17Only if the whole rationalist business had worked closer to the upper 10% of my expectations than it actually got into. The title of the essay was not “Rationalists are Systematized Winning”. There wasn’t even a rationality community back then. Rationality is not a creed. It is not a banner. It is not a way of life. It is not a personal choice. It is not a social group. It’s not really human. It’s a structure of a cognitive process. And you can try to get a little bit more of it into you. And if you want to do that and you fail, then having wanted to do it doesn’t make any difference except insofar as you succeeded. Hanging out with other people who share that creed, going to their parties. It only ever matters insofar as you get a bit more of that structure into you. And this is apparently hard.Dwarkesh Patel 3:49:29This seems like a No True Scotsman kind of point.Eliezer Yudkowsky 3:49:35Yes, there are No True Bayesians upon this planet.Dwarkesh Patel 3:49:38But do you really think that had people tried much harder to adopt the sort of Bayesian principles that you laid out, some of the successful people in the world would have been rationalists?Eliezer Yudkowsky 3:49:55What good does trying do you except insofar as you are trying at something which when you try it, it succeeds?Dwarkesh Patel 3:50:04Is that an answer to the question.Eliezer Yudkowsky 3:50:07Rationality is systematized winning. It’s not Rationality, the life philosophy. It’s not like trying real hard at  this thing, this thing and that thing. It was in the mathematical sense.Dwarkesh Patel 3:50:18Okay, so then the question becomes, does adopting the philosophy of Bayesianism consciously, actually lead to you having more concrete wins?Eliezer Yudkowsky 3:50:31I think it did for me. Though only in, like, scattered bits and pieces of slightly greater sanity than I would have had without explicitly recognizing and aspiring to that principle. The principle of not updating in a predictable direction. The principle of jumping ahead to where you can predictably be where you will predictably be later. The story of my life as I would tell it is a story of my jumping ahead to what people would predictably believe later after reality finally hit them over the head with it. This, to me, is the entire story of the people running around now in a state of frantic emergency over something that was utterly predictably going to be an emergency later as of 20 years ago. And you could have been trying stuff earlier, but you left it to me and a handful of other people. And it turns out that that was not a very wise decision on humanity’s part because we didn’t actually solve it all. And I don’t think that I could have tried even harder or contemplated probability theory even harder and done very much better than that. I contemplated probability theory about as hard as the mileage I could visibly, obviously get from it. I’m sure there’s more. There’s obviously more, but I don’t know if it would have let me save the world.Dwarkesh Patel 3:51:52I guess my question is, is contemplating probability theory at all in the first place something that tends to lead to more victory? I mean, who is the richest person in the world? How often does Elon Musk think in terms of probabilities when he’s deciding what to do? And here is somebody who is very successful. So I guess the bigger question is, in some sense, when you say — Rationality is systematized winning, it’s like a tautology. If the definition of rationality is whatever helps you in. If it’s the specific principles laid out in the sequences, then the question is, like, do the most successful people in the world practice them?Eliezer Yudkowsky 3:52:29I think you are trying to read something into this that is not meant to be there. The notion of “rationality is systematized winning” is meant to stand in contrast to a long philosophical tradition of notions of rationality that are not meant to be, about the mathematical structure not meant to be or about strangely wrong mathematical structures where you can clearly see how these mathematical productions structures will make predictable mistakes. It was meant to be saying something simple. There’s an episode of Star Trek wherein Kirk makes a 3D chess move against Spock and Spock loses, and Spock complains that Kirk’s move was irrational.Dwarkesh Patel 3:53:19Rational towards the goal.Eliezer Yudkowsky 3:53:20The literal winning move is irrational or possibly illogical, Spock might have said, I might be misremembering this. The thing I was saying is not merely — “That’s wrong, that’s like a fundamental misunderstanding of what rationality is.” There is more depth to it than that, but that is where it starts. There are so many people on the Internet in those days, possibly still, who are like — “Well, if you’re rational, you’re going to lose, because other people aren’t always rational.” And this is not just like a wild misunderstanding, but the contemporarily accepted decision theory in academia as we speak at this very moment. Causal decision theory basically has this property where you can be irrational and the rational person you’re playing against is just like — “Oh, I guess I lose then. Have most of the money. I have no choice but to” and ultimatum games specifically. If you look up logical decision theory on Arbital, you’ll find a different analysis of the ultimatum game, where the rational players do not predictably lose the same way as I would define rationality. And if you take this deep mathematical thesis that also runs through all the little moments of everyday life, when you may be tempted to think like — “Well, if I do the reasonable thing, won’t I lose?” That you’re making the same mistake as the Star Trek script writer who had Spock complain that Kirk had won the chess game irrationally, that every time you’re tempted to think like — “Well, here’s the reasonable answer and here’s the correct answer,” you have made a mistake about what is reasonable. And if you then try to screw that around as rationalists should win. Rationalists should have all the social status. Whoever’s the top dog in the present social hierarchy or the planetary wealth distribution must have the most of this math inside them. There are no other factors but how much of a fan you are of this math that’s trying to take the deep structure that can run all through your life in every moment where you’re like — “Oh, wait. Maybe the move that would have gotten the better result was actually the kind of move I should repeat more in the future.” Like to take that thing and turn it into — Social dick measuring contest time, rationalists don’t have the biggest dicks.Dwarkesh Patel 3:56:19Okay, final question. I don’t know how many hours this has been. I really appreciate you giving me your time. I know that in a previous episode, you were not able to give specific advice of what somebody young who is motivated to work on these problems should do. Do you have advice about how one would even approach coming up with an answer to that themselves?Eliezer Yudkowsky 3:56:41There’s people running programs who think we have more time, who think we have better chances, and they’re running programs to try to nudge people into doing useful work in this area. And I’m not sure they’re working. And there’s such a strange road to walk and not a short one. And I tried to help people along the way, and I don’t think they got far enough. Some of them got some distance, but they didn’t turn into alignment specialists doing great work. And it’s the problem of the broken verifier. If somebody had a bunch of talent in physics, they were like — Well, I want to work in this field. I might be like — Well, there’s interpretability, and you can tell whether you’ve made a discovery in interpretability or not. Sets it apart for a bunch of this other stuff, and I don’t think that saves us. So how do you do the kind of work that saves us? The key thing is the ability to tell the difference between good and bad work. And maybe I will write some more blog posts on it. I don’t really expect the blog posts to work. The critical thing is the verifier. How can you tell whether you’re talking sense or not? There’s all kinds of specific heuristics I can give. I can say to somebody — “Well, if your entire alignment proposal is this elaborate mechanism you have to explain the whole mechanism.” And you can’t be like “here’s the core problem. Here’s the key insight that I think addresses this problem.” If you can’t extract that out, if your whole solution is just a giant mechanism, this is not the way. It’s kind of like how people invent perpetual motion machines by making the perpetual motion machines more and more complicated until they can no longer keep track of how it fails. And if you actually had a perpetual motion machine, it would not just be a giant machine, there would be a thing you had realized that made it possible to do the impossible, for example. You’re just not going to have a perpetual motion machine. So there’s thoughts like that. I could say go study evolutionary biology because evolutionary biology went through a phase of optimism and people naming all the wonderful things they thought that evolutionary biology would cough out, all the wonderful properties that they thought natural selection would imbue into organisms. And the Williams Revolution as is sometimes called, is when George Williams wrote Adaptation and Natural Selection, a very influential book. Saying like that is not what this optimization criterion gives you. You do not get the pretty stuff, you do not get the aesthetically lovely stuff. Here’s what you get instead. And by living through that revolution vicariously. I thereby picked up a bit of the thing that to me obviously generalizes about how not to expect nice things from an alien optimization process. But maybe somebody else can read through that and not generalize in the correct direction. So then how do I advise them to generalize in the correct direction? How do I advise them to learn the thing that I learned? I can just give them the generalization but that’s not the same as having the thing inside them that generalizes correctly without anybody standing over their shoulder and forcing them to get the right answer. I could point out and have in my fiction that the entire schooling process of — “Here is this legible question that you’re supposed to have already been taught how to solve. Give me the answer using the solution method you are taught.” This does not train you to tackle new basic problems. But even if you tell people that, how do they retrain? We don’t have a systematic training method for producing real science in that sense. A quarter of the Nobel laureates being the students or grad students of other Nobel laureates because we never figured out how to teach science. We have an apprentice system. We have people who pick out people who they think can be scientists and they hang around them in person. And something that we’ve never written down in a textbook passes down. And that’s where the revolutionaries come from. And there are whole countries trying to invest in having scientists, and they churn out these people who write papers, and none of it goes anywhere. Because the part that was legible to the bureaucracy is, have you written the paper? Can you pass the test? And this is not science. And I could go on for this for a while, but the thing that you asked me is — How do you pass down this thing that your society never did figure out how to teach? And the whole reason why Harry Potter and the Methods of Rationality is popular is because people read it and picked up the rhythm seen in a character’s thoughts of a thing that was not in their schooling system, that was not written down, that you would ordinarily pick up by being around other people. And I managed to put a little bit of it into a fictional character, and people picked up a fragment of it by being near a fictional character, but not in really vast quantities of people. And I didn’t manage to put vast quantities of shards in there. I’m not sure there is not a long list of Nobel laureates who’ve read HPMOR, although there wouldn’t be, because the delay times on granting the prizes are too long. You ask me, what do I say? And my answer is — Well, that’s a whole big, gigantic problem I’ve spent however many years trying to tackle, and I ain’t going to solve the problem with a sentence in this podcast. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

I went over to the OpenAI offices in San Fransisco to ask the Chief Scientist and cofounder of OpenAI, Ilya Sutskever, about:* time to AGI* leaks and spies* what's after generative models* post AGI futures* working with Microsoft and competing with Google* difficulty of aligning superhuman AIWatch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.As always, the most helpful thing you can do is just to share the podcast - send it to friends, group chats, Twitter, Reddit, forums, and wherever else men and women of fine taste congregate.If you have the means and have enjoyed my podcast, I would appreciate your support via a paid subscriptions on Substack.Timestamps(00:00) - Time to AGI(05:57) - What’s after generative models?(10:57) - Data, models, and research(15:27) - Alignment(20:53) - Post AGI Future(26:56) - New ideas are overrated(36:22) - Is progress inevitable?(41:27) - Future BreakthroughsTranscriptTime to AGIDwarkesh Patel  Today I have the pleasure of interviewing Ilya Sutskever, who is the Co-founder and Chief Scientist of OpenAI. Ilya, welcome to The Lunar Society.Ilya Sutskever  Thank you, happy to be here.Dwarkesh Patel  First question and no humility allowed. There are not that many scientists who will make a big breakthrough in their field, there are far fewer scientists who will make multiple independent breakthroughs that define their field throughout their career, what is the difference? What distinguishes you from other researchers? Why have you been able to make multiple breakthroughs in your field?Ilya Sutskever  Thank you for the kind words. It's hard to answer that question. I try really hard, I give it everything I've got and that has worked so far. I think that's all there is to it. Dwarkesh Patel  Got it. What's the explanation for why there aren't more illicit uses of GPT? Why aren't more foreign governments using it to spread propaganda or scam grandmothers?Ilya Sutskever  Maybe they haven't really gotten to do it a lot. But it also wouldn't surprise me if some of it was going on right now. I can certainly imagine they would be taking some of the open source models and trying to use them for that purpose. For sure I would expect this to be something they'd be interested in the future.Dwarkesh Patel  It's technically possible they just haven't thought about it enough?Ilya Sutskever  Or haven't done it at scale using their technology. Or maybe it is happening, which is annoying. Dwarkesh Patel  Would you be able to track it if it was happening? Ilya Sutskever I think large-scale tracking is possible, yes. It requires special operations but it's possible.Dwarkesh Patel  Now there's some window in which AI is very economically valuable, let’s say on the scale of airplanes, but we haven't reached AGI yet. How big is that window?Ilya Sutskever  It's hard to give a precise answer and it’s definitely going to be a good multi-year window. It's also a question of definition. Because AI, before it becomes AGI, is going to be increasingly more valuable year after year in an exponential way. In hindsight, it may feel like there was only one year or two years because those two years were larger than the previous years. But I would say that already, last year, there has been a fair amount of economic value produced by AI. Next year is going to be larger and larger after that. So I think it's going to be a good multi-year chunk of time where that’s going to be true, from now till AGI pretty much. Dwarkesh Patel  Okay. Because I'm curious if there's a startup that's using your model, at some point if you have AGI there's only one business in the world, it's OpenAI. How much window does any business have where they're actually producing something that AGI can’t produce?Ilya Sutskever  It's the same question as asking how long until AGI. It's a hard question to answer. I hesitate to give you a number. Also because there is this effect where optimistic people who are working on the technology tend to underestimate the time it takes to get there. But the way I ground myself is by thinking about the self-driving car. In particular, there is an analogy where if you look at the size of a Tesla, and if you look at its self-driving behavior, it looks like it does everything. But it's also clear that there is still a long way to go in terms of reliability. And we might be in a similar place with respect to our models where it also looks like we can do everything, and at the same time, we will need to do some more work until we really iron out all the issues and make it really good and really reliable and robust and well behaved.Dwarkesh Patel  By 2030, what percent of GDP is AI? Ilya Sutskever  Oh gosh, very hard to answer that question.Dwarkesh Patel Give me an over-under. Ilya Sutskever The problem is that my error bars are in log scale. I could imagine a huge percentage, I could imagine a really disappointing small percentage at the same time. Dwarkesh Patel  Okay, so let's take the counterfactual where it is a small percentage. Let's say it's 2030 and not that much economic value has been created by these LLMs. As unlikely as you think this might be, what would be your best explanation right now of why something like this might happen?Ilya Sutskever  I really don't think that's a likely possibility, that's the preface to the comment. But if I were to take the premise of your question, why were things disappointing in terms of real-world impact? My answer would be reliability. If it somehow ends up being the case that you really want them to be reliable and they ended up not being reliable, or if reliability turned out to be harder than we expect. I really don't think that will be the case. But if I had to pick one and you were telling me — hey, why didn't things work out? It would be reliability. That you still have to look over the answers and double-check everything. That just really puts a damper on the economic value that can be produced by those systems.Dwarkesh Patel  Got it. They will be technologically mature, it’s just the question of whether they'll be reliable enough.Ilya Sutskever  Well, in some sense, not reliable means not technologically mature.What’s after generative models?Dwarkesh Patel  Yeah, fair enough. What's after generative models? Before, you were working on reinforcement learning. Is this basically it? Is this the paradigm that gets us to AGI? Or is there something after this?Ilya Sutskever  I think this paradigm is gonna go really, really far and I would not underestimate it. It's quite likely that this exact paradigm is not quite going to be the AGI form factor. I hesitate to say precisely what the next paradigm will be but it will probably involve integration of all the different ideas that came in the past.Dwarkesh Patel  Is there some specific one you're referring to?Ilya Sutskever  It's hard to be specific.Dwarkesh Patel  So you could argue that next-token prediction can only help us match human performance and maybe not surpass it? What would it take to surpass human performance?Ilya Sutskever  I challenge the claim that next-token prediction cannot surpass human performance. On the surface, it looks like it cannot. It looks like if you just learn to imitate, to predict what people do, it means that you can only copy people. But here is a counter argument for why it might not be quite so. If your base neural net is smart enough, you just ask it — What would a person with great insight, wisdom, and capability do? Maybe such a person doesn't exist, but there's a pretty good chance that the neural net will be able to extrapolate how such a person would behave. Do you see what I mean?Dwarkesh Patel  Yes, although where would it get that sort of insight about what that person would do? If not from…Ilya Sutskever  From the data of regular people. Because if you think about it, what does it mean to predict the next token well enough? It's actually a much deeper question than it seems. Predicting the next token well means that you understand the underlying reality that led to the creation of that token. It's not statistics. Like it is statistics but what is statistics? In order to understand those statistics to compress them, you need to understand what is it about the world that creates this set of statistics? And so then you say — Well, I have all those people. What is it about people that creates their behaviors? Well they have thoughts and their feelings, and they have ideas, and they do things in certain ways. All of those could be deduced from next-token prediction. And I'd argue that this should make it possible, not indefinitely but to a pretty decent degree to say — Well, can you guess what you'd do if you took a person with this characteristic and that characteristic? Like such a person doesn't exist but because you're so good at predicting the next token, you should still be able to guess what that person who would do. This hypothetical, imaginary person with far greater mental ability than the rest of us.Dwarkesh Patel  When we're doing reinforcement learning on these models, how long before most of the data for the reinforcement learning is coming from AI and not humans?Ilya Sutskever  Already most of the default enforcement learning is coming from AIs. The humans are being used to train the reward function. But then the reward function and its interaction with the model is automatic and all the data that's generated during the process of reinforcement learning is created by AI. If you look at the current technique/paradigm, which is getting some significant attention because of chatGPT, Reinforcement Learning from Human Feedback (RLHF). The human feedback has been used to train the reward function and then the reward function is being used to create the data which trains the model.Dwarkesh Patel  Got it. And is there any hope of just removing a human from the loop and have it improve itself in some sort of AlphaGo way?Ilya Sutskever  Yeah, definitely. The thing you really want is for the human teachers that teach the AI to collaborate with an AI. You might want to think of it as being in a world where the human teachers do 1% of the work and the AI does 99% of the work. You don't want it to be 100% AI. But you do want it to be a human-machine collaboration, which teaches the next machine.Dwarkesh Patel  I've had a chance to play around these models and they seem bad at multi-step reasoning. While they have been getting better, what does it take to really surpass that barrier?Ilya Sutskever  I think dedicated training will get us there. More and more improvements to the base models will get us there. But fundamentally I also don't feel like they're that bad at multi-step reasoning. I actually think that they are bad at mental multistep reasoning when they are not allowed to think out loud. But when they are allowed to think out loud, they're quite good. And I expect this to improve significantly, both with better models and with special training.Data, models, and researchDwarkesh Patel  Are you running out of reasoning tokens on the internet? Are there enough of them?Ilya Sutskever  So for context on this question, there are claims that at some point we will run out of tokens, in general, to train those models. And yeah, I think this will happen one day and by the time that happens, we need to have other ways of training models, other ways of productively improving their capabilities and sharpening their behavior, making sure they're doing exactly, precisely what you want, without more data.Dwarkesh Patel You haven't run out of data yet? There's more? Ilya Sutskever Yeah, I would say the data situation is still quite good. There's still lots to go. But at some point the data will run out.Dwarkesh Patel  What is the most valuable source of data? Is it Reddit, Twitter, books? Where would you train many other tokens of other varieties for?Ilya Sutskever  Generally speaking, you'd like tokens which are speaking about smarter things, tokens which are more interesting. All the sources which you mentioned are valuable.Dwarkesh Patel  So maybe not Twitter. But do we need to go multimodal to get more tokens? Or do we still have enough text tokens left?Ilya Sutskever  I think that you can still go very far in text only but going multimodal seems like a very fruitful direction.Dwarkesh Patel  If you're comfortable talking about this, where is the place where we haven't scraped the tokens yet?Ilya Sutskever  Obviously I can't answer that question for us but I'm sure that for everyone there is a different answer to that question.Dwarkesh Patel  How many orders of magnitude improvement can we get, not from scale or not from data, but just from algorithmic improvements? Ilya Sutskever  Hard to answer but I'm sure there is some.Dwarkesh Patel  Is some a lot or some a little?Ilya Sutskever  There’s only one way to find out.Dwarkesh Patel  Okay. Let me get your quickfire opinions about these different research directions. Retrieval transformers. So it’s just somehow storing the data outside of the model itself and retrieving it somehow.Ilya Sutskever  Seems promising. Dwarkesh Patel But do you see that as a path forward?Ilya Sutskever  It seems promising.Dwarkesh Patel  Robotics. Was it the right step for Open AI to leave that behind?Ilya Sutskever  Yeah, it was. Back then it really wasn't possible to continue working in robotics because there was so little data. Back then if you wanted to work on robotics, you needed to become a robotics company. You needed to have a really giant group of people working on building robots and maintaining them. And even then, if you’re gonna have 100 robots, it's a giant operation already, but you're not going to get that much data. So in a world where most of the progress comes from the combination of compute and data, there was no path to data on robotics. So back in the day, when we made a decision to stop working in robotics, there was no path forward. Dwarkesh Patel Is there one now? Ilya Sutskever  I'd say that now it is possible to create a path forward. But one needs to really commit to the task of robotics. You really need to say — I'm going to build many thousands, tens of thousands, hundreds of thousands of robots, and somehow collect data from them and find a gradual path where the robots are doing something slightly more useful. And then the data that is obtained and used to train the models, and they do something that's slightly more useful. You could imagine it's this gradual path of improvement, where you build more robots, they do more things, you collect more data, and so on. But you really need to be committed to this path. If you say, I want to make robotics happen, that's what you need to do. I believe that there are companies who are doing exactly that. But you need to really love robots and need to be really willing to solve all the physical and logistical problems of dealing with them. It's not the same as software at all. I think one could make progress in robotics today, with enough motivation.Dwarkesh Patel  What ideas are you excited to try but you can't because they don't work well on current hardware?Ilya Sutskever  I don't think current hardware is a limitation. It's just not the case.Dwarkesh Patel  Got it. But anything you want to try you can just spin it up? Ilya Sutskever  Of course. You might wish that current hardware was cheaper or maybe it would be better if it had higher memory processing bandwidth let’s say. But by and large hardware is just not an issue.AlignmentDwarkesh Patel  Let's talk about alignment. Do you think we'll ever have a mathematical definition of alignment?Ilya Sutskever  A mathematical definition is unlikely. Rather than achieving one mathematical definition, I think we will achieve multiple definitions that look at alignment from different aspects. And that this is how we will get the assurance that we want. By which I mean you can look at the behavior in various tests, congruence, in various adversarial stress situations, you can look at how the neural net operates from the inside. You have to look at several of these factors at the same time.Dwarkesh Patel  And how sure do you have to be before you release a model in the wild? 100%? 95%?Ilya Sutskever  Depends on how capable the model is. The more capable the model, the more confident we need to be. Dwarkesh Patel Alright, so let's say it's something that's almost AGI. Where is AGI?Ilya Sutskever Depends on what your AGI can do. Keep in mind that AGI is an ambiguous term. Your average college undergrad is an AGI, right? There's significant ambiguity in terms of what is meant by AGI. Depending on where you put this mark you need to be more or less confident.Dwarkesh Patel  You mentioned a few of the paths toward alignment earlier, what is the one you think is most promising at this point?Ilya Sutskever  I think that it will be a combination. I really think that you will not want to have just one approach. People want to have a combination of approaches. Where you spend a lot of compute adversarially to find any mismatch between the behavior you want it to teach and the behavior that it exhibits.We look into the neural net using another neural net to understand how it operates on the inside. All of them will be necessary. Every approach like this reduces the probability of misalignment. And you also want to be in a world where your degree of alignment keeps increasing faster than the capability of the models.Dwarkesh Patel  Do you think that the approaches we’ve taken to understand the model today will be applicable to the actual super-powerful models? Or how applicable will they be? Is it the same kind of thing that will work on them as well or? Ilya Sutskever  It's not guaranteed. I would say that right now, our understanding of our models is still quite rudimentary. We’ve made some progress but much more progress is possible. And so I would expect that ultimately, the thing that will really succeed is when we will have a small neural net that is well understood that’s been given the task to study the behavior of a large neural net that is not understood, to verify. Dwarkesh Patel  By what point is most of the AI research being done by AI?Ilya Sutskever  Today when you use Copilot, how do you divide it up? So I expect at some point you ask your descendant of ChatGPT, you say — Hey, I'm thinking about this and this. Can you suggest fruitful ideas I should try? And you would actually get fruitful ideas. I don't think that's gonna make it possible for you to solve problems you couldn't solve before.Dwarkesh Patel  Got it. But it's somehow just telling the humans giving them ideas faster or something. It's not itself interacting with the research?Ilya Sutskever  That was one example. You could slice it in a variety of ways. But the bottleneck there is good ideas, good insights and that's something that the neural nets could help us with.Dwarkesh Patel  If you're designing a billion-dollar prize for some sort of alignment research result or product, what is the concrete criterion you would set for that billion-dollar prize? Is there something that makes sense for such a prize?Ilya Sutskever  It's funny that you asked, I was actually thinking about this exact question. I haven't come up with the exact criterion yet. Maybe a prize where we could say that two years later, or three years or five years later, we look back and say like that was the main result. So rather than say that there is a prize committee that decides right away, you wait for five years and then award it retroactively.Dwarkesh Patel  But there's no concrete thing we can identify as you solve this particular problem and you’ve made a lot of progress?Ilya Sutskever  A lot of progress, yes. I wouldn't say that this would be the full thing.Dwarkesh Patel  Do you think end-to-end training is the right architecture for bigger and bigger models? Or do we need better ways of just connecting things together?Ilya Sutskever  End-to-end training is very promising. Connecting things together is very promising. Dwarkesh Patel  Everything is promising.Dwarkesh Patel  So Open AI is projecting revenues of a billion dollars in 2024. That might very well be correct but I'm just curious, when you're talking about a new general-purpose technology, how do you estimate how big a windfall it'll be? Why that particular number? Ilya Sutskever  We've had a product for quite a while now, back from the GPT-3 days, from two years ago through the API and we've seen how it grew. We've seen how the response to DALL-E has grown as well and you see how the response to ChatGPT is, and all of this gives us information that allows us to make relatively sensible extrapolations of anything. Maybe that would be one answer. You need to have data, you can’t come up with those things out of thin air because otherwise, your error bars are going to be like 100x in each direction.Dwarkesh Patel  But most exponentials don't stay exponential especially when they get into bigger and bigger quantities, right? So how do you determine in this case?Ilya Sutskever  Would you bet against AI?Post AGI futureDwarkesh Patel  Not after talking with you. Let's talk about what a post-AGI future looks like. I'm guessing you're working 80-hour weeks towards this grand goal that you're really obsessed with. Are you going to be satisfied in a world where you're basically living in an AI retirement home? What are you personally doing after AGI comes?Ilya Sutskever  The question of what I'll be doing or what people will be doing after AGI comes is a very tricky question. Where will people find meaning? But I think that that's something that AI could help us with. One thing I imagine is that we will be able to become more enlightened because we interact with an AGI which will help us see the world more correctly, and become better on the inside as a result of interacting. Imagine talking to the best meditation teacher in history, that will be a helpful thing. But I also think that because the world will change a lot, it will be very hard for people to understand what is happening precisely and how to really contribute. One thing that I think some people will choose to do is to become part AI. In order to really expand their minds and understanding and to really be able to solve the hardest problems that society will face then.Dwarkesh Patel  Are you going to become part AI?Ilya Sutskever  It is very tempting. Dwarkesh Patel  Do you think there'll be physically embodied humans in the year 3000? Ilya Sutskever  3000? How do I know what’s gonna happen in 3000?Dwarkesh Patel  Like what does it look like? Are there still humans walking around on Earth? Or have you guys thought concretely about what you actually want this world to look like? Ilya Sutskever  Let me describe to you what I think is not quite right about the question. It implies we get to decide how we want the world to look like. I don't think that picture is correct. Change is the only constant. And so of course, even after AGI is built, it doesn't mean that the world will be static. The world will continue to change, the world will continue to evolve. And it will go through all kinds of transformations. I don't think anyone has any idea of how the world will look like in 3000. But I do hope that there will be a lot of descendants of human beings who will live happy, fulfilled lives where they're free to do as they see fit. Or they are the ones who are solving their own problems. One world which I would find very unexciting is one where we build this powerful tool, and then the government said — Okay, so the AGI said that society should be run in such a way and now we should run society in such a way. I'd much rather have a world where people are still free to make their own mistakes and suffer their consequences and gradually evolve morally and progress forward on their own, with the AGI providing more like a base safety net.Dwarkesh Patel  How much time do you spend thinking about these kinds of things versus just doing the research?Ilya Sutskever  I do think about those things a fair bit. They are very interesting questions.Dwarkesh Patel  The capabilities we have today, in what ways have they surpassed where we expected them to be in 2015? And in what ways are they still not where you'd expected them to be by this point?Ilya Sutskever  In fairness, it's sort of what I expected in 2015. In 2015, my thinking was a lot more — I just don't want to bet against deep learning. I want to make the biggest possible bet on deep learning. I don't know how, but it will figure it out.Dwarkesh Patel  But is there any specific way in which it's been more than you expected or less than you expected? Like some concrete prediction out of 2015 that's been bounced?Ilya Sutskever  Unfortunately, I don't remember concrete predictions I made in 2015. But I definitely think that overall, in 2015, I just wanted to move to make the biggest bet possible on deep learning, but I didn't know exactly. I didn't have a specific idea of how far things will go in seven years. Well, no in 2015, I did have all these best with people in 2016, maybe 2017, that things will go really far. But specifics. So it's like, it's both, it's both the case that it surprised me and I was making these aggressive predictions. But maybe I believed them only 50% on the inside. Dwarkesh Patel  What do you believe now that even most people at OpenAI would find far fetched?Ilya Sutskever  Because we communicate a lot at OpenAI people have a pretty good sense of what I think and we've really reached the point at OpenAI where we see eye to eye on all these questions.Dwarkesh Patel  Google has its custom TPU hardware, it has all this data from all its users, Gmail, and so on. Does it give them an advantage in terms of training bigger models and better models than you?Ilya Sutskever  At first, when the TPU came out I was really impressed and I thought — wow, this is amazing. But that's because I didn't quite understand hardware back then. What really turned out to be the case is that TPUs and GPUs are almost the same thing. They are very, very similar. The GPU chip is a little bit bigger, the TPU chip is a little bit smaller, maybe a little bit cheaper. But then they make more GPUs and TPUs so the GPUs might be cheaper after all.But fundamentally, you have a big processor, and you have a lot of memory and there is a bottleneck between those two. And the problem that both the TPU and the GPU are trying to solve is that the amount of time it takes you to move one floating point from the memory to the processor, you can do several hundred floating point operations on the processor, which means that you have to do some kind of batch processing. And in this sense, both of these architectures are the same. So I really feel like in some sense, the only thing that matters about hardware is cost per flop and overall systems cost.Dwarkesh Patel  There isn't that much difference?Ilya Sutskever  Actually, I don't know. I don't know what the TPU costs are but I would suspect that if anything, TPUs are probably more expensive because there are less of them.New ideas are overratedDwarkesh Patel  When you are doing your work, how much of the time is spent configuring the right initializations? Making sure the training run goes well and getting the right hyperparameters, and how much is it just coming up with whole new ideas?Ilya Sutskever  I would say it's a combination. Coming up with whole new ideas is a modest part of the work. Certainly coming up with new ideas is important but even more important is to understand the results, to understand the existing ideas, to understand what's going on. A neural net is a very complicated system, right? And you ran it, and you get some behavior, which is hard to understand. What's going on? Understanding the results, figuring out what next experiment to run, a lot of the time is spent on that. Understanding what could be wrong, what could have caused the neural net to produce a result which was not expected. I'd say a lot of time is spent coming up with new ideas as well. I don't like this framing as much. It's not that it's false but the main activity is actually understanding.Dwarkesh Patel  What do you see as the difference between the two?Ilya Sutskever  At least in my mind, when you say come up with new ideas, I'm like — Oh, what happens if it did such and such? Whereas understanding it's more like — What is this whole thing? What are the real underlying phenomena that are going on? What are the underlying effects? Why are we doing things this way and not another way? And of course, this is very adjacent to what can be described as coming up with ideas. But the understanding part is where the real action takes place.Dwarkesh Patel  Does that describe your entire career? If you think back on something like ImageNet, was that more new idea or was that more understanding?Ilya Sutskever  Well, that was definitely understanding. It was a new understanding of very old things.Dwarkesh Patel  What has the experience of training on Azure been like?Ilya Sutskever  Fantastic. Microsoft has been a very, very good partner for us. They've really helped take Azure and bring it to a point where it's really good for ML and we’re super happy with it.Dwarkesh Patel  How vulnerable is the whole AI ecosystem to something that might happen in Taiwan? So let's say there's a tsunami in Taiwan or something, what happens to AI in general?Ilya Sutskever  It's definitely going to be a significant setback. No one will be able to get more compute for a few years. But I expect compute will spring up. For example, I believe that Intel has fabs just like a few generations ago. So that means that if Intel wanted to they could produce something GPU-like from four years ago. But yeah, it's not the best, I'm actually not sure if my statement about Intel is correct, but I do know that there are fabs outside of Taiwan, they're just not as good. But you can still use them and still go very far with them. It's just cost, it’s just a setback.Cost of modelsDwarkesh Patel  Would inference get cost prohibitive as these models get bigger and bigger?Ilya Sutskever  I have a different way of looking at this question. It's not that inference will become cost prohibitive. Inference of better models will indeed become more expensive. But is it prohibitive? That depends on how useful it is. If it is more useful than it is expensive then it is not prohibitive. To give you an analogy, suppose you want to talk to a lawyer. You have some case or need some advice or something, you're perfectly happy to spend $400 an hour. Right? So if your neural net could give you really reliable legal advice, you'd say — I'm happy to spend $400 for that advice. And suddenly inference becomes very much non-prohibitive. The question is, can a neural net produce an answer good enough at this cost? Dwarkesh Patel  Yes. And you will just have price discrimination in different models?Ilya Sutskever  It's already the case today. On our product, the API serves multiple neural nets of different sizes and different customers use different neural nets of different sizes depending on their use case. If someone can take a small model and fine-tune it and get something that's satisfactory for them, they'll use that. But if someone wants to do something more complicated and more interesting, they’ll use the biggest model. Dwarkesh Patel  How do you prevent these models from just becoming commodities where these different companies just bid each other's prices down until it's basically the cost of the GPU run? Ilya Sutskever  Yeah, there's without question a force that's trying to create that. And the answer is you got to keep on making progress. You got to keep improving the models, you gotta keep on coming up with new ideas and making our models better and more reliable, more trustworthy, so you can trust their answers. All those things.Dwarkesh Patel  Yeah. But let's say it's 2025 and somebody is offering the model from 2024 at cost. And it's still pretty good. Why would people use a new one from 2025 if the one from just a year older is even better?Ilya Sutskever  There are several answers there. For some use cases that may be true. There will be a new model for 2025, which will be driving the more interesting use cases. There is also going to be a question of inference cost. If you can do research to serve the same model at less cost. The same model will cost different amounts to serve for different companies. I can also imagine some degree of specialization where some companies may try to specialize in some area and be stronger compared to other companies. And to me that may be a response to commoditization to some degree.Dwarkesh Patel  Over time do the research directions of these different companies converge or diverge? Are they doing similar and similar things over time? Or are they branching off into different areas? Ilya Sutskever  I’d say in the near term, it looks like there is convergence. I expect there's going to be a convergence-divergence-convergence behavior, where there is a lot of convergence on the near term work, there's going to be some divergence on the longer term work. But then once the longer term work starts to fruit, there will be convergence again,Dwarkesh Patel  Got it. When one of them finds the most promising area, everybody just…Ilya Sutskever  That's right. There is obviously less publishing now so it will take longer before this promising direction gets rediscovered. But that's how I would imagine the thing is going to be. Convergence, divergence, convergence.Dwarkesh Patel  Yeah. We talked about this a little bit at the beginning. But as foreign governments learn about how capable these models are, are you worried about spies or some sort of attack to get your weights or somehow abuse these models and learn about them?Ilya Sutskever  Yeah, you absolutely can't discount that. Something that we try to guard against to the best of our ability, but it's going to be a problem for everyone who's building this. Dwarkesh Patel  How do you prevent your weights from leaking? Ilya Sutskever  You have really good security people.Dwarkesh Patel  How many people have the ability to SSH into the machine with the weights?Ilya Sutskever  The security people have done a really good job so I'm really not worried about the weights being leaked.Dwarkesh Patel  What kinds of emergent properties are you expecting from these models at this scale? Is there something that just comes about de novo?Ilya Sutskever  I'm sure really new surprising properties will come up, I would not be surprised. The thing which I'm really excited about, the things which I’d like to see is — reliability and controllability. I think that this will be a very, very important class of emergent properties. If you have reliability and controllability that helps you solve a lot of problems. Reliability means you can trust the model's output, controllability means you can control it. And we'll see but it will be very cool if those emergent properties did exist.Dwarkesh Patel  Is there some way you can predict that in advance? What will happen in this parameter count, what will happen in that parameter count?Ilya Sutskever  I think it's possible to make some predictions about specific capabilities though it's definitely not simple and you can’t do it in a super fine-grained way, at least today. But getting better at that is really important. And anyone who is interested and who has research ideas on how to do that, that can be a valuable contribution.Dwarkesh Patel  How seriously do you take these scaling laws? There's a paper that says — You need this many orders of magnitude more to get all the reasoning out? Do you take that seriously or do you think it breaks down at some point?Ilya Sutskever  The thing is that the scaling law tells you what happens to your log of your next word prediction accuracy, right? There is a whole separate challenge of linking next-word prediction accuracy to reasoning capability. I do believe that there is a link but this link is complicated. And we may find that there are other things that can give us more reasoning per unit effort. You mentioned reasoning tokens, I think they can be helpful. There can probably be some things that help.Dwarkesh Patel  Are you considering just hiring humans to generate tokens for you? Or is it all going to come from stuff that already exists out there?Ilya Sutskever  I think that relying on people to teach our models to do things, especially to make sure that they are well-behaved and they don't produce false things is an extremely sensible thing to do. Is progress inevitable?Dwarkesh Patel  Isn't it odd that we have the data we needed exactly at the same time as we have the transformer at the exact same time that we have these GPUs? Like is it odd to you that all these things happened at the same time or do you not see it that way?Ilya Sutskever  It is definitely an interesting situation that is the case. I will say that it is odd and it is less odd on some level. Here's why it's less odd — what is the driving force behind the fact that the data exists, that the GPUs exist, and that the transformers exist? The data exists because computers became better and cheaper, we've got smaller and smaller transistors. And suddenly, at some point, it became economical for every person to have a personal computer. Once everyone has a personal computer, you really want to connect them to the network, you get the internet. Once you have the internet, you suddenly have data appearing in great quantities. The GPUs were improving concurrently because you have smaller and smaller transistors and you're looking for things to do with them. Gaming turned out to be a thing that you could do. And then at some point, Nvidia said — the gaming GPU, I might turn it into a general purpose GPU computer, maybe someone will find it useful. It turns out it's good for neural nets. It could have been the case that maybe the GPU would have arrived five years later, ten years later. Let's suppose gaming wasn't the thing. It's kind of hard to imagine, what does it mean if gaming isn't a thing? But maybe there was a counterfactual world where GPUs arrived five years after the data or five years before the data, in which case maybe things wouldn’t have been as ready to go as they are now. But that's the picture which I imagine. All this progress in all these dimensions is very intertwined. It's not a coincidence. You don't get to pick and choose in which dimensions things improve.Dwarkesh Patel  How inevitable is this kind of progress? Let's say you and Geoffrey Hinton and a few other pioneers were never born. Does the deep learning revolution happen around the same time? How much is it delayed?Ilya Sutskever  Maybe there would have been some delay. Maybe like a year delayed? Dwarkesh Patel Really? That’s it? Ilya Sutskever It's really hard to tell. I hesitate to give a longer answer because — GPUs will keep on improving. I cannot see how someone would not have discovered it. Because here's the other thing. Let's suppose no one has done it, computers keep getting faster and better. It becomes easier and easier to train these neural nets because you have bigger GPUs, so it takes less engineering effort to train one. You don't need to optimize your code as much. When the ImageNet data set came out, it was huge and it was very, very difficult to use. Now imagine you wait for a few years, and it becomes very easy to download and people can just tinker. A modest number of years maximum would be my guess. I hesitate to give a lot longer answer though. You can’t re-run the world you don’t know. Dwarkesh Patel  Let's go back to alignment for a second. As somebody who deeply understands these models, what is your intuition of how hard alignment will be?Ilya Sutskever  At the current level of capabilities, we have a pretty good set of ideas for how to align them. But I would not underestimate the difficulty of alignment of models that are actually smarter than us, of models that are capable of misrepresenting their intentions. It's something to think about a lot and do research. Oftentimes academic researchers ask me what’s the best place where they can contribute. And alignment research is one place where academic researchers can make very meaningful contributions. Dwarkesh Patel  Other than that, do you think academia will come up with important insights about actual capabilities or is that going to be just the companies at this point?Ilya Sutskever  The companies will realize the capabilities. It's very possible for academic research to come up with those insights. It doesn't seem to happen that much for some reason but I don't think there's anything fundamental about academia. It's not like academia can't. Maybe they're just not thinking about the right problems or something because maybe it's just easier to see what needs to be done inside these companies.Dwarkesh Patel  I see. But there's a possibility that somebody could just realize…Ilya Sutskever  I totally think so. Why would I possibly rule this out? Dwarkesh Patel  What are the concrete steps by which these language models start actually impacting the world of atoms and not just the world of bits?Ilya Sutskever  I don't think that there is a clean distinction between the world of bits and the world of atoms. Suppose the neural net tells you — hey here's something that you should do, and it's going to improve your life. But you need to rearrange your apartment in a certain way. And then you go and rearrange your apartment as a result. The neural net impacted the world of atoms.Future breakthroughsDwarkesh Patel  Fair enough. Do you think it'll take a couple of additional breakthroughs as important as the Transformer to get to superhuman AI? Or do you think we basically got the insights in the books somewhere, and we just need to implement them and connect them? Ilya Sutskever  I don't really see such a big distinction between those two cases and let me explain why. One of the ways in which progress is taking place in the past is that we've understood that something had a desirable property all along but we didn't realize. Is that a breakthrough? You can say yes, it is. Is that an implementation of something in the books? Also, yes. My feeling is that a few of those are quite likely to happen. But in hindsight, it will not feel like a breakthrough. Everybody's gonna say — Oh, well, of course. It's totally obvious that such and such a thing can work. The reason the Transformer has been brought up as a specific advance is because it's the kind of thing that was not obvious for almost anyone. So people can say it's not something which they knew about. Let's consider the most fundamental advance of deep learning, that a big neural network trained in backpropagation can do a lot of things. Where's the novelty? Not in the neural network. It's not in the backpropagation. But it was most definitely a giant conceptual breakthrough because for the longest time, people just didn't see that. But then now that everyone sees, everyone’s gonna say — Well, of course, it's totally obvious. Big neural network. Everyone knows that they can do it.Dwarkesh Patel  What is your opinion of your former advisor’s new forward forward algorithm?Ilya Sutskever  I think that it's an attempt to train a neural network without backpropagation. And that this is especially interesting if you are motivated to try to understand how the brain might be learning its connections. The reason for that is that, as far as I know, neuroscientists are really convinced that the brain cannot implement backpropagation because the signals in the synapses only move in one direction. And so if you have a neuroscience motivation, and you want to say — okay, how can I come up with something that tries to approximate the good properties of backpropagation without doing backpropagation? That's what the forward forward algorithm is trying to do. But if you are trying to just engineer a good system there is no reason to not use backpropagation. It's the only algorithm.Dwarkesh Patel  I guess I've heard you in different contexts talk about using humans as the existing example case that AGI exists. At what point do you take the metaphor less seriously and don't feel the need to pursue it in terms of the research? Because it is important to you as a sort of existence case.Ilya Sutskever  At what point do I stop caring about humans as an existence case of intelligence?Dwarkesh Patel  Or as an example you want to follow in terms of pursuing intelligence in models.Ilya Sutskever  I think it's good to be inspired by humans, it's good to be inspired by the brain. There is an art into being inspired by humans in the brain correctly, because it's very easy to latch on to a non-essential quality of humans or of the brain. And many people whose research is trying to be inspired by humans and by the brain often get a little bit specific. People get a little bit too — Okay, what cognitive science model should be followed? At the same time, consider the idea of the neural network itself, the idea of the artificial neuron. This too is inspired by the brain but it turned out to be extremely fruitful. So how do they do this? What behaviors of human beings are essential that you say this is something that proves to us that it's possible? What is an essential? No this is actually some emergent phenomenon of something more basic, and we just need to focus on getting our own basics right. One can and should be inspired by human intelligence with care.Dwarkesh Patel  Final question. Why is there, in your case, such a strong correlation between being first to the deep learning revolution and still being one of the top researchers? You would think that these two things wouldn't be that correlated. But why is there that correlation?Ilya Sutskever  I don't think those things are super correlated. Honestly, it's hard to answer the question. I just kept trying really hard and it turned out to have sufficed thus far. Dwarkesh Patel So it's perseverance. Ilya Sutskever It's a necessary but not a sufficient condition. Many things need to come together in order to really figure something out. You need to really go for it and also need to have the right way of looking at things. It's hard to give a really meaningful answer to this question.Dwarkesh Patel  Ilya, it has been a true pleasure. Thank you so much for coming to The Lunar Society. I appreciate you bringing us to the offices. Thank you. Ilya Sutskever  Yeah, I really enjoyed it. Thank you very much. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

It is said that the two greatest problems of history are: how to account for the rise of Rome, and how to account for her fall. If so, then the volcanic ashes spewed by Mount Vesuvius in 79 AD - which entomb the cities of Pompeii and Herculaneum in South Italy - hold history’s greatest prize. For beneath those ashes lies the only salvageable library from the classical world.Nat Friedman was the CEO of Github form 2018 to 2021. Before that, he started and sold two companies - Ximian and Xamarin. He is also the founder of AI Grant and California YIMBY.And most recently, he has created and funded the Vesuvius Challenge - a million dollar prize for reading an unopened Herculaneum scroll for the very first time. If we can decipher these scrolls, we may be able to recover lost gospels, forgotten epics, and even missing works of Aristotle.We also discuss the future of open source and AI, running Github and building Copilot, and why EMH is a lie.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.As always, the most helpful thing you can do is just to share the podcast - send it to friends, group chats, Twitter, Reddit, forums, and wherever else men and women of fine taste congregate.If you have the means and have enjoyed my podcast, I would appreciate your support via a paid subscriptions on Substack 🙏.Timestamps(0:00:00) - Vesuvius Challenge(0:30:00) - Finding points of leverage(0:37:39) - Open Source in AI(0:40:32) - Github Acquisition(0:50:18) - Copilot origin Story(1:11:47) - Nat.org(1:32:56) - Questions from TwitterTranscriptDwarkesh Patel Today I have the pleasure of speaking with Nat Friedman, who was the CEO of GitHub from 2018 to 2021. Before that, he started and sold two companies, Ximian and Xamarin. And he is also the founder of AI Grant and California YIMBY. And most recently, he is the organizer and founder of the Scroll prize, which is where we'll start this conversation. Do you want to tell the audience about what the Scroll prize is? Vesuvius ChallengeNat Friedman We're calling it the Vesuvius challenge. It is just this crazy and exciting thing I feel incredibly honored to have gotten caught up in. A couple of years ago, it was the midst of COVID and we were in a lockdown, and like everybody else, I was falling into internet rabbit holes. And I just started reading about the eruption of Mount Vesuvius in Italy, about 2000 years ago. And it turns out that when Vesuvius erupted, it was AD 79. It destroyed all the nearby towns, everyone knows about Pompeii. But there was another nearby town called Herculaneum. And Herculaneum was sort of like the Beverly Hills to Pompeii. So big villas, big houses, fancy people. And in Herculaneum, there was one enormous villa in particular. It had once been owned by the father in law of Julius Caesar, a well connected guy. And it was full of beautiful statues and marbles and art. But it was also the home to a huge library of papyrus scrolls. When the villa was buried, the volcano spit out enormous quantities of mud and ash, and it buried Herculaneum in something like 20 meters of material. So it wasn't a thin layer, it was a very thick layer. Those towns were buried and forgotten for hundreds of years. No one even knew exactly where they were, until the 1700s. In 1750 a farm worker who was digging a well in the outskirts of Herculaneum struck this marble paving stone of a path that had been at this huge villa. He was pretty far down when he did that, he was 60 feet down. And then subsequently, a Swiss engineer came in and started digging tunnels from that well shaft and they found all these treasures. Looting was sort of the spirit of the time. If they encountered a wall, they would just bust through it and they were taking out these beautiful bronze statues that had survived. And along the way, they kept encountering these lumps of what looked like charcoal, they weren't sure what they were, and many were apparently thrown away, until someone noticed a little bit of writing on one of them. And they realized they were papyrus scrolls, and there were hundreds and even 1000s of them. So they had uncovered this enormous library, the only library ever to have sort of survived in any form, even though it's badly damaged. And they were carbonized, very fragile. The only one that survived since antiquity. In a Mediterranean climate these papyrus scrolls rot and decay quickly. They'd have to be recopied by monks every 100 years or so, maybe even less.It’s estimated that we only have less than 1% of all the writing from that period. It was an enormous discovery to find these hundreds of papyrus scrolls underground. Even if they were not in good condition but still present. On a few of them, you can make out the lettering. In a well meaning attempt to read them people immediately started trying to open them. But they're really fragile so they turned to ash in your hand. And so hundreds were destroyed. People did things like, cut them with daggers down the middle, and a bunch of little pieces would flake off, and they tried to get a few letters off of a couple of pieces. Eventually there was an Italian monk named Piaggio. He devised this machine, under the care of the Vatican, to unroll these things very, very slowly, like half a centimeter a day. A typical scroll could be 15 or 20 or 30 feet long, and manage to successfully unroll a few of these, and on them they found Greek philosophical texts, in the Epicurean tradition, by this little known philosopher named Philodemus. But we got new text from antiquity, which is not a thing that happens all the time. Eventually, people stopped trying to physically unroll these things because so many were destroyed. In fact, some attempts to physically unroll the scrolls continued even into the 200s and they were destroyed. The current situation is we have 600 plus roughly intact scrolls that we can open. I heard about this and I thought that was incredibly exciting, the idea that there was information from 2000 years in the past. We don't know what's in these things. And obviously, people are trying to develop new ways and new technologies to open them. I read about a professor at the University of Kentucky, Brent Seales, who had been trying to scan these using increasingly advanced imaging techniques, and then use computer vision techniques and machine learning to virtually unroll them without ever opening them. They tried a lot of different things but their most recent attempt in 2019, was to take the scrolls to a particle accelerator in Oxford, England, called the diamond light source, and to make essentially an incredibly high resolution 3D X Ray scan. And they needed really high energy photons in order to do this. And they were able to take scans at eight microns. These really quite tiny voxels, which they thought would be sufficient. I thought this was like the coolest thing ever. We're using technologies to read this lost information from the past And I waited for the news that they had been decoded successfully. That was 2020 and then COVID hit, everybody got a little bit slowed down by that. Last year, I found myself wondering what happened to Dr. Seales and his scroll project. I reached out and it turned out they had been making really good progress. They had gotten some machine learning models to start to identify ink inside of the scrolls, but they hadn't yet extracted words or passages, it's very challenging. I invited him to come out to California and hang out and to my shock he did. We got to talking and decided to team up and try to crack this thing. The approach that we've settled on to do that is to actually launch an open competition. We've done a ton of work with his team to get the data and the tools and techniques and just the broad understanding of materials into a shape where smart people can approach it and get productive easily. And I'm putting up together with Daniel Gross, a prize in sort of like an X PRIZE or something like that, for the first person or team who can actually read substantial amounts of real text from one of these scrolls without opening them. We're launching that this week. I guess maybe it's when this airs. What gets me excited are the stakes. The stakes are kind of big. The six or eight hundred scrolls that are there, it's estimated that if we could read all of them, somehow the technique works and it generalizes to all the scrolls, then that would approximately double the total texts that we have from antiquity. This is what historians are telling me. So it's not like – Oh, we would get like a 5% bump or a 10% bump in the total ancient Roman or Greek text. No, we get all of the texts that we have, multiple Shakespeares is one of the units that I've heard. So that would be significant. We don't know what's in there, we've got a few Philodemus texts, those are of some interest. But there could be lost epic poems, or God knows what. So I'm really excited and I think there's like a 50% chance that someone will encounter this opportunity and get the data and get nerd sniped by it and we'll solve it this year.Dwarkesh Patel I mean, really, it is something out of a science fiction novel. It's like something you'd read in Neal Stephenson or something. I was talking to Professor Seales before and apparently the shock went both ways. Because the first few emails, he was like – this has got to be spam. Like no way Nat Friedman is reaching out and has found out about this prize. Nat Friedman That's really funny because he was really pretty hard to get in touch with. I emailed them a couple times, but he just didn't respond. I asked my admin, Emily, to call the secretary of his department and say – Mr. Friedman requested me and then he knew there was something actually going on there. So he finally got on the phone with me and we got to zoom. And he's like, why are you interested in this? I love Brent, he's fantastic and I think we're friends now. We found that we think alike about this and he's reached the point where he just really wants to crack. They've taken this right up to the one yard line, this is doable at this point. They've demonstrated every key component. Putting it all together, improving the quality, doing it at the scale of a whole scroll, this is still very hard work. And an open competition seems like the most efficient way to get it done.Dwarkesh Patel Before we get into the state of the data and the different possible solutions. I want to make tangible what could be gained if we can unwrap these? You said there's a few more 1000 scrolls? Are we talking about the ones in Philodemus’s layer or are we talking about the ones in other layers?Nat Friedman You think if you find this crazy Villa that was owned by Julius Caesar's father in law, then we just dig the whole thing out. But in fact, most of the exploration occurred in the 1700s, through the Swiss engineer’s underground tunnels. The villa was never dug out and exposed to the air. You went down 50-60 feet and then you dig tunnels. And again, they were looking for treasure, not like a full archaeological exploration. So they mostly got treasure. In the 90s some additional excavations were done at the edge of the villa and they discovered a couple things. First, they discovered that it was a seaside Villa that faced the ocean. It was right on the water before the volcano erupted. The eruption actually pushed the shoreline out by depositing so much additional mud there. So it's no longer right by the ocean, apparently, I've actually never been. And they also found that there were two additional floors in the villa that the tunnels had apparently never excavated. And so at most, a third of the villa has been excavated. Now, they also know when they were discovering these papyrus scrolls that they found basically one little room where most of the scrolls were. And these were mostly these Philodemus texts, at least, that's what we know. And they apparently found several revisions, sometimes of the same text. The hypothesis is this was actually Philodemus’s working library, he worked here, this sort of epicurean philosopher. In the hallways, though, they occasionally found other scrolls, including crates of them. And the belief is, at least this is what historians have told me, and I'm no expert. But what they have told me is they think that the main library in this villa has probably not been excavated. And that the main library may be a Latin library, and may contain literary texts, historical texts, other things, and that it could be much larger. Now, I don't know how prone these classists are to wishful thinking. It is a romantic idea. But they have some evidence in the presence of these partly evacuated scrolls that were found in hallways, and that sort of thing. I've since gone and read a bunch of the firsthand accounts of the excavations. There are these heartbreaking descriptions of them finding like an entire case of scrolls in Latin, and accidentally destroying it as they tried to get it out of the mud and there were maybe 30 scrolls or something in there. There clearly was some other stuff that we just haven't gotten to.Dwarkesh Patel You made some scrolls right?Nat Friedman Yeah. This is a papyrus, and it's a grassy reed that grows on the Nile in Egypt. And for many 1000s of years they've been making paper out of it. And the way they do it is they take the outer rind off of the papyrus and then they cut the inner core into these strips. They lay the strips out parallel to one another and they put another layer to 90 degrees to that bottom layer. And they press it together in a press or under stones and let it dry out. And that's Papyrus, essentially. And then they'll take some of those sheets and glue them together with paste, usually made out of flour, and get a long scroll. You can still buy it, I bought this on Amazon, and it's interesting because it's got a lot of texture. Those fibers, ridges of the papyrus plant, and so when you write on it, you really feel the texture. I got it because I wanted to understand what these artifacts that we're working with. So we made an attempt to simulate carbonizing a few of these. We basically took a Dutch oven, because when you carbonized something and you make charcoal, it's not like burning it with oxygen, you remove the oxygen, heat it up and let it carbonize. We tried to simulate that with a Dutch oven, which is probably imperfect, and left it in the oven at 500 degrees Fahrenheit for maybe five or six hours. These things are incredibly light snd if you try to unfold them, they just fall apart in your hand very readily. I assume these are in somewhat better shape than the ones that were found because these were not in a volcanic eruption and covered in mud. Maybe that mud was hotter than my oven can go. And they’re just flakes, just squeeze it and it’s just dust in your hand. And so we actually tried to replicate many of the heartbreaking 1700s, 18th century unrolling techniques. They used rose water, for example, or they tried to use different oils to soften it and unroll it. And most of them are just very destructive. They poured mercury into it because they thought mercury would slip between the layers potentially. So yeah, this is sort of what they look like. They shrink and they turn to ash.Dwarkesh Patel For those listening, by the way, just imagine the ash of a cigar but blacker and it crumbles the same way. It's just a blistered black piece of rolled up Papyrus.Nat Friedman Yeah. And they blister, the layers can separate. They can fuse. Dwarkesh Patel And so this happened in 79 AD right? So we know that anything before that could be in here, which I guess could include? Nat Friedman Yes. What could be in there? I don't know. You and I have speculated about that, right? It would be extremely exciting not to just get more epicurean philosophy, although that's fine, too. But almost anything would be interesting in additive. The dream is – I think it would maybe have a big impact to find something about early Christianity, like a contemporaneous mention of early Christianity, maybe there'd be something that the church wouldn't want, that would be exciting to me. Maybe there'd be some color detail from someone commenting on Christianity or Jesus, I think that would be a very big deal. We have no such things as far as I know. Other things that would be cool would be old stuff, like even older stuff. There were several scrolls already found there that were hundreds of years old when the villa was buried. As per my understanding the villa was probably constructed about 100 years prior and they can date some of the scrolls from the style of writing. And so there was some old stuff in there. And the Library of Alexandria was burned 80 or 90 years prior. And so, again, maybe wishful thinking, but there's some rumors that some of those scrolls were evacuated and maybe some of them would have ended up at this substantial, prominent, Mediterranean villa. God knows what’ll be in there, that would be really cool. I think it'd be great to find literature, personally I think that would be exciting, like beautiful new poems or stories, we just don't have a ton because so little survived. I think I think that would be fun. You had the best, crazy idea for what could be in there, which was text which was GPT watermarks. That would be a creepy feeling.Dwarkesh Patel I still can't get over just how much of a plot of a sci fi novel this is like. Potentially the biggest intact library from the ancient world that has been sort of stopped like a debugger because of this volcano. The philosophers of antiquity forgotten, the earliest gospels, there's so much interesting stuff there. But let's talk about what the data looks like. So you mentioned that they've been CT scanned, and that they built these machine learning techniques to do segmentation and the unrolling. What would it take to get from there to understand the actual content of what is within?Nat Friedman Dr. Seales actually pioneered this field of what is now widely called virtual unwrapping. And he actually did not do it with these Herculaneum scrolls, these things are like expert mode, they're so difficult. I'll tell you why soon. But he initially did it with a scroll that was found in the Dead Sea in Israel. It's called The En-Gedi scroll and it was carbonized under slightly similar circumstances. I think there was a temple that was burned. The papyrus scroll was in a box. So it kind of is like a Dutch oven, it carbonized in the same way. And so it was not openable. it’d fall apart. So the question was, could you nondestructively read the contents of it? So he did this 3D X-ray, the CT scan of the scroll, and then was able to do two things. First, the ink gave a great X-ray signature. It looked very different from the papyrus, it was high contrast. And then second, he was able to segment the wines of the scroll, you know, throughout the entire body of the scroll, and identify each layer, and then just geometrically unroll it using fairly normal flattening computer vision techniques, and then read the contents. It turned out to be an early part of the book of Leviticus, something of the Old Testament or the Torah. And that was like a landmark achievement. Then the next idea was to apply those same techniques to this case. This has proven hard. There's a couple things that make it difficult, the primary one is that the ink used on the Herculaneum papyri is not very absorbent of X-Ray. It basically seems to be equally absorbent of X ray as the papyrus. Very close, certainly not perfectly. So you don't have this nice bright lettering that shows up on your Tomographic, 3D X-Ray. So you have to somehow develop new techniques for finding the ink in there. That's sort of problem one, and it's been a major challenge. And then the second problem is the scrolls are just really messed up. They were long and tightly wound, highly distorted by the volcanic mud, which not only heated them but partly deformed them. So just the segmentation problem of identifying each of these layers throughout the scroll is doable, but it's hard. Those are a couple of challenges. And then the other challenge, of course, is just getting access to scrolls and taking them to a particle accelerator. So you have to have scroll access and particle accelerator access, and time on those. It's expensive and difficult. Dr. Seales did the hard work of making all that happen. The good news is that in the last couple of months, his lab has demonstrated the ability to actually recognize ink inside these X rays with a convolutional neural network. I look at the X-ray scans and I can't see the ink, at least in any of the renderings that I’ve seen, but the machine learning model can pick up on very subtle patterns in the X-Ray absorption at high resolution inside these volumes in order to identify and we've seen that. So you might ask – Okay, how do you train a model to do that, because you need some kind of ground truth data to train the model? The big insight that they had was to train on broken off fragments of the Papyrus. So as people tried to open these over the years in Italy, they destroyed many of them, but they saved some of the pieces that broke off. And on some of those pieces, you can kind of see lettering. And if you take an infrared image of the fragment, then you can really see the lettering pretty well, in some cases. And so they think it's 930 nanometers, they take this little infrared image, now you've got some ground truth, then you do a CT scan of that broken off fragment, and you try to align it, register it with the image. And then you have data that you can use potentially to train a model. That turned out to work in the case of the fragments. I think this is sort of why now? This is why I think launching this challenge now is the right time, because we have a lot of reasons to believe it can work. In the core techniques, the core pieces have been demonstrated, it just all has to be put together at the scale of these really complicated scrolls. And so yeah, if you can do the segmentation, which is probably a lot of work, maybe there's some way to automate it. And then you can figure out how to apply these models inside the body of a scroll and not just to these fragments, then it seems seems like you could probably read lots of text,Dwarkesh Patel Why did you decide to do it in the form of a prize, rather than just like giving a grant to the team that was already pursuing it, or maybe some other team that wants to take it out? Nat Friedman We talked about that. But I think what we basically concluded was the search space of different ways you could solve this is pretty big. And we just wanted to get it done as quickly as possible. Having a contest means lots of people are going to try lots of things and you know, someone's gonna figure it out quickly. Many eyes may make it shallow as a task. I think that's the main thing. Probably someone could do it but I think this will just be a lot more efficient. And it's fun too. I think it's interesting to do a contest and who knows who will solve it or how? People may not even use machine learning. We think that's the most likely approach for recognizing the ink but they may find some other approach that we haven't thought of.Dwarkesh Patel One question people might have is that you have these visible fragments mapped out. Do we expect them to correspond to the burned off or the ashen carbonized scrolls that you can do machine learning on? Ground truth of one could correspond to the other? Nat Friedman I think that's a very legitimate concern, they're different. When you have a broken off fragment, there's air above the ink. So when you CT scan it, you have kind of ink next to air. Inside of a wrapped scroll, the ink might be next to Papyrus, right? Because it's pushing up against the next layer. And your model may not know what to do with that. So yeah, I think this is one of the challenges and sort of how you take these models that were trained on fragments and translate them to the slightly different environment. But maybe there's parts of the scroll where there is air on the inside and we know that to be true. You can sort of see that here. And so I think it should at least partly work and clever people can probably figure out how to make it completely work?Dwarkesh Patel Yeah. So you said the odds are about 50-50? What makes you think that it can be done?Nat Friedman I think it can be done because we recognized ink from a CT scan on the fragments and I think everything else is probably geometry and computer vision. The scans are very high resolution, they're eight micrometers. If you kind of stood a scroll on an end like this, they're taken in the slices through it. So it's like this in the Z axis from bottom to top there are these slices. And the way they're represented on disk is each slice is a TIFF file. And for the full scrolls, each slice is like 100-something megabytes. So they're quite high resolution. And then if you stack for example, 100 of these, they're eight microns, right? So 100 of these is 0.8 millimeters. Millimeter is pretty small. We think the resolution is good enough, or at least right on the edge of good enough that it should be possible. There's sort of like, seem to be six or eight pixels. For voxels I guess, across an entire layer of papyrus. That's probably enough. And we've also seen with the machine learning models, Dr. Seales, has got some PhD students who have actually demonstrated this at eight microns. So I think that the ink recognition will work. The data is clearly physically in the scrolls, right? The ink was carbonized, the papyrus was carbonized. But not a lot of data actually physically survived. And then the question is – Did the data make it into the scans? And I think that's very likely based on the results that we've seen so far. So I think it's just about a smart person solving this, or a smart group of people, or just a dogged group of people who do a lot of manual work that could also work, or you may have to be smart and dogged. I think that's where most of my uncertainty is, is just whether somebody does it.Dwarkesh Patel Yeah, I mean, if a quarter of a million dollars doesn’t motivate you.Nat Friedman Yeah, I think money is good. There's a lot of money in machine learning these days.Dwarkesh Patel Do we have enough data in the form of scrolls that have been mapped out to be able to train a model if that's the best way to go? Because one question somebody might have is – Listen, if you already have this ground truth, why hasn't Dr. Seales’ team already been able to just train it?Nat Friedman I think they will. I think if we just let them do it, they'll get it solved. It might take a little bit longer because it's not a huge number of people. There is a big space here. But I mean, yeah, if we didn't launch this contest, I'd still think this would get solved. But it might take several years. And I think this way, it's likely to happen this year.Dwarkesh Patel Let's say the prize is solved. Somebody figures out how to do this and we can read the first scroll. You mentioned that these other layers haven't been excavated. How is the world going to react? Let's say we get about one of these mapped. Nat Friedman That's my personal hope for this. I always like to look for sort of these cheap leverage hacks, These moments where you can do a relatively small thing and it creates a.. you kick a pebble and you get an avalanche. The theory is, and Grant shares this theory, if you can read one scroll, and we only have two scanned scrolls, there's hundreds of surviving scrolls, it’s relatively expensive to use to book a particle accelerator. So if you can scan one scroll, and you know it works, and you can generalize the technique out, and it's going to work on these other scrolls, then the money which is probably in the low millions, maybe only $1 million to scan the remaining scrolls, will just arrive. It’s just too sweet of a prize not for that not to happen. And the urgency and kind of return on excavating the rest of the villa, will be incredibly obvious too. Because if there are 1000s more papyrus scrolls in there, and we now have the techniques to read them, then there's golden that mud and it's got to be dug out. It's amazing how little money there is for archaeology. Literally for decades, no one's been digging there. That’s my hope. That this is the catalyst that works, somebody reads it, they get a lot of glory, we all get to feel great. And then the diggers arrive in Herculaneum and they get the rest.Finding points of leverageDwarkesh Patel I wonder if the budget for archaeological movies and games like Uncharted or Indiana Jones is bigger than the actual budget to do real world archaeology. But I was talking to some of the people before this interview, and that's one thing they emphasized is your ability to find these leverage points. For example, with California YIMBY, I don't know the exact amount you seeded it with. But for that amount of money, and for an institution that is that new, it is one of the very few institutions that has had a significant amount of political influence, if you look at the state of YIMBY in California and nationally today. How do you identify these things? There's plenty of people who have money who get into history or get into whatever subject, very few do something about it. How do you figure out where?Nat Friedman I'm a little bit mystified by why people don't do more things too. I don't know, maybe you can tell me why aren’t more people doing things? I think most rich people are boring and they should do more cool things. So I'm hoping that they do that now. I think part of it is I just fundamentally don't believe the world is efficient. So if I see an opportunity to do something, I don't have a reflexive reaction that says – Oh, that must not be a good idea if it were a good idea someone would already be doing it. Like someone must be taking care of housing policy in California, right? Or somebody must be taking care of this or that.So first, I don't have that filter that says the world's efficient don’t bother, someone's probably got it covered. And then the second thing is I have learned to trust my enthusiasm. It gets me in trouble too, but if I get really enthusiastic about something and that enthusiasm persists, I just indulge it. And so I just kind of let myself be impulsive. There's this great image that I found and tweeted which said – we do these things not because they are easy, but because we thought they would be easy. That's frequently what happens. The commitment to do it is impulsive and it's done out of enthusiasm and then you get into it and you're like – oh my god, this is really much harder than we expected. But then you're committed and you're stuck and you're going to have to get it done. I thought this project would be relatively straightforward. I’m going to take the data and put it up. But of course 99% of the work has already been done by Dr. Seales and his team at the University of Kentucky. I am a kind of carpetbagger. I've shown up at the end here and try to do a new piece of it. Dwarkesh Patel The last mile is often the hardest. Nat Friedman Well it turned out to be fractal anyway. All the little bits that you have to get right to do a thing and have it work and I hope we got all of them. So I think that's part of it – just not believing that the world is efficient and then just allowing your enthusiasm to cause you to commit to something that turns out to be a lot of work and really hard. And then you just are stubborn and don't want to fail so you keep at it. I think that's it. Dwarkesh Patel The efficiency point, do you think that's particularly true just of things like California YIMBY or this, where there isn't a direct monetary incentive or... Nat Friedman No. Certain parts of the world are more efficient than others and you can't assume equal levels of inefficiency everywhere. But I'm constantly surprised by how even in areas you expect to be very efficient, there are things that are in plain sight that I see them and others don't. There's lots of stuff I don't see too. I was talking to some traders at a hedge fund recently. I was trying to understand the role secrets play in the success of a hedge fund. The reason I was interested in that is because I think the AI labs are going to enter a new similar dynamic where their secrets are very valuable. If you have a 50% training efficiency improvement and your training runs cost $100 million, that is a $50 million secret that you want to keep. And hedge funds do that kind of thing routinely. So I asked some traders at a very successful hedge fund, if you had your smartest trader get on Twitch for 10 minutes once a month, and on that Twitch stream describe their 30-day-old trading strategies. Not your current ones, but the ones that are a month old. What would that... How would that affect your business after 12 months of doing that? So 12 months, 10 minutes a month, 30-day look back. That’s two hours in a year. And to my shock, they told me about an 80% reduction in their profits. It would have a huge impact. And then I asked – So how long would the look back window have to be before it would have a relatively small effect on your business? And they said 10 years. So that I think is quite strong evidence that the world's not perfectly efficient because these folks make billions of dollars using secrets that could be relayed in an hour or something like that. And yet others don't have them or their secrets wouldn't work. So I think there are different levels of efficiency in the world, but on the whole, our default estimate of how efficient the world is is far too charitable. Dwarkesh Patel On the particular point of AI labs potentially storing secrets, you have this sort of strange norm of different people from different AI labs, not only being friends, but often living together, right? It would be like Oppenheimer living with somebody working on the Russian atomic bomb or something like that. Do you think those norms will persist once the value of the secrets is realized? Nat Friedman Yeah, I was just wondering about that some more today. It seems to be sort of slowing, they seem to be trying to close the valves. But I think there's a lot of things working against them in this regard. So one is that the secrets are relatively simple. Two is that you're coming off this academic norm of publishing and really the entire culture is based on sort of sharing and publishing. Three is, as you said, they all live in group houses, summer in polycules. There's just a lot of intermixing. And then it's all in California. And California is a non-compete state. We don't have non-competes. And so they'd have to change the culture, get everybody their own house, and move to Connecticut and then maybe it'll work. I think ML engineer salaries and compensation packages will probably be adjusted to try to address this because you don't want your secrets walking out the door. There are engineers, Igor Babushkin for example, who has just joined Twitter. Elon hired him to train. I think that's public, is that right? I think it is. Dwarkesh Patel It will be now. Nat Friedman Igor's a really, really great guy and brilliant but he also happens to have trained state-of-the-art models at DeepMind and OpenAI. I don't know whether that's a consideration or how big of an effect that is, but it's the kind of thing that would make sense to value if you think there are valuable secrets that have not yet proliferated. So I think they're going to try to slow it down, publishing has certainly slowed down dramatically already. But I think there's just a long way to go before you're anywhere in hedge fund or Manhattan Project territory, and probably secrets will still have a relatively short half-life. Open Source in AIDwarkesh Patel As somebody who has been involved in open-source your entire life, are you happy that this is the way that AI has turned out, or do you think that this is less than optimal? Nat Friedman Well, I don't know. My opinion has been changing. I have increasing worries about safety issues. Not the hijacked version of safety, but some industrial accident type situations or misuse. We're not in that world and I'm not particularly concerned about it in the short term. But in the long term, I do think there are worlds that we should be a little bit concerned about where bad things happen, although I don't know what to do about them. My belief though is that it is probably better on the whole for more people to get to tinker with and use these models, at least in their current state. For example Georgi Gerganov did a four-bit quantization of the LLama model this weekend and got it inferencing on a M1 or M2. I was very excited and I got that running and it's fun to play with. Now I've got a model that is very good, it's almost GPT-3 quality, and runs on my laptop. I've grown up in this world of tinkerers and open-source folks and the more access you have, the more things you can try. And so I think I do find myself very attracted to that. Dwarkesh Patel That is the scientist and the ideas part of what is being shared, but there's also another part about the actual substance, like the uranium in the atom-bomb analogy. As different sources of data realize how valuable their data is for training newer models, do you think that these things will go harder to scrape? Like Libgen or Archive, are these going to become rate-limited in some way or what are you expecting there? Nat Friedman First, there's so much data on the internet. The two primitives that you need to build models are – You need lots of data. We have that in the form of the internet, we digitized the whole world into the internet. And then you need these GPUs, which we have because of video games. So you take like the internet and video game hardware and smash together and you get machine learning models and they're both commodities. I don't think anyone in the open source world is really going to be data-limited for a long time. There's so much that's out there. Probably people who have proprietary data sets that are readily scrapable have been shutting those down, so get your scraping in now if you need to do it. But that's just on the margin. I still think there's quite a lot that's out there to work with. Look, this is the year of proliferation. This is a week of proliferation. We're going to see four or five major AI announcements this week, new models, new APIs, new platforms, new tools from all the different vendors. In a way they're all looking forwards. My Herculaneum project is looking backwards. I think it's extremely exciting and cool, but it is sort of a funny contrast. Github AcquisitionDwarkesh Patel Before I delve deeper into AI, I do want to talk about GitHub. I think we should start with – You are at Microsoft. And at some point you realize that GitHub is very valuable and worth acquiring. How did you realize that and how did you convince Microsoft to purchase GitHub?Nat Friedman I had started a company called Xamarin together with Miguel de Acaza and Joseph Hill and we built mobile tools and platforms. Microsoft acquired the company in 2016 and I was excited about that. I thought it was great. But to be honest, I didn't actually expect or plan to spend more than a year or so there. But when I got in there, I got exposed to what Satya was doing and just the quality of his leadership team. I was really impressed. And actually, I think I saw him in the first week I was there and he asked me – What do you think we should do at Microsoft? And I said, I think we should buy GitHub. Dwarkesh Patel When would this have been?Nat Friedman This was like my first week. It was like March or April of 2016. Okay. And then he said – Yeah, it's a good idea. We thought about it. I'm not sure we can get away with it or something like that. And then about a year later, I wrote him an email, just a memo, I sort of said – I think it's time to do this. There was some noise that Google was sniffing around. I think that may have been manufactured by the GitHub team. But it was a good catalyst because it was something I thought made a lot of sense for Microsoft to do anyway. And so I wrote an email to Satya, a little memo saying – Hey, I think we should buy GitHub. Here's why. Here's what we should do with it. The basic argument was developers are making IT purchasing decisions now. It used to be the sort of IT thing and now developers are leading that purchase. And it's this sort of major shift in how software products are acquired. Microsoft really was an IT company. It was not a developer company in the way most of its purchases were made. But it was founded as a developer company, right? And so, you know, Microsoft's first product was a programming language. Yeah, I said – Look, the challenge that we have is there's an entire new generation of developers who have no affinity with Microsoft and the largest collection of them is at GitHub. If we acquire this and we do a merely competent job of running it, we can earn the right to be considered by these developers for all the other products that we do. And to my surprise, Satya replied in like six or seven minutes and said, I think this is very good thinking. Let's meet next week or so and talk about it. I ended up at this conference room with him and Amy Hood and Scott Guthrie and Kevin Scott and several other people. And they said – Okay, tell us what you're thinking. And I kind of said a little 20-minute ramble on it. And Satya said – Yeah, I think we should do it. And why don't we run it independently like LinkedIn. Nat, you'll be the CEO. And he said, do you think we can get it for two billion? And I said, we could try. He said Scott will support you on this. Three weeks later, we had a signed term sheet and an announced deal. And then it was an amazing experience for me. I'd been there less than two years. Microsoft was made up of and run by a lot of people who've been there for many years. And they trusted me with this really big project. That made me feel really good, to be trusted and empowered. I had grown up in the open source world so for me to get an opportunity to run Github, it's like getting appointed mayor of your hometown or something like that, it felt cool. And I really wanted to do a good job for developers. And so that's how it happened. Dwarkesh Patel That's actually one of the things I want to ask you about. Often when something succeeds, we kind of think it was inevitable that it would succeed but at the time, I remember that there was a huge amount of skepticism. I would go on Hacker News and the top thing would be the blog posts about how Microsoft's going to mess up GitHub. I guess those concerns have been alleviated throughout the years. But how did you deal with that skepticism and deal with that distrust? Nat Friedman Well, I was really paranoid about it and I really cared about what developers thought. There's always this question about who are you performing for? Who do you actually really care about? Who's the audience in your head that you're trying to do a good job for or impress or earn the respect of whatever it is. And though I love Microsoft and care a lot about Satya and everyone there, I really cared about the developers. I’d grown up in this open source world. And so for me to do a bad job with this central institution and open source would have been a devastating feeling for me. It was very important to me not to. So that was the first thing, just that I cared. And the second thing is that the deal leaked. It was going to be announced on a Monday and it leaked on a Friday. Microsoft's buying GitHub. The whole weekend there were terrible posts online. People saying we’ve got to evacuate GitHub as quickly as possible. And we're like – oh my god, it's terrible. And then Monday, we put the announcement out and we said we're acquiring GitHub. It's going to run as an independent company. And then it said Nat Friedman is going to be CEO. And I had, I don't want to overstate or whatever, but I think a couple people were like – Oh. Nat comes from open source. He spent some time in open source and it's going to be run independently. I don't think they were really that calmed down but at least a few people thought – Oh, maybe I'll give this a few months and just see what happens before I migrate off. And then my first day as CEO after we got the deal closed, at 9 AM the first day, I was in this room and we got on zoom and all the heads of engineering and product. I think maybe they were expecting some kind of longer-term strategy or something but I came in and I said – GitHub had no official feedback mechanism that was publicly available but there were several GitHub repos that the community members had started. Isaac from NPM had started one where he'd just been allowing people to give GitHub feedback. And people had been voting on this stuff for years. And I kind of shared my screen and put that up sorted by votes and said – We're going to pick one thing from this list and fix it by the end of the day and ship that, just one thing. And I think they were like – This is the new CEO strategy? And they were like – I don’t know, you need to do database migrations and can't do that in a day. Then someone's like maybe we can do this. We actually have a half implementation of this. And we eventually found something that we could fix by the end of the day. And what I hope I said was – what we need to show the world is that GitHub cares about developers. Not that it cares about Microsoft. Like if the first thing we did after the acquisition was to add Skype integration, developers would have said – Oh, we're not your priority. You have new priorities now. The idea was just to find ways to make it better for the people who use it and have them see that we cared about that immediately. And so I said, we're going to do this today and then we're going to do it every day for the next 100 days. It was cool because I think it created some really good feedback loops, at least for me. One was, you ship things and then people are like – Oh, hey, I've been wanting to see this fixed for years and now it's fixed. It's a relatively simple thing. So you get this sort of nice dopaminergic feedback loop going there. And then people in the team feel the excitement of shipping stuff. I think GitHub was a company that had a little bit of stage fright about shipping previously and sort of break that static friction and ship a little bit more felt good. And then the other one is just the learning loop. By trying to do lots of small things, I got exposed to things like – Okay, this team is really good. Or this part of the code has a lot of tech debt. Or, hey, we shipped that and it was actually kind of bad. How come that design got out? Whereas if the project had been some six-month thing, I'm not sure my learning would have been quite as quick about the company. There's still things I missed and mistakes I made for sure. But that was part of how I think. No one knows kind of factually whether that made a big difference or not, but I do think that earned some trust. Dwarkesh Patel I mean, most acquisitions don't go well. Not only do they not go as well, but like they don't go well at all, right? As we're seeing in the last few months with a certain one. Why do most acquisitions fail to go well? Nat Friedman Yeah, it is true. Most acquisitions are destructive of value. What is the value of a company? In an innovative industry, the value of the company boils down to its cultural ability to produce new innovations and there is some sensitive harmonic of cultural elements that sets that up to make that possible. And it's quite fragile. So if you take a culture that has achieved some productive harmonic and you put it inside of another culture that's really different, the mismatch of that can destroy the productivity of the company. Maybe one way to think about it is that companies are a little bit fragile. And so when you acquire them, it's relatively easy to break them. I mean, they're also more durable than people think in many cases too. Another version of it is the people who really care, leave. The people who really care about building great products and serving the customers, maybe they don't want to work for the acquirer and the set of people that are really load bearing around the long-term success is small. When they leave or get disempowered, you get very different behaviors. Copilot Origin StoryDwarkesh Patel So I want to go into the story of Co-pilot because until ChatGPT it was the most widely used application of the modern AI models. What are the parts of the story you're willing to share in public? Nat Friedman Yeah, I've talked about this a little bit. GPT-3 came out in May of 2020. I saw it and it really blew my mind. I thought it was amazing. I was CEO of GitHub at that time and I thought – I don't know what, but we've got to build some products with this. And Satya had, at Kevin Scott's urging, already invested in OpenAI a year before GPT-3 came out. This is quite amazing. And he invested like a billion dollars. Dwarkesh Patel By the way, do you know why he knew that OpenAI would be worth investing at that point?Nat Friedman I don't know. Actually, I've never asked him. That's a good question. I think OpenAI had already had some successes that were noticeable and I think, if your Satya and you're running this multi-trillion dollar company, you're trying to execute well and serve your customers but you're always looking for the next gigantic wave that is going to upend the technology industry. It's not just about trying to win cloud. It's – Okay, what comes after cloud? So you have to make some big bets and I think he thought AI could be one. And I think Kevin Scott deserves a lot of credit for really advocating for that aggressively. I think Sam Altman did a good job of building that partnership because he knew that he needed access to the resources of a company like Microsoft to build large-scale AI and eventually AGI. So I think it was some combination of those three people kind of coming together to make it happen. But I still think it was a very prescient bet. I've said that to people and they've said – Well, One billion dollars is not a lot for Microsoft. But there were a lot of other companies that could have spent a billion dollars to do that and did not. And so I still think that deserves a lot of credit. Okay, so GPT-3 comes out. I pinged Sam and Greg Brockman at OpenAI and they're like – Yeah, let's. We've already been experimenting with GPT-3 and derivative models and coding contacts. Let's definitely work on something. And to me, at least, and a few other people, it was not incredibly obvious what the product would be. Now, I think it's trivially obvious – Auto-complete, my gosh. Isn't that what the models do? But at the time my first thought was that it was probably going to be like a Q&A chatbot Stack Overflow type of thing. And so that was actually the first thing we prototyped. We grabbed a couple of engineers, SkyUga, who had come in from acquisition that we'd done, Alex Gravely, and started prototyping. The first prototype was a chatbot. What we discovered was that the demos were fabulous. Every AI product has a fantastic demo. You get this wow moment. It turns to maybe not be a sufficient condition for a product to be good. At the time the models were just not reliable enough, they were not good enough. I ask you a question 25% of the time you give me an incredible answer that I love. 75% of the time your answers are useless and are wrong. It's not a great product experience. And so then we started thinking about code synthesis. Our first attempts at this were actually large chunks of code synthesis, like synthesizing whole function bodies. And we built some tools to do that and put them in the editor. And that also was not really that satisfying. And so the next thing that we tried was to just do simple, small-scale auto-complete with the large models and we used the kind of IntelliSense drop down UI to do that. And that was better, definitely pretty good but the UI was not quite right. And we lost the ability to do this large scale synthesis. We still have that but the UI for that wasn't good. To get a function body synthesized you would hit a key. And then I don't know why this was the idea everyone had at the time, but several people had this idea that it should display multiple options for the function body. And the user would read them and pick the right one. And I think the idea was that we would use that human feedback to improve the model. But that turned out to be a bad experience because first you had to hit a key and explicitly request it. Then you had to wait for it. And then you had to read three different versions of a block of code. Reading one version of a block of code takes some cognitive effort. Doing it three times takes more cognitive effort. And then most often the result of that was like – None of them were good or you didn't know which one to pick. That was also like you're putting a lot of energy and you're not getting a lot out, sort of frustrating. Once we had that sort of single line completion working, I think Alex had the idea of saying we can use the cursor position in the AST to figure out heuristically whether you're at the beginning of a block and the code or not. And if it's not the beginning of a block, just complete a line. If it's the beginning of a block, show in line a full block completion. The number of tokens you request and when you stop gets altered automatically with no user interaction. And then the idea of using this sort of gray text like Gmail had done in the editor. So we got that implemented and it was really only kind of once all those pieces came together and we started using a model that was small enough to be low latency, but big enough to be accurate, that we reached the point where like the median new user loved Co-pilot and wouldn't stop using it. That took four months, five months, of just tinkering and sort of exploring. There were other dead ends that we had along the way. And then it became quite obvious that it was good because we had hundreds of internal users who were GitHub engineers. And I remember the first time I looked at the retention numbers, they were extremely high. It was like 60 plus percent after 30 days from first install. If you installed it, the chance that you were still using it after 30 is over 60 percent. And it's a very intrusive product. It's sort of always popping UI up and so if you don't like it, you will disable it. Indeed, 40 something percent of people did disable it but those are very high retention numbers for like an alpha first version of a product that you're using all day. Then I was just incredibly excited to launch it. And it's improved dramatically since then. Dwarkesh Patel Okay. Sounds very similar to the Gmail story, right? It's an incredibly valuable inside and then maybe it was obvious that it needs to go outside. We'll go back to the AI stuff in a second. But some more GitHub questions. By what point, if ever, will GitHub Profiles replace resumes for programmers? Nat Friedman That's a good question. I think they're a contributing element to how people try to understand a person now. But I don't think they're a definitive resume. We introduced readme’s on profiles when I was there and I was excited about that because I thought it gave people some degree of personalization. Many thousands of people have done that. Yeah, I don't know. There's forces that push in the other direction too on that one where people don't want their activity and skills to be as legible. And there may be some adverse selection as well where the people with the most elite skills, it's rather gauche for them to signal their competence on their profile. There's some weird social dynamics that feed into it too. But I will say I think it effectively has this role for people who are breaking through today. One of the best ways to break through. I know many people who are in this situation. You were born in Argentina. You're a very sharp person but you didn't grow up in a highly connected or prosperous network, family, et cetera. And yet you know you're really capable and you just want to get connected to the most elite part communities in the world. If you're good at programming, you can join open source communities and contribute to them. And you can very quickly accrete a global reputation for your talent, which is legible to many companies and individuals around the world. And suddenly you find yourself getting a job and moving maybe to the US or maybe not moving. You end up at a great start up. I mean, I know a lot of people who deliberately pursued the strategy of building reputation in open source and then got the sail up and the wind catches you and you've got a career. I think it plays that role in that sense. But in other communities like in machine learning research, this is not how it works. There's a thousand people, the reputation is more on Arxiv than it is on GitHub. I don't know if it'll ever be comprehensive.Are there any other industries for which proof of work of this kind will eat more into the way in which people are hired? I think there's a labor market dynamic in software where the really high quality talent is so in demand and the supply is so much less than the demand that it shifts power onto the developers such that they can require of their employers that they be allowed to work in public. And then when they do that, they develop an external reputation which is this asset they can port between companies. If the labor market dynamics weren't like that, if programming well were less economically valuable, companies wouldn't let them do that. They wouldn't let them publish a bunch of stuff publicly and they'd say that's a rule. And that used to be the case, in fact. As software has become more valuable, the leverage of a single super talented developer has gone up and they've been able to demand over the last several decades the ability to work in public. And I think that's not going away. Dwarkesh Patel Other than that, I mean, we talked about this a little bit, but what has been the impact of developers being more empowered in organizations, even ones that are not traditionally IT organizations? Nat Friedman Yeah. I mean, software is kind of magic, right? You can write a for loop and do something a lot of times. And when you build large organizations at scale, one of the things that does surprise you is the degree to which you need to systematize the behavior of the people who are working. When I first was starting companies and building sales teams, I had this wrong idea coming from the world as a programmer that salespeople were hyper aggressive, hyper entrepreneurial, making promises to the customer that the product wouldn't do, and that the main challenge you had with salespeople was like restraining them from going out and aggressively cutting deals that shouldn't be cut. What I discovered is that while it does exist sometimes, the much more common case is that you need to build a systematic sales playbook, which is almost a script that you run on your sales team, where your sales reps know the processing to follow to like exercise this repeatable sales motion and get a deal closed. I just had bad ideas there. I didn't know that that was how the world worked, but software is a way to systematize and scale out a valuable process extremely efficiently. I think the more digitized the world has become, the more valuable software becomes, and the more valuable the developers who can create it become. Dwarkesh Patel Would 25-year-old Nat be surprised with how well open source worked and how pervasive it is? Nat Friedman Yeah, I think that's true. I think we all have this image when we're young that these institutions are these implacable edifices that are evil and all powerful and are able to substantially orchestrate the world with master plans. Sometimes that is a little bit true, but they're very vulnerable to these new ideas and new forces and new communications media and stuff like that. Right now I think our institutions overall look relatively weak. And certainly they're weaker than I thought they were back then. Honestly, I thought Microsoft could stop open source. I thought that was a possibility. They can do some patent move and there's a master plan to ring fence open source in. And, you know, that didn't end up in the case. In fact when Microsoft bought GitHub, we pledged all of our patent portfolio to open source. That was one of the things that we did as part of it. That was a poetic moment for me, having been on the other side of patent discussions in the past, to be a part and be instrumental in Microsoft making that pledge. That was quite crazy. Dwarkesh Patel Oh, that's really interesting. It wasn't that there was some business or strategic reason. More so it was just like an idea whose time had come. Nat Friedman Well, GitHub had made such a pledge. And so I think in part of acquiring GitHub, we had to either try to annul that pledge or sign up to it ourselves. And so there was sort of a moment of a forced choice. But everyone at Microsoft thought it was a good idea too. So in many senses it was a moment whose time had come and the GitHub acquisition was a forcing function.Dwarkesh Patel What do you make of critics of modern open source like Richard Stallman or people who advocate for free software saying that – Well, corporations might advocate for open source because of practical reasons for getting good code. And the real way the software should be made – it should be free and that you can replicate it, you can change it, you can modify it and you can completely view it. And the ethical values about that should be more important than the practical values. What do you make of that critique? Nat Friedman I think those are the things that he wants and the thing that maybe he hasn't updated is that maybe not everyone else wants that. He has this idea that people want freedom from the tyranny of a proprietary intellectual property license. But what people really want is freedom from having to configure their graphics card or sound driver or something like that. They want their computer to work. There are places where freedom is really valuable. But there's always this thing of – I have a prescriptive ideology that I'd like to impose on the world versus this thing of – I will try to develop the best observational model for what people actually want whether I want them to want it or not. And I think Richard is strongly in the former camp.Dwarkesh Patel What is the most underrated license by the way? Nat Friedman I don't know. Maybe the MIT license is still underrated because it's just so simple and bare. Dwarkesh Patel Nadia Eghbal had a book recently where she argued that the key constraint on open source software and on the time of the people who maintain it is the community aspect of software. They have to deal with feature requests and discussions and maintaining for different platforms and things like that. And it wasn't the actual code itself, but rather this sort of extracurricular aspect that was the main constraint. Do you think that is the constraint for open source software? How do you see what is holding back more open source software?Nat Friedman By and large I would say that there is not a problem. Meaning open source software continues to be developed, continues to be broadly used. And there's areas where it works better and areas where it works less well, but it's sort of winning in all the areas where large-scale coordination and editorial control are not necessary. It tends to be great at infrastructure, stand-alone components and very, very horizontal things like operating systems. And it tends to be worse at user experiences and things where you need a sort of dictatorial aesthetic or an editorial control. I've had debates with Dylan Field of Figma, as to why it is that we don't have lots of good open source applications. And I've always thought it had something to do with this governance dynamic of – Gosh, it's such a pain to coordinate with tons of people who all sort of feel like they have a right to try to push the project in one way or another. Whereas in a hierarchical corporation there can be a head of this product or CEO or founder or designer who just says, we're doing it this way. And you can really align things in one direction very, very easily. Dylan has argued to me that it might be because there's just fewer designers, people with good design sense, in open source. I think that might be a contributing factor too, but I think it's still mostly the governance thing. And I think that's what Nadia's pointing at also. You're running a project and you gave it to people for free. For some reason, giving people something for free creates a sense of entitlement. And then they feel like they have the right to demand your time and push things around and give you input and you want to be polite and it's very draining. So I think that where that coordination burden is lower is where open source tends to succeed more. And probably software and other new forms of governance can improve that and expand the territory that open source can succeed in. Dwarkesh Patel Yeah. Theoretically those two things are consistent, right? You could have very tight control over governance while the code itself is open source. Nat Friedman And this happens in programming languages. Languages are eventually set in stone and then advanced by committee. But yeah, certainly you have these benign dictators of languages who enforce the strong set of ideas they have, a vision, master plan. That would be the argument that's most on Dylan's side. Hey, it works for languages why can't it work for end user applications? I think the thing you need to do though to build a good end user application is not only have a good aesthetic and idea, but somehow establish a tight feedback loop with a set of users. Where you can give them – Dwarkesh, try this. Oh my gosh. Okay, that's not what you need. Doing that is so hard, even in a company where you've total hierarchical control of the team in theory and everyone really wants the same thing and everyone's salary and stock options depend on the product being accepted by these users. It still fails many times in that scenario. Then additionally doing that in the context of open source, it's just slightly too hard. Dwarkesh Patel The reason you acquired GitHub, as you said, is that there seems to be complementarity between Microsoft’s and GitHub's missions. And I guess that's been proven out over the last few years. Should there be more of these collaborations and acquisitions? Should there be more tech conglomerates? Would that be good for the system? Nat Friedman I don't know if it's good but yes, it is certainly efficient in many ways. I think we are seeing a collaboration occur because the math is sort of pretty simple. If you are a large company and you have a lot of customers, then the thing that you've achieved is this very expensive and difficult thing of building distribution and relationships with lots of customers. And that is as hard or harder and takes longer and more money than just inventing the product in the first place. So if you can then go and just buy the product for a small amount of money and make it available to all of your customers, then there's often an immediate, really obvious gain from doing that. And so in that sense, like acquisitions make a ton of sense. And I've been surprised that the large companies haven't done many more acquisitions in the past until I got into a big company and started trying to do acquisitions. I saw that there are strong elements of the internal dynamics to make it hard. It's easier to spend $100 million on employees internally to do a project than to spend $100 million to buy a company. The dollars are treated differently. The approval processes are different. The cultural buy-in processes are different. And then to the point of the discussion we had earlier, many acquisitions do fail. And when an acquisition fails, it's somehow louder and more embarrassing than when some new product effort you've spun up doesn't quite work out as well. I think there's lots of internal reasons, some justified and some less so, that they haven't been doing it. But just from an economic point of view, it seemed like it makes sense to see more acquisitions than we've seen. Dwarkesh Patel Well, why did you leave? Nat Friedman As much as I loved Microsoft, and certainly as much as I loved GitHub. I still feel tremendous love for GitHub and everything that it means to the people who use it. I didn't really want to be a part of a giant company anymore. Building CoPilot was an example of this. It wouldn't have been possible without OpenAI and Microsoft and GitHub, but building it also required navigating this really large group of people between Microsoft and OpenAI and GitHub. And you reach a point where you're spending a ton of time on just navigating and coordinating lots of people. I just find that less energizing. Just my enthusiasm for that was not as high. I was torn about it because I truly love GitHub, the product and there was so much more I still knew we could do but I was proud of what we'd done. I miss the team and I miss working on GitHub. It was really an honor for me but it was time for me to go do something. I was always a startup guy. I always liked small teams, and I wanted to go back to a smaller, more nimble environment. Nat.org Dwarkesh Patel Okay, so we'll get to it in a second. But first, I want to ask about nat.org and the list of 300 words there. Which I think is one of the most interesting and very straussian list of 300 words I've seen anywhere. I'm just going to mention some of these and get some of your commentary. You should probably work on raising the ceiling, not the floor. Why? Nat Friedman First, I say probably. But what does it mean to raise the ceiling or the floor? I just observed a lot of projects that set out to raise the floor. Meaning – Gosh. We are fine, but they are not and we need to go help them with our superior prosperity and understanding of their situation. Many of those projects fail. For example, there were a lot of attempts to bring the internet to Africa by large and wealthy tech companies and American universities. I won't say they all had no effect, that's not true, but many of them were far short of successful. There were satellites, there were balloons, there were high altitude drones, there were mesh networks, laptops, that were pursued by all these companies. And by the way, by perfectly well-meaning, incredibly talented people who in some cases did see some success, but overall probably much less than they ever hoped. But if you go to Africa, there is internet now. And the way the internet got there is the technologies that we developed to raise the ceiling in the richest part of the world, which were cell phones and cell towers. In the movie Wall Street from the 80s, he's got that gigantic brick cell phone. That thing cost like 10 grand at the time. That was a ceiling raising technology. It eventually went down the learning curve and became cheap. And the cell towers and cell phones, eventually we've got now hundreds of millions or billions of them in Africa. It was sort of that initially ceiling raising technology and then the sort of force of capitalism that made it work in the end. It was not any Deus Ex Machina technology solution that was intended to kind of raise the floor. There's something about that that's not just an incidental example. But on my website, I say probably. Because there are some examples where people set out to kind of raise the floor and say – No one should ever die of smallpox again. No one should ever die of guinea worm again. And they succeed. I wouldn't want to discourage that from happening but on balance, we have too many attempts to do that. They look good, feel good, sound good, and don't matter. And in some cases, have the opposite of the effect they intend to. Dwarkesh Patel Here's another one and this is under the EMH section. In many cases, it's more accurate to model the world as 500 people than 8 billion. Now here's my question, what are the 8 billion minus 500 people doing? Why are there only 500 people? Nat Friedman I don't know exactly. It's a good question. I ask people that a lot. The more I've done in life, the more I've been mystified by this – Oh, somebody must be doing X. And then you hear there's a few people doing X, then you look into it, they're not actually doing X. They're doing kind of some version of it that's not that. All the best moments in life occur when you find something that to you is totally obvious that clearly somebody must be doing, but no one is doing. Mark Zuckerberg says this about founding Facebook. Surely the big companies will eventually do this and create this social and identity layer on the internet. Microsoft will do this. But no, none of them were. And he did it. So what are they doing? I think the first thing is that many people throughout the world are optimizing local conditions. They're working in their town, their community, they're doing something there so the set of people that are kind of thinking about kind of global conditions is just naturally narrowed by the structure of the economy. That's number one. I think number two is, most people really are quite mimetic. We all are, including me. We get a lot of ideas from other people. Our ideas are not our own. We kind of got them from somebody else. It's kind of copy paste. You have to work really hard not to do that and to be decorrelated. And I think this is even more true today because of the internet. I don't know if Albert Einstein, as a patent clerk, wouldn't he have just been on Twitter just getting the same ideas as everybody else? What do you have as decorrelated ideas? I think the internet has correlated us more. The exception would be really disagreeable people who are just naturally disagreeable. So I think the future belongs to the autists in some sense because they don't care what other people think as much. Those of us on the spectrum in any sense are in that category. Then we have this belief that the world's efficient and it isn't and that's part of it. The other thing is that the world is so fractal and so interesting. Herculaneum papyri, right? It is this corner of the world that I find totally fascinating but I don't have any anticipation that eight billion people should be thinking about that. That should be a priority for everyone. Dwarkesh Patel Okay, here's another one. Large scale engineering projects are more soluble in IQ than they appear. And here's my question, does that make you think that the impact of AI tools like co-pilot will be bigger or smaller because one way to look at co-pilot is it’s IQ is probably less than the average engineer, so maybe it'll have less impact. Nat Friedman Yeah, but it definitely increases the productivity of the average engineer to bring them higher up. And I think it increases the productivity of the best engineers as well. Certainly a lot of people I consider to be the best engineers telling you that they find it increases their productivity a lot. It's really interesting how so much of what's happened in AI has been soft, fictional work. You have Midjourney, you have copywriting, you have Claude from Anthropic is so literary, it writes poetry so well. Except for co-pilot, which is this real hard area where like, the code has to compile, has to be syntactically corrected, has to work and pass the tests. We see the steady improvement curve where now, already on average, more than half of the code is written by co-pilot. I think when it shipped, it was like low 20s. And so it's really improved a lot as the models have gotten better and the prompting has gotten better. But I don't see any reason why that won't be 95%. It seems very likely to me. I don't know what that world looks like. It seems like we might have more special purpose and less general purpose software. Right now we use general purpose tools like spreadsheets and things like this a lot, but part of that has to do with the cost of creating software. And so once you have much cheaper software, do you create more special purpose software? That's a possibility. So every company, just a custom piece of code. Maybe that's the kind of future we're headed towards. So yeah, I think we're going to see enormous amounts of change in software development. Dwarkesh Patel Another one – The cultural prohibition on micromanagement is harmful, great individuals should be fully empowered to exercise their judgment. And the rebuttal to this is if you micromanage you prevent people from learning and to develop their own judgment. Nat Friedman So imagine you go into some company, they hired Dwarkesh and you do a great job with the first project that they give you. Everyone's really impressed. Man, Dwarkesh, he made the right decisions, he worked really hard, he figured out exactly what needed to be done and he did it extremely well. Over time you get promoted into positions of greater authority and the reason the company's doing this is they want you to do that again, but at bigger scale, right? Do it again, but 10 times bigger. The whole product instead of part of the product or 10 products instead of one. The company is telling you, you have great judgment and we want you to exercise that at a greater scale. Meanwhile, the culture is telling you as you get promoted, you should suspend your judgment more and more and defer your judgment to your team. And so there's some equilibrium there and I think we're just out of equilibrium right now where the cultural prohibition is too strong. I don't know if this is true or not, but maybe in the 80s I would have felt the other side of this. That we have too much micromanagement. I think the other problem that people have is that they don't like micromanagement because they don't want bad managers to micromanage, right? So you have some bad managers, they have no expertise in the area, they're just people managers and they're starting to micromanage something that they don't understand where their judgment is bad. And my answer to that is stop empowering bad managers. Don't have them, promote and empower people who have great judgment and do understand the subject matter that they're working on. If I work for you and I just know you have better judgment and you come in and you say, now like you're launching the scroll thing and you think you've got the final format wrong, here's how you should do it, I would welcome that even though it's micromanagement because it's going to make us more successful in them and learn something from tha. I know your judgment is better than mine in this case or at least we're going to have a conversation about it, we're both going to get smarter. So I think on balance, yeah, there are cases where people have excellent judgment and we should encourage them to exercise it and sometimes, things will go wrong when you do that, but on balance you will get far more excellence out of it and we should empower individuals who have great judgment. Dwarkesh Patel Yeah. There's a quote about Napoleon that if he could have been in every single theater of every single battle he was part of, that he would have never lost a battle. I was talking to somebody who worked with you at GitHub and she emphasized to me, and this is like really remarkable to me, that even the applications are already being shipped out to engineers how much of the actual suggestions and the actual design came from you directly, which is kind of remarkable to me that as CEO you would have. Nat Friedman Yeah, you can probably also find people you can talk to who think that was terrible. But the question is always: does that scale? And the answer is it does not scale. The experience that I had as CEO was I was terrified all the time that there was someone in the company who really knew exactly what to do and had excellent judgment, but because of cultural forces that person wasn't empowered. That person was not allowed to exercise their judgment and make decisions. And so when I would think and talk about this, that was the fear that it was coming from. They were in some consensus environment where their good ideas were getting whittled down by lots of conversations with other people and a politeness and a desire not to micromanage. So we were ending up with some kind of average thing. And I would rather have more high variance outcomes where you either get something that's excellent because it is the expressed vision of a really good auteur or you get a disaster and it didn't work and now you know it didn't work and you can start over. I would rather have those more high variance outcomes and I think it's a worthy trade.Dwarkesh Patel Okay, let's talk about AI. What percentage of the economy is basically text to text? Nat Friedman Yeah, it's a good question. We've done the sort of Bureau of Labor Statistics analysis of this. It's not the majority of the economy or anything like that. We're in the low double digit percentages. The thing that I think is hard to predict is what happens over time as the cost of text to text goes down? I don't know what that's going to do. But yeah, there's plenty of revenue to be got now. One way you can think about it is – Okay, we have all these benchmarks for machine learning models. There's LAMBADA and there's this and there's that. Those are really only useful and only exist because we haven't deployed the models at scale. So we don't have a sense of what they're actually good at. The best metric would probably be something like – What percentage of economic tasks can they do? Or on a gig marketplace like Upwork, for example, what fraction of Upwork jobs can GPT-4 do? I think is sort of an interesting question. My guess is extremely low right now, autonomously. But over time, it will grow. And then the question is, what does that do for Upwork? I’m guessing it’s a five billion dollar GMV marketplace, something like that. Does it grow? Does it become 15 billion or 50 billion? Does it shrink because the cost of text to text tasks goes down? I don't know. My bet would be that we find more and more ways to use text to text to advance progress. So overall, there's a lot more demand for it. I guess we'll see. Dwarkesh Patel At what point does that happen? GPT-3 has been a sort of rounding error in terms of overall economic impact. Does that happen with GPT-4, GPT-5, where we see billions of dollars of usage? Nat Friedman Yeah, I've got early access to GPT-4 and I've gotten to use it a lot. And I honestly can't tell you the answer to that because it's so hard to discover what these things can do that the prior ones couldn't do. I was just talking to someone last night who told me – Oh, GPT-4 is actually really good at Korean and Japanese and GPT-3 is much worse at those. So it's actually a real step change for those languages. And people didn't know how good GPT-3 was until it got instruction tuned for chatGPT and was put out in that format. You can imagine the pre-trained models as a kind of unrefined crude oil and then once they've been kind of RLHF and trained and then put out into the world, people can find the value. Dwarkesh Patel What part of the AI narrative is wrong in the over-optimistic direction? Nat Friedman Probably an over-optimistic case from both the people who are fearful of what will happen, and from people who are expecting great economic benefits is that we're definitely in this realm of diminishing returns from scale. For example GPT-4 is, my guess is, two orders of magnitude more expensive to train the GPT-3, but clearly not two orders of magnitude more capable. Now is it two orders of magnitude more economically valuable? That would also surprise me. When you're in these sigmoids, where you are going up this exponential and then you start to asymptote it, it can be difficult to tell if that's going to happen. The idea that we might not run into hard problems or that scaling will continue to be worth it on a dollar basis are reasons to be a little bit more pessimistic than the people who have high certainty of GDP increasing by 50% per month which I think some people are predicting. But on the whole, I'm very optimistic. You're asking me to like make the bear case for something I'm very bullish about. Dwarkesh Patel No, that's why I asked you to make the bear case because I know about you. I want to ask you about these foundation models. What is the stable equilibrium you think of how many of them will there be? Will it be an oligopoly like Uber and Lyft where…? Nat Friedman I think there will probably be wide-scale proliferation. And if you asked me, what are the structural forces that are pro proliferation and the structural forces that are pro concentration? I think the pro proliferation case is a bit stronger. The pro proliferation case is – They're actually not that hard to train. The best practices will promulgate. You can write them down on a couple sheets of paper. And to the extent that secrets are developed that improve training, those are relatively simple and they get copied around easily. Number one, number two. The data is mostly public, it's mostly data from the internet. Number three, the hardware is mostly commodity and the hardware is improving quickly and getting much more efficient. I think some of these labs potentially have 50, 100, 200 percent training efficiency improvement techniques and so there's just a lot of low-hanging fruit on the technique side of things. We're seeing it happen. I mean, it's happening this weekend, it's happening this year. We're getting a lot of proliferation. The only case against proliferation is that you'll get concentration because of training costs. And I don't know if that's true. I don't have confidence that the trillion dollar model will be much more valuable than the 100 billion dollar model and that even it will be necessary to spend a trillion dollars training it. Maybe there will be so many techniques available for improving efficiency. How much are you willing to spend on researchers to find techniques if you're willing to spend a trillion on training? That's a lot of bounties for new techniques and some smart people are going to take those bounties.Dwarkesh Patel How different will these models be? Will it just be sort of everybody chasing the same exact marginal improvement leading to the same marginal capabilities or will they have entirely different repertoire of skills and abilities? Nat Friedman Right now, back to the mimetic point, they're all pretty similar. Basically the same rough techniques. What's happened is an alien substance has landed on Earth and we are trying to figure out what we can build with it and we're in this multiple overhangs. We have a compute overhang where there's much more compute in the world than is currently being used to train models like much, much more. I think the biggest models are trained on maybe 10,000 GPUs, but there's millions of GPUs. And then we have a capability and technique overhang where there's lots of good ideas that are coming out and we haven't figured out how best to assemble them all together, but that's just a matter of time kind of until people do that. And because many of those capabilities are in the hands of the labs, they haven't reached the tinkerers of the world. I think that is where the new – What can this thing actually do? Until you get your hands on it, you don't really know. I think OpenAI themselves were surprised by how explosively chat GPT has grown. I don't think they put chatGPT out expecting that to be the big announcement. I think they thought GPT-4 was going to be their big announcement. Iit still probably is and will be big, but the chatGPT really surprised them. It's hard to predict what people will do with it and what they'll find valuable and what works. So you need tinkerers. So it goes from hardware to researchers to tinkerers to products. That's the pipe, that's the cascade. Dwarkesh Patel When I was scheduling my interview with Ilya, it was originally supposed to be around the time that chatGPT came out and so their comm’s person tells me – Listen, just so you know, this interview would be scheduled around the time. We're going to make a minor announcement. It's not the thing you're thinking, it's not GPT-4, but it's just like a minor thing. They didn't expect what it ended up being. Have incumbents gotten smarter than before? It seems like Microsoft was able to integrate this new technology role. Nat Friedman There's two, there's been two really big shifts in the way incumbents behave in the last 20 years that I've seen. The first is, it used to be that incumbents got disrupted by startups all the time. You have example after example of this in the mini-computer, micro-computer era, et cetera. And then Clay Christensen wrote The Innovator's Dilemma. And I think what happened was that everyone read it and they said – Oh, disruption is this thing that occurs and we have this innovator's dilemma where we get disrupted because the new thing is cheaper and we can't let that happen. And they became determined not to let that happen and they mostly learned how to avoid it. They learned that you have to be willing to do some cannibalization and you have to be willing to set up separate sales channels for the new thing and so forth. We've had a lot of stability in incumbents for the last 15 years or so. I think that's maybe why. That's my theory. So that's the first major step change. And then the second one is – man, they are paying a ton of attention to AI. If you look at the prior platform revolutions like cloud, mobile, internet, web, PC, all the incumbents derided the new platform and said – Gosh, like no one's going to use web apps. Everyone will use full desktop apps, rich applications. And so there was always this laughing at the new thing. The iPhones were laughed at by incumbents and that is not happening at all with AI. We may be at peak hype cycle and we're going to enter the trough of despair. I don't think so though, I think people are taking it seriously and every live player CEO is adopting it aggressively in their company. So yeah, I think incumbents have gotten smarter. Questions from TwitterDwarkesh Patel All right. So let me ask you some questions that we got from Twitter. This is former guest and I guess mutual friend Austin Vernon. Nat is one of those people that seems unreasonably effective. What parts of that are innate and what did he have to learn? Nat Friedman It's very nice of Austin to say. I don't know. We talked a little bit about this before, but I think I just have a high willingness to try things and get caught up in new projects and then I don't want to stop doing it. I think I just have a relatively low activation energy to try something and am willing to sort of impulsively jump into stuff and many of those things don't work, but enough of them do that I've been able to accomplish a few things. The other thing I would say, to be honest with you, is that I do not consider myself accomplished or successful. My self-image is that I haven't really done anything of tremendous consequence and I don't feel like I have this giant bed of achievements that I can go to sleep on every night. I think that's truly how I feel. I'm an insecure overachiever, I don't really feel good about myself unless I'm doing good work, but I also have tried to cultivate a forward-looking view where I try not to be incredibly nostalgic about the past. I don't keep lots of trophies or anything like that. Go into some people's offices and it's like things on the wall and trophies of all the things they've accomplished and I'd always seemed really icky to me. Just had a sort of revulsion to that. Dwarkesh Patel Is that why you took down your blog? Nat Friedman Yeah. I just wanted to move forward. Dwarkesh Patel Simian asks for your takes on alignment. “He seems to invest both in capabilities and alignment which is the best move under a very small set of beliefs.” So he's curious to hear the reasoning there. Nat Friedman I guess we'll see but I'm not sure capabilities and alignment end up being these opposing forces. It may be that the capabilities are very important for alignment. Maybe alignment is very important for capabilities. I think a lot of people believe, and I think I'm included in this, that AI can have tremendous benefits, but that there's like a small chance of really bad outcomes. Maybe some people think it's a large chance. The solutions, if they exist, are likely to be technical. There's probably some combination of technical and prescriptive. It's probably a piece of code and a readme file. It says – if you want to build aligned AIs, use this code and don't do this or something like that. I think that's really important and more people should try to actually build technical solutions. I think one of the big things that's missing that perplexes me is, there's no open source technical alignment community. There's no one actually just implementing in open source, the best alignment tools. There's a lot of philosophizing and talking, and then there's a lot of behind closed doors, interpretability and alignment work. Because the alignment people have this belief that they shouldn't release their work I think we're going to end up in a world where there's a lot of open source, pure capabilities work, and no open source alignment work for a little while. Hopefully that'll change. So yeah, I wanted to, on the margin, invest in people doing alignment. It seems like that's important. I thought Sydney was a kind of an example of this. You had Microsoft essentially released an unaligned AI and I think the world sort of said – Hmm, sort of threatening its users, that seems a little bit strange. If Microsoft can't put a leash on this thing, who can? I think there'll be more interest in it and I hope there's open communities. Dwarkesh Patel That was so endearing for some reason. Threatening you just made it so much more lovable for some reason. Nat Friedman Yeah, I think it's like the only reason it wasn't scary is because it wasn't hooked up to anything. If it was hooked up to HR systems or if it could like post jobs or something like that, then I don't know, like to get on a gig worker site or something. I think it could have been scary. Dwarkesh Patel Yep. Final question from Twitter. Will asks “What historical personality seems like the most kindred spirit to you”. Bookshelves are all around us in this room, some of them are biographies. Is there one that sticks out to you?Nat Friedman Gosh, good question. I think I'd say it's changed over time. I've been reading Philodemus's work recently. When I grew up Richard Feynman was the character who was curious and plain spoken. Dwarkesh Patel What's next? You said that according to your perception that you still have more accomplishments ahead of you. What does that look like, concretely? Do you know yet? Nat Friedman I don't know. It's a good question. The area I'm paying most attention to is AI. I think we finally have people building the products and that's going to just accelerate. I'm going to pay attention to AI and look for areas where I can contribute. Dwarkesh Patel Awesome. Okay. Nat this was a true pleasure. Thanks for coming on the podcast. Nat Friedman Thanks for having me.  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

I flew out to Chicago to interview Brett Harrison, who is the former President of FTX US President and founder of Architect.In his first longform interview since the fall of FTX, he speak in great detail about his entire tenure there and about SBF’s dysfunctional leadership. He talks about how the inner circle of Gary Wang, Nishad Singh, and SBF mismanaged the company, controlled the codebase, got distracted by media, and even threatened him for his letter of resignation.In what was my favorite part of the interview, we also discuss his insights about the financial system from his decades of experience in the world's largest HFT firms.And we talk about Brett's new startup, Architect, as well as the general state of crypto post-FTX.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Similar episodesSide note: Paying the billsTo help pay the bills for my podcast, I've turned on paid subscriptions on Substack.No major content will be paywalled - please don't donate if you have to think twice before buying a cup of coffee.But if you have the means & have enjoyed my podcast, I would appreciate your support 🙏.As always, the most helpful thing you can do is just to share the podcast - send it to friends, group chats, Twitter, Reddit, forums, and wherever else men and women of fine taste congregate.Timestamps(0:00:00) - Passive investing & HFT hacks(0:08:30) - Is Finance Zero-Sum?(0:18:38) - Interstellar Markets & Periodic Auctions(0:23:10) - Hiring & Programming at Jane Street (0:32:09) - Quant Culture(0:42:10) - FTX - Meeting Sam, Joining FTX US(0:58:20) - FTX - Accomplishments, Beginnings of Trouble(1:08:11) - FTX - SBF's Dysfunctional Leadership(1:26:53) - FTX - Alameda(1:33:50) - FTX - Leaving FTX, SBF"s Threats(1:45:45) - FTX - Collapse(1:53:10) - FTX - Lessons(2:04:34) - FTX - Regulators, & FTX Mafia(2:15:42) - Architect.xyz(2:30:10) - Institutional Interest & Uses of CryptoTranscriptThis transcript was autogenerated and thus may contain errors.Dwarkesh PatelOkay. Today I have the pleasure of speaking with Brett Harrison, who is now the founder of Architect, which provides traders with infrastructure for accessing digital markets. Before that he was the president of FTX US, and before that he was the head of ETF technology at Citadel. And he has a large amount of experience in leadership positions in finance and tech. So this is going to be a very interesting conversation. Thanks for coming on the Lunar Society, Brett.Brett HarrisonYeah. Thanks for coming out to Chicago.Dwarkesh PatelYeah, my pleasure. My pleasure. Is the growth of ETFs a good thing for the health of markets? There's one view that as there's more passive investing, you're kind of diluting the power of smart money. And in fact, what these active investors are doing with their fees is subsidizing the price discovery that makes markets efficient. And with passive investing, you're sort of free writing off of that. You were head of ETF technology at Citadel, so you're the perfect person to ask this. Is it bad that there's so much passive investing?Brett HarrisonI think on that it's good. I think that most investors in the market shouldn't be trying to pick individual stock names. And the best thing people can do is invest in sort of diversified instruments. And it is far less expensive to invest in indices now than it ever was in history because of the advent of ETFs.Dwarkesh PatelYeah. So maybe it's good for individual investors to put their money in passive investments. But what about the health of the market as a whole? Is it hampered by how much money goes into passive investments?Brett HarrisonIt's hard to be able to tell what it would look like if there was less money in passive investment. Now, I do think one of the potential downsides is ending up creating extra correlated activity between instruments purely by virtue of them being included in index products. So when Tesla gets added to the Sfp 500, tesla doesn't suddenly become a different company whose market value is fundamentally changing, but yet it's going to start moving very differently in terms of its beta correlation between other instruments in SP 5100, purely as a function of all the passive investing that moves these instruments in the same direction. So that's the sense in which I think it could be detrimental naively.Dwarkesh PatelYou would assume that efficient market hypothesis would say that if people know that Tesla's stock price would irrationally climb whence including the S&P 500, then people would short it and then there should be no impact from this irrelevant information. Why isn't that the case?Brett HarrisonIt probably mostly is. I think that sometimes there can be liquidity differences that cause at least temporary dislocations and stocks. The simplest example is like you have an ADR like an American Depository receipt that's sort of expunging for some underlying foreign stock and these two things should be like almost the same value at all times, like net of currency conversion and conversion ratios. But if one of the markets is highly illiquid or difficult to access, then there's going to be dislocations in price. And that's like the job of the Jane Streets, the world to kind of arbitrage away the price over time and so long run you wouldn't expect these things to be dislocated for that long. So I'm sure there are people who are understanding the fundamentals of individual names in the S P 500 and when there's like American News and the entire S and P falls, they are maybe buying S and P and selling individual names and expecting that relative value spread to come in over time.Dwarkesh PatelSpeaking of by the way, these firms, you don't have to tell me specifics, but how similar are the strategies for market making or trading that Jean Street versus Citadelo and these firms, is it the same sorts of strategies or are they pretty different?Brett HarrisonI think a lot more differences than people appreciate from the outside. Different companies have established different niches and areas like Jane Street established its early niche and ETF at kind of like a mid frequency level. So not like ultra fast but not like long term year long discretionary macro. Whereas maybe your Citadel securities kind of firm built their niche more on lower latency options, market making so it could be all over the place. There are some where they are trying to optimize for really short term like microstructure. Alpha is trying to predict where the order book is going to move over the course of anywhere from milliseconds to seconds. There are firms that care more about the relative convergence of instruments over the course of hours to days. There's sophisticated quantity of trading firms that are doing longer term days to weeks to months long trades too. A lot of the infrastructure can be similar. Like either way you need to be able to connect to exchanges, download market data, establish simulation platforms, build tools for traders to be able to grasp what's going on in the market and especially be able to visualize their own proprietary models and Alphas. But beyond that, the actual strategies and the ways they make money can be very different.Dwarkesh PatelFamously, in other kinds of development, there's these like, very famous hacks and algorithms, right? So in gaming and graphics, John Carmack has the famous fastener square root for doing graphics calculations, normalizing vectors faster. You were not only a developer in finance. I know what the exact term is for that. But you led teams of hundreds of people who are doing that kind of development. Are there famous examples like this in finance, the equivalent of fastener square root, but for the kinds of calculations you guys do?Brett HarrisonYeah, they're all over the place. There's tons of hacks and tricks and things like that. I think, for example, here's a famous one, not famous, I think I read it in a paper and like a bunch of other developers from different other companies told me about this. It's not something I saw at places that I worked. But if you're sending a message to, let's say, Nasdaq to buy stock and you want to get there as fast as possible, well, what is a message to Nasdaq? It's a TCP IP wrapped message with a particular proprietary protocol that Nasdaq implements. Well, let's say your goal is, you know, you're going to trade Apple, but you're not sure, like, what price and at what time. And you're kind of waiting for some signal to buy Apple as fast as possible. So what you can do is you can preconstruct the entire TCP IP message. Like, first put the TCP header on there, then the IP header, then, like, the kind of outer protocol that Nasdaq specifies and the inner protocol except for the byte slot where you put in the price and then pre. Load that message into the network cards sending buffer so that once you're ready to send, you can just pop in the price and send it off and incur as little latency as possible.Dwarkesh PatelThat's awesome.Brett HarrisonI think the analogy to video games is a good one because just like in video game graphics, what's the end goal? It's not like to produce the most theoretically perfect simulation of environmental graphics. It's to have something that looks good enough and is fast enough for the user. And that's also true in hft and quantitative finance, where the goal is to get to the approximately right trade as fast as you can, it's not to have the perfect theoretical model of underlying.Dwarkesh PatelPrice dynamics that is so fascinating. But this actually raises an interesting question. If you have some sort of algorithm like this that gets you a few nanoseconds faster to the Nasdaq Exchange, and that's why you have Edge, or you've leased microwave towers to get from New Jersey to Chicago faster, or you've bought an expensive server in the same place that Nasdaq is housed. What fundamentally is the advantage to society as a whole from us getting that sort of information faster? Is this just sort of a zero sum game of who can get that incorporate that signal faster. Like, why is it good for society that so much, so many resources and so much brain power is spent on these kinds of hacks and these kinds of optimizations?Brett HarrisonYeah. So I think if you start from the premise that having liquid, tight, efficient markets is important for the world and you say, like, how do I design a system that optimizes for that? I think you want smart, sophisticated technologies competing at the margins. And of course, the more they compete, the smaller the margins become to the point where you think, like, the little extra activity people are doing to get slightly better don't seem to be greatly affecting the whole system as much as if as it was in the earlier days when things were slower and tick sizes were wider. I think it's difficult to imagine designing a market where you say, like, okay, everyone should innovate up until this point and then stop competing and then just stay stasis. And maybe you can create certain regulatory or market structures to try to prevent that. But I think on average you want people competing at the margins, even if they seem like they are minuscule. But at the same time, I think it's not zero sum for society for technologists to be creating super fast, ultralow latency, very sophisticated algorithms. Like maybe, I don't know, we have a lot of geopolitical instability in the world. Who knows if our microwave network that we built out in the US. Could have greater use cases than just for quantitative finance? But the quantitative finance subsidized the creation of these towers.Dwarkesh PatelOkay? So that's sort of like a contingent potential benefit. People tell us a little story about NASA, right, in this case, literally microwaves that they subsidize a lot of the science that ended up becoming becoming into products. So that's an interesting account of the benefits of finance, that it has the same yeah, whatever tricks they come up with might be useful elsewhere. But that's not a story about how it's directly useful to have nanosecond level latency for filing your Apple stock or something like that. Why is that useful directly?Brett HarrisonI mean, if there is some kind of news that happens in one part of the world and that should affect the current price of stock in a different part of the world. I think that if you care about efficient markets, you want the gap between source of truth events and ultimate price discovery to be as small as possible. I think if you believe if you want to question whether getting a few extra milliseconds or microseconds or nanoseconds is worth it, I think you're then putting some kind of value judgments on.Brett HarrisonWhat.Brett HarrisonIs the optimal time it takes to get from to price discovery and saying a second is too slow, but a millisecond is too fast, or a millisecond is too slow, but a microsecond is too fast, and I just don't think we're in a position to do that. I think we kind of always want as close to instantaneous price discovery as possible.Dwarkesh PatelI'm only asking more about this because this is really interesting to me. There are some level of resources where we would say that at this point it's not worth it, right? Let's say $5 trillion a year was spent on getting it down from like, two nanoseconds to like, 1. Know that's probably not a realistic number, but just like there is some margin at which for some weird reason that there's society or just spend so many resources on it, would you say that we haven't reached that margin yet where it's not socially useful? The amount of brain power and resources that are spent on getting these tight.Brett HarrisonSpreads I don't know how large a percentage of GDP prop trading is. I suspect it's not that large. So I don't think we're close to that theoretical limit of where I would start to feel that it's a waste. But I also think there's a reason why they're willing to spend the money on this kind of technology because they're obviously profiting from doing so and it has to come from somewhere. So somehow the market is subsidizing the creation of this technology, which means that there's still ability for value capture, which means there's still a service that's being provided in exchange for some kind of profit. I think we wouldn't spend $5 trillion in a microwave network because there isn't $5 trillion of extra value to be created in doing so.Dwarkesh PatelGot it. Has being a market maker change your views about civilizational tail risk because you're worried about personally getting run over, right, by some sort of weird event and adverse selection? Does that change how we think about societies getting run over by a similar thing, or are the mental models isolated?Brett HarrisonSo I think working in high speed finance teaches you to understand how to more correctly estimate the probability of rare events. And in that sense, working in finance makes me think more about the likelihood of civilization ending problems. But it doesn't suggest to me sort of different solutions. There's a very big difference being in a financial setting where your positions are.Brett HarrisonNumbers that you can put in a.Brett HarrisonSpreadsheet and you can model. Like, what happens if every single position goes against me three X the wrong way? And what instruments would I have to buy or sell in order to be able to hedge that portfolio? That's like a closed system that you can actually model and do something about. Having, like, a trigger mentality on future pandemics I don't think helps you much. I think maybe it slightly changes your ability to kind of estimate the probability of such events. But the actual solutions to these problems are a combination of, like, collective action problems plus being able to sort of model the particular type of unknown unknown about whatever the event is. And I think those kinds of solutions should be left to the experts in those particular fields and not off the traders. In other words, I don't think, like, having the trader mentality among rare events in, like, normal civilization outside of finance really kind of helps you much.Brett HarrisonAnd maybe in some ways it's led.Brett HarrisonPeople to think more hubristically that they can do something about it.Dwarkesh PatelGee, who could be talking about that's?Brett HarrisonReally interesting.Dwarkesh PatelYou would say that famously, these market making firms really care about having their employees be well calibrated and good at sort of thinking about risk. I'm surprised you think that the transfer between thinking about that in financial context and thinking about that in other contexts is that low.Brett HarrisonYeah.Brett HarrisonAgain, I think it helps you at estimating probability of rare events, but it does not translate super well to what action, then, do you take in the face of knowing those rare events?Dwarkesh PatelWere your circles or people in finance earlier to recognize the dangers of COVID.Brett HarrisonThat's a good question. I think that people in my circles were quicker to take action in the face of knowing about COVID There are a lot of people who kind of stuck around in cities and their existing particular situations not knowing kind of where this was going to head long term. And I think if you have the fortune of having the financial flexibility to be able to do something like this, a lot of the people in kind of financial circles kind of immediately recognize, okay, there's this big risk.Brett HarrisonThis unknown and I don't want to.Brett HarrisonGet out of or selected against in terms of being able to get out of the locus of bad pandemic activity. So people immediately were fleeing cities, I think, faster than other people.Dwarkesh PatelThat seems to point in the opposite direction of them not being able to estimate and deal with geopolitical risk.Brett HarrisonWell, I mean, there you have an actual event that has occurred, and then in the face of the event, what do you do right now? Yeah, I think that's different than, like, what do we do about the potential for AI to destroy civilization in the next hundreds of years? Or what do we do about the next potential biological weapon or the next pandemic that could occur.Dwarkesh PatelSpeaking of COVID you were head of semi systemic technology at Citadel when COVID hood, right?Brett HarrisonYes, exactly.Dwarkesh PatelHow did these Hft firms react to COVID? What was it like during COVID Because obviously the market moved a lot, but on the inside, was it good, bad?Brett HarrisonYeah. All the companies, Citadel securities, but really all of the ones in this sort of this finance year, I think were extremely resilient. I think a lot of them found that their preexisting ideas that in order for the team to succeed, everyone needed to be the exact same place. And it was very important from like an IP perspective to make sure that people weren't taking a lot of this work home with them completely went out the window. And people had to completely adjust to the idea that actual trading teams that are used to be able to have eye contact with each other at all times need to adjust to this pandemic world. And they largely did. I think at least from a profitability perspective. It was some of the best years of Hft firms PnLs in recent history.Dwarkesh PatelMatching engines already have to deal with the fact that you can have orders coming from, like, Illinois, you can have orders coming from Japan, and given light speed, they're not going to run at the same time, but you still kind of have to work around that. Is there any hope of a single market and matching engine for once humanity goes interplanetary or interstellar? Could we ever have a market between, like, us and Alpha Centauri or even Austin Mars? Or is the lag too much for that to be possible?Brett HarrisonYeah, without making any changes to a matching engine. There is nothing that says that when an order comes in, it can't be older than X time.Brett HarrisonRight.Brett HarrisonWhat it does mean is that the actual sender, they're sending a market order from halfway across the world, by the time that the order reaches the exchange, they might end up with a very different price than the one that they were expecting when they sent it. And therefore there's probably a lot of adverse selection sending a market order from halfway across the world than in a colocation facility. So you can technologically run an interstellar exchange. This might not be good for that person living on the moon.Dwarkesh PatelIs there any way to make it more fair?Brett HarrisonYeah, so I think there's actually kind of real world analog of that which is like automated market makers on slow blockchains. Because if you're used to working on Nasdaq where Nasdaq processes like a single message in somewhere between like tens and hundreds of nanoseconds per order a blockchain, like ethereum processes what, like 15 to 50 messages per second, so significantly slower by numbers of orders of magnitude. And yet they've been able to establish pretty mature financial marketplaces by saying that rather than you having to send orders with prices on them and then cancel them when the prices aren't good anymore, there will be kind of an automated function that moves the prices at the matching engine. And so whenever your order reaches the exchange, it'll always be kind of a predetermined fair price based on the kind of prevailing liquidity at the time. So one can imagine building a Nasdaq for interstellar market is kind of similar to building uniswap now on a theory of in terms of order, magnitude and speed. But there's other things you can do, too, like you could establish like, periodic auctions instead of like continuous matching and things like that. And that could potentially help mitigate some of these issues.Dwarkesh PatelYes, that's something else I want to ask you about. What do you what is your opinion of periodic frequent batch auction systems? Should we have more of that instead of so?Brett HarrisonIn theory, they help mitigate the advantages of high frequency trading. Because if you know there's going to be an auction every 30 seconds, and it's not going to be by time priority, it's going you buy price, then it doesn't matter if you send that order at the beginning of the 32nd period or the end of 32nd period. It's really the price that determines that you get filled. Not something to do with particular latency to the exchange. I think in practice, the couple of exchanges around the world that used to have those have switched away from them. I think the, like, Taiwan Stock Exchange used to have a periodic auction system. And I just thought the like, the liquidity and price discovery wasn't good and it was like, complained about a lot and they eventually moved off of it to a continuous matching system. So I guess in practice it doesn't quite work as well. But it's hard to tell.Dwarkesh PatelIt's really hard to tell what country, meaning your long experience of dribbling financial infrastructure, what country do you feel has the best infrastructure and set up for good markets?Brett HarrisonI would say the United States, except what's happened is US. Companies like Nasdaq have licensed their exchange matching engine technology to other exchanges around the world. So Nasdaq OMX technology powers a number of the exchanges in Europe and some in Asia. So it's hard to sort of say that. Is the technology American? I guess so. I'm not sure exactly who wrote a lot of the stuff underneath the Nasdaq technology, but I do think the US. Markets are some of the most efficient and low, latency and expansive and products that allowed in the world.Dwarkesh PatelHow do adverse selection in trading and hiring differ?Brett HarrisonIn hiring, there are one, many more opportunities for positive selection versus a negative selection usually encounter in finance. And the other thing is that most financial markets are in the US. When you think about trading in general, you're thinking about liquid markets. The hiring market is highly inefficient. Maybe the pipeline of orders from like, Harvard, MIT, Princeton, Yale to Jane Street and Sale securities is like a very liquid pipeline. But there are many, many universities and colleges throughout the country and the world that have extremely talented individuals whose resumes will never end up on your doorstep. So you might end up with a resume from some graduating senior from college who has no internship experience, and your.Brett HarrisonTrader mindset might think, okay, this is.Brett HarrisonTerrible adverse selection, but it actually could be that person. If he's willing to put themselves out there and apply to your company from this relatively unknown university, then that might be the signal that is like the best person in that entire region. And that might be a positive selection. So I think that it's not exactly the same, like, adverse selection dynamics as there is in the traditional trading world.Dwarkesh PatelYeah, yeah, definitely. Especially if you have, like, I guess mission oriented companies have especially a good way of getting rid of adverse selection. Right?Brett HarrisonYeah, exactly. The companies with really strong brands, I mean, that's one of the things we saw at Jane Street was like, I heard stories in the old days of Jane Street that, like, the first resumes from Harvard were like the people were terrible. Like, they couldn't do like basic math and they just were the worst candidates compared to other people that they were able to find. And then they established this brand and this recruiting pipeline and this reputation for having very difficult interviews and for paying people really well and having this amazing work environment that all of a sudden all the people getting through the pipeline from Harvard were like, really, really great. And it wasn't like the quality of students at Harvard changed. There's probably a bell curve there like there is everywhere else. It was just like the positive selection resulting from the branding efforts and the mission driven focus of the company that really brought that positive selected pipeline to them.Dwarkesh PatelThat's really interesting. Should Jane Street replace Okamel with rust?Brett HarrisonNo, because there's too much infrastructure already in Okamo.Dwarkesh PatelYeah, but starting from scratch.Brett HarrisonSo I guess the world is if they could snap their fingers and suddenly replace all their Ocal infrastructure with Rust at zero cost, would it be worth it?Dwarkesh PatelYeah.Brett HarrisonIn that case, I would say yes, because I think that you get a lot of the sort of static typing and compile time safety in Rust that you get from Ocamol. But the base level program that you can write in Rust is much, much faster than one you can write in Okamel because of the way Ocamel is designed, where there's this kind of automatic garbage collection, the worst thing you can do in high speed finance is do any memory allocation that results in garbage collection. And so you have to write very, very careful o camel that almost ends up looking like C in order to end up staying in functional programming land, but not actually creating tons of memory on the heap or the stack that ends up getting collected later.Dwarkesh PatelI guess you've been playing around with the Rust a lot recently, right?Brett HarrisonYeah.Dwarkesh PatelWhat is your impression of the language? You've been enjoying it?Brett HarrisonIt's great and it's come very long way in the last three to five years. I think crypto has something to do with that. It seems to be like one of the languages of choice for people to write blockchains and smart contracts and so there's been enormous amount of open source contribution to Rust. And so comparison when I last looked at it a couple of years ago, it's a lot easier to write really good, sophisticated programs now in Rust and get all of the type safety and the speed that you get, which is like very comparable to C plus plus on the speed side.Dwarkesh PatelWell, when I'm writing programs, they're not large code bases with many people contributing. So what I use for us, it's just like a huge pay. And I just want to do something very simple. Why do I have to put like an arc instead of a box instead of an option? But I can totally understand if you have something where like billions of dollars are at stake.Brett HarrisonThere's definitely a learning curve. I think for basic scripting you want to use something like Python, right? But exactly. If you're writing low latency distributed infrastructure that has to never fail, russ is a pretty good choice.Dwarkesh PatelYeah. Speaking of Jane Street, why does a company pay interns like 16 or seventeen K a month for their summer internships? Is the opportunity cost for one of these smart students that high in the summer?Brett HarrisonThe short answer is yes, but the long answer to why I think they do that is the starting salary for the top people in not just finance but in tech is sort of in this like low to mid six figures now. And you can debate whether you think that's like, the appropriate starting salary for a person with no experience coming out of college or not. That's just sort of the reality is that the talents pool is extremely competitive from the employer side. So if you start with that as like a reasonable salary plus bonus for an employee, I think change rates mentality is these interns who are coming here like they're doing real work, they should be paid like a full time employee, just like prorated for the time when they're actually here. And so that ends up like checking out to be like the right numbers.Dwarkesh PatelWait on net, are interns I mean, forget about the salary, are they actually on net contributing? Given that subtracting away the time of the traders who are training them, maybe.Brett HarrisonIt sort of breaks even if you consider the time to train them. But it's extremely worthwhile, because when those interns come back full time and Jane Street hires a significant percentage of its incoming classes from their internship program that they're already trained, they're ready to go day one. They're almost immediately useful because they had that like, three month period where they got trained and only the ones that really liked it and were good come back. So it's like rather than wait for them to come on site, train people, and maybe half of them aren't good or and half them don't fit with the culture and you kind of don't know what to do with them. The internship program provides a really good place to get on the job training and then only kind of select on both sides for the ones that are.Brett HarrisonThe best.Dwarkesh PatelIs there a free writer problem with internships where if, like, a company like Jane Street puts in the effort to train somebody for three months, they might get some of them to work for them, but they've also trained some people who might work for the competition. And is there some sort of free rider problem there?Brett HarrisonThere for sure is, which is why the companies have to work as hard as possible to make their experience as good as possible, which is like, it's good for the interns. When you go to street, not only do you learn a lot, but they pay you really well. And also you get to visit one of the foreign offices for like a week or something. Also they have all these really fun programs where they bring famous speakers to come to the office and speak to the whole intern class and they have parties and all sorts of stuff. And it adds to like, the experience of thinking like, okay, this is the place I want to work. I don't want to like, take my training and go to the competitor, I want to come to you.Dwarkesh PatelI clearly got in the wrong business with podcast. Why did you pursue finance dev instead of trading? Why did that appeal more to you?Brett HarrisonYeah, so in college I studied computer science in math and I really liked programming, but I think I didn't quite know what a career in programming looked like. I think the conventional wisdom, at least in 2009 when we applying for internships, was like, okay, I'm going to sit in the cubicle and stare at a screen for 16 hours a day. I'm going to be miserable and it's not going to be a very social job. I consider myself like, a pretty social person. And I had a lot of friends who had had these various internships and quantitative finance, mostly from the trading side. And so when eventually I went to Jane Street as an intern, I had kind of like a hybrid summer, like, doing some dev stuff and some trading stuff. And to me I thought, like, okay, the traders are much more, much closer to, like, the real action of the company and like, I want to be a part of that. And so when I joined Jane Street, I was hired as a trader on the ADR desk. And I realized very soon into that that one, no, actually the developers have just as much, if not more impact on the outcome of success of the company. And two, I just like, enjoyed it a lot more and it was just much more up my alley and my training, and so I ended up going that route instead.Dwarkesh PatelI want to ask about the culture at these sorts of places like Acidadelle or Jane Street. I mean, you spend some time in Silicon Valley and around like, traditional sort of like, startup scene as well. What is the main difference between Silicon Valley tech culture versus New York culture?Brett HarrisonSure, yes, I have a ton of personal experience in the Silicon Valley culture or like the tech culture, since I've only really worked at kind of finances my finance places my whole life. But the sense I get is that the kind of New York Chicago quant, finance dev culture is one about extreme Pragmatism. You know what the outcome is. It's to be the most profitable of the strategy. And you kind of try to draw a straight line between what you're doing and that profitability as fast as you can compare it to. I think the Silicon Valley culture is much more about creativity and doing things that are new that no one else has done before. A healthy amount of cross pollination would be good for both where I think a lot of trading firms are doing the exact same thing that all the other trading firms have done and some healthy injection of creativity into. Some of that stuff to maybe think slightly outside the box of, like, as you said earlier, get slightly faster to go to Nasdaq or something. Which is like, okay, might be fine, but it's, like, not that creative. Would be good for those plot terms. At the same time, the sheer approach to Pragmatically getting something done out there and sold and making money would help a lot of Silicon Valley firms that kind of like hang out in this sort of creative land for too long and don't end up getting a product to market.Dwarkesh PatelYeah, I know. Definitely. It seems like there should be one founder from both those cultures, every single startup. It's similar to what you were saying earlier with SBF and Visionaries versus Pragmatist in that context. How conspicuous I mean, you were just mentioning earlier that these traders are making mid six figure salaries to begin with, let alone where they arise over the careers. How conspicuous is their spending and lifestyle? Is it close to Wolf of Wall Street? Is it just walmart T shirts? Where are we talking?Brett HarrisonIt's not a lot closer to Walmart T shirts than it is Wolf of Wall Street. Certainly it is now. Even when I started, it was pretty inconspicuous. I don't think it was that way in the previous decade or two before I joined Finance, I guess. I'm not really sure, but I got the sense that the current culture around inconspicuous consumption is sort of a function of millennial consumption habits where people are focusing a lot more on experiences than having shiny material objects. I think that's had a large effect on kind of like the high earning tech and finance culture that exists today.Dwarkesh PatelWell, I guess are they spending that much money on experiences either? Because how expensive is a flight to Hawaii, right? Even after you subtract that, where is this money going? Are they just saving it?Brett HarrisonMaybe it's not like just a flight to Hawaii, but it's like, bring your ten friends to Hawaii with you or something. Or it's get involved in a charitable organization in a way that someone who is 24 normally wouldn't be able to do, surely by being able to donate a lot.Dwarkesh PatelYeah. What is the social consequence, for lack of a better word, of having a bunch of young, nerdy people, often male, often single, having this extraordinary level of wealth? What impact does it have? I don't know if society is the right word, but what is the broader impact of that class of people?Brett HarrisonI think we'll have to play this out over the next decade or two to really see where this goes. If I'm going to be an optimist about this, I'd like to think that when it was like older, single or married males hoarding a large amount of wealth that for the most part, they kept it to themselves and kind of waited until later in life to do anything with it, and were the kind of people who really, like, saved their same career their whole lives, as opposed to if younger and younger generations are amassing wealth through what they can actually perform with their skills, then I think that hopefully injects more Dynamism into the distribution of that wealth later on because those millennials within like or Gen Z or whoever will go on to found new companies, and maybe they'll be able to see the company themselves, their own money, and have a lot easier time, like bringing, like, interesting new things to market. Or they'll be able to donate to, like, really interesting causes, or they'll be able to, you know, help out their friends and family more easily from a young age. Or they'll be more selective in the kinds of things that they give to or contribute to that don't just involve getting their name on, like, a building of a school or something.Dwarkesh PatelYeah, that's a very optimistic story. I hope that's the way it plays out. So tell me about the psychology of being a quant or a trader or a developer in that space, because you're responsible. Like, one wrong piece stroke and you've lost millions of dollars, one bug in your code. And there are historical cases of this where entire firms go down because of a bug. What is the sort of day to day psychological impact of that kind of responsibility?Brett HarrisonMaybe the job selects for the people who don't kind of crumble under the theoretical stress of that job. But personally, I don't lose sleep overnight at night over that. Because within any mature financial institution, like a trading firm, there are typically many layers of safeguards in place, like limits on how many dollars you can trade in a minute and how much you can trade overall or for your desk or, like, how many messages you can send to the exchange. And then there's, like, limits on, like, the individual trader and desk level and firm level and there's layers of different checks. Often there are actual rules, like regulatory rules to comply with and market access checks. Like FINRA is like 15 C, three five. And so when you're writing new code, it's not like a completely blank slate thing where you're connecting directly to an exchange and hoping for the best. Usually you're embedding some piece of code within some very large established framework where the goal is to make something trader proof. No matter what some trader clicks on or does or configures with their system, there's like a limit to how badly they can go, how badly they can actually go. And so, especially in my particular role as a developer, actually being able to understand the technological stack and say like, oh, I can tell and can sort of verify that these particular safeguards in place and it is actually as trader proof as I think it is, I can sleep at night knowing nothing too bad is going to happen. I mean, the times I actually lose sleep are like, a trader in London or Hong Kong calls me in the middle of the night to say, like, hey, can you explain how this thing works? I need your help. Those are the times where I actually lose sleep. But it's not over, like, being concerned about risk.Dwarkesh PatelYeah, that's interesting. If you ask the people who work in these firms, what is the social value you're creating separate from the question of what the correct answer to that question is? Would the majority of them say that I'm doing something really valuable? Would they say I'm indifferent to it, but it's earning me a lot of money? What is their understanding of the value they're creating?Brett HarrisonIt really depends on the company, and it depends how diffused the culture is at older firms that have fewer people impacting the culture on any significant way. I think you might not get a clear answer on this thing for a place like Jane Street, where the firm is really run by, like, 30 or so, you know, partners and senior employees who have, like, been there. For a really long time and have carried through the core culture of that company up until the present day. And with that large number of people at the top in a very flat environment have actually been able to propagate that culture and maintain it throughout the company. I think you'll find a much more kind of homogeneous view on their social value, which I think they would say is that they provide the best pricing and access to. Markets that are critical for facilitating capital allocation throughout the world and allow people to very efficiently invest in vehicles that are global in nature.Dwarkesh PatelThat seems very abstract. And while it is probably very well correct and is very valuable for society, it might not seem that, like, tangible to somebody who's working in that space. Is there some technique that these firms have of making visceral the impact these traders have? I don't know, do they bring out some child who benefit from efficient markets or something?Brett HarrisonI think, well, probably not like children. I think it's more like anecdotes about, like the pension like fund behind this, like, state government needed to get exposure to some diversified asset class and came to one of these companies and said, we want to move like a $5 billion portfolio. Can you help us do it in an efficient way? And it ends up saving them, like significant numbers of percent or basis points over what would happen if they went to the market. And you can say, well, there's like a direct connection between the price that someone like Jane Street gives them and the amount of money that they ultimately get to save and ultimately pass on to the people in their state who are part of their pension plan. And so it feels like a direct connection there.Dwarkesh PatelOkay, let's start by addressing the elephant in the room, which is FTX. Let's begin at Jane Street, which is where you met SBF. Can you tell us sort of the origin story of how you first met him and what your first impressions were?Brett HarrisonYeah, absolutely.Brett HarrisonSo I was at Jane Street from 2010 to 2018. Sam was at Jane Street for a couple of years in the middle of that, I think 2013 to 2017. And one of the things I did at Jane Street was I started this program called Okamel Bootcamp. It was a yearly course for the new trader hires to spend four weeks with me learning programming in Okamel, which was like the esoteric programming language that we use at Jane Street along with a lot of our other proprietary systems. And Sam was in one of the first cohorts of students and so I got to meet him through that experience.Dwarkesh PatelGot it. Okay, and what was your impression of him?Brett HarrisonYeah, he was a smart kid, he was nice, he kind of got along well with other people in his class. He was definitely above average, but not completely stand out at the top. Although then again, the bar was extremely high at Change Street, so I think that's already sort of a compliment. But people liked him a lot and thought he had a lot of promise, but he was a young guy like everyone else.Dwarkesh PatelGot it. And did that perception change over time while you were at Jane Street?Brett HarrisonIt slowly started to. Sam was on one of the largest trading desks at Jane Street and had 50 or 60 people on it. He had several managers. And one of my roles at Jane Street was to work with all of the different trading desks on the designs of their particular strategies and systems. And so I would frequently go over to his desk and talk with his managers about stuff and they started pulling him into conversations more and more specifically to talk about some of the lower latency Etfr stuff. We were doing some of the original OTC automation things we were working on. And so he started actually contributing more to the actual design and thought behind some of these systems and thought he was precocious and had a lot of really good intuitions about the markets.Dwarkesh PatelGot it. Okay, and so what exactly was your role at Jane Street at this time and what was his?Brett HarrisonYeah, so at this time I was sort of leading the group of software developers building the technology that was closest to actual trading. You can think of Hft or any kind of trading firm. There's lots of different developers, people who work on stuff really relating specifically to the trading technology, people who work on kind of the core systems, networking, kind of internal automation tools, tools for developers. So we were in the part of the spectrum that was closest to actual trading. And so my job was to go over to the different trading desks within the company, talk to them about their specific strategy for the products they traded, understand how to like their priorities, about what venues they want to connect to what different systems they want to create? What different parameter changes they need in their automated trading systems? What kind of research tools will help them do their job better? What user interface would make it easier for them to understand what's going on in the market and kind of all of that?Dwarkesh PatelOkay. And did SVF at this point have any sort of reputation of either being uncooperative or being cooperative or anything ethical or professional that's not worthy of this time?Brett HarrisonI don't think there was much that stood out, although he was again pretty precocious at that particular time period. One anecdote that sort of drew me closer to him was Jane Street's offices were in 250 Vessie. They still are in New York City. And there's a big food cart on the second floor. And so I once went down to meet with a development person from a nonprofit that works in animal welfare and something that my wife and I had donated to for a long time. And I met with this guy and he said, you're the second person I met from Jane Street today. Which was wild because Aintree was like only a couple of hundred people there. This is like a pretty niche organization. And I was like, that's crazy. Who did you meet? And they said, oh, Sam Bankman Freed. And I was like, Sam? I just came down from talking with him upstairs. And so I went back and we sort of realized we had this kind of shared interest in helping kind of animal welfare causes. We're both vegans and we sort of bonded over that. That's how we kind of became friendly.Dwarkesh PatelGot it. It seems that his interest in effective altruism was genuine at this point. And early on there was a history of this.Brett HarrisonYeah, it wasn't like EA was super popular at Jane Street. I feel like that's a bit of recent sampling bias among this younger crew of Jane Streeters. There definitely I think it was because of a lot of association prior to joining Jane Street that were into effective altruism. But there were a couple of people there who really were fairly vocal about the fact that they were donating the majority of their yearly salary and bonus to charitable causes. And Sam was one of them. And yeah, started to become known for that.Dwarkesh PatelGot it. Okay, so I guess fast forward to he's no longer at Jane Street, you're no longer at Jane Street, and you're at Citadel. He started FTX, actually, before we back go there. Were you in contact with him up until the point where you had started talking about a potential yeah, off and on.Brett HarrisonWhen I first left Jane Street, and he left sorry, when we both left Jane Street around the same time, him before me, he had told everyone at Jane Street that he was leaving to join the center for Effective Altruism full time. And I guess he did that. I'm not sure if it actually happened because he very soon after started this trading firm and tried to pull off of Jane Street people to join him to do this trading firm, which didn't make people super happy, but it was funny. We had a phone call and he told me that it wasn't really going super well. He said it was really great in the beginning. They made a lot of money, they had this arbitrage trade, and then a few things kind of went by the wayside, and they had taken out these huge loans to be able to get their initial capital for Alameda. And also there was a big fracture within the company. Half the company split, people left. He really didn't tell me much about that at the time, and he said he's probably going to do something else. And when I asked him, he said, I think I'm going to work on political prediction markets. And I was like, okay, it doesn't sound super exciting to me. I'm going to continue on with what I was doing, which was moving to Chicago, taking a new role. But then fast forward, I guess that idea. Maybe he wasn't telling me the whole truth at the time, but I guess that idea became FTX and he had the impossibly, like resuscitated Alameda in the process.Dwarkesh PatelYeah, that's really interesting. Do you have some sense of what it was that went sideways?Brett HarrisonSo I pieced together some details over the years because he told me a little bit more after I first joined. I heard a little bit more later from other people and then saw some reporting kind of post FTX collapse. I think there were two things. One was the infrastructure they had built, I think was really poor in the beginning. A lot of Python scripts, like, slapped together, and a couple of times they had sent tokens to the wrong wallet and ended up losing millions in the process. And they had some big non arbitrage directional bet on in some token, it might have been ETH or something, and it went against them. And so they lost a lot of their trading capital. And then the other thing was that after some of their technical problems, there was internal disagreements, supposedly. This is what Sam told me about how to move forward with tech. There was half the crew that wanted to kind of rewrite everything from scratch in a different programming language. There was another half that said, like, okay, we can make some small incremental changes from here and fix things up. And Sam and Gary and the shot were more in. That latter crew, that former crew kind of broke off and started their own thing, and that's what originally happened.Dwarkesh PatelOkay, got it. And were you aware of the extent of this at the time, or something piece together?Brett HarrisonNo, not at all. Sam told me a little bit about it, but this is over the course of years now where I had two different roles, one at Headlands, one at Citadel securities. Sam was starting alameda. We spoke maybe once a year, briefly on the phone. So all this stuff was happening in the background and I had no clue. In fact, the first time I even heard about FTX was one of my colleagues from Citadel securities told me, hey, did you ever work with this, like, Sandbagman Freed guy? And I was like, yeah, a little bit. Why? And they're like, you know, he's like a billionaire and he has this Hong Kong crypto exchange. Like, what? No, since when? And then started to see him pop up in articles. There was like a box article about him and a few other things, especially related to his political donations. And that's kind of when I got back in touch with him and we started talking a little bit.Dwarkesh PatelWhen was it that he called you to say that there are potentially troubles and I'm considering starting a political prediction market?Brett HarrisonThat was in 2018.Dwarkesh PatelOkay, yeah, got it, got it.Brett HarrisonSo I it was right after I left Jane Street.Dwarkesh PatelGot it. Okay, so now you've moved on to Citadel, and I guess you are still in touch at this point.Brett HarrisonYeah, like, very briefly, a text every now and then.Dwarkesh PatelOkay. And then at some point you become president of FTX US. Do you want to talk about, I guess, how he approached you about that and what was going on at the time?Brett HarrisonYeah, it was interesting. So at the time, I was running what was called the semi systematic trading technology at Citadel securities. And so this was the group of technologists working on systems for ADRs, ETFs options, and OTC market equities. There's around 100 software engineers or so that rolled up to me and, you know, that was going well. But, you know, Sam and I started talking. It was, I guess March of 2021, and he was like, telling me a couple of things going on in FTX. And then he said, if you're interested in coming over to FTX, we would still love to have you. And I thought, still, I've never talked about doing this before, but sure, let's entertain this. And then we started talking and he had me meet him and Gary and Nashad over video call I was in Chicago, they were in Hong Kong at the time. These calls were taking place like late at night my time. And very quickly like an offer came together and I thought, this is a really cool opportunity to jump into a field and take a role that was very different from stuff I've done in the past. And I signed up.Dwarkesh PatelGot it. Okay. And where was FTX at this point in terms of its sort of business development?Brett HarrisonYeah, so FTX was doing quite well. It was basically finished its first, its second year of operation and it was maybe the fourth or fifth largest exchange in the world by volume, if you include spot crypto and crypto derivatives. And it was also one of the primary destinations for institutions, proprietary trading firms, hedge funds to trade crypto and derivatives, especially because of how it was designed. And so it was doing really well. FTX us was virtually nonexistent. They had started the, they formed the entities. They had started the exchange, I think in either December 2020 or January 2021, but it had like, de minimis volume compared to the other exchanges around the world, especially in the US. Too. And Sam talked to me a lot about the aspirations for the US business. One, to grow the spot exchange, of course. Two was to be able to find a regulated path for bringing some of these offshore products like Bitcoin and ether futures and options onshore in a regulated way. And on top of that, Sam had also told me about kind of longer term desires to be a single app or marketplace for everything, not just crypto, so launching a stocks trading platform as well. And so that was one of the reasons I think he wanted to bring me on, was because I had all this experience kind of inside of regulated broker dealers and sort of knew roughly what it took to get that started.Dwarkesh PatelOkay, got it. The initial offer was specifically for President of FTX US, right?Brett HarrisonYeah. Sam wasn't someone who loved thinking hard about titles and even like what my original title was going to be was like a point of contention, but I'm not sure it was clear exactly what my role was going to be. I think Sam wanted me to write software for FTX and FTX US. Sorry for FTX US, but to me, I sort of thought there was like this bigger opportunity to kind of kind of work with Sam to lead this other startup which was FTX US, and kind of build it up and sort of follow in FTX's footsteps in its success. And that was the part that was most exciting to me because this is what I've been doing now for years. It's like managing large teams of people, thinking about strategy, getting people together, occasionally doing some software development myself. But that was the primary reason for wanting to join.Dwarkesh PatelGot it. And what was the relationship between FTX and FTX US at that time? Were they kind of subsidiaries? Were they separate entities?Brett HarrisonThey were separate entities. They weren't subsidiaries. There was technology sharing between them. So, like the FTX US exchange technology was licensed from FTX. You can think of FTX US as like FTX stripping away most of the interesting parts of FTX. Right. Because it was just a dozen or two spot tokens. And when I joined, there were very few people within FTX US, maybe like two or three dedicated people. So over the course of the next year or so, my job that I sort of fit for myself was to open up some offices, hire a bunch of people, establish separate compliance and legal and operational and support teams, start to build out these regulated entities.Dwarkesh PatelWas Chicago the initial base of that operation?Brett HarrisonYeah, for selfish reasons. I have my family here's, here, and I wasn't going anywhere. But also I thought Chicago is a great place for FTX US, because if our main goal was to establish regulated derivatives, like, Chicago is really the place where that happens. We have like the CME, we have many of the top proprietary trading firms. A lot of the Futures Commission merchants and various brokers are all here historically, like the kind of the floor of the Chicago Board of Trade and the Chicago Mercantile Exchange. Like, they're here. And so it kind of felt like a good place to be.Dwarkesh PatelAnd at this point, I guess before you joined, did you get a chance to ask him about the relationship between FTX and Alameda?Brett HarrisonYeah, I did. It was definitely of interest to me because the primary reason being that I wasn't interested in doing Prop again. I worked at Jane Street. I worked at Headlands Tech. I was at Cedar securities. If I wanted to continue doing Prop trading, I would have stayed at one of those places. So I wanted to do this exchange business. And what Sam told me was the same thing he said publicly everywhere, which is that Alameda is basically running itself. All of Sam's time is on FTX. They're kind of walled off from the FTX people. And their access to the exchange is just like any other market maker. Like, there's like the public API feeds, there's benefits from market makers that trade enough volume. But it's not like Alameda had any special privileges in that sense. And. So I thought they were just basically separate.Dwarkesh PatelAnd did you ask to, I guess, audit their sort of financials or this relationship before you joined?Brett HarrisonNo. I mean, I don't know about you, but I've never gotten an offer to a company and said before I signed, show me your audited financial. It's just like, not a thing that happens.Dwarkesh PatelRight, okay, fair enough. So you joined FTX and then you mentioned some of the stuff you were working on, the operational legal, getting the organization set up. But yeah, feel free to talk in more detail about what were the things that came up during your tenure and what are the accomplishments you're proud of?Brett HarrisonYeah, I guess on the professional and personal front so, I guess on a professional front, I'm most proud of establishing out our team and making significant headway to a lot of our goals to establish these regulated businesses. So, for example, LedgerX, we acquired LedgerX and we had this application to the CFTC to enable kind of real time, direct to customer, 24/7 margining and cross collateralization. And it was an extremely innovative proposal and it felt like we were making real progress towards establishing new and very exciting regimes for Cfdc regulated derivatives in the US. I also established a broker dealer in the US for the purposes of letting people trade stocks like some lords, robin Hood. I wrote like 90% of all the code for that stocks platform myself. And yeah, I was very proud of that accomplishment. And then on a personal front, I it was great to get embedded into the crypto industry. I was very excited by everything that I saw. It was great to make all the connections through FTX with, like, the different people in the crypto ecosystem and become friends with these people and certainly has an influence where I am today. So I'm sort of proud of all of that.Dwarkesh PatelHow did you manage the management of, I don't know how big the team was at to speak, and it sounds like you were heavily I mean, involved is an understatement in the actual engineering. How were we able to manage both roles at the same time?Brett HarrisonYeah, so we were like between 75 and 100 total people in the US. And it was challenging. It was one of my biggest complaints, which I'm sure we'll get into, that yes, I can write code, but I feel like that's my comparative advantage is helping kind of to leverage teams of people to get them to work towards the common goal of building out large distributed systems that are complex and multivariate nature. And the best use of my time was not me programming between the hours of like 10:00 P.m. And 02:00 A.m. Every night while trying to keep on board with what all the personnel were doing. So I really wanted to grow the US team significantly to at least be more than a handful of developers. And so, yeah, that was one of the initial points of contention.Dwarkesh PatelOkay, speak more about that. So he was opposed to growing the team.Brett HarrisonSam would frequently talk publicly about how proud he was that all of FTX is built by two developers and all of these crazy organizations that hire thousands of developers and can't get anything done. They should learn from me about how, like, a small lean team can be much more effective. And there's some truth to that. I do think the conventional wisdom now is a lot of big tech companies overhired for software engineers. And not only was it sort of an expense on the balance sheet, but it was also expensive in terms of slowing down the kind of operational efficiency of the organization. And having a small lean team can help you get to your first or your anth product a lot more quickly. That's great for a startup, but once you're like a north of $10 billion valuation company, like, promising the world to customers and investors, two software developers doesn't really cut it anymore. I mean, at some point, you have to grow up and face the reality that it's time to actually grow an organization into a real kind of managed enterprise with teams of software engineers specializing in certain tasks. And so there was always pushback. People would tell me, like, look, we're not trying to be like Jane Street or Citadel in terms of our number of software engineers. We want to stay lean. That's our comparative advantage. And most importantly, they didn't want two separate development teams, like one in the US. One in then the Bahamas, like, they wanted to keep the nexus of software development underneath Nashad and Gary in the Bahamas, which I just thought wasn't going to be sustainable long term. Like, if you run a broker dealer in the US. You need to have staff that is specifically allocated towards broker dealer activities. It can't be that if FINRA comes and says like, well, who's working on the broker dealer? You say, well, it's like this Gary guy who lives in the Bahamas who sometimes is awake at like 04:00 A.m., spends 20 minutes a day thinking about stocks that can't fly right, and has.Dwarkesh PatelNo images of him. Okay, so we're Nashad and Gary contributing code to the FTX US. Code base.Brett HarrisonRemember, like the FTX us. Side of things was like strict subset of FTX. So, like, in that sense, it kind of flowed into FTX US. With the exception of the FTX us. Derivatives, the Ledger X stuff was actually a completely separate team because that was through an acquisition.Dwarkesh PatelWhen you're talking about the code of, like, the matching engine or things like that. Was the code shared between FTX and FTX us.Brett HarrisonYes.Dwarkesh PatelOkay, who was in charge of ultimately approving the pull request, basically, of the Xtx US. Code base?Brett HarrisonYeah, I was like all Gary and Nashad.Dwarkesh PatelOkay, got it. And so the code you were contributing was also going to the sort of like universal global code base. Yeah, got it. Did you have sort of access to the entire code base or just the FTX US side?Brett HarrisonYeah, again, it was one share repo. I mean, there was an enormous amount of code. And one of the big problems, another problem that I raised while I was there, was that 90 plus percent of all the code of FTX was written by these two people. And it was very hard to follow. I don't know if you've ever seen like a large Python code base before. So whenever there were issues that arose there's, like this particular problem with an account on the exchange, the only answer was like, call Nashad, call Gary. Which I also knew to be unsustainable from the organizational perspective. One of the guiding principles at Janetree, for example, was mentor your junior dev so that you can hand off all your responsibilities to them. And in the process of handing off responsibilities, you make the code better, more automated, more robust problems, more easily debuggable in real time. If you hoard everything to yourself in your own brain, you end up with a code base that is just only understandable by that one person. And so it was the kind of thing where a lot of people talked about this internally. Like if Gary got hit by a bus and couldn't come to work anymore, fjs was done. It's done. Exactly.Dwarkesh PatelWhat do you think was the motivation behind this? Was it just that he wanted to avoid as a sort of like Google growing to 100,000 people kind of thing? Or was there something else going on? Like what? Why did it why this sort of concentration?Brett HarrisonClearly there was something else going on. I think an open question now, only thinking about this in hindsight was how much of this very cloistered organizational decision around the development team was a function of the various things they were doing that they were hiding from the rest of the company? Or was it really this sort of like one, ultra paranoia about growing too large too quickly and getting losing control of the organization, and two, an almost like sort of cultlike belief in this small team, like being the but for cause of all past, present, and future success.Dwarkesh PatelWhat was the discretion that you had at FTX US? It sounds like you weren't even given the capacity to hire more engineers if you wanted to. What were the things you did? Control.Brett HarrisonYeah, hiring, for example. I began pushed for many months that we should hire more people. Eventually I got permission for us to interview people, but then those ultimately have to get finally approved by the people in the Bahamas. And they would frequently say no to people who I thought were good candidates. Finally, we hired one person, and this person was doing well. He was here in Chicago, and they invited him to go spend like a month in the Bahamas to kind of hang out with them and supposedly just like to ramp up on the system. And this person comes back to Chicago and they say, you know what? Like, I really want to move to the Bahamas. They really kind of confused me to do it. And it was so frustrating.Dwarkesh PatelI was just poaching from your own company.Brett HarrisonExactly. It was such a constant battle. And at some point I kind of gave up on this idea that I was going to be able to actually grow the separate developer team. So, I mean, the bottom line is on kind of like the day to day operational stuff, especially the decisions within some of the things I was responsible for, like the stocks trading platform that I was working on, I had a fair amount of discretion and people certainly looked up to me for management and advice and direction. But ultimately the discretion ended up with this small group in the Bahamas who not only had final say on decisions, but would often make decisions and not communicate with the senior people in the US. Side and we would just sort of find out things were happening.Dwarkesh PatelIs there a specific example or set of examples that comes to mind?Brett HarrisonSure. The biggest example for me was this sort of post my kind of effective resignation, but some of these strategic acquisitions that were being done in the US. During the summer of 2022, I would find out from the news or it would sort of be mentioned on a signal chat or something that this was happening. And there was no opportunity to actually wade into the discussion about how this is going to greatly affect the US. Business, it's going to greatly affect our priorities. And it wasn't clear if this was like a good decision or a bad decision. It was like a unilateral decision that was made, like, we're acquiring this company or we have the option to acquire this company.Dwarkesh PatelAre there decisions that were made from the Bahamas that stick out to you as being unwise that, I don't know, you try to speak out against? You mentioned some of them, right? Like not hiring enough people and not getting more developers. But are there other things like that that stick out to you as bad decisions?Brett HarrisonA lot of the spending, I mean, on everything from, like, lavish real estate to all of these, like, partnerships to, like, very, very large venture deals, like, these were the kinds of things in the company where people ask, when does it stop? To one end, are we doing a lot of these things? And some of those resulted in sort of like direct confrontations, like, just, why are we doing yet another deal with a sports person or a celebrity? This is ridiculous. This is not doing anything for the company. And we're completely distracting from the role that we thought we all had which is to build a really great core product for people trading crypto on crypto derivatives.Dwarkesh PatelYeah. And did you bring this up directly with SBF?Brett HarrisonYeah, multiple times.Dwarkesh PatelAnd how would he respond?Brett HarrisonSometimes he was nice about it, and he would say, yeah, I see where you're coming from. I do think what we've done so far has been really valuable, and we probably should do some more of it, but maybe at some point we should stop a lot of this. Sort of like, hedging language that was ultimately non confrontational, noncommittal I mean, he was a very non confrontational person. Very conflict, avoidant person within the company. And then at worst, there were other times where I brought up specific things that I thought that he was doing wrong. There was one really unfortunate time where it was the first time I visited the Bahamas in November of 21. And I'm the kind of person who, if I see something wrong at a company, it doesn't matter what company I've worked at or how junior or senior I've been. I like to go to the person most senior in. Charge and tell them this thing seems wrong to me and that's I feel like it's one of my superpowers of just like, not being afraid of just saying when something seems wrong to me. And sometimes I'm just totally wrong and don't understand the full picture, and sometimes it results in something better happening, and people will, you know, thank me for having been honest and bringing to attention something that's actually wrong. And so I said to Sam, I think you're doing way too much PR and media. First of all, it's really diluting you and the FTX brand to constantly be doing TV interviews and podcasts and flying to banking and private equity conferences. And it was so much time spent on this stuff, and also it was completely taking away from the management of the company. People would sometimes send Sam slack or signal messages and not get responses for weeks at a time. And it felt like he was spending virtually no time helping the company move forward. It was so much about image and brand and PR, and he was really angry at hearing this criticism directly.Dwarkesh PatelHow did he react?Brett HarrisonI mean, he was just he was sort of emotional. He was worked up. He told me, like, I completely disagree with you. I mean, he said, like, I think you're completely wrong. He said, I think the stuff that I've done for PR is maybe the greatest thing that's happened to this company and I should do more of it. I didn't think it was physically possible to do more of it. And I realized at that moment that this was not really going to work super well long term. Like, if we're not in a relationship where I can give sort of my direct, superior, like, real, honest, constructive criticism that I thought was for the good of the company that this wasn't really going to work.Dwarkesh PatelHe actually did my podcast about, I don't know, eight months ago or something. And while I was, like, very grateful he did it, even at the time, I'm like, I don't know if I would have agreed to this if I was in charge of a $30 billion empire.Brett HarrisonYeah, sometimes some reporters would say to me, can you get me in touch with Sam? And I would say why? I'm not really his keeper. You could contact him yourself. They're like, oh, because we want to come to Bahamas and do a special on him. And I would say, like, okay, you're going to be like the 6th one this month.Dwarkesh PatelThere's an exclusive here. So I guess to steal man, his point, he did get a lot of good PR at the time, right? Potentially. Well, not potentially, actually too much. In a way that really created at the time sort of like the king of crypto sort of image. Was he right about the impact of the PR at the time? Yes. Let me ask a question a different way. How did he create this image? I mean, people were saying that he's the JP. Morgan of crypto. He could do no wrong. Even things that in retrospect seem like clear mistakes, like only having a few developers on the team universally praised huge empire run by a few developers. How was this image created?Brett HarrisonI think that media was primed for the archetype that was Sam, this sort of young, upstart prodigy in the realm of fintech. We have a lot of these characters in the world of big tech, and I think that he had a particular role to play in the world of finance. And by making himself so accessible all the time, he gave people a drug that they were addicted to, which was like, that constant access. I feel like any time of day or night, someone could text Sam and get him on the phone with them if they were in media, and they loved it. It was like getting access to a direct expert who was also this famous person, who was also this billionaire, who was also this extremely well connected person, who was also this very insightful person, who knew a lot was going on in the industry and can give them insight and tips. And I think there was some amount of what I like to call like, reputation laundering going on here, where it was like, okay, so you get the famous celebrity to endorse Sam, which makes this politician think highly of Sam, because they also like that celebrity. And then also the investors are writing really great positive things online about it, but also the media is enforcing how cool it is that Sam is doing all these other things. And it all sort of fed into this flywheel of building up Sam's image over time in a way that didn't necessarily need to match the underlying reality of who he was with the company.Dwarkesh PatelAnd what was the reaction of other employees at FTX of this sort of not only the media hypetrain, but also the amount of time Sam was spending with the media.Brett HarrisonOn one hand, I think people were rowing frustrated within the company because of the lack of direction and some of like the power vacuums that resulted from Sam's continual absence. On the other hand, so many people within the company just hero worship Sam. When you hear all the really tragic stories now of all the employees who kept all of their funds and life savings on FTX, they really, really believed in Sam. And doesn't matter how little time he spent with the company, it doesn't matter how he treated employees internally, it was like he was this sort of genius pioneer and that image couldn't be shaken.Dwarkesh PatelAnd I certainly don't blame anybody for it. I interviewed him. I tried to do a lot of research before I interviewed him, and I certainly was totally taken with this.Brett HarrisonRight.Dwarkesh PatelI thought he was the most competent person who had ever grazed crypto, but so what was he actually like as a manager and leader? Other than, I guess obviously the micromanaging aspect of it, or feel free to speak more on that as well. But in terms of the decisions he would make in terms of business development and prioritizing things, can you describe his sort of management style and leadership?Brett HarrisonIn the beginning? When I joined FTX, my initial impressions were that he had pretty clear intuition and insight into the simple things to do that would work in many ways. If you think about what FTX did, it wasn't really super complicated. It was like just be operationally good and give your trading customers as predictable of an experience as possible with regards to collateral management and auto liquidation and matching engine behavior and latency. And so they did it. I would say, aside from the intuition, sam wasn't a details man. That was usually left up to the people below him to really take care of was like to drive a project to completion to figure out all the details that had to be done. I think besides that, as a leader, I thought he was fairly incompetent. I thought he was very conflict, avoidant. He didn't like to get into direct confrontation with any of his employees where most of the reasons why people needed to talk to him were because there were significant issues, whether those were personnel or otherwise, and he just blew them off. That was a frequent occurrence in the company. If you went to Bahamas and I went to only a couple of times to actually visit the office, if he was in the office, he was there all day on calls all day, whether those were with investors or with media, podcasts, whatever. It was just consistently just doing that. And I saw very little time where he actually got up and talked to anyone else within the company about anything. So I think to me that was the primary impression I got of his leadership was virtually that there was none, which made me feel a lot like I and others needed to step up and sort of take that role in the absence.Dwarkesh PatelGot it. And so who was making these day to day decisions in the absence of Sam?Brett HarrisonOn the foreign side in the Bahamas, Nashad was really like the number two person there. I mean, he was making a lot of decisions. There were a couple of others in the Bahamas who were taking kind of swaths of the company, whether it was like investments or marketing or legal things like that. On the US side, we had like a different crew trying to make decisions where we could for us regulated matters. But again, we were always sort of below the decision making authority that was happening in the Bahamas, especially inside of the home where they were all living.Dwarkesh PatelSo it seems like Fcx was a really good product compared to other crypto exchanges. I've heard a lot of traders phrase it was this competence sort of built while SBF was still doing media stuff, or was this built before he kind of went on the PR tray? And like, how was this product built while the CEO was kind of distracted?Brett HarrisonSo I think the core of the product was built before my time, and my understanding was in the transition from Alameda to FTX, where there was no publicity around Alameda, there wasn't any publicity around FTX. It was very much like heads down build mode for several months. And just think, think, think about the core product having been a trader on these different exchanges around the world that also offer derivatives and knowing all their problems. Like, for example, if you had an ether futures position and also an ether spot position on this one exchange, you could get liquidated on your ether futures position even if you had enough ether spot as collateral, because you needed to have that spot crypto within the ether futures spot collateral wallet, which was different than the ether spot wallet. And so it was this game of shifting assets around to different wallets to make sure you kept meeting your collateral requirements, which was just an operational nightmare. And so Sam told and worked with Gary and the Shot to build basically a cross collateralization system where you have just one wallet with all of your assets, all, you know, haircut. It appropriately based on volatility and liquidity, but then summing up to a single collateral value that represents what you can put on in terms of margin for all of your positions. Or having an auto liquidation system that doesn't. Just the second that you're slightly below your margin fraction. Send a giant market order into the book and dislocate the order book by 10%. It would automatically start liquidating small percentages of your portfolio at a time to try to minimize market impact. And then if the position got too underwater, it would auction that position off to backstop liquidity providers, a number of them, who would then take on that position again without having to kind of rip through the book and cause dislocation. And so it was much more orderly, it was much more predictable. And that had to have come from the initial intuitions that Sam and his colleagues got from being traders on these exchanges and thinking, how should this work if it were perfect? So I do think in the beginning, they were really working on that product together. And then once the success came and Sam got drunk on the celebrity of being so out there and known and having all these newfound connections, that things are to go by the wayside.Dwarkesh PatelYou mentioned that one of these things that he was doing was making these sort of exorbitant deals and with celebrities, with acquisitions, branding. What was your understanding at the time of where the money to do this was coming from?Brett HarrisonYeah, so, for example, when I joined the company, FTX had just inked that Miami Heat deal, and I think it was something like 19 million a year. And I was like, well, that sounds like a lot of money. Right? But at the time, you could see the publicly reported volume on FTX, it was something around 15 to 20 billion emotional per day. The fee schedule was also public. So even at like the the highest volume tiers, the you know, the take fee would be something like two basis points per trade. So if you just did like $20 billion traded per day times two basis points times 365, which, because crypto trades every single day, you can get a sense of how much money FTX was making a year. And at the time, I think the run rate for FTX was something like close to a billion dollars in income. And you think, okay, is $19 million a reasonable percentage of the total income to spend on a very significant, important marketing play? I don't know. It feels kind of reasonable. Like, how much does Coca Cola spend per year on marketing as a percentage of their income? It's probably somewhere between like 50 and 130%. I don't actually know what it is. It doesn't seem crazy.Dwarkesh PatelYeah. But if you add on top of that, the real estate, the other sort.Brett HarrisonOf acquisition, all that stuff came later. And secondly, a lot of that wasn't known to the employees within the company. Most of the venture deals, the value of the real estate, et cetera, was non public within the company. There were 100 plus million dollar investments into various companies and other investment funds that were never discussed openly, at least to the US. People. So it wasn't like there was sort of this clear internal accounting where people could look at it and say, hey, are you really spending all this money on this, all this stuff? No, I think Sam very deliberately kept all that stuff within his innermost circle for a reason, because he didn't want the criticism on what he was spending on.Dwarkesh PatelAnd did you have access to, or did you ask to see, I guess, the balance sheet or any of the sort of financial documents?Brett HarrisonI have zero access to bank account stuff or financials on the FTX.com side on the US. I had some. But remember now, knowing what we now know about even like, recent, like the guilty pleas from the shot and seeing like the complaints from like, the SEC Cfdc, they were like, deliberately falsifying information that went into ultimately the audited financials. So in order to actually have suspected anything, one would have to not only, like, disagree with all of the kind of internal conventional wisdom around how the company was doing, but also have to basically distrust audited, financials coming. Back to the company combined with having any concerns about income when it seemed like we were generating income faster than any startup in history. So I think it was very difficult for anyone within the company, especially in the US side, to have a clue what was going on.Dwarkesh PatelSure. Let's talk about Alameda. So I guess, again, maybe the best point to start this story is also with Jane street, where Caroline Ellison went out to become the CEO of Alameda, was a trader. Did you happen to cross paths with.Brett HarrisonHer at Jane street? It's hard to remember because it was like the early days, but I'm pretty sure she was also one of my boot camp students.Dwarkesh PatelIt all starts there.Brett HarrisonBut besides those early interactions, I barely interacted with Caroline, not in the same way that I had done with Sam, just based on the trade and desk he was on. And when I joined the company the FTX us People, communication wise, were walled off from Alameda. So we didn't really cross paths almost at all.Dwarkesh PatelWhat was your understanding of the relationship between Alameda and FTX?Brett HarrisonThis is a completely separate company. Sam doesn't really do anything for them anymore because he is 100% focused on FTX. It's separately being run by Caroline and Sam Tribuco. They have the same access to the exchange, like, data feeds and API as any other market maker on the exchange. And also, you know, especially towards the time that I left, that alameda wasn't even a significant percentage of the exchange volume anymore. They weren't in like the top 20 market makers on FTX.com or something like that.Dwarkesh PatelYou mentioned that you were contributing to the code base and you had access to the code base. People have been speculating about whether Gary or Nashad had hard coded some sort of special limit for Alameda. Did you see any evidence of that in the code base?Brett HarrisonDefinitely not.Dwarkesh PatelYou mentioned that you. Visited the Bahamas offices a few times, and the Alameda, there's like four huts and there's like a meeting room. There's burst salmon, the engineers are there's, the Future Fund, and then there's like, the Alameda hut.Brett HarrisonYeah.Dwarkesh PatelDid the physical proximity between the offices and of course, the fact that the leaders were living together, was that something you inquired about or were concerned with?Brett HarrisonI never visited the places where they lived in that Albany section of the Bahamas, so I think I didn't fully grasp the extent to which they were all living in this particular arrangement. But I understood that as long as Sam was going to be the 90% owner or something of Alameda, he would want oversight there. And so having them close by made sense. But the actual hut set up was such that they had like, physical separation from minute to minute. So it wasn't like Alameda could overhear stuff happening on the exchange or people in the exchange could overhear stuff that was happening at Alameda. So to some extent they felt like, well, at least they're going through the right motions of setting up, like, physical separate buildings. Also, this is not uncommon within trading firms and investment banks. Right. Like, if you imagine there needs to be wall separation between buy side and sell side at different institutions. And the way they do that is they put them on different floors in the same building. Right. And sure, they can meet each other for lunch in the lobby, but they set up some actual physical separation. This is like super par for the course when it comes to financial firms that have these businesses that need to be walled off from each other. And so that didn't seem like particularly strange thing to me at all.Dwarkesh PatelIs there anything that, in retrospect, seems to you like a yellow flag or a red flag, even if at the time it's something that might make sense? In the grand scheme of things, the.Brett HarrisonMost obvious thing only in hindsight, was that Sam liked to do bonuses for the employees twice a year and once the end of June, once the end of December. So they were like semester bonuses. And in the previous semesters, he had paid them early in May for the first semester in November, or early December for the second one. And he was extremely late in doing the mid year 2021, 2022 bonuses. So much so that people within the company started to freak out because there was a lot of bad news in the press about other companies doing layoffs or folding. And it was two to three months late, and people were expecting to get bonuses to pay rent and do whatever. And there's very little communication around this, and people were very concerned. So at the time, people said, look, Sam's like really busy.Brett HarrisonHe's flying to DC every week, he.Brett HarrisonHas all the stuff going on. He just hasn't gotten around to it. But don't worry, it's coming. In hindsight, it felt like there was some clear liquidity issue that was probably the most obvious thing. Everything else is all just things that were red flags about the organization, not red flags about potential liquidity issues or fraud. Things like the complete inability to hire more people, especially on the developer side, not allowing me to establish separate sort of sea level staff on the US side that would have authority that was really separate from the ones in the Bahamas. How completely tightly controlled the Dev team was around access to the code base and the inner workings of all the exchange, and really wanting to keep that nexus of the developer group in the Bahamas next to Gary and Ashod. Those seem like red flags now.Dwarkesh PatelYeah, but not at the time. Did you notice anything weird during the Terra Luna collapse? Because in the aftermath, people have said that that's probably when Alameda defaulted on some loans and maybe some sort of like hole dug itself deeper.Brett HarrisonReally?Brett HarrisonNothing at all. I mean, maybe that's a function of being here in Chicago and just not seeing a group of people freaking out. But nothing seemed wrong at all. In fact, we started having conversations around paying out mid year bonuses a couple of weeks later after Terra announcement and everything seemed very normal. Sam sent out an announcement to the whole company basically saying like, okay, we're going to be paying out bonuses soon. People should expect they're going to be like a little bit lower because we have very similar revenue to last year. But we've also grown in size and also like, the market is slowing and we need to be a little bit more conservative. So all the signs pointed to things as normal.Dwarkesh PatelYou had a thread sort of boiling down this experience on Twitter and one of the things you pointed out there is that you saw the sort of symptoms of sort of mental health issue or addiction issue at the time there. Are you referring to the sort of management mishaps and bad decision making or was there something more that made you come to this conclusion?Brett HarrisonI think it was more than that. When I knew Sam, when he was 21, 22 years old, he was like a happy, healthy looking kid who was very positive, very talkative, got along super well with his cohort of traders. The people on the desk really liked him. When I got to FTX, I think over the course of my time there, I saw someone who was very different than that person I remembered. I think he was angrier, seemed more depressed, more anxious. He couldn't get through a conversation without shaking his leg.Dwarkesh PatelStreet.Brett HarrisonHe wasn't like, that not something I remember at all. He would snap easily. He would not respond to messages for long periods of time. And people had different theories. I mean, people would attribute it to the unbelievable stress of being in the position that he was in complete lack.Brett HarrisonOf sleep, like his diet, lack of exercise.Brett HarrisonI mean, people had plenty of thoughts about what could be causing it all, but something definitely had deteriorated mentally and physically about him from who I remembered.Dwarkesh PatelIf you had to yes, most likely cause of that, what would you say?Brett HarrisonI don't know. I think that's up for a professional with credentials that I don't have. But I do think it was probably a combination of everything. The lack of sleep, the stress he probably was under, not just being in his role, but having kept this secret for so many years around. Whatever was happening with the holes in the exchange and the lying he was doing to his own employees, to investors, to auditors, maybe that weighed on him. Maybe had something to do with his medications and he had just had to be just a plain deterioration in mental state or some kind of personality disorder or a different kind of anxiety disorder. I really don't know. Maybe a mixture of everything.Dwarkesh PatelYeah, got it. You said you gave him a sort of ultimatum letter where you said, unless you change these things, I'm resigning. What were the things you asked that be changed in that letter?Brett HarrisonYeah. So the top three things were, one, to communicate more with me in particular, I could probably count on one hand the number of times I had, like, a one on one phone call with Sam, which probably seems insane, given, like, the position I was supposed to be in. I basically said, like, we have to talk every week. It's impossible for me to get anything done if I don't have the authority, but I have the responsibility to be able to push this company forward, and we're not talking at all. So that was number one. Number two was to establish separate, especially sea level management staff on the US. Side. If Sam was going to be so busy doing what he was doing, at least he needed to delegate that responsibility to, like, a set of professional managers who could actually take care of the day to day operations within the company. And it felt like things were starting to unravel in the absence of that. And then the third was to grow the tech team and move a lot of the authority and management of that team away from nisha and gary so that we could actually spread the knowledge and be able to keep up with a lot of the tasks that we were assigning ourselves and trying to build all these new business lines. That pretty much summarizes it, yeah.Dwarkesh PatelHow regularly were you talking?Brett HarrisonIt wasn't regular. I was on chat groups that he was in, and so occasionally he would respond to something I say on that group, but one on one conversations, I think there were fewer than ten for my entire tenure.Dwarkesh PatelWow, okay. And that was over a year, right?Brett HarrisonYear and a half. Year and a half.Dwarkesh PatelAbout less than one every two months, yeah. How did he respond to this letter?Brett HarrisonSo it took a little while before we got on the phone and he went through every point and refuted everyone, starting with communication. He said, I think phone calls are a waste of time. I think that if I promise people regular phone calls, they will use it to waste my time and it's not an efficient mode of communication. He said, I think we have the best developer team in the world and I think anyone who suggests otherwise is completely wrong. And if we add more people to the Dev team, if we move them to the US and move them away from the Bahamas, we're going to be worse as an organization. He kind of ignored the point about separate leadership. I think he hated the idea of giving other people kind of titles that would reflect kind of greater responsibility within the company. That conversation ended with us kind of not knowing what the future was going to be because I basically said, look, I'm going to resign if you don't fix this. He said, we're not fixing anything. And then what happened next was he had deputized another person within a company to come here to Chicago and pull me into a side room and say, you are probably going to be fired for this letter that you wrote and not only are you going to be fired, but Sam is going to destroy your professional reputation. Like, where do you think you're going to be able to work after FTX after all this happened? And he was threatening me. And then not only that, he had said, if you are going to have any hope of staying and if you can forget about getting paid bonuses, you need to write Sam an apology letter and show it to me first because I'm going to edit it and I'm going to tell you what to say. And I said, absolutely not. This isn't like a mafia organization. This is extremely unprofessional. And I knew at that point there was absolutely no way I was staying. It was a matter of when, not if. But what I did know was that I'm still a professional, I'm still loyal to the company. I still believe the company itself had an incredible potential to continue its sort of road of profitability. And I really liked all my employees here on the US side and I wasn't going to abandon them. So I sort of thought like a three to six month time period is about standard to take the time to unwind responsibilities, to finish the stocks platform that I was working on to, you know, get my team in. A position where I knew they would be in good standing and they wouldn't be retaliated against after I left and took the time to do that before officially resigning. In kind of the end of the summer in early fall.Dwarkesh PatelAnd did that happen after you left? Did the, did he try to enjoy your professional reputation?Brett HarrisonHe did. The acute thing that happened was Sam, I actually offered to stay on longer. I could stay on for a couple more months and help this transition. To whomever you name as the successor president of FTX US. And he said, no, I want you gone more quickly. And so I should say he said that, but he was communicating through other people. He wasn't talking to me directly at that point. And so he said like, I want you gone on September 27. So okay, that's fine with me. On September 27, not only did he announce to the company my resignation, he also announced that he was closing the Chicago and San Francisco offices and that everyone had to move to Miami. And basically if they didn't move to Miami by a certain date, they were not going to be at the company anymore. So the employees were distraught. And what I had learned later from several investors and reporters who had talked to me was that when they talked to Sam about my leaving, sam told them that my my leaving was a combination of resignation and firing and that one of the reasons that I had to leave was because I refused to move my family to Miami. So basically that guy was constructively fired that he had closed down this office that I built and that if I wasn't going to move that I couldn't, I know, roll off of the company. And so that took a little bit to crawl out from. I had to tell people like, well, it's completely false, it didn't happen at all. And yeah, and he was telling people that he fired me.Dwarkesh PatelAnd when he said that, he was still at a sort of like peak of hype, so to speak. Right, absolutely. So, I mean, did the idea forming Architect have already had that idea by this point?Brett HarrisonYeah.Brett HarrisonKnowing that I was going to leave, I started thinking what I was going to do next and thought, well, if I think I can run a company better than Sam, I should put my money where my mouth is and start a company.Brett HarrisonBut I had this, a couple of.Brett HarrisonIdeas and they had this particular idea for Architect and it was starting to really form kind of towards the end of my time at FTX, but I hadn't started anything. And so finally I left FTX and then took a little bit of time off and then started to talk to investors about maybe raising some money for starting this company. And there were a few investors that basically said like, do you have Sam's blessing to do this? Why do I need Sam's blessing? I've resigned, I don't work there anymore. They said, we really would feel more comfortable if we could talk to Sam first. And kind of like, you know, make sure things are okay and kind of figure out what he's doing, find out if he wants to invest too before we kind of talk to you further. And it was impossible to escape that like the Sam kind of hype bubble. Even having left the company.Dwarkesh PatelWhy do you think they were so concerned about were they trying to invest in FTX in the future?Brett HarrisonThey were existing FTX investors.Dwarkesh PatelOkay.Brett HarrisonAnd I think it really mattered to them what Sam thought of them. And if they didn't know the full story, and if they were being told that Sam fired me, then I think they were concerned about potential conflict investing in me too.Dwarkesh PatelWas any part of that because Sam had a reputation as I don't know, if like, an investor invested in somebody he disapproved of, he would get upset in some way?Brett HarrisonNo. If that happened, I don't know about it, but I think it was just sam had such a kind of magical hold over the entire industry, from investors to media to politicians, that they looked to him for approval.Dwarkesh PatelOkay.Brett HarrisonYeah.Dwarkesh PatelSo at this point, you've left FTX us and you're starting to work on your own company. And when is this exactly? This is.Brett HarrisonWell, my official resignation was the end of September. I had stopped working earlier than that and so I kind of started to start working on fundraising for the company.Dwarkesh PatelIn October and then a month later the thing implodes. So when did you hear the first inkling that there might be some potential trouble?Brett HarrisonThe first thing I heard was the night before the announcement that finance might be buying FTX. I was just looking at Twitter and just saw all of this fearmongering. It was like, okay, well, Cz says he's selling FtT and so FtT is going to go down. And people were saying, well, that means Alameda's Toast. And then once Alameda goes under, oh, that's going to be a problem for FTX. Pull your funds from FTX. And I was just sort of laughing at this because whatever, I'm used to people saying things on Twitter that seemed nonsensical. And first of all, Sam and Caroline are great traders. Like, if anything, like maybe they'll profit from all this volatility and tokens and they don't understand, like, there's no way anything's going to happen to Alameda. But also this connection between the price of FtT token and the ability for customers to withdraw their funds from the exchange, like, this just did not compute for me at all. So I was like, this will boil over in a couple of days, like everything else. And the next morning I was actually busy talking to my own lawyers and investors for the company because we were actually closing up our investment round. Actually, the closing docs for my investment round went out that morning. The morning that FTX announced they were going to be bought by finance. It was like the worst timing in crypto fundraising history. So I was busy all morning. And then I went online and checked Twitter and then saw Sam's tweet that said, what comes around goes around, and we're going to get acquired by finance. And I don't know. I felt dizzy. I had no idea what was going on in the world at FTX. I just couldn't put the pieces together in my head. It just didn't make any sense to me.Dwarkesh PatelSo before then, you did not think this was possible?Brett HarrisonI kept a bunch of money on the exchange. I was still an equity holder in FTX and FTX US. I was still very pro FTX, in spite of my experience with Sam.Dwarkesh PatelAnd then how did that week unfold for you? You were, I guess, almost about to close your round. What happened to the round? And then how were you processing the information? I mean, it was like a crazy week. After Direct, the deal falls apart, bankruptcy hacking. Anyways, tell me about that week for you.Brett HarrisonSure. First, the investors, we all had to hit pause. First of all, Architect became priority number 1000 on everyone's list. Secondly, a number of those investors were trying to do damage control themselves. They either they were themselves investors in FTX or FtT. They had companies who part of their runway was held on FTX, or they were expecting to get investment from FTX. So people were just trying to assess what was happening with their own companies. They were not writing checks into new companies anymore. So I had to hit pause on the whole thing for their sake and for my sake. And yeah, just what could one do in that situation except for just read the news all week? Because everything that came out was something brand new and unbelievable, more unfathomable than the thing before. And it was a mixture of, like, rumors on Twitter and articles coming out in major media publications and the kind of the announcements of the bankruptcy. It was just information overload. And it was very difficult to parse fact from fiction. And so it was an emotional time.Dwarkesh PatelYeah. Understatement. Right. All right, so we've kind of done the whole story of you joining to the company collapsing. I want to do a sort of overview of, I guess, what exactly was happening that caused the company to collapse. And I guess the lessons there. Right. In the aftermath, SPF has been saying that FTX US is fully solvent. If they wanted to, they could start processing withdrawals. He had a substance recently in January where he said that it had $400 million more in assets and liabilities. What is your understanding of the sort of relationship between the solvency of FTX US?Brett HarrisonSure. Answer is, I really don't know.Brett HarrisonIf you had asked me about the.Brett HarrisonSolvency of FTX US at the time that I left, I would have said, why are you asking about this? Like, of course everything's fine right now. It's very difficult to understand what is going on. First, the level of deception that was created by this inner circle of Sam's and now reported through the various complaints and the indictments from DOJ, they were doing things to intentionally manipulate internal records in order to fool, like, the employees and auditors and investors. So everything's out the window at that point. And then secondly, it sounded like in the week prior to the bankruptcy, there was this flurry of intercompany transfers. And given all that that's happened, it's impossible to say what state we are in now compared to where we were several months prior. So it's impossible to know who took.Dwarkesh PatelOver management of Ftsus when you left.Brett HarrisonI'm not sure.Dwarkesh PatelWas it a single individual or was it just rested back to the Bahamas?Brett HarrisonI really don't know. I mean, I've totally cut off from everything. FTX at the time that I left.Dwarkesh PatelBefore you left, were the assets of FTX US custody separately to FTX international's assets?Brett HarrisonYes, they were. Okay, so we had like a separate set of bank accounts, separate set of crypto wallets. The exchange itself was like a separate database of customers. It ran in like a different AWS cloud than the one that the international exchange ran on.Dwarkesh PatelOkay, got it. And you had full access to this and it checked out basically more assets and liabilities.Brett HarrisonRight. But remember that the thing that makes them not separate is the fact, and this was completely public, that Sam was the CEO of FTX and FTXus, and Gary was the CTO of FTX and FTX US, and Nashi was the director of engineering for FTX and FTX US. And so as long as there wasn't this, like, completely separate, walled off governance that we were trying to establish while I was there, there was never going to be perfect separation between the companies. This was like a known problem. And that was what makes it so difficult to sort of understand the nature of what was potentially happening behind the scenes.Dwarkesh PatelSo I guess we've been talking about the sort of management organizational issues of FTX. Were these themselves not like some red flag to you that, I don't know, something really weird could be happening here, even if it wasn't like fraud, right? These people are responsible for tens of billions of dollars worth of assets, and they don't seem that competent. They don't seem to know what they're doing. They're making these mistakes. Was that itself not something where that concerns you?Brett HarrisonI mean, it concerned me, and I tried to raise concerns multiple times. If you raise concerns multiple times and they don't listen, what can you do other than leave? But you have to understand that every company I've ever worked at, and I would think any company anyone's ever worked at, has management problems and growing problems. And especially for a super high growth startup like FTX, it's a very natural progression to have the visionary CEO who brings that product to product market fit, who enjoys that sort of explosive success, and then the reins of the company are eventually handed over to professional managers who sort of take it into its maturation phase. And I thought, well, really, I'm not that person because Sam and I have interpersonal issues. But there's 100 plus major investors in FTX. Someone will figure out how to install the correct management of this company over time, and we'll bring it to a good place. Like, one way or another, this is going to succeed. There are too many people with vested interest in doing so. And so, no, I wasn't concerned that FTX wouldn't somehow figure this out. I still thought FTX had an extremely bright future.Dwarkesh PatelBut there might be, I guess, these sorts of visionaries. A lot of them might have, like, problems, to put it in that kind of language, but I don't know how many of them would make you suspect that there's, like, mental health issues or there's addiction issues that for somebody who's in charge of a multibillion dollar empire, I don't know. Seems like something that's I can't quite speak to.Brett HarrisonWhether people would think there are mental health issues of other people who are supposed to be the kind of figureheads of large companies. But remember, at this point, sam is not leading the day to day operations of the company like many other people are. Right. And as the kind of public figurehead of the company, sam was obviously doing a very good job. He was extremely successful at raising money. He was extremely successful at building a positive image for the company. And so in that sense, that was all going fine and the rest of the company was being run by other people. So, you know, I didn't witness anything like, you know, the addiction stuff firsthand. I definitely thought he was not as happy a person as I met, you know, a long time ago. But could you blame a person for, you know, inheriting a 20, $30 billion company and not taking it super well when you're 29 years old? I think so.Dwarkesh PatelYou mentioned that given the fact that all hundreds of accredited investors presumably had done good due diligence, that gave you some comfort about the ultimate, I guess, soundness of the company. But potentially those hundreds of investors are relying on the experienced highlevel executives that SBF had brought on that is thinking that, listen, if somebody from Citadel and Jane Street is working at FTX, that's a good indication that they're doing a good job. And so, in some implicit way, you're lending your credibility to FTX, right? I guess. Was there just this sort of circle of trust where the investors are assuming if this person who has tons of leadership experience in traditional finance is coming to Fdx, they must have done the due diligence themselves. And then you are assuming that the investors have done this. And then so it's like, nobody's role to be the guy who's like this was my job, and I was the.Brett HarrisonPerson in charge of remember, regardless of how experienced or inexperienced people within the company are, regardless of how many or a few investors there are how many senior lateral hires there are if a very small group of individuals who are very smart and very capable intentionally put forth schemes that deceive people within the company and outside the company about the veracity of records, what can you do? What is one supposed to do in that situation? If the public reporting matches private reporting, if investors have done their own diligence, if we've joined the company and we see nothing wrong within the company from a financial perspective, if we can see the public volume on the exchange. And it all matches up with our internal reporting and we know how much fees we'll be able to collect and all that. And it seems like a lot of income compared to our expenses for a two or 300 person company. At what point do you go against all of that and say, in spite of the overwhelming evidence to the contrary, I think something is wrong?Dwarkesh PatelYeah, but someone might look at this and say, listen, Brett, you weren't like a junior trader who was like, right out of MIT or something, who just joined FTX. You have more than ten years of experience in finance. You saw Lehman happen. You've managed really large teams in traffic by, and then you have the skills and the experience. And if somebody with your skills and experience and not only that, your position in FTX, as president of FTX US, if you can't see it coming, and maybe you couldn't, right. Whose job was it to see it coming? It doesn't seem that anybody other than the inner circle could have been in a better position, and maybe nobody could have seen it. But is there somebody who outside of the inner circle you think should have been able to see it coming?Brett HarrisonI don't know. It's a good question of, like, when a major fraud happens in such a way where it was very expertly crafted to be hidden from the people who could have done something about it, what should one do? One answer is never trust anyone. Right. Like every company I ever worked for in the future, every time we say we've done some transaction, I will ask them to show me the bank records and give me the number of the bank teller I can call to have them, like, independently verify every single banking transaction. This is sort of like impractical and ridiculous.Brett HarrisonIt doesn't happen.Brett HarrisonAnd so I think it sounds like the counterfactual here is one where, okay, first I have to believe that there is some kind of fraud, which I don't. Then I have to say, okay, I would like to start auditing all. Bank transactions. Actually I want to start auditing all bank transactions for the company that I don't work for. Also I want to disbelieve audited financials from respected third party auditors. I also want to look into the possibility that Sam is like lying under oath in congressional hearings about segregation of customer funds. Also I should disbelieve all of the trusted media outlets and also 100 financial institutions that have invested in FTX. It's like the chain that you have to go through in order to get to a point where you start to be able to figure out something is wrong is, I think, really impossible. And I think the bottom line is for sure should be mandated at certain stages of company growth, independent boards. And I think that a lot of that has to do with where the nexus of control of the company really is and making sure it's in a place where there is appropriate regulatory oversight and appropriate financial oversight. I think that maybe could have helped. But besides that, I think this is ultimately a job for enforcement. Like, people will commit crimes and there is nothing one can do to stop all people from committing all possible future crimes. What Gun can do is come up with the right structures and incentives so that we can build like a trust based system where people can innovate and build great companies and people who are bad actors can get flushed out, which is ultimately what I think is happening.Dwarkesh PatelBut I guess they're not letting you hire people. They're like they're like overseeing, writing the actual code for FTX US from the Bahamas. Not something that makes you think, like, why are they doing this? It's like a little odd.Brett HarrisonI just thought it was not the right way to run the company. There's a very large chasm between I don't think they're doing a good job running the company and I think that customer funds are at risk.Dwarkesh PatelRight, yeah, fair enough. Why should someone who sees bad organizational practices there's no board. They're making a ton of really weird investments and acquisitions. And not only that, like, most importantly, they are responsible for managing tens of billions of dollars worth of other people's assets. What should somebody do when they're seeing all this happening? I mean, obviously it's very admirable and that you put this in writing to him, you gave it to him, and then you resigned when he refused to abide by it. So maybe the answer is just that. But is there something else that somebody should do?Brett HarrisonI would say within any company, and I would expect that the overwhelming majority of companies, if you see bad management, it does not imply fraud. But there's lots of places with bad workplace culture and people are making bad management decisions. And it should be that if you're and find yourself in that position, there is someone you can go to to talk to. It might be your manager, it might be your manager's manager. It could be someone in your HR department. But there should be like a designated person within the company for you as an employee that, you know, you have a safe space to bring complaints about the workplace and about the company strategy. And then you should see how they handle it. Do they take it seriously? Do they make changes? Do they look into the stuff you're talking about? Do they encourage cooperative, positive discussion? Do they threaten you? Do they retaliate against you in some way? Do they start excluding you from conversations? Do they threaten to withhold pay? Like if you're in that ladder camp, what do you do? At that point? It's easy for me to say, and I've been in fortunate positions within companies and have personal flexibility, it might not be so easy for the average person to sort of get up and leave a job. But I do think that at some point you have to start making plans, because what can you do in the face of a giant organization that you disagree with other than leave?Dwarkesh PatelLet's talk about regulators and your relationship with them while you're at FTX. Obviously, as head of FTX US, I imagine you were heavily involved with talking to them. What was their attitude towards FTX like before it fell?Brett HarrisonAll the regulators were, I think, in the common belief that crypto was a large and viable asset class. And in order for it to grow in a responsible way, it needs to come within the regulatory envelopes that already exist in whatever way that's appropriate for crypto. And crypto could mean a lot of different things. We have to maybe distinguish between centralized and decentralized finance here. But I would say regulators saw FTX as at least one of the companies that was very willing to work directly and collaboratively with regulators, as opposed to trying to kind of skirt around the regulatory system.Dwarkesh PatelWell, when I was preparing to interview SPF, actually, I got a chance to learn about your proposal to the Cfdc. We were just talking about you were explaining this earlier, but the auto liquidation and cross margining system bring that not only to crypto in the US. But to derivatives for stocks and other assets. I thought, and I still think it's a good idea, but do you think there's any potential for that now, given that the company most associated with that has been blown up? What is the future of that innovation to the financial system look like?Brett HarrisonYeah, I definitely think it's been set back. It's interesting. Walt Lucan from the Futures Industry Association, in a conference that was shortly after the class of FTX talked about FTX and sort of a speech, but specifically made a call to the fact that in spite of what happened to FTX. The idea of building a future system that can evolve with a 24/7 world is still a worthwhile endeavor and something that we should consider and pursue and be ready for. We are 3D printing organs and coming up with like, specially designed mRNA vaccines, but like, you still can't, you know, get margin calls on a Saturday for SAP 500 future. There's like some real lack of evolution in market structure in a number of areas of traditional finance, and I think it's still a worthwhile endeavor to pursue it. I think the La Ledger X proposal makes a lot of sense. I think it's understandable where some of the concerns were around how that could really dramatically alter the landscape for derivatives regulatory structure and market structure. And there were still unaddressed questions there. But I still think that it was the right idea.Dwarkesh PatelDuring those hearings, I guess the establishment CME and others brought up criticisms like, oh, we have these sort of biscuit relationships with our clients. And if you just have this algorithm take its place, you can have these liquidation cascades where illiquid assets, they start getting sold. That drives the price even lower, which causes more liquidations from this algorithm. And you have this sort of cascade where the bottom falls out. And even though it might not be an accurate way to describe what happened with FtT and FTX because there was obviously more going on, do you think that they maybe had a point, given how FTX has played out?Brett HarrisonA lot of FCMs have auto liquidation. There is one particular one where they actually automatically close you every day at 04:00 p.m., and they do it in a really bad way. So the idea of auto liquidation is not new. The idea of direct to customer clearing is not new. The idea of cross collateralization is not new. The thing I think that was novel about FTX was putting all together, it was direct to customer margining, cross collateralization, auto liquidation. And so in order for the regulators to get comfortable with the application, they had to understand that FTX was one entity was performing the roles that typically multiple different entities perform. And you always need to ask yourself the question of, like, was there something worthwhile about having those different entities be separate or not? Is it just sort of legacy regulatory structure? I think that remains to be seen. And I think we don't have enough experience, especially in the US. With that kind of model, to be able to say whether it actually works better or worse. I think either way, it was worth a try. And I think maybe the biggest misconception about the application was that if we got approved, it meant suddenly FTX is going to list everything from corn to soybeans to oil to SMP 500 overnight and completely, you know, destroy the existing derivatives landscape. I think what have actually happened was FTX would have gotten permission to list, like, one contract on kind of small size and there would have been experience with the platform and it would have been assessed compared to the alternatives on traditional CCPS. And if it was worse, changes would have been made and if it was better, it would evolve and the market would basically decide what people wanted to trade on. I do think the auto liquidation part was the main piece that people were hung up on, which was like, how do you provably show the kind of worst case scenario in auto liquidation cascade? Then again on large TCPS. Now in the US and Europe, there are margin breaches all the time. The current system is far from perfect.Dwarkesh PatelBacking up to, I guess, regulation more generally. I mean, many people saw crypto as a sort of regulatory arbitrage where because regulations are so broken in finance, I guess evidence would be that you're not allowed to do this manually, right? You had to go through the lengthy approval process. If you're a giant company to begin with, the entire point of crypto was to get around the regulators and not go through them to get approval for things and hand over that kind of approval process to them. Do you think that working with the regulators and then also being part of crypto was a sort of like it kind of defeated the point of crypto?Brett HarrisonI think I disagree with the premise. I don't think the point of crypto is equal to arbitrage. I think while crypto remains unregulated, it is easier to get something done in crypto than if it were regulated. That's sort of like total logical. I also think that most people, especially on the institutional side, who trade crypto, believe that we are in a temporary state that cannot last forever, which is that crypto is largely unregulated or has a weird patchwork of regulatory authority. Maybe it's like the 50 state regulators in the US. Or it's some combination of like, you know, money transfer and, you know, CFD or broker dealer activity in Europe. So I think this is, it's absolutely a worthwhile endeavor knowing that there's going to be some regulation for at least part of the crypto ecosystem to work with regulators to make sure that it's done well.Dwarkesh PatelOne very important question about the whole idea thing is what did the conventional narrative about how it went down and why it went down, what did it get wrong? Given that you were on the inside, what do you know was different than what has been reported?Brett HarrisonI actually think not much. And I think the reason for that is typically when something like this goes wrong and it becomes this media frenzy, there's like plenty of opportunity for misinformation to spread. But to the credit of the investigators working on this case, they moved so quickly that, you know, they had, you know, unsealed indictments within what, two months of this going down. And so having kind of a lot of the truth, you know, being able to be spelled out in facts in a public written document, I think quelled a lot of the opportunity for misinformation to proliferate. And whether that's from Twitter troll or if it's from Sam Bankman freed himself trying to spread information about what happened. I think a lot of it wasn't really given the room to breathe.Dwarkesh PatelWhat did you make of his press tour in the aftermath? Why did he do it and what was your impression of it?Brett HarrisonI'm not going to speculate what's inside Sam's head. I think Sam had built up his empire through bartley his control over media. And he did that by being available all the time and being ostensibly open and honest with him all the time and probably thought, why can't the same strategy work now? And maybe I can sway public opinion. If I can sway public opinion, maybe I can sway regulators and law enforcement. And it turns out that is definitely not true. So I don't really know. It could just be an addiction to the media. He couldn't stand people talking about him and him not being part of the conversation.Dwarkesh PatelYeah. And I guess the earlier account you gave of his day long media cycles kind of lends credence to that mentality. I have a question about the future of the people who are at FTX. There's many different organizations who have had their alumni go on to have really incredible careers in technology. Famously, PayPal had a mafia, so called mafia, where they wanted to found YouTube with Elon Musk, SpaceX, Tesla. So many other companies came out of the people who came out of PayPal. And Bern Hobart has this interesting theory. The reason that happens is when a company exits too fast, you still have these people who are young and ambitious in the company who go then go on to do powerful things with the network and the skills they've accumulated. Do you think that there will be an FTX mafia?Brett HarrisonThe number of the most talented people within FTX are leaving FTX in a slightly different position than the people exiting PayPal and acquisition. I would say they're in positions more like actual mafia people. So I'm not sure it's going to be like some giant FTX mafia, but I do think there are a ton of talented people at FTX who are going to look to do something with their careers. And also a lot of those people came from very impressive backgrounds prior to FTX. So I expect them to want to continue to get back on track and build something great. And so I do think you're going to see at least a couple of people who emerge from this and do something really great.Dwarkesh PatelThat's a good note to close the FTX chapter of the interview on sure. Let's talk about Architect, your new company. Do you want to introduce people to what Architect is doing and what problem is solving.Brett HarrisonSure.Brett HarrisonSo the goal of Architect is to provide a single unified infrastructure that makes it really easy for individuals and institutions to access kind of all corners of the digital asset ecosystem everywhere from individual crypto spot exchanges that are centralized to Dfi protocols, to qualified custodians and self custody and everything in between.Dwarkesh PatelYeah, I'm not sure I have enough context to understand all of that. I don't know, a few grade levels.Brett HarrisonBelow backing up a very high level. So let's say you are someone who wants to trade crypto in some way or what do you actually have to do? So imagine you want to do something slightly more than just like sign up for Coinbase and click the buttons there. Let's say you would like to find the best price across multiple exchanges. Let's say that you not only want to find the best price across multiple exchanges, you also want to occasionally do borrow and lending from defy. Maybe not only that, you also want to store your assets in off exchange custody as much as possible. Well, aside from doing all that manually, by opening up all the different tabs in your browser and clicking all the buttons to move assets around and connect all these different exchanges, you actually want to build a system that unifies all these things. You have this diverse build choice. And the build choice looks like. Hire five to ten software developers and get them to write code that understands all the different protocols and different exchanges, all the synchronicity of them, that downloads market data, that stores the market data, that connects to these different custodians that kind of bridges all these things together, that provides some kind of user interface that pulls it all together. It's a significant amount of work that up till now, basically all of these different companies are just reproducing. Again, they're all solving the same problem. And as a trader, you want to focus your time on strategy development and alpha and monetization and not on how do I connect to random exchange? So the goal of Architect is to build this sort of commodity software that people can then sort of deploy out of the box that gives them access to all of these different venues all at the same time.Dwarkesh PatelAnd so it sounds like this is a solution for people with significant levels of assets and investment in crypto. I'm assuming it's not for.Brett HarrisonSo I think that's like the place we want to start. But one phenomenon in crypto that I think is somewhat new and exciting is the fact that, okay, if you want to get into sophisticated equities trading, well, what do you have to do? You usually have to either establish a broker dealer or get hooked up to an existing broker. You need to get market data which can be very expensive. Like the full depth of book feed from Nasdaq costs like tens of thousands of dollars per month. If you want to compete on latency, you have to get like a colocated server in the Nasdaq colo, which is also going to cost you tens of thousands of dollars per month. There's a significant time and money overhead to doing all this, which is why it's so hard to compete in that space against all the incumbent players. Whereas in crypto many of the markets are just in the cloud, like in Amazon's cloud or Alibaba's cloud. And you can just very cheaply and easily spin up like a server in there for a couple of dollars a month and have the same access as a big Hft. All the market data is free, the order entry is free. The protocols are usually fairly simple, like you can use Json over a websocket as opposed to speaking like fix over some private line. As a result, there is this large and growing class of kind of like semi professional individual traders that have grown where there are people who are smart individuals who have like, maybe some wealth amassed and they want to be able to do kind of professional trading. Whether that's like manual quick trading or like simple algos using python or whatever. And they can do that and experiment easily because of the open access of crypto markets. And so there's a much wider customer base for something like this which includes these kind of like high powered individuals in addition to your small medium, large hedge funds and prop shops and different institutions.Dwarkesh PatelAnd is the goal to is crypto the ultimate market you're targeting or are there other asset classes that you also want to provide the service to?Brett HarrisonWe're building very general infrastructure and we think crypto is a viable asset class, but is one of many. And our goal is to provide institutional great connectivity and software to anyone who wants to participate in trading in US semi sophisticated way. So I think over time we'll want to grow our offering as much as possible.Dwarkesh PatelGiven the fact that Nasdaq or whatever already have these barriers, is it possible for someone to remove those barriers with a solution like yours? I guess like an analogy that comes to mind is I guess nobody before Mark Cuban's, whatever pharmaceutical company just try to go outside the insurance system and directly sell drugs to people. Is it possible to do something like that for Nasdaq?Brett HarrisonYeah, you can't connect to Nasdaq without connecting to Nasdaq. You can't not go through a broker dealer. But I think that we could eventually try to get the appropriate licensing required to be an intermediary that is focused on being like a technology forward interface towards people being able to do more program trading. And so if the mission of our company is to provide better access, I think we can do so within the existing system.Dwarkesh PatelI guess this raises a broader question of if you're initially trying to solve for the problems that these exchanges should natively have solutions to at least or some of the problems are the ones that these exchanges should natively have solutions to. Why haven't these exchanges built this stuff already? You're a part of one such exchange and maybe function better than the other ones, but they're highly profitable, they have a bunch of money. Why haven't they invested in making their infrastructure really great?Brett HarrisonSo in many cases, their infrastructure is very good. It's more a question of what's the incentive of the exchange? And I think no matter what, no single exchange is going to have all the market share. So there's always going to be this like, market fragmentation problem. And the question is, whose responsibility is it to make software that helps solve that problem? If I'm some centralized exchange, my incentive is not to build software to make it easier for my customers to go to all the other exchanges. It's like, make my exchange better. So I'm going to put all of my R and D dollars into providing new products and offering new different kinds of services and investment advisory, or lowering the barrier to entry to connect into my own exchange, but not creating this sort of like, pan asset class, pan exchange, interconnectivity software.Dwarkesh PatelGot it. And given the fact that you're trying to connect these different exchanges, currently most of the volume in crypto is in centralized exchanges. What is your estimate of the relative trading volume of C five versus D five? Do you think it'll change over time?Brett HarrisonSo I do think it'll change over time. I think my view is I can't predict what way it's going to change. So people after FTX had asked me like, hey, why don't you try to start your own exchange, take all your knowledge from FTX US, and maybe even raise money to buy the IP out of bankruptcy and start a new exchange. And my feeling is I don't want to bet personally on the exact direction of crypto trading. I could see it continuing status quo where your coin bases and biases the world kind of maintained market share. I could see it moving significantly to defy, where people feel like this is the true spirit of crypto. It's in this sort of noncustodial, fully centralized trading environment. I could also see it going the complete opposite direction and having the existing highly regulated exchange players like Naisi and Azdaq and Sivo start to enter the game on spot trading. And where is the ultimate flow going to end up between these three possibilities? I have no idea. So I'm much more excited about providing the kind of connectivity layer to all of them and saying, regardless of where the liquidity ends up, we'll be able to facilitate it.Dwarkesh PatelSpeaking of FTX, how has your experience with FTX informed the development of Architect?Brett HarrisonYeah, first of all, working at FTX has given me an appreciation for just how behind a lot of the infrastructure is on other exchanges. People really like trading on FTX. Institutions especially really like trading on FTX because the API made sense, really did follow kind of standard state machine of any kind of financial central limit order book that you would see on a place like Nasdaq or CME. Whereas there are a lot of exchanges that have crazy behavior. Like, you send a cancel for an order, you get acknowledged that your order has been canceled, and then you get a fill and you actually get traded on your thing that you supposedly thought you canceled and like things that you think shouldn't be possible or possible. So actually, my time at FTX is interesting with the relation to Architect, because FTX, it gave me an appreciation for how to design a good API for especially institutions that want to be able to trade all the time and the protocols and some of these other exchanges aren't quite as good. So I think it's informed how much the focus of Architects should be kind of wrapping up the complexity of these different exchanges and providing like a really good API for institutions and individuals on our side. And guess like thing one thing. Thing two is obviously what has happened with FTX. People are much less likely to trust a centralized institution with their personal information, especially things like the keys that allow you to trade on their exchange account, or the keys that give you access to their wallet. And so we're thinking a lot about how to design Architects such that the user can connect to all these places and hook up their wallets without needing to ever give us any of their private credentials. And so that's like another particular inspiration from everything that's happened in FTX.Dwarkesh PatelWhat is your opinion of crypto in general at this point? How has your sort of perception of its promise changed, if at all, given.Brett HarrisonThe same I feel the same way now as I did then, which is it's a one to $3 trillion asset class that is traded by every major institution, that is being invested in by every major institution. And so it's totally viable and it needs good mature infrastructure to support its growth.Dwarkesh PatelGot it. But is the motivation also informed by a view that, I don't know, crypto is going to be even bigger or in some way going to solve really big use cases? Or is it simply that, listen, this market exists, I don't know what it's going to be good for, but it needs a solution?Brett HarrisonIt is, I think, I certainly do believe that that is a likely future for crypto. But to me, the interest in it starts with knowing that this is a huge asset class that needs better infrastructure.Dwarkesh PatelFor trading it in the aftermath of FTX and other things, I mean, all crypto companies have special scrutiny on them. And fairly or unfairly, if there's like FTX alumni, it'll be even more so. How are you convincing potential. Clients, investors, that crypto is safe, FTX alumni are safe.Brett HarrisonYeah. On the FTX alumni side, I just personally haven't had those issues really in recent months as we've been building out Architect. I hired like three, almost five now employees from formerly at FTX to come work with me.Dwarkesh PatelBut by the way, is that like some sort of ARB basically, that the overall hiring market is overcorrected on them or something? 100%, yeah.Brett HarrisonAnd not just an FTX right now. Like it is March 2023 as we're recording this, there is like a huge ARB in the hiring market. I mean, all the layoffs in tech and crypto, all of like the fear around various financial services means that like, we basically didn't need to work on recruiting. I had like the best people who worked for me at FTX US. I had ex colleagues of mine from former jobs that come work with me here. And we actually didn't have to do any formal recruiting efforts because of just how much supply there now is on the job market, especially in tech and finance. Luckily, I've had a long career history prior to FTX, and even at FTX we built really great stuff. We had a very good connections relationships with our customers and our investors. There would be times where on Twitter I would answer like a customer's support question at 02:00 in the morning and I maintained a lot of those relationships even through the collapse. And these are the kinds of people who are reaching out, like offering support, like offering to test out stuff, who want to be customers, who are also having problems with existing crypto tools, looking for something better. So all that stuff has remained intact. So I don't really have a concern there.Dwarkesh PatelWhat is institutional interest in crypto like at this point, given what's happened?Brett HarrisonI think it is just as great as it was before. Every major investment bank in the US has announced some plan to do something with blockchain technology still. Even like post FTX, the top trading institutions in the world are all continuing to trade it. I think as of what we're speaking about right now, volumes are down because people are sort of generally fearful. But I expect that to turn around pretty quickly and the institutional interest still remains really high. People are definitely expecting and waiting for proper regulatory oversight, especially in the US. That's still happening. People are waiting for higher grade professional tools that make it safe for them to trade and invest in crypto. I think that's obviously in the works for various things, Architect and otherwise, but otherwise the interest is all completely there.Dwarkesh PatelA broader question somebody could have about crypto at this point is, or maybe not crypto generally, but crypto trading is why is it good to have more crypto trading, at least with stocks and bonds and other kinds of traditional assets? As we were talking about earlier, you can tell a story that listening to health capital allocation projects that need funding, will get funding and so on. Why is it good if the price of bitcoin is efficient? Why is building a product that enables that something that's socially valuable?Brett HarrisonI think it boils down to, first of all, do you think it's important for people to be able to trade commodities? Like how important is it for the world that people can, you know, trade gold efficiently or they can trade oil efficiently? I think the answer is if people have a use for the underlying commodity, then it's important. And so maybe that is like what's the use of crypto? Well, I think each crypto token might have its own use. I don't think everyone has a good use. I think that there's a bunch that do. But if you believe in bitcoin as sort of like a store of value in a great medium of exchange, then it's important that there's a good fair price for bitcoin to enable that. If you think that the ether token is important for the gas fees required to run like a decentralized computer, and you think that the programs running on a decentralized computer are important, then it's important for there to be like a good price for ether that's fair. So I think it really depends on if you kind of believe in the underlying use case at all in the same way you would for kind of any commodity.Dwarkesh PatelGot it.Brett HarrisonAnd sometimes there are tokens that have more security like properties where they are like trading Apple stock. Basically there was an initial offering of that token and then if people bought it, it actually directly funded the product behind the token. And then the efficient trading of that token is sort of a barometer for the health of that particular company and they can like, sell more tokens to raise more capital and secondary offerings. In which case it looks very much exactly like the stock market.Dwarkesh PatelThat's a great leading to the next question, which is will there ever be a time when things that are equivalent to stocks or other kinds of equities will be traded on change in some sort of decentralized way?Brett HarrisonI think it's likely. I think the primary reason is that existing settlement systems in traditional markets seem to be very slow and built on very outdated technology that's like highly non transparent and very error prone. So equities are a prime example of this. Like it still requires two business days to settle a stock. And a frequent occurrence when I was at trading firms was that, you know, you would get your settlement file, that one told you, like, what trades were settled, and two told you things like if any corporate actions had occurred overnight, like paying a dividend or share split, and they would frequently be wrong, like the dividend would be wrong or would be missing, or the share split amount was for the wrong amount. Or they missed the day that it happened or they messed up. Some trades didn't get reported properly. They're just frequently mistakes. And it feels like there should be some easy, transparent kind of open, decentralized settlement layer for all things that you can trade. And rather than try to retrofit the existing settlement technology to be faster and better, starting from scratch with something like Blockchain could make a lot of sense, which is why you hear about a lot of these investment banks working on settling fixed income products on chain. The fixed income products have even worse settlement cycles than equities.Dwarkesh PatelShould the marginal crypto trader stop trading? Maybe this might also be a good question to ask by the marginal trader for on Robin Hood or something, but.Brett HarrisonI have a couple of thoughts about this. So the first is that I don't think crypto markets are as efficient as equity markets, so there's probably more opportunities for short and long term edge as a trader in crypto than there would be in equities. That being said, I think there's still an enormous amount of room in both traditional and crypto markets for even individuals to have and derive information that gives them profitable trading ideas. And I actually think it's the wrong conventional wisdom to think that if you are not Jane Street or Acidadel or Hudson River or Tower or Jump trading, then you have no chance of being able to profit in Marcus except for luck. I do think there are a lot of people who trade, and it's like pure speculation. It's not really like on me to tell them that they shouldn't speculate. They probably derive some personal enjoyment from speculation besides the opportunity for profit. But I do think the access to more sophisticated instruments and information has helped what have traditionally been players that have been unable to compete in the market actually be able to do so in a way that is systematically profitable.Dwarkesh PatelOkay, so that is, I think, a good point to end the conversation. We got to talk a chance to talk about a lot of things. Let's let the audience know where they can find out more of our Architect and also where they can find your Twitter and other sorts of links.Brett HarrisonYeah. So Architect's website is Architect.XYZ. We also have @architect_xyz on Twitter. And I'm Brett Harrison, 88 on Twitter.Dwarkesh PatelOkay, perfect. Awesome. Brett, thank you so much for being on the Lunar Society. This was a lot of fun.Brett HarrisonThank you so much.  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

My podcast with the brilliant Marc Andreessen is out!We discuss:* how AI will revolutionize software* whether NFTs are useless, & whether he should be funding flying cars instead* a16z's biggest vulnerabilities* the future of fusion, education, Twitter, venture, managerialism, & big techDwarkesh Patel has a great interview with Marc Andreessen. This one is full of great riffs: the idea that VC exists to restore pockets of bourgeois capitalism in a mostly managerial capitalist system, what makes the difference between good startup founders and good mature company executives, how valuation works at the earliest stages, and more. Dwarkesh tends to ask the questions other interviewers don't.Byrne Hobart, The DiffWatch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Follow me on Twitter for updates on future episodes.Similar episodesYou may also enjoy my interview of Tyler Cowen about the pessimism of sex and identifying talent, Byrne Hobart about FTX and how drugs have shaped financial markets, and Bethany McLean about the astonishing similarities between FTX and the Enron story (which she broke).Side note: Paying the billsTo help pay the bills for my podcast, I'm turning on paid subscriptions on Substack.No major content will be paywalled - please don't donate if you have to think twice before buying a cup of coffee.But if you have the means & have enjoyed my podcast, I would appreciate your support 🙏.As always, the most helpful thing you can do is just to share the podcast - send it to friends, group chats, Twitter, Reddit, forums, and wherever else men and women of fine taste congregate.Timestamps(0:00:17) - Chewing glass(0:04:21) - AI(0:06:42) - Regrets(0:08:51) - Managerial capitalism(0:18:43) - 100 year fund(0:22:15) - Basic research(0:27:07) - $100b fund?(0:30:32) - Crypto debate(0:43:29) - Future of VC(0:50:20) - Founders(0:56:42) - a16z vulnerabilities(1:01:28) - Monetizing Twitter(1:07:09) - Future of big tech(1:14:07) - Is VC Overstaffed?TranscriptDwarkesh Patel 0:00Today, I have the great pleasure of speaking with Marc Andreessen, which means for the first time on the podcast, the guest’s and the host’s playback speed will actually match. Marc, welcome to The Lunar Society.Marc Andreessen 00:13Good morning. And thank you for having me. It's great to be here.Chewing glassDwarkesh Patel 00:17My pleasure. Have you been tempted anytime in the last 14 years to start a company? Not a16z, but another company?Marc Andreessen 00:24No. The short answer is we did. We started our venture firm in 2009 and it's given my partner, Ben and I, a chance to fully exercise our entrepreneurial ambitions and energies to build this firm. We're over 500 people now at the firm which is small for a tech company, but it's big for a venture capital firm. And it has let us get all those urges out.Dwarkesh Patel 00:50But there's no product where you think — “Oh God, this needs to exist, and I should be the one to make it happen”?Marc Andreessen 00:55I think of this a lot. We look at this through the lens of — “What would I do if I were 23 again?” And I always have those ideas. But starting a company is a real commitment, it really changes your life. My favorite all time quote on being a startup founder is from Sean Parker, who says —“Starting a company is like chewing glass. Eventually, you start to like the taste of your own blood.” I always get this queasy look on the face of people I’m talking to when I roll that quote out. But it is really intense. Whenever anybody asks me if they should start a company, the answer is always no. Because it's such a gigantic, emotional, irrational thing to do. The implications of that decision are so profound in terms of how you live your life. Look, there are plenty of great ideas, and plenty of interesting things to do but the actual process is so difficult. It gets romanticized a lot and it's not romantic. It's a very difficult thing to do. And I did it multiple times before, so at least for now, I don't revisit that.Dwarkesh Patel: 02:04But being a venture capitalist is not like that? When you're in the 38th pitch of the day, you're not wondering if chewing glass might not be more comfortable?Marc Andreessen 02:10No, it's different. I'll tell you how I experienced it. People are wired to respond to stress in different ways. And I think there are people who are wired to be extremely productive and get very happy under extreme levels of stress. I have a different… I'm fine with stress. In fact, I incline towards it and if I don't have any, I seek it out. But past a certain level, I don't really enjoy it. It degrades the quality of my life, not improves it. Maybe you have an affinity for self torture.Look, there's stress in every profession and there's certainly stress in being an investor, but it's a completely different kind of stress. Because when you're a startup founder, it's all on you. Everything that happens is on you, everything that goes wrong is on you. When there's an issue in the company, a crisis in the company, it's on you to fix it. You're up at four in the morning all the time worrying about things. With investors, there's just a layer of buffer. We have no end of problems and we help our portfolio companies as best we can with all kinds of issues, like some crisis inside a company. But it's not my company, not everything is my fault. So it’s a more diffused kind of stress, and honestly easier to deal with.Dwarkesh Patel 03:32Got it, that makes sense. Why did you stop your blog? Would you ever start it again?Marc Andreessen 03:37I write intermittently. The original blog was from 2007 to 2009. And then we started the firm, and that was like having a new baby and that soaked up all my time. I write intermittently, and then I do social media intermittently. Part of it is — I have a lot to say, and a lot that I'm interested in, but also I like to experiment with the new formats. We do live in a fundamentally different world as a result of social media, the internet, blogging, Twitter, and all the rest of it. So I try to keep my hand in it and experiment. But I rotate both how I spend my time and rotate what I think makes sense.AIDwarkesh Patel 04:21Before AWS, deploying applications was probably the bottleneck on new software. What is the biggest bottleneck today? At what layer of abstraction do we need new tools?Marc Andreessen 04:30Literally sitting here today, overwhelmingly it's the impact AI is having on coding. I think there's a real possibility that basically every application category gets upended in the next five years. I think the whole model of how applications get built across every domain might just completely change. In the old model without AI, you typically have some sort of database, you have some sort of front end for the database, you had forms, you had these known user interaction models, mobile apps and so forth. We got to a pretty good shared understanding of how humans and machines communicate, in the windowing era, and then in the mobile era, in the web era.AI might just upend all that. The future apps might just be much more of a dialogue between computer and machine. Either a written-text dialogue, or a spoken dialogue or some other form of dialogue. And the human is guiding the machine on what to do, and receiving real time feedback. And there's a loop, and then the machine just does what it does, and it gives you the results. I think we're potentially on the front end of that, that all might change. The very fundamental assumptions about how software gets built might just completely change. The tools on that are at the very front end. There's an entirely new stack that needs to get built to do that. So that's probably the big thing.Dwarkesh Patel 05:55Is there a reason though that AI is not one of your focus areas? As far as I know, you guys don't have an AI fund dedicated to that technology specifically?Marc Andreessen 06:03Basically we look at it all as software. We look at it like it is the core business. Software is the core of the firm, we've been public on that for a long time. The core venture fund is the core software fund. And then AI basically is the next turn on software. And so I view it as the opposite of what you said, it is the most integral thing that we're doing. The separate funds get created for the new areas that are structurally different in terms of how industries work. AI is basically the future of software. And so it's the future of the core of the firm.RegretsDwarkesh Patel 06:42Got it. Now, let's talk a little about your past. So you sold Netscape for $10 billion. But today, Chrome has what, like 2.7 billion users or something. And then Opsware was sold for like $1.7 billion. AWS is gonna probably make close to $100 billion in revenue yearly. In retrospect, do you think if these companies had remained startups, they would have ended up dominating these large markets?Marc Andreessen 07:03So I spend virtually no time on the past. The one thing I know about the past is I can't change it. So I spend virtually no time revisiting old decisions. People I know who spend a lot of time revisiting old decisions are less effective because they mire themselves in what ifs and counterfactuals. So I really don't spend time on it. I really don't even have theories on it. The big thing I would just say is that reality plays out in really complicated ways.Everything on paper is straightforward. Reality is very complicated and messy. The technical way that I think about it is basically every startup is charting a path dependent course through a complex adaptive system. And because of that, if you’ve read about this, people had this obsession a while back with what's called Chaos Theory.It's sort of this thing where we're used to thinking about systems as if they're deterministic. So you start at point A, you end up at point B, and you can do that over and over again. You know what happens when you drop an apple out of a tree, or whatever. In the real world of humans and 8 billion people interacting, and trying to start companies that intersect in these markets and do all these complicated things and have all these employees, there's random elements all over the place. There's path dependence as a consequence. You run the same scenario, start with point A, one time you end up point B, one time you end up point Z. There's a million reasons why the branches fork.This is my advice to every founder who wants to revisit all decisions. It's not a useful and productive thing to do. The world is too complicated and messy. So you take whatever skills you think you have and you just do something new.Managerial capitalismDwarkesh Patel 08:51Make sense. Are venture capitalists part of the managerial elite? Burnham says that “the rise of the finance capitalist is the decisive phase in the managerial revolution.” What would he think about venture capitalists?Marc Andreessen 09:04I actually think about this a lot. And I know you said everybody can Google it, but I'll just provide this just so this makes sense. James Burnham famously said — there's basically two kinds of capitalism and we call them both capitalism, but they're actually very different in how they operate. There's the old model of capitalism, which is bourgeois capitalism and bourgeois capitalism was the classic model where the owner of the business was a person who, by the way, often put their name on the door. Ford Motor Company, right?Dwarkesh Patel 09:31Andreessen HorowitzMarc Andreessen 09:32Andreessen Horowitz, right. And then that person owned the business, often 100% of the business, and then that person ran the business. These are the people that communists hated. This is the bourgeois capitalist — Company owner, builder, CEO, as one person with a direct link between ownership and control. The person who owns it controls it, the person who controls it runs it. It's just a thing. There's a proprietor of the business.So that's the old model. And then what he said basically, as of the middle of the 20th century, most of the economy was transitioning, and I think that transition has happened and is basically now complete. Most of the economy transitions to a different mode of operating, a different kind of capitalism called managerial capitalism. In managerial capitalism, you have a separation of ownership and management. Think of a public company, you have one set of owners who are dispersed shareholders, and there's like a million of them for a big company, and who knows where they are, and they're not paying any attention to the company, and they have no ability to run the company. And then you've got a professional managerial class, and they step in and they run the company. What he said is — as a consequence of that the managers end up in control. Even though the managers don't own the company. In a lot of public companies, the managers might own like 1% of the company, but they end up in total control, and then they can do whatever they want.And he actually said — Look, it doesn't even matter if you think this is good or bad, it's just inevitable. And it's inevitable because of scale and complexity. And so the modern industrial and post industrial organizations are going to end up being so big and so complex and so technical, that you're going to need this professional managerial class to run them. And it's just an inevitability that this is how it's gonna go. So I really think this is exactly what's played out.A consequence of that, that I think is pretty obvious, is that managerial capitalism has a big advantage that Burnham identified, which is that the managers are often very good at running things at scale. And we have these giant industries and sectors of the economy and health care and education, all these things that are running at giant levels of scale, which was new in the 20th century.But there's sort of a consequence of that, which is managers don't build new things. They're not trained to do it, they don't have the background to do it, they don't have the personality to do it, they don't have the temperament to do it, and they don't have the incentives to do it. Because the number one job, if you're a manager, is not to upset the applecart. You want to stay in that job for as long as possible, you want to get paid your annual comp for as long as possible, and you don't want to do anything that would introduce risk. And so managers can't and won't build new things.And so specifically, to your question, the role of startups, the role of entrepreneurial capitalism, is to basically bring back the old bourgeois capitalist model enough. It's a rump effort, because it's not most of the economy today, but bring back the older model of bourgeois capitalism, or what we call entrepreneurial capitalism, bring it back enough to at least be able to build the new things.So basically what we do is we fund the new bourgeois capitalists, who we call tech founders. And then there's two layers of finance that enable bourgeois capitalism to at least resurface a little bit within this managerial system. Venture capital does that at the point of inception, and then private equity does that at a point when a company needs to actually transform.I view it as — we're an enabling agent for at least enough of a resumption of bourgeois capitalism to be able to get new things built, even if most of the companies that we built ultimately themselves end up being run in the managerial model. And Burnham would say that's just the way of the modern world, that's just how it's gonna work.Dwarkesh Patel 13:10But you guys get preferred shares and board seats, and rightfully so, but wouldn't Burnham look at this and say — “You're not the owners and you do have some amount of control over your companies.”Marc Andreessen 13:20I think he would say that we're a hybrid, we're a managerial entity that is in the business of catalyzing and supporting bourgeois capitalist companies. He would clearly identify the startups that we fund. He would be like, “Oh yeah, that's the old model. That's the old model of Thomas Edison, or Henry Ford, or one of these guys.” You can just draw a straight line from Thomas Edison, Henry Ford to Steve Jobs, Larry Page, and Mark Zuckerberg. That's that model, it's a founder, it’s a CEO, at least when they started out owning 100%. They do have to raise money most of the time, but they're throwbacks. The modern tech founders are a throwback to this older model of bourgeois capitalism. So you're right in that he would view us as a managerial entity, but he would view us as a managerial entity that is in the business of causing new bourgeois capitalist institutions to at least be created. And I think he would credit us with that. And then he would also say — however, our fate is that most of the companies that we fund and most of the founders that we back end up over time, handing off control of their companies to a managerial class.When the companies we fund get to scale, they tend to get pulled into the managerial orbits, they tend to get pulled into the managerial matrix, which by the way, is when they stop being able to build new things, which is what causes the smart and aggressive people at those companies to leave and then come back to us and raise money and start a new bourgeois capitalist company.I view it as — the economy is like 99% managerial, and if we can just keep the 1% of the old model alive, we'll keep getting new things. By the way if venture capital ever gets snuffed, it's outlawed or whatever, it just fails and there is no more venture capital, there's no more tech startups or whatever then at that point the economy is going to be 100% managerial. And at that point, there will be no innovation forever.People might think they want that. I don't think they actually want that. I don't think we want to live in that world.Dwarkesh Patel 15:16Will this trend towards managerialism also happen to a16z as it scales? Or will it be immune? What happens to a16z in five decades?Marc Andreessen 15:23At a certain point this becomes the succession problem. As long as Ben and I are running it our determination is to keep it as much in the bourgeois model as possible. And as you pointed out, literally it’s our names on the door. Ben and I control the firm. The firm doesn't have a board of directors, it's just Ben and me running it. It's a private entity there’s no outside shareholders.And so as long as Ben and I are running it, and we're running it in the way that we're running it, it will be as bourgeois model as any investment firm could be.Some day there's the succession challenge, and I bring that up, because the succession challenge for tech companies is usually sort of when that transformation happens. When it goes from being in the bourgeois model to being in the managerial model.And then this gets to sort of the philosophy of succession in tech companies. And the general thing that happens there is that, you see this over and over again with the great founder CEOs, when it comes time to hand it off, there's basically two kinds of people that they can hand it off to. They can hand it off to somebody like them who's a mercurial, idiosyncratic, high disagreeableness, ornery, sort of entrepreneurial kind of personality, somebody in their mold. Or they can hand it off to somebody who knows how to run things at scale. Almost always, what they do is they hand it off to somebody who can run it at scale. The reason they do that is, there’s actually two reasons. There's the theoretical reason they do that which is — it is at scale at that point, and somebody does need to run it at scale. And then the other is, they often have what I call the long suffering number two. You've had this high octane founder CEO who breaks a lot of glass and then there's often the number two, like the chief operating officer or something who's the person who fundamentally keeps the trains running on time, and keeps everybody from quitting.And that long suffering number two has often been in that job for 10 or 15 years at that point, and is literally the longest suffering. They've always been the underling, and then it's like — Okay they now “deserve” the chance to run the company themselves. And that's the handover. Now, those founders often end up regretting that decision. And in later years, they will tell you — Boy, I wish I had handed it off to this other person who was maybe deeper in the organization who was maybe younger, who was more like I am, and maybe would have built more products and maybe that was a mistake. But the fact that they do this over and over again, to me illustrates why the Burnham theory is correct, which is — large, complex organizations ultimately do end up getting run by managers in almost all cases.The only optimistic view on that is that it's the transition from these companies being in the bourgeois capitalist model to the managerial model that creates the opportunity for the new generation of startups. Because then the counterfactual, if these companies remained bourgeois capitalist companies for 100 years, then they would be the companies to create all the new products, and then we wouldn't necessarily need to exist because those companies would just do what startups do. They just build all the new stuff.But because in that model, they won't do that and they don't do that, almost without exception. Therefore there's always the opportunity for the next new startup. And I think that's good. That keeps the economy vital, even in the face of this overwhelming trend towards managerialism.100 year fundDwarkesh Patel 18:43If you had a fund with a 100 year lock-in what would you be able to invest in that you can’t invest in right now?Marc Andreessen 18:50The base lockup for venture is like 10 years, and then we have the ability to push that out, we can kind of push that to 15. And for really high quality companies, we can push that to 20. We haven't been in business long enough to try to push it beyond that. So, we'll see.If you could push it to 100 years, the question is — is it really time that's the bottleneck? The implication of the question would be — are there more ambitious projects that would take longer, that you would fund that you're not funding because the time frames are too short. And the problem with a 100 year timeframe, or even a 50 year time frame, or even a 20 year timeframe is that new things don't tend to go through a 20 year incubation phase in business and then come out the other end and be good. What seems to happen is they need milestones, they need points of contact with reality. Every once in a while there will be a company, a very special company will get funded with a founder who's like — look, I'm gonna do the long term thing, and then they go into a tunnel for 10 or 15 years where they're building something and the theory is they're going to come out the other side. These have existed and these do get funded.Generally they never come up with anything. They end up in their own Private Idaho, they end up in their own internal worlds, they don't have contact with reality, they're not ever in the market, they're not working with customers. They just start to become bubbles of their own reality. Contact with the real world is difficult every single time. The real world is a pain in the butt. And mark to market your views of what you're doing with the reality of what anybody's actually going to want to pay for, requires you to go expose yourself to that. It's really hard to do that in the abstract, or to build a product that anybody's going to want to use. And so this thing where people go in a tunnel for 10, or 15, or 20 years, it doesn't go well. I think 100 years would be an even more degenerate version of that. Best case is this unbounded research lab that maybe would write papers and something maybe comes out the other end of the far future in the form of some open source thing or something, but they're not going to build an enterprise that way. And so I think having some level of contact with reality over the course of the first five to seven years is pretty important.The other way to get to the underlying question would be — what if you just had more zeros on the amount of money? What if instead of funding companies for $20 million, you could fund them for $2 billion, or $20 billion? In other words, maybe they would operate on the timeframe of today's companies, on a five or 10 year timeframe, but you can fund them with 20 billion of venture financing, instead of $20 million.I think that's a more interesting question. It's possible that there are pretty big fundamental things that could be built with larger amounts of money in this kind of entrepreneurial model. Every once in a while you do see these giants. Tesla and SpaceX are two obvious examples of these world changing things that just took a lot of money and then had a really big impact. So maybe there's something there, and maybe that's something that the venture ecosystem should experiment with in the years ahead. I would be more focused on that as opposed to elongating the time.Basic researchDwarkesh Patel 22:15But what about basic research? You've spoken about the dysfunctions of the academic-government-research complex. But within the next internet, the next thing that the Andreessen firm 10 years from now is building on top of, if the government effort is broken maybe you need to bootstrap something yourself. Have you considered that?Marc Andreessen 22:34The strong version of this argument is from a guy named Bill Janeway, a legendary VC. Janeway is a great, wonderful guy. If people haven't heard of him, he is a PhD in economics. I think he’s a student of a student of John Maynard Keynes. He comes from a high pedigree in economic theory background. And himself was a legendary venture capitalist in his career. He became a hands-on investor at the firm Warburg Pincus and funded some really interesting companies. And so he's one of these rare people who's both theoretical and practical on this kind of question. He wrote this book, which I really recommend, it's called Doing Capitalism where he goes through this question. The argument that he makes, along the lines of what you're saying, it’s a little bit of a pessimistic argument. The argument he makes is — if you look at the entire history of professional venture capital, which is now a 60 year journey, basically, or maybe even 50 years, from the late 60s, early 70s, in kind of modern form. He said the big category that's worked is computing or computer science. And then he said, the second category that's worked is biotech. And then he said, at least at the time of writing, everything else didn't work.And all the money that people poured into cleantech and da-da-da, all these other areas the venture capitalists tried to fund, they just didn't work from a return standpoint. You just burned the capital. When he wrote the book, he ran the numbers and computer sciences work twice as well as biotech or something like that. And then what he said is this is a direct result of federal research funding over the previous 50 years. Computer science based venture capital was able to productize 50 prior years of basic research in computer science, information science, information theory, communications theory, algorithms, all the stuff that was done in engineering schools from 1940 through like 1990.And so he said — we are productizing that, that's been the big thing. In Biotech we are productizing the work that NIH and others put into basic research in the biological sciences and that was about half as much money, and maybe half as much time. That work really started kicking in in the 60s and 70s, a little bit later.And then he said — Look, the problem is there aren't other sectors that have had these huge investments in basic research. There's just not this huge backlog of basic research into climate science or take your pick of online content, or whatever the other sectors are where people burn a lot of money.And so he says, if you want to predict the future venture capital, you basically just look at where the previous 50 years of basic research, R&D has happened, federal research funding has happened. He has a strong form of it, there's no shortcuts on this. And so if you're trying to do venture capital in a sector that doesn't have this big kind of install base of basic research has already happened, you're basically just tilting at windmills.I think there's a lot to his argument. I'm a little more optimistic about a broader spread of categories. A big reason I'm more optimistic about a broader set of categories is because computer science in particular, now applies across more categories. This was sort of the underlying point of the software eats the world thesis, which is that computers used to be just an industry where people made and sold computers. But now you can apply computer science into many other markets, financial services, and healthcare, and many, many others, where it can be a disruptive force. And so I think there's a payoff to computer science and software for sure, that can apply in these sectors. Maybe some of the biological sciences can be stretched into other sectors.There's a lot of smart people in the world, there's niche research efforts all over the place in many fields that are doing interesting work. Maybe you don't get a giant industry out the other end in some new sector, but maybe you get some very special companies. SpaceX is a massive advance in aeronautics, it took advantage of a lot of aeronautics R&D. It’s not like there's some huge aeronautics venture industry. But there is a big winner, at least one, and I think more to come. And so I'm a little bit more optimistic and open minded. Bill would probably say that I'm naive.$100b fund?Dwarkesh Patel 27:07You mentioned earlier about being able to potentially write 9 or 10 figure checks to companies like SpaceX or Tesla, who might require the capital to do something grand. Last I checked, you guys have $35 billion or something under management. Do we need to add a few more zeros to that as well? Will a16z’s assets under management just keep growing? Or will you cap it at some point.Marc Andreessen 27:27We cap it as best we can. We basically cap it to the opportunity set. And it may be obvious, but it's not a single chunk of money. It's broken into various strategies, and we apply different strategies to different sectors at different stages. So it's decomposed. And we have six primary investment groups internally in different stages, and so that money's broken out in different ways.We cap it as best we can to the opportunity set. We always tell LPs the same thing, which is we're not trying to grow assets under management, that's not a goal. To the best of our ability, we're trying to maintain whatever return level we're maintaining. We are trying to eat market share, we'd like to eat as much market share as possible. And then we would like to fully exploit the available opportunities, we'd like to fund all the really good founders, we'd like to back all the interesting new spaces. But what we wouldn't want to do is double assets under management in return for 5% lower returns or something like that. That would be a bad trade for us.So to put another zero on that, as I said, we would need a theory on a different kind of venture capital model, which would be trying to back much larger scale projects. And again, there's a really big argument you could make that that’s precisely what firms like ours should be doing. There are these really big problems in the world and maybe we just need to be much more aggressive about how we go at it. And we need founders who are more aggressive, and then we need to back them with more money.You can also argue either that wouldn't work, or we don't need it. The counter argument on the Tesla and SpaceX examples that I gave is that they didn't need it, right? They raised money the old fashioned way. They raised money round by round in the existing venture ecosystem. And so for whatever limitations you think the existing ecosystem has, and maybe it's not ambitious enough or whatever, it did fund Tesla and SpaceX.And so maybe it works. So the underlying question underneath all this is not the money part. The underlying question is how many great entrepreneurs are there? And then how many really big ideas are there for those entrepreneurs to go after? And then that goes one level deeper, which is — What makes a great entrepreneur? Are they born? Are they trained? What made Elon, Elon? What would you need to do to get ten more Elons? What would you need to do to get 100 more Elons? What would you need to do to make 1000 more Elons? Are they already out there and we just haven't found them yet? Could we grow them in tanks?Dwarkesh PatelOr just add testosterone to the water supply?Marc Andreessen 29:57Yeah or do we need a different kind of training program? Does there need to be a new kind of entrepreneurial university that trains entrepreneurs? It's just a totally different thing. Those are the underlying questions. I think if you show me ten more Elons, I'll figure out how to fund their companies. We work with a lot of great founders and we also work with Elon and he's still special. He's still highly unusual even relative to the other great entrepreneurs.Crypto debateDwarkesh Patel 30:32Yeah. Let's talk about crypto for a second. When you're investing in crypto projects, how do you distinguish between cases where there is some real new good or service that new technology is enabling and cases where it's just speculation of some kind?Marc Andreessen 30:45What we definitely don't do is the speculation side, we just don't do that. And I mean that very specifically, we're not running a hedge fund. What we do is we apply the classic venture capital 101 playbook to crypto. And we do that the exact same way that we do with every other venture sector that we invest in, which is to say we're trying to back new ventures. In crypto that venture might be a new company, or it might be a new network, or it might be a hybrid of the two and we're completely agnostic as to which way that goes. When we write our crypto term sheets, even when we're backing a crypto C Corp, we always write in the term sheet that they can flip it into being a tokenized network anytime they want to. We don't distinguish between companies and networks.But we approach it with a Venture Capital 101 playbook, which is — we're looking for really sharp founders who have a vision and the determination to go after it. Where there's some reason to believe that there's some sort of deep level of technological economic change happening, which is what you need for a new startup to wedge into a market. And that there's a reason for it to exist, that there's a market for what they're building and they're gonna build a product, and there's gonna be an intersection between product and market, and there's gonna be a way to make money and you know, the core playbook.We go into every crypto investment with the same timeframe as we go into venture investing. So we go in with at least a five to 10 year timeframe, if not a 15 to 20 year timeframe. That's what we do, the reason that's not necessarily the norm in crypto is an artifact of the fact that — especially anything with crypto tokens, there is this thing where they tend to publicly float a lot sooner than startup equity floats. Let's say we're backing a new crypto network, it goes ahead and floats a token as sort of one of the first steps of what it does. It has a liquid thing years in advance of when a corresponding normal C Corp would. There’s one thing in behavioral economics where when something has a daily price signal and where you can trade it, people tend to obsess on the daily price signal and they tend to trade it too much. There's all this literature on this that kind of shows how this happens. It's part of the human experience, we can't help ourselves, it's like moths to a flame. If I can trade the stock every day, I trade the stock every day.Almost every investor in almost every asset class trades too often in a way that damages their returns. And then as a consequence of that, what's happened is a lot of the investment firms that invest in crypto startups are actually hedge funds. They're structured as hedge funds, they have trading desks, they trade frequently, they have the equivalent of what's called a public book in hedge fund land. They've got these crypto assets they're trading frequently, and then they'll back a startup and then they'll trade that startup's token just like they trade Bitcoin or Ethereum.But in our view that's the wrong way. And by the way there's an incentive issue, which is they pay themselves on a hedge fund model, they pay themselves annually. So they're paying themselves annually based on the market for projects that might still be years away from realization of ultimate underlying value. And then there's this big issue of misalignment between them and their LPs. And so that's all led to this thing where the tokens for these crypto projects are traded too aggressively. In our model they just shouldn't be, they're just not ready for that yet. And so we anchor hard on the venture capital model, we treat these investments the exact same way as if we're investing in venture capital equity, we basically buy and hold for as long as we can. And have a real focus on the underlying intrinsic value of the product and technology that's being developed. If by speculation you mean daily trading and trying to look at prices and charts and all that stuff, we don’t do that.Dwarkesh Patel 34:22Or separately, another category would be things that are basically the equivalent of baseball cards, where there's no real good or service that's being created. It is something that you think might be valuable in the future but not because the GDP has gone up.Marc Andreessen 34:38Oh. Baseball cards are a totally valid good and service. That's a misnomer. I would entirely disagree with the premise of that question.Dwarkesh Patel 34:48But are they gonna raise median incomes even slightly?Marc Andreessen 34:50Yeah, there are people who make their living on baseball cards. Look, art has been a part of the economy for thousands of years. Art is one of the original things that people bought and sold. Art is fundamental to any economy. Would you really want to be part of an economy where they didn't value art? That would be depressing.Dwarkesh Patel 35:15Yeah but there's the question of — Do they value art versus are they speculating on art? And then how much of the effort is being spent on speculating on the art versus creating the art?Marc Andreessen 35:25Well, this gets into this old kind of cultural taboo. This depends on what you mean by speculation. If what you mean by speculation is obsessing on daily price signals and buying and selling and turning a portfolio, like being a day trader kind of speculation. That's what I think of speculation. Let's say that's the bad form of speculation, that's the non productive form.If by speculation, on the other hand, you mean — look, there are different kinds of things in the world that have different possible future values. And people are trying to estimate those future values, and people are trying to figure out utility, and they're trying to figure out aesthetic value.  Look at how the traditional art market works, is somebody supporting a new contemporary artist speculating or not? Yes, maybe from one lens they are. Maybe they're buying and selling paintings, and maybe they buy in and if it doesn't start going up in price, they flip it and buy something else. But also, maybe they're supporting a new young artist. And maybe they build a speculative portfolio of new young artists and as a consequence those artists can get paid, and they can afford to be full time artists. And then it turns out they're the next Picasso.And so I think that kind of speculation is good and healthy. And it's core to everything. I'd also say this — I don't know that there's actually a dividing line between that form of speculation, and speculation on what people call investments. Because even when people make investments, even just the institutional bond market. Look at US government debt, people are today in the bond market trying to figure out what that's worth. Because is the debt ceiling gonna get raised? Even that's up for grabs. To me, that’s not speculation in the bad sense, that's a market working properly. People are trying to estimate. Ben Graham said “financial markets are both a voting machine and a weighing machine. And in the short term, they tend to be a voting machine in the long run, they tend to be a weighing machine.”What's the difference between a voting machine and a weighing machine? I don't know, some people would say they're very different. Maybe it's actually the same thing. Why did prices go up? Because there are more buyers and sellers. Why do the prices go down? There were more sellers than buyers. The way markets work is you get individuals trying to make these estimations and then you get the collective effect. There's this dirty interpretation of any kind of trading or any kind of people trying to do the voting and weighing process. I just think it's this historical, ancient taboo against money. It's like in the Bible, Jesus kicking the money changers out of the temple. It's this old taboo against charging interest on debt. Different religions and cultures tend to have some underlying unease with the concept of money, the concept of trade, the concept of interest. And I just think it's like superstition, it's like resentment, it's fear of the unknown. But those things are the things that make economies work. And so I'm all in favor.Dwarkesh Patel 38:20I don't mean to get hung up on this — but if you think of something like the stock market or the bond market, fundamentally you can tell a story there. Where the reason what these stockbrokers or these hedge fund managers are doing is valuable, they're basically deciding where capital should go. Should we build a factory in Milwaukee? Should we build it in Toronto? Fundamentally, where should capital go? Whereas what is the story there? What is the NFT helping allocate the capital towards? Why does it matter if the price is efficient there?Marc Andreessen 38:48Because it's art. NFT is a very general concept. NFT is basically just a form of digital ownership. There will be many kinds of NFTs in the future, many of them, for example, will represent claims on real underlying property. I think a lot of real assets are gonna be wrapped in NFTs. And so NFTs are a very broad technological mechanism. But let's specifically take the form of NFT that everybody likes to criticize, which is NFT as a creative project or an image or a character in a fictional universe or something like that, the part that people like to beat on.And I'm just saying — they're just art. That's just digital art, right? And so every criticism people make of that is the same criticism you would make of buying and selling paintings, it would be the same buying and selling photographs, of buying and selling sculpture.I always like to really push this, what's the Mona Lisa worth? I don't want to spoil the movie. But the new Knives Out movie, let's just say the Mona Lisa plays a role in the movie. What's the Mona Lisa worth? One way of looking at the Mona Lisa is that it's worth the cost of producing it.  It's worth the canvas and the paint. And you could create a completely identical reproduction of the Mona Lisa with like 25 bucks of canvas and paint. So the Mona Lisa is worth 25 bucks. Or you could say the Mona Lisa is a cultural artifact and as a cultural artifact that's worth probably a billion dollars or $10 billion. Specifically on your question, what explains the spread between $25 and the $10 billion that it would go out if it ever hit the market. It’s because people care. Because it's art, because it's aesthetic, because it's cultural. Because it's part of what we've decided is the cultural heritage of humanity. The thing that makes life worth living is that it's not just about subsistence, that we are gonna have higher values and we're gonna value aesthetics.Dwarkesh Patel 40:35Do you see a difference between the funding the flying cars and the SpaceXs and Teslas versus something that improves the aesthetic heritage of humanity? But does one of them seem like a different category than the other to you? Or is that all included in the venture stuff you're interested in?Marc Andreessen 40:52It's a little bit like saying — should we fund Thomas Edison or Beethoven? If push comes to shove and we can only fund one of them, we probably should fund Edison and not Beethoven. Indoor lighting is probably more important than music. But I don't want to live without Beethoven.I think this is a very important point. People have lots and lots of views on human existence. There's lots and lots of people trying to figure out the point of human existence, religions and philosophies and so forth. But kind of what they all have in common, other than maybe Marxism, what they all have in common is — we're not just here to get up in the morning, work in a factory all day, go home at night, be depressed and sad, go to bed. We're not just material, right? Whatever this is all about, it's not just about materiality. There are higher aspirations and higher goals. And we create art, we create literature, we create paintings, we create sculptures, we create aesthetics, we create fashion, right, we create music, we create all of these things.And fiction. Why does fiction exist? Why is a fake story worth anything? Because it enhances your life to get wrapped up in a fake story. It makes your life better that these things exist. Imagine living in a world where there's no fiction, because everybody's like — “Oh, fiction is not useful. It's not real.” No, it's great. I want to live in a world where there's fiction. I like nothing more at the end of the day than having a couple hours to be able to get outside of my own head and watch a really good movie. And I don't want to live in a world where that doesn't happen.As a consequence, funding movies as another example of what you're talking about, is a thing that really makes the world better. And here's the other thing. The world we live in actually is the opposite of the world you're alluding to. The world we live in is not a world in which we have to choose between funding flying cars and funding NFTs or like in my example, funding Edison versus funding Beethoven. The world we live in is actually the opposite of that, where we have a massive oversupply of capital and not nearly enough things to fund.The nature of the modern economy is we have what Ben Bernanke called the global savings glut. We've just got this massive oversupply of capital that was generated by the last few 100 years of economic activity, and there's only one Elon. There's just this massive supply demand imbalance between the amount of capital that needs to generate a return and the actual number of viable investable projects and great entrepreneurs to actually create those projects. We certainly don’t have enough flying car startups, we also don't have enough art startups. We need more of all of this. I don't think there's a trade off, we need more of all of it.Future of VCDwarkesh Patel 43:29Have we reached the end of history when it comes to how venture capital works? For decades you get equity in these early stage companies, you invest more rounds, it's a 2-20 structure. Is that what venture is going to look like in 50 years, or what's going to change?Marc Andreessen 43:42I think the details will change, and the details have changed a lot, and the details will change a lot. If you go back to the late 60s, early 70s, the details were different then and the details were different 20 years ago. By the way, they're changing again right now in a bunch of ways, and so the details will change.Having said that, there’s a core activity that seems very fundamental. And the term I use I borrowed from Tyler Cowen who has talked about this, he calls it Project Picking. When you're doing new things, new tech startups, making new movies, publishing new books, creating new art, when you're doing something new. There's this pattern that just repeats over and over again. If you look back in history, it's basically been the pattern for hundreds or 1000s of years, and it seems like it's still the pattern. Which is, you're going to do something new, it's going to be very risky, it's going to be a very complex undertaking, it's going to be some very complicated effort that's going to involve a path dependent kind of journey through a complex adaptive system, reality is going to be very fuzzy and messy. And you're going to have a very idiosyncratic set of people who start and run that project. They're going to be highly disagreeable, ornery people because that's the kind of people who do new things. They're going to need to build something bigger than themselves, they're going to need to assemble a team and a whole effort. They're going to run into all kinds of problems and issues along the way.Every time you see that pattern there's this role, where there's somebody in the background who's like — Okay, this one, not that one. This founder, not that founder. This expedition, not that expedition. This movie, not that movie. And those people play a judgment and taste role, they play an endorsement, branding and marketing role. And then they often play a financing role. And they often are very hands-on, and they try to contribute to the success of the project.A historical example of this I always use is that the current model of venture capital is actually very similar to how whaling expeditions got funded 400 years ago. To the point that the term that we actually have, which is carried interest or carry, which is the profit sharing that the VCs get on a successful startup, that term actually goes back to the whaling industry 400 years ago, where the financiers of whaling journeys — like literally out of Moby Dick, to go hunt a whale and bring its carcass back to land.The carry was literally the percentage of the carried amount of whale that the investor’s got. It was called carry because it was literally the amount of whale that the ship could carry back. And so if you go back to how the whaling journeys off, like the coast of Maine and the 1600s, were funded, there were a group of what we — they didn't call themselves venture capitalist at that time, but there were a group of basically capitalists. And they would sit in a tavern or something, and they would get pitches by whaling captains.And you can imagine the whaling captains. A third of the whaling journeys never came back. A third of the time the boats got destroyed and everybody drowned. And so it's like — I'm the captain who's going to be able to not only go get the whale, but I'm gonna be able to keep my crew alive. By the way, I have a strategy and a theory for where the whale is.And maybe one guy is like — look, I'm gonna go where everybody knows there are whales and other guy’s gonna be like — no, that place is overfished, I'm gonna go to some other place where nobody thinks there's a whale, but I think there is. And then one guy is gonna say — I'm better at assembling a crew than the other. And the other one's like — Well, no, I don't even need a crew. I just need a bunch of grunts and I'm going to do all the work. And then another guy might say — I want a small fast boat. And other guy might say — I want a big slow boat.And so there's a set of people, imagine in the tavern under candlelight at night, debating all this back and forth — Okay, this captain on this journey, not that captain on that journey and then putting the money behind it to finance the thing. That's what they did then and that's still what we do. So what I'm pretty confident about is there will be somebody like us who is doing that in 50 years, 100 years, 200 years. It will be something like that. Will it be called venture capital? That I don't know. Where will it be happening? I don't know. But that seems like a very fundamental role.Dwarkesh Patel 47:56Will the public private distinction that exists now, will that exist in 50 years?Marc Andreessen 48:00You mean like companies going public?Dwarkesh Patel 48:07Yeah and just the fact that there's different rules for investing in both and just a separate category? Is that gonna exist?Marc Andreessen 48:12There's already shades of gray. I would say that's already dissolving. There's very formal rules here. But there's already shading that is taking place. In the last 20 years, it's become much more common for especially later stage private companies to have their stocks actually trade. Actually be semi liquid and trade either through secondary exchanges or tender offers or whatever. That didn't used to happen, that didn't really happen in the 1990s. And then it started happening in the late 2000s.And then you've got lots of people with different kinds of approaches to have different kinds of private markets and new kinds of private liquidity. And look, you've got these new mechanisms, you've got crypto tokens. You've got entirely new mechanisms as well popping up representing underlying value.And then arguments, debates all the time in public and with regulators and in the newspapers about what counts — Who can invest in? This whole accredited investor thing. A lot of this is around “protecting investors”. And then there's this concept of high net worth investors should be allowed to take more risk, because they can bear the losses. Whereas normal investors should not be allowed to invest in private companies, but then there's a counter argument that says, then you're cutting off growth investing as an opportunity for normal investors, and you're making wealth inequality worse.That debate will keep playing out. It'll kind of fuzz a bit. I'd expect both sides will moderate a little bit. So in other words, public companies will get to be a little bit more liquid over time. The definition of what it means to be public will probably broaden out. I'll give you an example. Here's an interesting thing. So you can have this interesting case where you can take a company private, but it's still effectively public because it has publicly traded bonds. And then it ends up with publicly filed financials on the bond side, even though its stock is private. And so it's effectively still public because of information disclosure. And then the argument is — well, if I already have full information disclosure, as a result of the bonds trading, you might as well take the stock public again. Anyway it'll fuzz out somewhere in there.FoundersDwarkesh Patel 50:20Okay, so there's a clear pipeline of successful founders, who then become venture capitalists like yourself, obviously. But I'm curious why the opposite is not more true? So if you're a venture capitalist, you've seen dozens of companies go through hundreds of different problems. And you would think that this puts you in a perfect position to be a great entrepreneur. So why don't more venture capitalists become entrepreneurs?Marc Andreessen 50:40One reason is it's just harder to build a company, it just flat out is. It's not easy to be a VC, but it's harder to build a company. And it requires a level of personal commitment. Successful venture capitalists do get to a point in life where they start to become pretty comfortable. They make money and they start to settle into that sort of fairly nice way of living at some point in a lot of cases. And going back to the 2 AM chewing glass kind of thing is maybe a little bit of a stretch for how they want to spend their time.So that's part of it. The other part of it is — the activities are pretty different. The way I describe it is — actually starting and running a company is a full on contact sport, it's a hundred decisions a day. I’ll give an example: bias to action. Anybody who's running a company, you have to have a bias to action. You're faced with a hundred decisions a day, you don't have definitive answers on any of them. And you have to actually act anyway. Because if you sit and analyze the world will pass you by. And it's like — a good plan executed violently is much better than a great plan executed later.So it's a mode of operating that rewards aggression, contact with reality, constantly testing hypotheses, screwing up a lot, changing your mind a lot, revisiting things. It’s thousands and thousands of crazy real world variables all intersecting.Being an investor is different. It's much more analytical, clinical, outside-in. The decision cycles are much longer, you get a much longer period of time to think about what you should invest in, you get a much longer period of time to figure out when you should sell. Like I said, you generally don't want to trade frequently if you're doing your job right. You actually want to take a long time to really make the investment decisions, and then make the ultimate sale decisions.VCs, we help along the way, when companies have issues that they're in the middle of. But fundamentally, it's a much bigger level of watching, observing, learning, thinking, arguing,in the abstract, as opposed to day to day bloody combat.Honestly, it's a little bit like — Why don't the great football broadcasters go get on the field? Try being the running back for a season?Dwarkesh Patel 53:12Got it. How soon can you tell whether somebody will make for a good CEO of a large company specifically? So can you tell as soon as they've got a new startup that they're pitching you? Or does it become more clear over time as they get more and more employees?Marc Andreessen 53:25The big thing with being able to run things at scale, there's actually a very big breakthrough that people either make or they don't make. And the very big breakthrough is whether they know how to manage managers. Say you're running a company with a hundred thousand employees, you don't have a hundred thousand direct reports. You still only have like eight or ten direct reports. And then each of them have eight or ten direct reports and each of them have eight or ten direct reports. And so even the CEOs of really big companies, they're only really dealing with eight or ten or twelve people on a daily basis.And then how do you become trained as a manager? The way you become trained as a manager initially is you manage a team of individual contributors. I'm an engineering manager, I have eight or ten coders working for me. And then the breakthrough is — am I trained in how to become a manager of managers?If I'm early in my career, the way I think about that is I start out as an individual contributor, let's say an engineer. I get trained on how to be a manager of individual contributors, and that makes me an engineering manager. And then if I get promoted to what they call engineering director, which is one level up, now I'm a director and now I'm managing a team of managers. Anybody who can make that jump now has a generalizable skill of being able to manage managers, and then what makes that skill so great is that skill can scale. Because then you can get promoted to the VP of engineering, now you have a team of directors who have teams of managers who have teams of ICs and so forth. And then at some point, if you keep climbing that ladder, at some point you get promoted to CEO. And then you have a team of managers who are the executives of the company, and then everything spans out from there.And so if you can manage managers, at least in theory, you have the basic skill and temperament required to be able to scale all the way up. Then it becomes a question of how much complexity can you deal with? Can you learn enough about all the different domains of what it means to run a business? Are you going to enjoy being in the job and being on the hot seat? All those kinds of questions.I think 100% of the people we back have the intelligence to do it, maybe half of them have the temperament to do it, and then maybe half of those have the intelligence and the temperament and they really want to do it. And by “might want to do it” I mean, 20 years from now, they still want to be running their company.And enough of them where we get the success cases. But having said that as an entrepreneur, you have to really want that. You have to be smart enough and you have to have the temperament and you have to actually want to learn the skills. And not everybody is able to line those up.Dwarkesh Patel 55:54Got it, got it. Managing the managerial revolution.Marc Andreessen 56:00Actually, that's exactly right. The best case scenario is a bourgeois capitalist, entrepreneurial CEO, managing a team of managers who are doing all the managerial stuff required at scale. That's the best case scenario for a large modern organization. Best of both worlds, they're able to harness the benefits of scale, and they're able to still build new things.The degenerate version of that is a manager running a company of people who in theory can build your products. But in the Burnham sense, if the CEO is the manager who is running a team of people who want to build their products, that company probably will not actually build their products. Those people will probably all leave and start their own companies.a16z vulnerabilitiesDwarkesh Patel 56:42Yep, yep. Now, as unlikely as this may be, just humor the hypothetical. Let's say a16z for the next 10 to 20 years has mediocre returns. If you had to guess looking back, what would be the most likely reason this might happen? Would it have to be some sort of macro headwind, would it have to be betting on the wrong tech sectors, what would it have to be?Marc Andreessen 57:0020 years is a long enough time where it's probably not just a macroeconomic thing. The big macro cycles seem to play out over 7 to 10 year periods. And so over 20 years, you'd expect to kind of get two or three big cycles through that. And so you'd expect to get at least some chance to make money and harvest profits. Probably it wouldn't be a macro problem. Look, you can imagine it, if a real pandemic happens. By the way, I’m now gonna get you demonetized on Google because I'm going to reference pandemics but..Dwarkesh Patel 57:34Don’t worry, I didn't have enough views to be monetized anyway.Marc Andreessen 57:38If something horrible happens then you could be in a ditch for 20 years. But if things continue the way that they have, for the last 50 years or 80 years. There'll be multiple cycles, and there'll be a chance to make money for people who make good investments.So it's probably not that, and then there'll be the micro explanation, which is we just make bad investments. We invest the money, but we just invest in the wrong companies and we screw up. And that's of course always a possibility. And probably the most likely downside case.The other downside case is — I would build on what I was mentioning earlier, from Bill Janeway. The other downside case would just be that there's just not enough technological change happening. There wasn't enough investment in basic research in the preceding 50 years in areas that actually paid off. There wasn't enough underlying technological change that provided an opportunity for new entrepreneurial innovation. And the entrepreneurs started the companies and they tried to build products and we funded them and for whatever reason, the sectors in which everybody was operating just didn't pay off.If we hit five clean-tech sectors in a row or something like that, the whole thing just doesn't work. In a sense, that's the scariest one because that's the one that's most out of our control. That's purely exogenous. We can't wish new science into existence. And so that would be a scary one. I don't think that's the case. And in fact, I think quite possibly the opposite is happening. But that would be the downside scenario.Dwarkesh Patel 59:15How vulnerable is a16z to any given single tech sector not working out? Whether it's because of technical immaturity, or by their regulation or anything else? But if your top sector doesn't work out, how vulnerable is the whole firm?Marc Andreessen 59:29Innovation could just be outlawed. And that's a real risk, because innovation is outlawed in big and important areas like Nuclear. I always love meeting with new nuclear entrepreneurs, because it's just so obvious that we should have this big investment in nuclear energy and there's all these new designs. But the Nuclear Regulatory Commission has not authorized a new nuclear design since its inception nearly 50 years ago. So it's just illegal to build new nuclear in the US. By the way, there's all these fusion entrepreneurs that are super geniuses, the products are great, it looks fantastic. I just don't think there's any prospect of nuclear fusion being legal in the US. I think it's just impossible and can't be done. Maybe it's just all outlawed, in which case, at a societal level we will deserve the result. But that would be a bummer for us.Dwarkesh Patel 1:00:14And then I don't know, let's say crypto gets regulated or it's just not ready yet. It doesn't have to be crypto specifically. But what happens to a16z as a whole? I mean, does a whole firm carry on? Or?Marc Andreessen 1:00:28Look, it's up to our LPs. We raise money on a cycle. So our LPs have an option every cycle to not continue to invest. Just logically the firm is somewhat diversified now. We have six primary investment domains. So at least in theory, we have some diversification across categories. At least in theory, we could lose a category or two and the investment returns could still be good, and the investors will still fund us. The downside case from there would be that those categories are actually more correlated than we would want them to be. As a firm, we have a big focus on software, we think software is a wedge across each of those verticals. Maybe AI turns out for whatever reason not to work, or gets outlawed or something or just fundamentally makes economics worse or something. Then you can imagine that hitting multiple sectors. Again, I don't think that's going to happen, but I guess it's a possibility.Monetizing TwitterDwarkesh Patel 1:01:28Yeah. What did the old management of Twitter fail to see about the potential of the platform?Marc Andreessen 1:01:30So first I'd say that I have a very hard time second guessing management teams, because like I said, my belief is that it's so easy to criticize companies and teams in the outside, it's so hard to run these companies, there are always a thousand factors that are invisible from the outside that make it really hard to make decisions internally.By the way, the histories on all this stuff are really always screwed up. Because what you almost always find in the history of the great companies is that there were moments early on where it was really tenuous, and it could have easily gone the other way. Netflix could have sold out to Blockbuster early on, and Google could have sold out to Yahoo. And we never would have even heard of those companies. And so it's really, really hard to second guess.I guess I will just put it this way — I've always believed and I was an angel investor in Twitter back when it first got started. I've always believed that the public graph is something that should just be titanically valuable in the world. The public-follow graph. In computer science terms, Twitter is what's called publish subscribe to the idea of a one way public follow graph.That ought to be just absolutely titanically valuable, that ought to be the most valuable content, loyalty brand signal in the world. That ought to be the most complete expression of what people care about in the world, that ought to be the primary way that every creator of everything interacts with their customers and their audience. This ought to be where all the politics operates, this ought to be where every creative profession operates, this ought to be where a huge amount of the economy operates.They were always on to such a big idea. Like with everything, it's a question of — What does that mean in terms of what kind of product you can build around that? And then how can you get people to pay for it?  But yeah, I've always viewed that the economic opportunity around that core innovation that they had is just much, much larger than anybody has seen so far.Dwarkesh Patel 1:03:21But how specifically do you monetize that graph?Marc Andreessen 1:03:22Oh, there's a gazillion ways. There's tons and tons of ways. Elon has talked about this publicly so it’s not spoiling anything, but Twitter is a promotional vehicle for a lot of people who will then provide you stuff on another platform.I'm just taking an obvious example. He has talked about video. People create video, they market it on Twitter, and then they monetize it on YouTube. Like, why? Why is that not happening (on Twitter)? Musicians will have followings of 5-10 million people on Twitter, they aren't selling concert tickets.I'm sure this was happening before but where it first came to mind was, if you remember Conan O'Brien when he got famously fired from the Tonight Show, he did this tour. And I was a fan of his so I was following him at the time. He did his first live comedy music tour. And he sold out the tour across 40 cities in like two hours. How did he do it? Well, he just put up on his Twitter account. He said — I'm going on the road, here are the dates, click here to buy tickets.Boom, they all sold out. “Now click here to buy tickets” was not “click here to buy tickets on Twitter.” It was “click here to buy tickets somewhere else”. But why isn't every concert in the world, why isn't every live event getting booked on Twitter? There's a lot of this kind of thing.As Elon is fond of saying, it's not rocket science.Dwarkesh Patel 1:04:38Yeah. It's funny that a few revolutions in the Middle East were organized in the same way that Conan O'Brien organizes tour, just by posting it on Twitter.Marc Andreessen 1:04:54So this is the thing that got me so convinced on social media relatively early. Even before the Arab Spring, I don’t know if you remember, you might be too young, but there was this overwhelming critique of social media between inception in like 2001 to basically mainstreaming in like, 2011-2012. There was a decade where there was just this overwhelming critique from all the smart people, as I like to say. That was basically — this thing is useless. This is narcissism. This is just pointless self ego stroking, like narcissism. Nobody cares. The cliche always was Twitter is where you go to learn what somebody's cat had for breakfast. Who cares what your cat had for breakfast? Nothing will ever come from any of this. And then I remember, you could pick up any newspaper on any given day through that period and you could read something like this.And then I remember when Erdoğan was consolidating control of Turkey. Erdoğan came out and he said, “I think Twitter is the primary challenge to the survival of any political regime in the modern world,” And I was like — Okay, all the smart analysts all think this is worthless and then a guy who's actually trying to keep control of a country is like, this is my number one threat. The spread of what that meant, of what the outcomes meant. I was just like — “Oh my god.”My conclusion was Erdoğan is right and all the smart westerners are wrong. And quite honestly, I think it’s still quite early on. We’re still pretty early in the long arc of social media. The high level thing here would be — the world in which 5 billion people are on the internet is still only a decade or so old. That’s still really early. The world in which 5 billion people are on social networks is like five years old. It’s still super early. If you just look at the history of these transitions in the past, just look at the printing press as a prescient example. It took 200 years to fully play out the consequences of the printing press. We’re still in the very early stages with these things.Future of big techDwarkesh Patel 1:07:09I was like ten in 2011 so I don’t know if I would’ve personally. I would’ve liked to think I would’ve caught on if I was older but maybe not. It’s hard to know. But it is kind of interesting. You are personally invested in every single major social media company. So it’s interesting to get your thoughts on where that sector might go. Do you think the next ten years will look like the last ten years when it comes to Big Tech? Is it just going to keep becoming a bigger fraction of GDP? Will that ever stop?Marc Andreessen 1:07:35As a fraction of GDP, it’s only gonna go up. It is the process of tech infusing itself in every sector. And I think that’s just an overwhelming trend. Because there are better ways to do things. There are things that are possible today that were not possible ten years ago. There are things that will be possible five years from now that aren’t possible today. So from a sector standpoint, the sector will certainly rise as a percent. I’m putting my money where my mouth is in the following statement — Entrepreneurial capitalism will deliver most of that. A lot of that gain will be in companies that were funded in the venture capital, silicon valley kind of model. For the basic reason we discussed which is you do need to have that throwback to the bourgeois capitalist model to do new things. Incumbents are generally still very poor at changing themselves in response to new technology for reasons we’ve discussed. So that process will continue to play out. Another thing that I would just highlight is — The opportunity set for tech is changing over time in another interesting way. We’ve been good at going over the dynamic but small slices of GDP in the last fifty years. And more and more now, we’re going to be going after the less dynamic but much larger sectors of GDP. Education, healthcare, real estate, finance, law, government are really starting to come up for grabs. They are very complicated markets and they’re hard to function in. As startups, it’s harder to build the companies but the payoff is potentially much bigger. Because those are such huge slices of GDP. So the shape of the industry will change a bit over time. What is technology? Technology is a better way of doing things. At some point, the better way of doing things is the way that people do things. At some point that does shift market share from people doing things the old to the people doing things the new way.Dwarkesh Patel 1:09:32But let's say you build a better education system somehow. The government is still going to be dumping trillions of dollars into the old education system or the old healthcare system. Do you just accept this as a lost cause that basically 50% of the GDP will just be wasted but we’ll make the other 50% really good? When you're building alternatives, do you just accept the loss of the existing system?Marc Andreessen 1:09:56Education is a great example. I think the incumbent education system is trying to destroy itself. It and the people running it, and the people funding it are trying to kill it. And they’re doing it every possible way they can. For K-12 they are trying to prioritize the teachers over the students which is the opposite of what any properly run company would do. At the university level, the problems in the modern university have been well covered by other people. They have become a cartel. Stanford now has more administrators than they have students. No company would run that way.Dwarkesh Patel 1:10:40There’s a positive vision where you could turn that into the Bloom two-sigma, single student for single administrator but I don’t think that’s what's happening.Marc Andreessen 1:10:49Yes, yes. That’s correct. You could and they’re not. That’s exactly right. And then you see the federal student loan kind of crazy thing. By the way, the universities are voluntarily shutting down use of admissions testing. They’re shutting down SAT, ACT, GRE. They’re very deliberately eliminating the intelligence signal which is a big part of the signal employers piggyback on top of. They become intensely politicized. We now know through the replication crisis that most of the research that happens in these universities is fake. Most of it is not generating real research results. We know that because it won’t replicate. You’ve just got these increasingly disconnected mentalities and there’s some set of people who are obviously going to keep going to these schools.And then you just look at cost. A degree from a mainstream university that costs, in ten years, a half-million or a million dollars that has no intelligence signal attached to it anymore. Where most of the classes are fake, where most of the degrees are fake, most of the research is fake, where they are wrapped up in these political obsessions. That’s probably not the future of how employers are going to staff. That’s probably not where people are actually going to learn valuable marketable skills. The last thing they want is to actually teach somebody a marketable skill. Teaching somebody a marketable skill is just so far down in the list of priorities of a university now it’s not even in the top 20.Lot of it is just they’re a cartel. They operate as a cartel, they run as a cartel, it is a literal cartel. And the cartel is administered through the agencies, the quasi-governmental bodies that determine who gets access to federal student loan funding. And those bodies are staffed by the current university administrators. So it’s a self-governing cartel. It does exactly what cartels do, it’s stagnating and going crazy in spectacular ways.There’s clearly going to be an educational revolution. Does that happen today or five years or ten years, I don’t know. Does it happen in the form of new in-person tuitions versus internet-based? I don’t know. Is it driven by us or is it driven by employers who just get fed-up and they’re like — “Screw it. We’re not gonna live like this anymore and we’re gonna hire people in a totally different way.” That, I don’t know. There’s lots and lots of questions about what’s gonna happen from here. But the system is breaking in fundamental and obvious ways.Healthcare, same thing. It’s extraordinarily difficult to find positive outcomes in healthcare. In other words, there’s lots of activity in healthcare. It’s very hard to find anything that causes people to live longer. Or to be healthier longer. Every once in a while there’s a successful new cancer treatment or something but there are all these analyses that show that massive investment and public support for health insurance and all these things. And the health outcomes basically don’t move.To the extent that people care at all about the reality of their health, there are going to have to be new ways of doing things and tech is going to be the way through the market for people who have those ideas.Is VC Overstaffed?Dwarkesh Patel 1:14:07Hopefully these revolutions in education and healthcare are not like healthcare itself where we are always twenty years away from a cure to cancer and we’re always twenty years away from making education technological.You’ve talked about how big tech is 2 to 4x overstaffed in the best case. I’m curious how overstaffed do you think venture capital is? How many partners and associates could we let go and there really wouldn’t be a difference in the performance of venture capital.Marc Andreessen 1:14:30My friend Andy Rachleff, who is the founder of Benchmark and teaches venture capital at Stanford. I think his description of this is correct. He says — Venture capital is always over staffed and over funded. His estimate is that it is overfunded by a factor of 5. It should probably be 20% of the size that it is. It should be 20% of the number of people, it should be 20% of the number of funds, it should be 20% of the amount of money. And his conclusion after watching this for a long time and analyzing it was it’s basically a permanent 5x overfunding, overstaffing. It goes to what I referenced earlier which is, the world we live in just has a massive imbalance of too much money chasing too few opportunities to invest the money productively. There’s just too much money that needs long run returns that looks to venture as part of their asset allocation. In the way that modern investors do asset allocation. The full version of it he describes is that — there’s only ever been two models of institutional investment. There’s the old model of institutional investment which is 60-40 stocks and bonds that kind of dominated the 20th century up until the 1970s. And there’s what’s called the Swensen model. Swensen who created the Yale endowment in its modern form and that’s the model that all the endowments and foundations have today and increasingly sovereign wealth funds, where they invest in alternative assets. Which means hedge funds, venture capital, real estate and things that aren't stocks and bonds. So anybody following the Swensen model has an allocation to venture capital, on average that’s maybe 4% of their assets. But 4% of the entire global asset base is just a gigantic number. It’s like someone once said — It’s like having a 6th marriage, hope triumphing over experience.The thing you will hear from LPs is every LP says they only invest in the top ten venture capital funds and every LP has a different list for who that is. They all kind of know that the whole sector is overfunded, but they all kind of know that they suffer from a real lack of... where else is the money going to go? And then, it’s always possible that you’ll have some great new fund, there’s some great new sector that will open up. A huge advantage that venture capital has is the long dated part of it. It means you don’t suffer the consequences of a bad venture capital investment upfront. You get a ten year lease on life when you make a venture capital investment. You’re not gonna get judged for a long time. And so I think that causes people to invest more in this sector than they should.Dwarkesh Patel 1:17:09Is the winner's curse also a big component here where the guy who bids the most is the one who sets the price?Marc Andreessen 1:17:14That can happen. At the early stages the best companies tend to raise at less than the optimal price because the signal of who invests is more important than the absolute price. And so almost every investment that we fund at the Series A stage, they could raise money at 2-4 times the price they raised from us. But they value the signal. And I think that’s also true of the seed landscape and it’s also still true in a lot of cases at the series B level. Series C and beyond it becomes much more of an efficient market.Again it’s not a full auction. It’s a little bit like your earlier question. At least here’s the theory — it’s not just money, it’s not just a straight up liquid financial market. These are whaling journeys. By the way, there’s a much blunter answer to this question which is — people who raise seed money and series A money from the high bidder often end up really regretting it because they end up raising money from people who don’t actually understand the nature of a whaling journey, or a tech startup. And then they panic at the wrong times and they freak out. And the wrong investors can really screw up a company. At least historically, there’s a self-correcting equilibrium that comes out of that. Where the best entrepreneurs understand that they want someone on their team who really know what they’re doing and they don’t want to take chances with someone that’s gonna freak out and try to shut the company down the first time that something goes wrong. But we’ll see. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Garett Jones is an economist at George Mason University and the author of The Cultural Transplant, Hive Mind, and 10% Less Democracy.This episode was fun and interesting throughout!He explains:* Why national IQ matters* How migrants bring their values to their new countries* Why we should have less democracy* How the Chinese are an unstoppable global force for free marketsWatch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Timestamps(00:00:00) - Intro(00:01:08) - Migrants Change Countries with Culture or Votes?(00:09:15) - Impact of Immigrants on Markets & Corruption(00:12:02) - 50% Open Borders?(00:16:54) - Chinese are Unstoppable Capitalists (00:21:39) - Innovation & Immigrants (00:24:53) - Open Borders for Migrants Equivalent to Americans?(00:28:54) - Let's Ignore Side Effects?(00:30:25) - Are Poor Countries Stuck?(00:32:26) - How Can Effective Altruists Increase National IQ(00:39:13) - Clone a million John von Neumann?(00:44:39) - Genetic Selection for IQ(00:47:02) - Democracy, Fed, FDA, & Presidential Power(00:49:42) - EU is a force for good?(00:55:12) - Why is America More Libertarian Than Median Voter?(00:56:19) - Is Ethnic Conflict a Short Run Problem?(00:59:38) - Bond Holder Democracy(01:04:57) - Mormonism(01:08:52) - Garett Jones's Immigration System(01:10:12) - Interviewing SBFTranscriptThis transcript was autogenerated and thus may contain errors.[00:00:41] Dwarkesh Patel: Okay. Today I have the pleasure of speaking with Garrett Jones, who is an economist at George Mason University. . He's most recently the author of the Cultural Trans. How migrants make the economies. They move to a lot like the ones they left, but he's also the author of 10% Less Democracy and Hive Mind. We'll get into all three of those books. Garrett, welcome to the podcast. [00:01:06] Garett Jones: Glad to be here.Thanks for having me.[00:01:08] Migrants Change Countries with Culture or Votes?[00:01:08] Garett Jones: Um, [00:01:09] Dwarkesh Patel: first question is, isn't the cultural transplant still a continuation of your argument against democracy? Because the isn't one of the reasons we care about the values of migrants, the fact that we eliminate democracy. So should review this book as part of your critique against democracy rather than against migration specifically.[00:01:27] Garett Jones: Um, well, I do think that, uh, governments and productivity are shaped by the citizens in a nation in, in almost any event. Um, I think that even as we've seen recently in China, even in a very strong authoritarian dictatorship, which some would call totalitarian, even there, the government has to listen to the masses.So the government can only get so far away from the masses on average, even in, uh, an autocracy. If you had [00:01:57] Dwarkesh Patel: to split apart the contribution though, um, the, the impact of migrants on, let's say the culture versus the impact that migrants have on a country by voting in their political system, um, uh, how, how would you split that apart?Is, is the, is mainly the impact we, the cultural impact we see for migration due to the ability of migrants to vote or because they're just influencing the culture just by being [00:02:19] Garett Jones: there? I'll cheat a little bit because we don't get to run experiments on this, so I just have to kind of guess, uh, make an informed guess.I, I'm gonna call it 50 50. Um, so the way people, uh, the way citizens influence a country through formal democracy is important. Uh, but citizens end up placing some kind of limits on the government anyway. And the people in the country are the, they're the folks who are gonna work in the firms and be able to either establish or not establish.Those complicated networks of exchange that are crucial to high productivity. . ,[00:02:52] Mean vs Elite IQ[00:02:52] Dwarkesh Patel: I wanna linger on hive mind a little bit before we talk about the cultural transplant. Um, if you had to guess, does, do the benefits of National IQ come from having a right tail of elites that is smarter or is it from not having that strong of a left tail of people who are, you know, lower productivity, more like markedly to commit crimes and things like that?In other words? Uh, yeah, go ahead. [00:03:14] Garett Jones: Yeah. Yeah. I, I think, uh, the upper tail is gonna matter more than the lower tail, um, in, in the normal range of variation. Uh, and I think part of that is because, uh, nations, at least moderately prosperous nations have found tools for basically reducing the influence of the least informed voters.And for. Uh, basically being able to keep productivity up even when there are folks who are sort of disrupting the whole process. Um, you know, the, the, the risks of crime from the lower end is basically like a probabilistic risk. It's not like it's, it's not like some, uh, zero to one switch or anything. So we're talking about something probabilistic.And I think that, uh, it's the, the median versus the elite is the, is the contrast that I find more interesting. Um, uh, median voter theorem, you know, normal, the way we often think about democracy says that the median should be matter more for determining productivity and for shaping institutions. Um, and I tend to think that that's more important in democracies for sure.So when we look at countries, if you just look at a scatter plot, just look at the raw data of a scatter plot. If you look at the few countries that are exceptions to the rule, where the mean is the mean, IQ is the best predictor of productivity compared to elite iq. Um, . The exceptions are non democracies and South Africa.So you see a few, uh, places in the Gulf where there are large migrant communities who are exceptionally well educated, exceptionally cognitively talented. Um, and that's associated with high productivity. Those are a couple of Gulf states. It's probably cutter, the UAE might be Bahrain in there, I'm not sure.Um, and then you've got South Africa. Those are the, those are the countries where the average test score, it doesn't have to be iq, it could be just Pisa, Tim's type stuff. Um, those are the exceptions to the rule that the average iq, the mean IQ is the best predictor of national productivity. [00:05:14] Dwarkesh Patel: Hmm. Uh, interesting.Um, does that imply the fact that the, um, at least in certain contexts, the elite IQ matters more than the left tail. Does that imply that we should want a greater deviation of IQ in a country? That you could just push a button and increase that deviation? Would that be good? [00:05:33] Garett Jones: No. No, I don't think so. Uh oh.If you could just increase the deviation, um, holding the mean constant. Yeah. Yeah. I think so. In the normal range of variation. Yeah. Yeah. Yeah. So, mm-hmm. , um, is it, and I think that it has more effects. It, no, it's people at the top who are, um, tend to be coming up with, uh, the big breakthroughs, the big scientific breakthroughs, the big intellectual breakthroughs that end up spilling over to the whole world.Basically the, the positive externalities of innovation. This is a very, almost Pollyanna-ish, uh, Paul Roamer new endogenous, new, uh, new growth theory thing, right? Which is the innovations of the elite, a swamp, uh, the negatives of the low skilled among. , [00:06:14] Dwarkesh Patel: can we just apply this line of reasoning to low skilled immigration as well?Then that maybe the average goes down, the average IQ of your country goes down if the, if you just let in, you know, millions of low skilled immigration immigrants, and maybe there's some cultural effects to that too. But, you know, you're also going to the, that the elite IQ will still be preserved and more elites will come in through the borders, along with the low scale migrants.So then, you know, since we're caring about the devi deviation anyways, uh, more immigration might increase the deviation. Uh, and then, you know, the, we just, uh, that's a good [00:06:46] Garett Jones: thing. So notice what you did there is you, you did something that didn't just, uh, increase the variance. You simultaneously increase the variance and lowered the mean Yeah.Yeah. And median, right? And so I think that, uh, hurting the mean and median is actually a big cost, especially in democracies. And so that is very likely to swamp, uh, the benefits of, um, the small, the small probability of getting. Hire elite folks in as part of a low-skilled immigration policy. Mm-hmm. , so pulling down the mean or the median is that that's a, that's that swamps that swamps the benefits of increasing variants there.Yeah. Yes. [00:07:26] Dwarkesh Patel: But if you get rid of their migrant's ability to vote, and I guess you can't do that, but let assume you could do that. Yeah. What exactly is, like, what is the exec mechanism by which the, the, the cultural values or the lower median is impacting the elite's ability to produce these valuable externalities?You know, like there's a standard compared to advantage story that, you know, they'll, they'll do the housework and the cooking for the elites and they can do the more productive [00:07:52] Garett Jones: Yeah. Taking all the institutions as given, which is what a lot of open borders optimists do. They take institutions as given they take cultural norms as given.Um, all that micro stuff works out just fine. I'm totally, I'm totally on board with all that sort of Adam Smith division of labor. Blah, blah, blah. Um, but, institutions are downstream of culture and, uh, cultural norms will be changing partly because of what I call spaghetti theory, right?We meet in the middle when new folks come to a country. There's some kind of convergence, some part where people meet in the middle, um, between the, the values, uh, that were previously existing and the values that have shown up, uh, that migrants have brought with them. So, you know, like I I call it spaghetti theory because, um, when Italians moved to America, that got Americans eating more spaghetti, right?And if you just did a simple assimilation analysis, you'd say, wow, everybody in America eats the same now, like the burgers and spaghetti. So look, the Italians assimilated, but migrants assimilate us. Um, uh, native Americans certainly changed in response to the movement of Europeans. Um, English Americans certainly changed in response to the migration of German and Irish Americans.So this meeting in the middle is something that happens all the time, and not just through Democratic channels, just through the sort of soft contact of cultural norms that sociologists and social psychologists would understand. [00:09:15] Impact of Immigrants on Markets & Corruption[00:09:15] Garett Jones: Um, no, I'm sure you saw the book that was released, I think in 2020 titled, uh, retro Refuse, uh, where they showed, uh, slight positive relationship between, uh, immigration and, you know, pro-market, uh, laws.[00:09:27] Dwarkesh Patel: And I guess the idea behind that is there's selection effects in terms of who would come to a country like America in [00:09:32] Garett Jones: the first place. Well, they never ran the statistical analysis that would be most useful. I think they said that. Uh, so this is Powell and Na Roth Day. Yeah. They ran a statistical analysis that said, and they said, in all of the statistical analysis we've ever run, we've never found negative relationship between low-skilled migration, any measure of it, and changes in economic freedom.And, um, I actually borrowed another one of Powell's data sets, and I thought, well, how would I check this theory out? The idea that changes in migration have an effect on economic freedom? And I just used the normal economist tool. I thought about how do economists check to see if changes in money, changes in the money supply, change the price level.That's what we call the quantity theory, right? Mm-hmm. , the way you do that is on the x-axis. You, you show the change in the money supply On the y axis, you show the change in prices, right? This Milton Friedman's idea. Money's always everywhere. Yeah. Inflation's always neverwhere Montessori phenomenon. So that's what I did.Uh, I did this with a, with a, um, a student. Uh, we co-authored a paper doing this. And the very first statistical analysis we ran, we looked at migrants who came from countries that were substantially more, uh, corrupt than the country's average. And we looked at the, the different, the relationship between cha, an increase in migrants from corrupt countries, and subsequent changes in economic freedom.Every single statistical analysis we found had a negative relationship. , we ran the simplest estimate you could run. Right? Change on change. Change in one thing, predicts change in another. They somehow never got around to running that very simple statistical analysis. CH one change predicts another change.Hmm. We found negative relationships every time. Sometimes statistically significant, sometimes not always negative. Somehow they never found that. I just don't know how . But [00:11:21] Dwarkesh Patel: what about the anecdotal evidence that in the US for example, the, in the periods of the greatest expansion of the welfare state or of governed power during the New Deal or great society, the levels of foreign-born people were at like historical lows.Uh, is that just a coincidence or what, what do you think of? I'm [00:11:38] Garett Jones: not really interested in, uh, migration per se. Right. My story is never that, like migration per se, does this bad thing. Migrants are bad. That's never my story, right? Mm-hmm. , as you know, right? Yeah. Yeah. So my story is that migrants bring, uh, cultural values from their old country to their new country.And sometimes those cultural norms are better than what you've got, and sometimes they're worse than what you've got. And sometimes it's just up for debate. [00:12:02] 50% Open Borders?[00:12:02] Dwarkesh Patel: So if you had to guess what percentage of the world has cultural values that are equivalent to or better than the average of Americas? [00:12:11] Garett Jones: Uh oh.Equivalent to or better then? Yeah. Uh, I mean, just off the top of my head, maybe 20%. I dunno, 30%. I'll just throw something out there like that. Yeah. So I mean, like for country averages, right? Yeah, yeah, yeah, yeah, yeah. Um, [00:12:25] Dwarkesh Patel: currently we probably don't have, uh, it would probably be hard for like 20% of the rest of the world to get into the us.Um, w w would you support some, uh, PO policy that would make it easy for people from those countries specifically to get to the us? Just, uh, have radical immigration liberalization from those places? [00:12:44] Garett Jones: Um, that's really not my comparative advantage to have opinions about that, but like, substantial increases of people who pass multiple tests, like, let's take the low hanging fruit and then move down from there.Right? So people from, uh, countries, uh, that ha um, on average have say higher savings rates, um, higher, uh, education levels. Higher s what I call s a t, deep root scores and, um, countries that are, say half a standard deviation above the US level on all three, [00:13:18] Dwarkesh Patel: right? Why do they have to be higher? Why not just equivalent, like, uh, you get all the gains from trade and plus it can't be, you know, equivalent.So it's, there's no [00:13:27] Garett Jones: trade. Part of the reason is because the entire world depends on US innovation. So we should make America as good as possible, not just slightly better than it is. So very few firms would find that their optimal hiring policy would be hire anyone who's better than your current stock of employees.Would you agree with that? [00:13:42] Dwarkesh Patel: Yeah. But you, uh, have to pay them a salary. If you're just, uh, if it's just somebody just comes to the us, you don't have to like pay them a salary, right? So if somebody is better, that, if somebody's producing more value for a firm than the salary would pay them, I think [00:13:52] Garett Jones: like is is a firm's job to maximize its profits or to just make a little bit more than it's making right?Maximize profits. But yeah, there you go. So you pack, you find the best people you can, you know, sports teams that are hiring don't just say, we wanna hire people who are better than what we got. They say, let's get the best people we can get. Why not get the best? That was Jim Jimmy Carter's, that was Jimmy Carter's, uh, biography.Why not the best. But you, [00:14:16] Dwarkesh Patel: you can do that along with getting people who are, you know, unexpected, uh, terms as good as the existing Americans. Why gives [00:14:24] Garett Jones: y'all like, I don't care what you, why you want this? This seems like crazy, right? What are you talking about? But [00:14:29] Dwarkesh Patel: I, I'm not sure why not the best what the trade out there, huh?No, I'm not saying you don't get the best, but I, I'm saying once you've gotten the best, what is the harm in getting the people who have equivalent s a t scores and, and the rest of the things you [00:14:41] Garett Jones: mentioned. I think part of the reason would be you'd wanna find out, I mean, if you really wanna do something super hardcore, you'd have to find out what's best for the planet as a whole.What's the trade off between, um, Having the very best, uh, most innovative, talented, frugal people in America doing innovating that has benefits for the whole world, versus having an America that's like 40% better, but we're the median's a little bit, the median of skills a little bit lower. Right. Uh, because the median's shaping the productivity of the whole team.Right? Yeah. This is what you, you know what it means when you believe in externalities, right? [00:15:14] Dwarkesh Patel: But if you have somebody who's equivalent by definition, they're not moving the median down. [00:15:19] Garett Jones: That's, you're, you're totally right about that. Yeah. But like, why wouldn't I want the best thing possible? Right. Okay.I'm still trying to figure out why you wouldn't want the best thing possible. You're trying to go, why? I don't want the best thing possible. I'm like, why not? [00:15:31] Dwarkesh Patel: I'm not disagreeing with you. I'm just, I'm a little bit confused about why that that precludes you from also getting the second best thing possible.At the same time you're, because you're not limited to just the best. [00:15:42] Garett Jones: Right. Well, uh, because the second best is going to have a negative externality on the first best. Everything's externalities. This is my worldview, right? Everything's externalities. You bring in the second best, you're like, you're not, that person's gonna make things on average a little worse for the first best person.[00:16:00] Dwarkesh Patel: But it seems like you were explaining earlier that the negative externalities are coming from people from countries with, uh, low s a t scores. And by the way, s a t you can explain what that means just for the audience who's not familiar with how you're using that term. [00:16:11] Garett Jones: Oh yeah. So, um, there, there are three prominent, uh, measures in what's known as the deep roots literature and, uh, that are widely used.Uh, two are s n a, that state history and agricultural history. That's how many thousands of years your ancestors have had experience living under organized states or living unsettled agriculture. And then the T-score is the tech history score. I used the measure from 1500. It's basically what fraction of the world's technology were your ancestors using in 1500 before, uh, Columbus and his expansive conquest ended up upending the entire world.Uh, the world map. So s a and T are all predictors of modern prosperity, but especially when you adjust for migration. [00:16:54] Chinese are Unstoppable Capitalists [00:16:54] Garett Jones: Gotcha. [00:16:55] Dwarkesh Patel: We can come back to this later, but one of the interesting things I think from the book was you have this chapter on China and the Chinese people as a sort of unstoppable force for free market capitalism.Mm-hmm. . Um, and it's interesting, as you mentioned in the book, that China is a poorest majority Chinese country. Um, what do you think explains why China is a poorest, uh, majority Chinese country? Maybe are there like non-linear dynamics here where, uh, if you go from 90 40 to 90% Chinese, there's positive effects, but if you go from 90 to 95% Chinese, there's too much?[00:17:26] Garett Jones: No, I think it's just, I think just communism is dumb and it has terrible, like sometimes decades long effects on institutional quality. I don't really quite understand. So I'd say North Korea, if we had good data on North Korea, North Korea would be even a bigger sort of deep roots outlier than China is.Right? It's like, don't, don't have a communist dictatorship in your country. Seems to be pretty, a robust lesson for a national prosperity. China's still stuck with a sort of crummy version of that mistakes still. North Korea, of course, is stuck with an even worse version. So I think that's, I, my hunch is that that's, you know, the overwhelming issue there.Um, it's, it's something that, it's, it's sort of a China's stuck in an ins. Currently China's stuck in an institutional cul-de-sac and they just don't quite know how to get out of it. And it's, uh, bad for a lot of, for the people who live there. On average, if the other side had won the Chinese Civil War, things would probably be a lot, lot better off in China today.Yeah. [00:18:22] Dwarkesh Patel: Um, but what, what is that suggestion about the deep roots literature? If the three biggest countries in the world, China, India, and America, Um, it, it, it under predicts their performance, or sorry, in the case of China and India, it, uh, it, it over predicts their performance. And in the case of America, it under predicts maybe the, how, how reliable is this if like the three biggest countries in the world are not, uh, adequately accounted for?[00:18:45] Garett Jones: Uh, well, you know, communism's a really big mistake. I, I think that's totally accounted for right there. Um, I think India's underperformance isn't that huge. Um, the US is a miracle along many ways. Um, it's, we should draw our lessons from the typical country, and I think, uh, population weighted estimates, I don't think that basically one third of the knowledge about the wealth of nations comes from the current GDP per capita of China, India, and the us, right?I think much less than one third of the story of the wealth of nations comes from those three. And, uh, again, in, in all three cases though, if you look at the economic trajectories of all three of those people, oh, all three of those countries, uh, they're all, uh, China and India growing faster than you'd expect.And also, I wanna point out. This is the most important point actually. Um, when we look at, uh, when Kaplan made this claim, right? Brian Kaplan has made this claim, right? Yeah. That the SATs, that the ancestry scores, the deep root scores don't predict, um, the prosperity of, uh, the, the low performance of Indian China.He only checked the S and the A and the s a T scores. Okay. Which letter did he not predict? Which letter did he never test out? He never tested the T. What do you think happens when he tests the T? Does it predict, uh, China [00:20:02] Dwarkesh Patel: and India and America, [00:20:03] Garett Jones: Hey, start, they t goes back to being statistically significant again, UhhuhSo with T, which we've always known is the best of the deep root scores, somehow Kaplan never managed to measure that one. Just as Powell Naste never managed to run the simplest test change in, uh, migrant corruption versus change in economic institutions somehow, like the simplest test just never get run.[00:20:26] Dwarkesh Patel: Okay. And then what is the impact if you include t. If you, [00:20:29] Garett Jones: if you, if you look at tea, then, um, then, uh, contrary to what Kaplan says, uh, the deep roots, that deep roots measure is sig statistically significant. [00:20:38] Dwarkesh Patel: Okay. Um, yeah, I, [00:20:40] Garett Jones: interesting. The puzzle goes away, [00:20:42] Dwarkesh Patel: interesting. [00:20:43] Garett Jones: Um, yeah. So somehow these guys just never seem to run like the simple things, the transparent things.I don't know [00:20:49] Dwarkesh Patel: why the, um, the weird, huh? The, the, the one you mentioned from, what was it Nassa, the name of the guy who wrote the Richard at re refuse [00:20:57] Garett Jones: the Yeah, yeah. Powell Naste. [00:20:59] Dwarkesh Patel: Yeah. Yeah. That you said you did the regression on institutional corruption, uh, and from the countries to come from. Is that, was that right?I, [00:21:06] Garett Jones: and so yeah. The, the measure they use, I just took, I took Powell's dataset from another study, and it was the percent. Of it was basically, um, the percentage of your nation's population, the percentage increase in your nation's population from relatively poor or corrupt countries. They had multiple measures, UhhuhSo, and what is on the y axis there? Y axis is change in economic freedom. That's my preferred one. Gotcha. There's also a change in corruption one, which is a noisier indicator. Um, you get much clearer results with change in economic freedom, so. Gotcha, [00:21:38] Dwarkesh Patel: gotcha. [00:21:39] Innovation & Immigrants [00:21:39] Dwarkesh Patel: Um, now does the ideas getting harder to find stuff and great stagnation, does that imply we should be less worried about impinging on the innovation engine in these, uh, countries that people might wanna migrate to?Because worse comes to worst. It's not like there are a whole bunch of great new theories that were gonna come out anyways. [00:21:58] Garett Jones: Uh, no. I think that, I think that it's always good to have great things, um, and new ideas. Yes, new ideas are getting harder to find, but, um, that, but that the awesome ideas that we're still getting are still worth so much.Right. If we're still increasing lifespan a month, a year, uh, for every year of research we're doing, like, that just seems great. Right? A decade that adds a year to life, so, mm-hmm. , just to use a rough, uh, ballpark measure there. But, so we [00:22:25] Dwarkesh Patel: have a lot of these countries where a lot of innovation is happening.So let's say we kept, uh, one or two of them as, you know, immigrate, uh, havens from any potential, uh, downsides, from radical changes. You know, we already had this in the case of Japan or South Korea, there's not that much of migration there. Mm-hmm. . What is, what is a harm in then using the other ones to decrease global poverty by immigration or something like [00:22:48] Garett Jones: that?Well, um, it's obviously better to create a couple of innovation powerhouses, um, rather than none. Right? So obviously that's, that's nice. But instead, I would prefer to have, um, open borders for Iceland if the Open borders advocates are right and open borders. , we'll have no noticeable effect on institutional quality, then it's great to move, , to have our open borders experiment run in a country that's lightly populated, has a lot of open land, and, um, has good institutional quality.And Iceland fits the bill perfectly for that. So we could preserve the institutional innovation skill, uh, the institutional quality of the, the what I call the I seven. Uh, that's, you know, China, Japan, South Korea, the us, Germany, uk, France, and choose any country out of the a hundred, out of the couple of dozen countries that have good institutional quality.Just pick one of the others that aren't one of those seven, pick one that's not an innovation powerhouse and turn that into your open borders, uh, country. Um, you could, uh, if you wanted to get basically Singapore levels of population density in Iceland, that'd be about 300 million people, I think. I think I, that's about what the numbers end up looking like.Something like that. But [00:24:00] Dwarkesh Patel: the, so you can put entire, but, but the value of open borders comes from the fact that you're coming to a country with high conglomerations of talent and capital and other things, which is, uh, not true of Iceland. Right. So isn't the entire [00:24:13] Garett Jones: No, no. I thought the whole point of open borders, that there's institutional quality and there's some exogenous institutions that make that place more productive than other places.Mm-hmm. . And so by move, I, I, that's my version of what I've been exposed to as open borders, the, is that institutions exogenously exist. There's some places have, uh, moderately laissez, fairer institutions in their country and moving a lot more people there will not reduce the productivity of the people who are currently there, and they'll become much more productive.And so, like the institu, you know, the institutional quality's crucial. So, I mean, if you're a real geography guy, you'd be excited about the fact that Iceland is so far, so close to the north. because latitude is a predictor of prosperity. [00:24:53] Open Borders for Migrants Equivalent to Americans?[00:24:53] Dwarkesh Patel: Um, I want to go back to the thing about, well, should we have open border for that 20% of the Popula global world's population that comes from Yeah.Um, equivalent, s a t and other sort of cultural traits as America. Mm-hmm. , because I feel like this is important enough to dwell on it. You know, it seems similar to saying that once picked up a hundred dollars bill on the floor, you wouldn't pick up a $20 bill on the floor cuz you only won the best bill.Uh, the $20 bills is right there. Why not pick it up? Um, [00:25:18] Garett Jones: so what if you have, yeah. What if the $20 bill makes your, turns, your, uh, a hundred dollars bill into like an $80 bill and turns all of your 80 a hundred dollars bills and $80 bills. [00:25:27] Dwarkesh Patel: But is it, aren't your controlling for that by saying that they have equivalent scores along all those cultural tests that you're.[00:25:34] Garett Jones: No, because, um, the median, so, so take the simple version of my story, which is the median of the population ends up shaping the productivity of everybody in the country. Right? Or the mean, right? The mean skill level ends up shaping the productivity of the entire population. Right? So that means we end up, I mean, I, I try not to math this up.I don't wanna math this up for the, you know, in a popular book, but it means we face a trade off between being small, a small country with super awesome, uh, positive externalities for all the workers by just selecting the best people. And every time we lower the average skill level in the country, we're lowering the average productivity of everyone else we're creating.We didn't, [00:26:11] Dwarkesh Patel: what? We didn't lower it. So you have to have skills that are lower compared to, than the median of a median American. You, [00:26:18] Garett Jones: so this is, this is a c Paraba story, right? Like if you could suppose the US is at 80 now on a zero to a hundred scale, right? Just, just saying it's 80. Yeah. Yeah. And you have a choice between being hundred and being 99.if you're at 99, the 99 is making, all compared to the world of average of a hundred, the world of an average 99 is making, reducing the productivity of all those hundreds. Okay. So if we chose 90, we're reducing the productivity of all those hundreds. [00:26:48] Dwarkesh Patel: Yes. Okay. So let's say we admit all the smartest people in the world, and that gets us from 80 to 85.That's a new, that's a new media in America. Yeah. At that point. And, but this is because we've admitted a whole bunch of like 90 nines that have just increased our average. Yeah, yeah. Um, at that point, open borders for everybody who's ever been 85, [00:27:08] Garett Jones: like I, this is, this is, ends up being a math problem. It's a little hard to solve on a podcast, right?Because it's the, it's the question of do I want a smaller country with super high average productivity? Or a bigger country with lower average productivity. And by average productivity, I don't just mean, uh, uh, a compositional effect. I mean negative external, I mean relatively fewer positive externalities.So I'll use the term relatively fewer positive externalities rather than negative externalities, right? So like, I don't exactly know where this is. Trade off's gonna pan out, but, um, there is a case for a sort of Manhattan when people talk about a Manhattan project, right? They're talking about putting all like a small number of the smartest people in a room.And part of the reason you don't want like the 20th, smartest person in the room. Cause, cuz that person's gonna ruin the ruin stuff for our, for the other smart people. I, it's amazing how your worldview changes when you see everybody as an external. I, [00:28:02] Dwarkesh Patel: I'm kind of confused about this because just having, at some point you're gonna run outta the smartest people, the remainder of the smartest people in the world.If you've admitted all the brilliant people. Yeah. And given how big the US population is to begin with, you're not gonna change the median that much by doing that. Right. So it's, it's almost a global end to just having more births from the average American. Like if, if the average American just had more kids, the population would still grow.Mm-hmm. and the relative effect of the brightest people might dilute a little bit. Um, but I I, [00:28:33] Garett Jones: and that maybe that's a huge tragedy. We don't know without a bunch of extra math and a bunch of weird assumptions. We don't know. So like I'm, there's a point at which I have to say like, I don't know. Right. Okay.Yeah. Uh, yeah. Is diluting the power of the smartest person in America, like keeping us from having wondrous miracles all around us all the time? I mean, probably not, but. I don't know, [00:28:53] Dwarkesh Patel: but, [00:28:54] Let's Ignore Side Effects?[00:28:54] Dwarkesh Patel: but I guess the sort of the meta question you can ask about this entire debate is, listen, there's so much literature here and it's hard to tell what exactly will happen.You know, it's possible that culture will become worse. It's possible, it'll become better. It's possible to stay the same, given the fact that there's this ambiguity. Why not just do the thing that on the first order of effect seems good? And, you know, just like moving somebody who's like in a poor country to a rich country, first order effect seems good.I don't know how the third and fourth order effect shapes out. Let's just, you know, let's just do the simple obvious thing. [00:29:22] Garett Jones: I, I thought that the, one of the great ideas of economics is that we have to worry about secondary and tertiary consequences. Right? [00:29:28] Dwarkesh Patel: But if, if we, if we can't even figure out what they are exactly, why not just do the thing that at the first order seems, uh, good.[00:29:35] Garett Jones: Um, because if you have a compelling reason to think that the, uh, direction of strength of the second and third and fourth order things are negative and the variances are really wide, then you're just adding a lot more uncertainty to your outcomes. So, And adding uncertainty or outcomes that has sizable negative tail, especially for the whole planet.Isn't that great? Go ahead and run your experiments in Iceland. Let's run that for 50 years and see what happens. It's weird how everybody's obsessed with it running the experiment in America, right? Why not running in Iceland first? Because America's [00:30:05] Dwarkesh Patel: got a great, a lot of great institutions right there.We can check and see what [00:30:08] Garett Jones: Iceland Iceland's a great place too. Um, and I use Iceland as a metaphor, right? Like it's, people are obsessed with running it in America. Like there's some kind of need. I don't know why. So let's try in France. Um, let's try, let's try Northern Ireland. , [00:30:24] Dwarkesh Patel: uh, are,[00:30:25] Are Poor Countries Stuck?[00:30:25] Dwarkesh Patel: are places with low s a t scores and again, s a t we're not talking about the, uh, in case you're skipping to the timestamp, we're not talking about the college test.Um, the deep roots. [00:30:35] Garett Jones: S a t Exactly. Uh, state history, agricultural history, tech history. [00:30:38] Dwarkesh Patel: Right. Exactly. Are, are those places with, uh, low scores on, um, on that test? Are they stuck there forever? Or, uh, is there something that can be done if you are a country that has had a short or not significant history of, um, technology or agriculture?[00:30:56] Garett Jones: Well, the, I start off the book with this, which I really think that, uh, one thing they could do is, uh, create a welcoming environment for large numbers of Chinese migrants to move there persistently. I don't think that's of course the only thing that could ever work, but I think it's something that's within the range of policy for at least some poor countries.I don't know which ones, but, uh, some poor countries could follow the. Approach that many countries in Southeast Asia followed, which has created an environment that's welcoming, welcoming enough to Chinese migrants. Um, it's the one country in the world with large numbers of high s a t score, uh, with alar, with a high s a T score culture, large population.It's enough of an economic failure, so for at least a little longer that, uh, folks can, might be able to be interested in moving to a poor country with lower s a t scores. In a better world, you can do this with North Korea too, but the population of North Korea isn't big enough to make a big dent in the world, right?Mm-hmm. , uh, China's population is big enough. Yeah. [00:31:54] Dwarkesh Patel: Another thing you're worried have to worry about in those cases though though, is the risk that if you do become successful in that country, there's just gonna be a huge backlash and your resources will. AppD, like what happened famously. [00:32:05] Garett Jones: So in, in Indonesia, right?Yeah. There have been many Oh, yeah, yeah. Times across Southeast Asia where anti-Chinese pogroms have been, um, uh, unfortunately a fact of life. So, yeah. Yeah. [00:32:15] Dwarkesh Patel: Or Indians in Uganda under, uh, IDI. I, I mean, yeah. Yep. Um, yeah. Yeah. Uh, okay. So actually I, I'm curious how you would think about this given the impact of National iq.[00:32:26] How Can Effective Altruists Increase National IQ[00:32:26] Dwarkesh Patel: Um, if you're an effective altruist, what, uh, are you just, uh, handing out iodine tablets, uh, across, across the world? What, what are you doing to increase national [00:32:34] Garett Jones: iq? Yeah. This is places, this is something that I, yes. Uh, finding ways I, this is what I call a, a Flynn cycle. Like I wish, I'm hoping for a world where there are enough public health interventions and probably K through six education interventions.to boost test scores in the world's poorest countries. And I think that ha ends up having, um, uh, a virtuous cycle to it, right? As people get more productive, then they can afford more public health, which makes them more productive, which means they can afford more public health. I think brain health is an important and neglected part of child development.Um, fortunately we've done a fair amount to reduce the amount of environmental lead, um, in a lot of poor countries. That's probably having a good effect right now as we speak in a lot of the world's poorest countries. You're right. Um, iodine, basic childhood nutrition, uh, reliable healthcare, uh, to, you know, prevent the worst kinds of just mild childhood infections that are probably, uh, creating what the, what they, what economists sometimes call health.Things that end up just hurting you in a way that causes, uh, an ill-defined long-term cost. A lot of that's gonna have to show up in the, in the brain. Um, I'm a big fan of the, of the view that part of the Flynn Effect is, uh, basically nutrition and health. Mm-hmm. , uh, Flynn wasn't a huge believer in that, but I think that's, um, certainly important in the poorest countries.Yeah. [00:33:57] Dwarkesh Patel: Um, I, I think Brian showed an open voters that if you look at , the, um, IQ of adoptees from poor countries, um, who go, uh, Sweden is the only country that collects data, but if you get adopted by a parent in, um, uh, Sweden, uh, the, the half the gap between the averages of two countries, half gap, yeah, yeah, yeah, yeah.Goes away. So, I mean, is one of the ways we can increase global IQ just by moving kids to, uh, countries with good health outcomes that, uh, will nourish their [00:34:27] Garett Jones: intelligence. Well, that's a classic short run versus long run effect, right? So, uh, libertarians and open borders advocates tend to be focused on the short run, static effects.So, um, and so you're right, moving kids from poor countries to richer countries is probably gonna raise their test scores quite a lot. And, uh, then the question is, in over the longer run, are those, uh, lower skilled folks, the folks with lower test scores, uh, going to degrade the institutional quality? of the places they move to, right?So if you close half the gap between the poor country and the rich country, half the gap is still there. Right? And if I'm right, , that IQ has big externalities then, , moving people from a, uh, lower scoring country to a richer scoring country and closing half the IQ gap still means on net you're creating a negative externality in the country the kids are moving to.[00:35:17] Dwarkesh Patel: Um, yeah, yeah. Uh, we can come back to that, but yeah. Yeah. So [00:35:23] Garett Jones: it, it's, it's basically, you just look at the question, is this lowering the mean test scores in your country? And if it's lowering the mean test scores in the long run, it's on average gonna lower institutional quality productivity savings rates, those.Um, it's hard to avoid that. It's hard to avoid that outcome. So, uh, I don't [00:35:38] Dwarkesh Patel: remember the exact figures, but didn't Brian address this in the book, um, in the Open Borders book as well, that you can, even if there's a, the, a national iq, uh, lowers on average, if you're just, uh, if you're still raising the global iq, that, that it's still nets out positive, or am I [00:35:54] Garett Jones: remembering that wrong?Well, that, notice what he's, he, what he does is he attributes, uh, he says there's some productivity that's just in the land, that's just geographic factors. Yeah. So basically being close for, and so that, so basically moving people away from the equator boost productivity substantially. And again, that's, uh, a static result.Um, the reason I, uh, I mentioned that ignores all the I seven stuff that I'm talking about where anything that lowers. Um, level of innovation in the world's most innovative countries has negative costs for the entire planet in the long run, but that's something you'd only see over the course of 20, 30, 50 years.And libertarians and open border advocates are very rarely interested in that kind of [00:36:33] Dwarkesh Patel: timeframe. Is there any evidence about, uh, the impact of migration on innovation specifically? So not on the average institutional quality or on, you know, uh, the, the corruption or whatever, but like, just directly the amount of innovation that happens or maybe the Noble Prizes won or things [00:36:48] Garett Jones: like that?Um, no. I mean, I would presume, I think a lot of us would presume that, uh, the European invasion of North America ended up having, uh, positive effects for global innovation. It's not an invasion that I'm in favor of, but if you wanna talk crudely about Yeah, yeah. Whether migrations had an effect on innovation, uh, you'd probably have to include that as any kind of analysis.[00:37:07] Dwarkesh Patel: Yep. Yep. , do you think that the people who are currently Americans, but , their ancestry, traces back to countries with low s a t scores? I i, is it possible that US GDP per capita would be higher, without that contribution?Or how do you think about that? [00:37:21] Garett Jones: I mean, that it follows from thinking through the fact that we are all externalities positive or negative, right? I don't know what in, in any particular, any one particular country could turn out to be some exciting exception to the rules, some interesting anomaly. Um, but on average, we should presume that the average skill level of voters, the average, uh, traits that we're bringing from, uh, the nations, that the nations of our, of our ancestors are as having an effect on our current productivity for gut ori.So just following through the reasoning, I'd have to say on average, that's most likely. Uh, but it, there could always be exceptions to the rule. [00:37:56] Dwarkesh Patel: I guess we see large disparities in income between different ethnic groups across the world, not just in the United States. Yeah. Doesn't that suggest that some of the gains can be privatized from whatever the cultural or other traits there are? Cuz if these, if over decades and centuries these sorts of, uh, these sorts of gaps continue, [00:38:18] Garett Jones: I don't see why that would follow.Right. Um, [00:38:21] Dwarkesh Patel: uh, if everything is being, if all the externalities are just being averaged out over time, what did you expect that these GA gaps would [00:38:29] Garett Jones: narrow? Well, I mean, I'm being a little rhetorical when I'm saying everything's literally an externality, right. I don't literally believe that's true. Um, for instance, people with higher education levels do actually earn more than people with lower education levels.So that's literally not an externality. Right. So some of these other cultural traits that people are bringing with them from their, um, ancestors, nations of origin, um, could be one or one likely one source of these income differences. I mean, if you think about differences in frugality, uh, differences in personal responsibility, which show up in the surveys, uh, that are persistent across generations, those are likely to have an effect on long run productivity for you, yourself and your family.So, mm-hmm. , let alone the hive mind stuff, where you find that there's a positive relationship between test scores and, and product. [00:39:13] Clone a million John von Neumann?[00:39:13] Garett Jones: There was a [00:39:14] Dwarkesh Patel: blogger who took a look at your 2004 paper about the, um, impact of National IQ on, um, on G uh, G D P. Um, and they calculated, so they were just speculating. Let's say you cloned a million John Mond Nomans, and as assume that John Mond Noman had an IQ of 180, then you could, uh, let me just pull up the exact numbers.You could, um, you could raise the average IQ of the United States by 0.21 points, um, and if it's true that one IQ point contributes 6% to, uh, G increasing G, then this proposal would increase U US GDP by, uh, 1.2, uh, six two 6%. Do you buy these kinds of extrapolations or 1.26%? Yeah. Yeah, because you're only cloning a million, [00:39:58] Garett Jones: Jon.Oh, yeah. Yeah. Okay. So this is about 1 million Jon. Yeah. Yeah, that sounds. I mean, that's the kind of thing where I wouldn't expect it to happen overnight. Right. I tend to think of that, uh, the IQ externalities as being two, three generations. I, I lump it in with what economists call organizational capital.That sounds about right. Yeah. Yeah, yeah. I mean, I, I can't remember where I saw this. I think I, I stumbled across it myself at some point too, so. [00:40:19] Dwarkesh Patel: Yeah. Yeah. Uh, by the way, his name is Avaro Dam Bernard, if you wanna [00:40:22] Garett Jones: find it. Oh, okay. Yes, yes. Okay. Yeah, it's, I mean, in, in, it's in that ballpark, right? It's just this idea that, and, and more importantly, um, a million John Bon Nomans would be a gift to the entire planet, right?Yep. Yep, yep. So, yeah, if you had a, if you had a choice of which country to have the John Vno, the million John Von Nomans, uh, it's probably gonna be one of the I seven maybe there's, maybe there's a, maybe Switzerland would be a good alternative. [00:40:46] Dwarkesh Patel: What is the optimal allocation of intelligence across the country?Because one answer, and I guess this is the default answer in our society, is you just send them where they can get paid the most, because that's a good enough proxy for how much they're contributing. Yeah. And so you have these high glomeration of talent and intelligence in places like Silicon Valley or New York.Um, and, you know, because their contributions there can scale to the rest of the world. This is actually where they're producing the most value. Another is, you know, you actually, you should disperse them throughout the country so that they're helping out communities. They're, you know, teachers in their local community.Um, I think there was, uh, A result. There was an interesting anecdotal evidence that during the Great Depression, the crime in New York went down a ton, and that was because the cops in New York were able to hire the, you know, they had like a hundred applications for every cop they hired. And so they were able to hire the best and the brightest, and there were just a whole bunch of new police tactics and every that were pioneered at the time anyways.So, is the market allocation of intelligence correct? Or do you think there should be more distribution of intelligence across the country? How do you think about that? [00:41:50] Garett Jones: Yeah, I mean, the mar the, the market signals aren't terrible. Uh, but, uh, this is my, my Interpol Roamer kicks in and says, uh, innovation is all about externalities.And there's market failures everywhere when it comes to, in the fields of innovation. Mm-hmm. . And so, you know, I, I personally, I mean, I, I like the idea of finding ways to allocate them to, to stem style, stem style technical fields, and. , we do a fair amount of that, and maybe we do the, maybe the US does a pretty good job of that.I don't have any huge complaints at that, at the, at the crudes 50,000 foot level, um, for the, you know, the fact that people know that there's, uh, status games they can play within academia that are perhaps more satisfying or at least as satisfying as the sort of corporate hierarchy stuff. So, yeah. Yeah. I I You don't want 'em all just, I wouldn't encourage them to solely follow market signals.Right. I'd, I'd encourage them to be more HandsOn and, uh, play a variety of status games because the academic, um, and intellectual status game is worth a lot, both personally and than it leads to positive spillovers for. [00:42:58] Dwarkesh Patel: But how about the geographic distribution? Do you think that it's fine that there's people leave, uh, smart people leave Kentucky and go to San Francisco or, yeah, [00:43:08] Garett Jones: I'm a big glomeration guy.Yeah. I'm, I'm, yeah, I'm a big glomeration guy. Yeah. I mean, the internet makes it easier, but then like, still being close to people's, being in the room's important. Um, there, there's, there's something, uh, both HandsOn and Gerard in here about, like, we need to find role models to imitate, and that's probably important for productivity.[00:43:30] Dwarkesh Patel: Um, are there increasing or decreasing returns to National iq?No, [00:43:38] Garett Jones: I think, um, you know, my findings were that it was all basically log linear. And so log linear looks crudely, like increasing returns. . So yeah, it looks exponential, right? So yeah, there's increasing returns to National iq. Yeah. Are are you? But, but this is, this is a commonplace finding in a sense because so many, uh, like human, all the human capital relationships I'm familiar with end up having something like a log linear form, which is exponential.So why is that? Um, yeah, there's something multiplicative that that's how, what I have, that's all I have to say is like it's something. Somehow this all taps into Adam Smith's pin factory, and we have multiplicative not additive effects when we are increasing brain power.Um, I have, I suspect it does have something to do with, uh, a, a better organization of the division of labor between people, which ends up happening something close to e to, uh, exponential effects on productivity. [00:44:39] Genetic Selection for IQ[00:44:39] Garett Jones: A are, uh, are you a fan of genetic selection for intelligence, uh, as a means of increasing national iq or do you think that's too much playing at the margins if it's voluntary?I mean, people should be able to do what they want and, um, after a couple day decades of experimentation, I think people would end up finding a path to, uh, government subsidies or tax credits or something like that. I think people voluntarily deciding what kind of kids they want to have. is a, a, a good thing.And so by genetic selection, I assume you're meaning at the most elementary level people testing their embryos the way they do now, right? Yeah. So I mean, we, we already do a lot of genetic selection for intelligence. Um, anybody, you know, who's, uh, in their mid thirties or beyond who's had amniocentesis, they've been doing a form of genetic selection for intelligence.So it's a widespread practice already in our culture. Um, and, uh, welcoming that in a voluntary way is probably going to have good effects for our future. What [00:45:40] Dwarkesh Patel: do you make of the fact that G B T three, or I think it was Chad g p t, had, uh, measured IQ of 85? Yeah, [00:45:47] Garett Jones: I've seen a few different measures of this, right?You might have seen multiple measures. Um, yeah, I think it's, I think it's a sign that basically, and, and when you see people using non IQ tests to sort of assess the outputs of G P T on, um, long essays, it does does seem to fit into that sort of, not quite a hundred, but not, not off by a lot. Yeah. I mean, I think it's, I think it's a sign that a lot of, uh, uh, mundane, even fairly complex, moderately complex human interactions can be simulated by a large, uh, language learning model.Mm-hmm. . And I think that's, that's, uh, gonna be rough news for a lot of, uh, people whose life was in the realm of words and dispensing simple advice and solving simple problems. That's pretty bad news for their careers. I'm, I'm disappointed hearing that, so [00:46:36] Dwarkesh Patel: Yeah. Yeah. [00:46:37] Garett Jones: Um, at least for the transition. I dunno what the, I dunno what's gonna happen after the transition, but [00:46:41] Dwarkesh Patel: Yeah.I'm hoping that's not true of programmers or economists. I like you. I mean, [00:46:46] Garett Jones: it might be right. I mean, it's, if that's the way it is, I mean, I, the, I mean, the car put a lot of, uh, people who took care of horses right out of outta work too, so. [00:46:55] Dwarkesh Patel: Yep. Um, even, okay, so let's talk about democracy that I thought this was also one of your really interesting books.No, thanks. Yeah. [00:47:02] Democracy, Fed, FDA, & Presidential Power[00:47:02] Dwarkesh Patel: even controlling for how much democratic oversight there is of institutions in the government. There seems to be a wide discrepancy of how well they work. Like the Fed seems to work reasonably well. I, I, I don't know enough about macroeconomics to know how the object level decisions they make, but mm-hmm.you know, it seems to be a non-corrupt, like, uh, technocratic organization. Um, enough, but yeah. Yeah. Uh, if you look at something like the fda, it's also somewhat insulated from democratic processes. It seems to not work as well. Mm-hmm. , what determines controlling food democracy? What controls, what, what determines how well an institution in the government works?[00:47:38] Garett Jones: Well, I, I think, um, in the case, the Fed, it really does matter that they, uh, the people who run it have guaranteed long terms and they print their own money to spend mm-hmm. . So that means that they're basically, Congress has to really. Make an effort to change anything of the Fed. So they really have the kind of independence that matters.Right. You know, they have a room of their own. And, uh, the FDA has to come to Congress for money more or less every year. And the fda, uh, heads do not have any kind of security of appointment. Their appoint, they serve at the pleasure of the president. Mm-hmm. . So I do think that they don't have real independence.Uh, I do think that they're basically, um, they're living in this slack, this area of slack to use this sort of mcno gas PolySci jargon. They're living in this realm of slack between the fact that the president doesn't wanna me, uh, muddle with them, uh, metal with them, excuse me. And the fact that Congress doesn't really wanna medal with them.But on the other hand, , I really think that that the f d A and the C d C are doing what Congress more or less wanted them to do. They reflect, they reflect the muddled disarray that Congress was in over the period of say, COVID. Hmm. Uh, that I think that's a first order importance. I mean, I do think the fact, it's the fact that, uh, f d A and c d C don't ha, uh, seem to have that culture of, um, raw technocracy the way the Fed does that, I think that has to be important on its own.But I think behind that, some of that is just like F D A C D C creatures of Congress much more than the Fed is. Should the [00:49:17] Dwarkesh Patel: power of the president be increased? [00:49:20] Garett Jones: Uh, no. No. Like the power of independent committees should be increased. Like more Congress should be like the Fed. If, uh, my plan for a Fed re for an FDA or CDC reorganization would be.Making them more like the Fed, where they have appointed experts who have long terms and they have enough of a long term that they can basically feel like they can blow off Congress and build their own culture. [00:49:42] EU is a force for good?[00:49:42] Dwarkesh Patel: Mm-hmm. , , so the European Union is an interesting example here because they also have these appointed technocrats, but they seem more interested in creating anno annoying popups on your websites than with dealing with econo, the, you know, the end of economic growth on the continent.Is this a story where more democracy would've helped, or how do you think about the European Union in this context? [00:50:04] Garett Jones: No. And the eu, like, uh, the European, European voters just aren't that excited about democracy. I, excuse me, aren't that excited about markets overall. The EU is gonna reflect that, right? Um, what little evidence we have suggests that, uh, countries that are getting ready to join the eu, they improve their economic freedom scores, their sort of laissez fairness.Hmm. Uh, on the path to getting ready for. , uh, join an eu. So, and then they may increase it a little bit afterwards once they join. But basically it's like, it's like, uh, when you're deciding to join the eu, it's like you decided you have your rocky training montage and get more laissez-faire. And so EU on net is a mess at polls in the direction of markets compared to where, uh, Europe would be otherwise.I mean, just look at the nations that are in the EU now, right? A lot of them are, um, east of Germany, right? And so those are countries that don't have this great, you know, uh, history of being market friendly. And a lot of parties aren't that market friendly, and yet the EU sort of nags them into their version, like as much markets as they can handle.So [00:51:05] Dwarkesh Patel: what do you think explains the fact that the Europe, uh, Europe as a whole and the voters in there are less market friendly than Americans? I mean, if you look at the sort of deep roots analysis of Europe, you would think that they should be the most. Uh, most in favor of, I don't know if the deep roots, uh, actually maybe they apply that, but Yeah, [00:51:23] Garett Jones: compared to the planet as a whole, they're pretty good.Right? So, um, I, I'm, I never get that excited about like, the small little distinctions between the US and Europe, like these 30% GDP differences, which are very exciting to pundits and bloggers and whatever. I'm like 30% doesn't matter very much. That's not really my bailiwick. What I'm really interested in is the 3000% between the poorest countries and the richest countries.So, like I can speculate about Europe, I, I don't really have a great answer. I mean, I, I think there's something to the, the naive view that, um, the Europeans with the most, uh, what my dad would call gumption are those who left and came to America. Some openness, some adventurousness. Uh, and maybe that's part of what trans, uh, made we, so basically there's a lot of selection working, uh, on the migration side to, uh, make America more open to laissez fair than Europe would be.[00:52:14] Dwarkesh Patel: Does that overall make you more optimistic about migration to the US from anywhere? Like, you know, the same story [00:52:20] Garett Jones: of Yeah. Center is perab us like America, America gets people who are really great, right? I went with you there. Yeah. [00:52:26] Dwarkesh Patel: Does, um, elite technocratic control work best in only in high IQ countries?Because otherwise you don't have these high IQ elites who can make good policies for you, but you also don't get the democratic protections against famine and war and things like that. [00:52:43] Garett Jones: Oh, I mean, I don't know. I think, I think the case for, for, uh, handing things over to elites is pretty strong in anything that's moderately democratic, right?Um, I don't have to be. Anything that's substantially more democratic than the official measure of Singapore, for instance. I mean, that's why my book 10% Less Democracy, really is targeted at the rich, rich democracies. Once we get too far below, uh, the rich democracies, I figure once you put elites in charge, they really are just gonna be old-fashioned Gordon to rent seekers and steer everything Jordan themselves and not give a darn about the masses at all.So that's, you know, uh, elite control in a democracy, a a lot of elite control in any kind of democracy, I think is gonna have good effect. If it's re you're really looking at something that is, uh, that meets a Mar Sen's definition of a democracy competitive market. Competitive party's free press. [00:53:38] Dwarkesh Patel: Mm-hmm.does Singapore meet that criteria? [00:53:41] Garett Jones: No. Because their parties aren't really allowed to compete. I mean, that's pretty obvious. Yeah. The, the pa the People's Action Party really controls, uh, party competition there. [00:53:52] Dwarkesh Patel: So, but it, I guess Singapore is one of the great examples of technocratic, um, technocratic control, and [00:53:59] Garett Jones: they're just an exception of the rule.Most countries that try to pull off that lower level democracy wind up much [00:54:03] Dwarkesh Patel: worse. So what is your, uh, what is your opinion of Neoreactionaries? I guess they're not in favor of 10% less democracy. They're more in favor of a hundred percent less democracy. [00:54:12] Garett Jones: But yeah, I think they're like kind of too much LARPing, too much romanticizing about the roheim, I guess.I don't know. What is rheum? Yeah. The, these guys in the Lord of the Rings, you know? . , romanticizing Monarch is a mistake. Um, it's worth noting that, uh, as my colleague Gordon Tok pointed out, as along as many others, uh, in Equilibrium Kings are almost always king and council, right.and so it's worth thinking through why King and Council is the equilibrium. Something more like a corporate board and less like, um, either the libertarian ideal of the entrepreneur who, who owns the firm, or the monarch who has the long-term interest in being a stationary bandit in real life. There's this sort of muddled thing in between that works out as the equilibrium, even in the successful so-called monarchies.So it's worth thinking through why it is that the successful so-called monarchies aren't really monarchies, right? They're really oligarchies. [00:55:12] Dwarkesh Patel: Yep. Yep. Um, if you look at the median voter in terms of their preferences on academic policies, it seems like they're probably more, um, in favor of government involvement than the actual policies of the United States, for example.Yeah. What explains this? Shouldn't the media voter theorem that we should be much less libertarian as a country than? Yeah, that's a great [00:55:35] Garett Jones: point from, um, Brian Kaplan's excellent. Bill Smith of the rational voter. Right? Yeah. I think part of it, I mean, I think his stories are right, which is that, uh, politicians facing reelection have this tradeoff between giving voters what the voters say they want and giving the voters the economic growth that will help the politicians get reelected, right?Mm-hmm. Um, so it's, uh, it's a version of saying like, you know, I don't want you to pull off the bandaid, but I want my wound to all get better. So and so the politician has to, it's the politician's job to handle the contradictory demands of the voters, and by delegating authority to them. To the vote or to the elected politicians.You get some of the benefits of elitism, um, even in a so-called democracy. [00:56:19] Is Ethnic Conflict a Short Run Problem?[00:56:19] Dwarkesh Patel: Um, over the long run, should we expect any of the tensions or all of the tensions of ethnic diversity to fade away? Like nobody today worries about the different Parisian tribes in France butting heads at the workplace, right? So over time yourself [00:56:33] Garett Jones: and, and you're right like that, uh, the, uh, anti-German ethnic sentiment in the US totally gone, right?So, [00:56:39] Dwarkesh Patel: right. Yeah. But over time, so then this, this is another one of those, the short run effects that you, uh, emphasize that your focus lesson on, right? [00:56:46] Garett Jones: Yeah, that's a good point. Um, it's poss you don't know which one. I mean, the problem is that ethnic conflict has been a hardy perennial. It's not the only conflict that people can ever have.I don't, I don't know to what extent, uh, they'll, these things will fade away. As I emphasize in the culture transplant, the ethnic diversity channel is actually the least important of any of the channels I discuss. Um, and so I'm open to this thought that what you're saying will actually happen and maybe we'll just find something else to get mad at each other about like, um, uh, social media tribes or, uh, religious, religious groups.Um, I mean, it hasn't happened yet in all the documented human history. We have. People seem to find some ethnic, uh, balance for conflict. It is worth pointing out that the one one, um, study that I report, uh, I think it's a waard coha piece. It's fine. That window, the real, uh, the source of ethnic conflict happens when private values are correlated with, um, ethnic groups, right?So if, uh, cultural values are basically uncorrelated with ethnicity, then basically there's nothing to fight over. And that's really what's happened with a lot of old ethnic battles in the us mm-hmm. . And, um, so you're right. Some of these things will fade with time. The problem is that human beings are, one of our great evils is that we are always looking for a focal point.and we can, people will use visible appearance as a horrifying focal point around which to, uh, peg their conflicts. It's an easy one because our brains are looking for visual patterns, and I don't like that, but it's something that will probably keep happening. [00:58:22] Dwarkesh Patel: One of the interesting points you made in the chapter was that the, uh, benefits of diversity are greatest when search costs are lower and the cost of vetting are lower. What do, how, how do we make sure that that is true of non-lead professions?So if you're looking for a plumber or if you're looking for a carpenter, how, how do we make sure that you can vet them easily? [00:58:42] Garett Jones: I mean, I have to say that this has to be a case where like Yelp and Google and all these online ratings have given us tools for checking these things out. We know we have to be skeptical, of course, but uh, for people who know that they're good at something, the cost of entry into a new field has to be much lower than it was a few decades ago because, you know, 10 20 good Google reviews, um, and you can actually enter.So yeah, lower, basically not, not banning, not banning disclosure of data. I'd say that's the most important thing we can do. Mm-hmm. ? Um, I think, um, you sometimes hear that medical doctors, I haven't checked up on this a long time, but apparently medical doctors often, uh, make a very risky to give bad reviews.Sometimes you get lost, you get a lawsuit or something. Mm-hmm. . So making that a lot harder is worth it. You know, we know that some negative reviews are gonna be malicious and inaccurate, but the benefits of information flow seem really high. . [00:59:38] Bond Holder Democracy[00:59:38] Dwarkesh Patel: Yeah. I thought one of the really interesting chapters in the, the 10% list democracy was the chapter on, you know, bond holder democracy.Yeah. And I'm curious, so I mean, corporations are ex uh, obviously an example to use here where they do have bond holders who hold them accountable. Mm-hmm. , but the average lifespan of a corporation is 10 years, I believe. So do you think it'll be, it would, um, it would be even shorter if bond holders had a lesser sale on corporations or you, you know, what is the, what does the transients of the corporation tell us about their controls?[01:00:11] Garett Jones: Oh, that's a good point. Um, well, we, we can suspect that the average person who's investing in a corporation makes money, right? Because, uh, otherwise people wouldn't be doing it right. On average people. Right? It must work. Um, so. This is what, Ryan, you actually have me stumped here. So can you rephrase the question again?I'm trying to think through what the, what the question is there. Sure. Yeah. I, [01:00:32] Dwarkesh Patel: I, if bond holders do extend the longevity and the long term thinking of the organizations on, on who they hold bonds, why aren't corporations who give out bonds, why don't they tend to live longer than I think the average of 10 years?Would it be even shorter without bond holders or, [01:00:50] Garett Jones: oh, I, I'd say I, a, I'd say it'd probably be shorter without bond holders or any kind of financial monitor, but second, most corporations just shouldn't live that long. Right? Most corporations, their ideas that you try out and then it, like you find out it, it doesn't work, or it should be bought up by somebody else, or the IP should be sold off.And so having a lot of companies, uh, fade out is actually on net a good sign. I think this is really part of the John Halter wearing line of research that the sort of modern version of creative destruction research. Which finds that, you know, uh, low productivity firms exiting, you know, uh, just as naive laissez-faire predicts means that those workers and that capital can get reallocated over to a more productive firm.So the alternative is, uh, you know, stereotypically Japanese zombie firms, right? They're kept limping along by banks that are perhaps under political pressure to lend. And so a lot of, a lot of cap human and physical capital gets tied up in low productivity projects. Yeah. So, yeah. Um, uh, a brutal bond market is, uh, a good way to send a market signal to move capital from low productivity to high productivity projects.Um, why [01:01:56] Dwarkesh Patel: are yields on 30 year, uh, fixed, um, treasuries? Why are they so low? Because theoretically, investors should know that we have a lot of liabilities in the form of, you know, social security to baby boomers. Yeah. And that we've radically inflated the money supply very recently and may do so again. Uh, do you think the investors are being irrational with the, uh, low yields or what, what's going on?[01:02:18] Garett Jones: No, no. I'm a fan of the view that the bond holders are gonna win in the long run and that, uh, inflation, any kind of super, like, super, super high inflation is not gonna be the path, uh, of the future. And what's gonna happen is that, at least think about the us Um, the way the bond holders are gonna win is that there's gonna be a mixture of tax hikes and slower spending growth, especially hurting the poor.And that's how the US is gonna close its fiscal gap. I don't know particularly what paths other countries are gonna go through, but the US has this basically, um, this one tool, this one superpower sitting, um, sitting in the room that it hasn't used yet, and it's, oh, it's a vat, right? So the US could dramatically increase its tax revenue through either an overt or disguised value added tax, and that would raise a ton of money just like it raises in Europe.And that would, that's the easy way to close the US fiscal gap. We probably won't even have to get to that, just making Medicaid worse. Slowly over the long run , um, maybe making Medicare worse over the long run. Right? Um, that, that by itself would close a lot of this fiscal gap. So basically, I think they'll balance the long run budget on the kind of the backs of the poor and the middle class.That's probably the most likely outcome. So are you expecting, hence no, hence no hyperinflation. So are, are, [01:03:38] Dwarkesh Patel: but so you're expecting the welfare state to shrink either in quality or quantity over [01:03:42] Garett Jones: time in relative terms, uh, compared to the trend. I mean, if America's still getting say 1%, 1.5% richer each year, um, then that by itself, uh, means that, you know, you know, that adds a certain level of quality to healthcare over time.And so basically if it, if it ends up staying the equivalent of say, 0%, um, that by itself, if you could get healthcare spending in, in real terms to be 0% over time, um, that, that would end up closing the gap when you compound it out long enough. Right? So, yep. Yep. Yeah. [01:04:16] Dwarkesh Patel: Um, is that kind of thinking. So, you know, when Liz Truss in the UK tried to implement, uh, tax reform, there was a bond holder revolt, and, you know, she was ousted.Yeah. Uh, bondholders. There's one [01:04:28] Garett Jones: right there. Yeah. [01:04:29] Dwarkesh Patel: So do you, do you are, do we already live in the Bondholder utopia or ? [01:04:32] Garett Jones: Oh, yeah. I, I mean I think that that was a nice, uh, reminder that basically contrary to sort of the MMT view, um, and the sort of Pop m the pop kasian view, the debt is no barrier at all.Um, I think that showed the bond holders, uh, are actually paying attention to long-term signals of fiscal policy credibility, and they'll take action. Yeah. Mm-hmm. . Yeah. [01:04:57] Mormonism[01:04:57] Garett Jones: What, what are the deep roots of Mormonism? Why do they have such high trust and uh, uh, such tight-knit communities? I mean, I think part of it is that they are, they reflect a lot of this sort of, Uh, what for then was Western Pioneer culture, upstate New York, Pennsylvania, then Ohio.Um, I think those communities tended to be, uh, high trust communities necessarily because of the difficult, uh, environment that they were living in. Um, and there was a lot of selection. There was a lot of selection over the first few decades of Mormon history where those who were willing to sort of trust the group stayed in and those who weren't willing to trust the group, um, ended up leaving.And not just trust, but trustworthiness. I think a lot of people probably got weed out because they weren't contributing to the common good. So I think that basically by the time the Mormons got established in Utah, uh, they, they had already selected for a strong culture of, um, a kind of a, kind of in-group prosociality.And I think that's, um, helped them, that helped them weather the storms of the 19th century. So the whole 19th century people were only joining. during this, this is during the era of polygamy in Utah. Right. Um, if they thought that they were willing to put up with this, right? And, you know, you're, you're signing up for some kind of deep sociality with a mixture of uncon, a lot of unconventional stuff.And that foundation, uh, really helped. And the fact that Mormons since then have stayed as a religion that requires a medium, high level of, of commitment, also weeds out people who just aren't willing to make that kind of commitment. Mm-hmm. . So, I mean, I was, I was raised Mormon. Um, you know, I wasn't ultimately willing to make the commitment.And maybe the part of the reason is cause I'm too much of a free rider, so the Mormons who are left are probably better than me. [01:06:46] Dwarkesh Patel: Um, the Mormon church has, I think, more than a hundred billion in assets. Uhhuh , what is it planning on doing with all this money? That's a, that's a tremendous, that's a tremendous sum.[01:06:56] Garett Jones: I don't know. I mean, maybe they're planning to hand it to the savior when the second coming happens. Right. It's, uh, there's, there's gotta be a great argument for this option. Value of just having the wealth there. Right. It does, it must give them a kind of independence from the world when various storms come along.Cultural, political storms. Mm-hmm. . Um, you know, I don't actually know what their plans are for what they would do with all the money, but I do know that like normal economics tells us that just peop being frugal is good for the economy overall. So Steven LANs has a great, uh, essay and praise of Scrooge.It's especially appropriate for this time of year. And, um, being frugal means you're building up the capital stock and you're giving, uh, a sort of invisible gift to future generations. So Mormon frugality is basically helping build up the US capital stock and indirectly the world's capital stock, helping make us all more productive, which I think is something that fits in with Mormon values.[01:07:52] Dwarkesh Patel: Yeah. Yeah. I think people have pointed out that people should be spending more money given the fact that they have so much left over by the time they die. Usually, [01:08:00] Garett Jones: yeah. As an individual level, if you care about your own wellbeing. That's true. Right? [01:08:03] Dwarkesh Patel: Yeah. . Yeah. But, okay, so if you, it is interesting, like leaving a large inheritance is, uh, is so, is socially valuable.Yeah. [01:08:10] Garett Jones: Leaving a large inheritance means there's, uh, you're leaving, you're, you're, you're producing a lot, but you're not consuming very much. That means you're building up the capital [01:08:16] Dwarkesh Patel: stock. So. Yep. Yep. Um, and there's also, I think, um, a large amount of, uh, multi-level marketing schemes that proliferate in Utah.Yeah. Is that one of the downsides of high social trust? [01:08:31] Garett Jones: Yeah. The, cuz people predate upon it, right? It strikes me as a total rent seeker sort of thing. I mean, I have to say the knives are really good. So I'm, uh, , uh, everybody I know who's ever had Cutco knives ends up using 'em for decades. So that's one of the popular multi-level marketing schemes that actually gets to, to men.A lot of them are targeted at, at women through cosmetics, as you might know, so mm-hmm. , but at least the men's one works out. ,[01:08:52] Garett Jones's Immigration System[01:08:52] Dwarkesh Patel: if you had to implement an immigration system from scratch, would you actually, uh, would you actually consider these s a t scores and these other deep roots scores as part of somebody's admittance? Or would you just consider the individual level, um, your personal skill as an education and things like [01:09:07] Garett Jones: that?Now, I'd wanna launch a 10 year, maybe 20 year research project of figuring how to turn the deep roots scores into something useful. So I, like, I, uh, I think right now with the deep roots literature, we're about where Milton Friedman's Monetarism was in the late sixties. You know, Friedman said, Hey, I figured out where inflation comes from, and we'd be a lot better off if we just grew the money supply 3% a year and.N ultimately, nobody thought he was right about the 3% a year thing, but they did think that he had a, still had a lot of good advice. So Friedman ended up having a lot of good ideas, but they weren't policy ready. And I think that's about where we are with the deep roots literature right now, which is, um, I mean at most one would use it as a, like a small plus factor and a point system, but I don't even know which points I'd use.But something along those lines is worth thinking about. I would never use a cutoff, I would never use any, uh, quotas or hard cutoffs. Uh, if you think about point space systems, 10, 20 years of. Further research, and maybe you'd find a way to put the deep roots into a point space system.[01:10:12] Interviewing SBF[01:10:12] Dwarkesh Patel: Yeah. Yeah. [01:10:12] Garett Jones: Um, how was the SPF F thing? What do you mean? So did he just say like, I'll fly you out? [01:10:20] Dwarkesh Patel: So I was there for the, um, EA Bahamas. Oh, okay. Okay. Yeah. Yeah. And then while I was there, I, I, um, I, I talked to somebody who knew him and I'm like, Hey, I would love to interview him.Yeah, yeah. Some things I would ask him. Yeah, yeah. Yeah. It was, it was one of the ones where, actually I feel like I would really want to redo that one because I was aware of some things back then that were kind. Yeah, that would be worth asking about in retrospect. And of course, it's all in retrospect, but yeah.Yeah. Um, I should have focused harder at that rather than asking these sort of philosophical questions about effective altruism. [01:10:51] Garett Jones: Yeah. Do you think, uh, I mean, is it as simple as like he was co-mingling funds? Uh, he, he lent a bunch of FTX money over to a hedge fund and then they lost it. [01:11:02] Dwarkesh Patel: Um, I, I, I, yeah. I'm guessing first [01:11:04] Garett Jones: approximation.Yeah. Yeah, yeah. So it's like, it's old fashioned financial fraud, partly driven by, uh, not having a really good board over em or a good oversight. . [01:11:14] Dwarkesh Patel: You know what, I'm really curious to ask of you this, because you know what you're talking hive mind about the fact that higher IQ people on average, um, are more cooperative in prisoners dilemma type situations.Yeah, yeah, yeah. And I just interviewed Bethany McClean on the podcast. It hasn't been released yet, but you know, she wrote the smartest guys in the room, which about Enron. Right. And then, so there is this thing where maybe they are less likely to commit fraud on average, but when they do, they're so much, they're really good at it.Right, exactly. Right. So, yeah, I, I don't know, maybe, maybe one of the downsides of having a high IQ society is that what people do commit in fraud, they're super successful at it. Uh, you know, I don't know. Yeah. I mean, the, [01:11:52] Garett Jones: the evils of of super smart people are obviously a huge risk to all of humanity.Right? Right. I don't have to worry about humanity being wiped out by a bunch of people with sticks and stones. Right? Yeah. I have to worry about humanity being wiped out by nuclear weapons, which could only be invented by [01:12:07] Dwarkesh Patel: smart people, right? Yeah, yeah, yeah, yeah. Um, are, are smart people more cooperative in a sort of very calculating sense that, you know, this game is gonna go on, so I wanna make sure I preserve my relationships.Or even in the last turn of a iterated prisoner's dilemma game, even in the last turn, they would cooperate. [01:12:28] Garett Jones: Oh, in the last turn they walk away. Yeah. Yeah, yeah, yeah. I think it's, I think. There is no correlation between, uh, intelligence and say agreeableness, right? Mm-hmm. normal, psychological agreeableness.And I think that's a broader principle or conscientiousness for that matter, right? Psychological conscientiousness. so Machiavelli intelligence, I think is what's driving the link between IQ and cooperation. So in repeated games, that Machiavelli intelligence, which a lot of intelligence researchers will talk about, turns into cosan intelligence where people find a way to grow the pie, but it's a very cynical, self-interested form of growing the pie.Yeah. Yeah. And so I, I don't think that has any, um, I don't think it's driven by inherent prosociality. I think it's it's endogenous prosociality, not exogenous prosociality. And that's a reason to worry about it. [01:13:19] Dwarkesh Patel: What is, what happens to these high IQ people when if society goes into a sort of zero sum mode where there's not that much economic growth?And so the only way you can increase your share of the pie is just by cutting out bigger and bigger slices for yourself. [01:13:32] Garett Jones: Yeah. Like then you gotta watch out, right? Yeah. It's like the Middle Ages right there, right? Yep. Exactly. Yeah, yeah, yeah. [01:13:38] Dwarkesh Patel: Um, yeah. Interesting. Um, awesome. Uh, Garrett, thanks so much for coming on the podcast. This was interesting. Thanks for having me. This has been fantastic. Yeah. Yep. Excellent. Thanks for reading my books. Appreciate it. Yeah, of course. ​ ​ Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

One of my best episodes ever. Lars Doucet is the author of Land is a Big Deal, a book about Georgism which has been praised by Vitalik Buterin, Scott Alexander, and Noah Smith. Sam Altman is the lead investor in his new startup, ValueBase.Talking with Lars completely changed how I think about who creates value in the world and who leeches off it.We go deep into the weeds on Georgism:* Why do even the wealthiest places in the world have poverty and homelessness, and why do rents increase as fast as wages?* Why are land-owners able to extract the profits that rightly belong to labor and capital?* How would taxing the value of land alleviate speculation, NIMBYism, and income and sales taxes?Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow Lars on Twitter. Follow me on Twitter.Timestamps(00:00:00) - Intro(00:01:11) - Georgism(00:03:16) - Metaverse Housing Crises(00:07:10) - Tax Leisure?(00:13:53) - Speculation & Frontiers(00:24:33) - Social Value of Search (00:33:13) - Will Georgism Destroy The Economy?(00:38:51) - The Economics of San Francisco(00:43:31) - Transfer from Landowners to Google?(00:46:47) - Asian Tigers and Land Reform(00:51:19) - Libertarian Georgism(00:55:42) - Crypto(00:57:16) - Transitioning to Georgism(01:02:56) - Lars's Startup & Land Assessment (01:15:12) - Big Tech(01:20:50) - Space(01:23:05) - Copyright(01:25:02) - Politics of Georgism(01:33:10) - Someone Is Always Collecting RentsTranscriptThis transcript was partially autogenerated and thus may contain errors.Lars Doucet - 00:00:00: Over the last century, we've had this huge conflict. All the oxygen's been sucked up by capitalism and socialism duking it out. We have this assumption that you either have to be pro worker or pro business that you can't be both. I have noticed a lot of crypto people get into Georgism, so not the least of which is Vitalik Buterin and you endorse my book. If you earn $100,000 in San Francisco as a family of four, you are below the poverty line. Let's start with just taxing the things nobody has made and that people are gatekeeping access to. Let's tax essentially monopolies and rent seeking. The income tax needs to do this full anal probe on everyone in the country and then audits the poor at a higher rate than the rich. And it's just this horrible burden we have. Dwarkesh Patel - 00:00:39: Okay, today I have the pleasure of speaking with Lars Doucet, who developed the highly acclaimed Defender's Quest game and part two is coming out next year, but now he's working on a new startup. But the reason we're talking is that he wrote a review of Henry George's progress and poverty that won Scott Alexander's Book Review Contest and now it has been turned into an expanded into this book Land is a Big Deal. So Lars, welcome to the podcast. New Speaker: Great to be here, Dwarkesh . Okay, so let's just get into it. What is Georgism? Lars Doucet - 00:01:12: Okay, so the book is based off of the philosophy of a 19th century American economist by the name of Henry George from once we get George's and basically George's thesis is kind of the title of my book that land is a big deal. Georgism is often reduced to its main policy prescription that we should have a land value tax, which is a tax on the unimproved value of land, but not a tax on any buildings or infrastructure on top of the land, anything humans add. But the basic insight of it is that it's kind of reflected in the aphorisms you hear from real estate agents when they say things like the three laws of real estate or location location location and buy land, it's the one thing they're not making any more of. It's basically this insight that land has this hidden role in the economy that is really underrated. But if you look at history through the right lens, control over land is the oldest struggle of human history. It goes beyond human history. Animals have been fighting over land forever. That's what they're fighting over in Ukraine and Russia right now, right? And basically the fundamental insight of Georgism is that over the last century, we've had this huge conflict. All the oxygen's been sucked up by capitalism and socialism duking it out. We have this assumption that you either have to be pro worker or pro business that you can't be both. And Georgism is genuinely pro pro worker and pro business. But what it's against is is land speculation. And if we can find a way to share the earth, then we can solve the paradox that is the title of George's book, progress and poverty, why does poverty advance even when progress advances? Why do we have all this industrialized technology and new methods and it in George's time it was industrial technology in our time its computers and everything else? We have all this good stuff. We can make more than we've ever made before. There's enough wealth for everybody. And yet we still have inequality. Where does it come from? And George answers that question in his book. And I expand on it in mine. Dwarkesh Patel - 00:03:15: Yep. OK, so yeah, I'm excited to get into the theory of all of it in a second. But first I'm curious how much of your interest in the subject has been inspired with the fact that as a game developer, you're constantly dealing with decentralized rent seekers, like Steve or iOS app store. Is that part of the inspiration behind your interest in Georgism or is that separate? Lars Doucet - 00:03:38: It's interesting. I wouldn't say that's what clued me into it in the first place. But I have become very interested in all forms of rent seeking. In this general category of things we call land-like assets that come to first mover advantages in these large platform economies. I've started to think a lot about it basically. But the essence of land speculation is you have this entire class of people who are able to basically gatekeep access to a scarce resource that everybody needs, which is land, that you can't opt out of needing. And because of that, everyone basically has to pay them rent. And those people don't necessarily do anything. They just got there first and tell everyone else, it's like, well, if you want to participate in the world, you need to pay me. And so we're actually the actual connection with game development, actually clued me into Georgism. And I'd heard about Georgism before. I'd read about it. I thought it was interesting. But then I started noticing this weird phenomenon in online multiplayer games going back 30 years repeatedly of virtual housing crises, which is the most bizarre concept in the world to me, like basically a housingcrisis in the Metaverse and predecessors to the Metaverse. And as early as the Alt Online (?)online when I was 19, this is this online game that you could play. And you could build houses in the game and put them down somewhere. And so what I found was that houses were actually fairly cheap. You could work long enough in a game to be afford to buy blueprints for a house, which will be put it somewhere. But there was no land to put it on. And at the time, I thought, oh, well, I guess the server failed up. I didn't really think much about it. I was like, this stinks. I didn't join the game early enough. I'm screwed out of housing. And then I kind of forgot about it. And then 20 years later, I checked back in. And that housing crisis is still ongoing in that game. That game is still running a good 25 years later. And that housing crisis remains unsolved. And you have this entire black market for housing. And then I noticed that that trend was repeated in other online games, like Final Fantasy 14. And then recently in 2022, with all this huge wave of crypto games, like Axi Infinity, and that's Decentral Land and the Sandbox. And then Yuga Labs' Board-Ape Yacht Club, the other side, had all these big land sales. And at the time, I was working as an analyst for a video game consulting firm called Novik. And I told my employers, it's like, we are going to see all the same problems happen. We are going to see virtual land speculation. They're going to hit virtual. They're going to reproduce the conditions of housing crisis in the real world. And it's going to be a disaster. And I called it, and it turns out I was right. And we've now seen that whole cycle kind of work itself out. And it just kind of blew my mind that we could reproduce the problems of the real world so articulately in the virtual world without anyone trying to do it. It just happened. And that is kind of the actual connection between my background in game design and kind of getting George Pilled as the internet kids call it these days. Dwarkesh Patel - 00:06:43: There was a hilarious clip. Some comedian was on Joe Rogan's podcast. I think it was like Tim Dillon. And they're talking about, I think, Decentraland, where if you want to be Snoop Dogg's neighbor in the Metaverse, it costs like a couple million dollars or something. And Joe Rogan was like, so you think you can afford to live there. And then Tim Dillon's like, no, but I'm going to start another Metaverse and I'm going to work hard. But OK, so let's go into Georgism himself. So Tyler Cohen had a blog post a long time ago who was comparing taxing land to taxing unimproved labor or unimproved capital. And it's an interesting concept, right? Should I, so I have a CS degree, right? Should I be taxed at the same level as an entry level software engineer instead of a podcast or because I'm not using my time as efficiently as possible. And so leisure in another way is the labor equivalent of having an unimproved parking lot in the middle of San Francisco or capital. If I'm just keeping my capital out of the economy and therefore making it not useful, maybe I should have that capital taxed at the rate of the capital gains on T-Bill. And this way, you're not punishing people for having profitable investments, which you're kind of doing with a capital gains, right? What would you think of that comparison? Lars Doucet - 00:08:07: Yeah, so really, before you can even answer that question, you've got to go back to ground moral principles you're operating on. Like, is your moral operating principle like we just want to increase efficiency? So we're going to tax everyone in a way to basically account for the wasted opportunity cost, which brings up a lot of other questions of like, well, who decides what that is. But I think the Georgist argument is a little different. We're not necessarily like it is efficient, the tax we propose, but it actually stems kind of from a more, from a different place, a more kind of fundamental aspect of justice, you know? And from our perspective, if you work and you produce value, your work produced that value, right? And if you save money and accumulate capital in order to put that capital to work to receive a return, you've also provided something valuable to society, you know? You saved money so a factory could exist, right? You saved money so that a shipping company could get off off the ground. You know, those are valuable, contributed things, but nobody made the earth. The earth pre-exists all of us. And so someone who provides land actually does the opposite of providing land. They unprovide land, and then they charge you for opening the gate. And so the argument for charging people on the unimproved value of land is that we want to tax unproductive rent seeking. We want to tax non-produced assets because we think we want to encourage people to produce assets. We want to encourage people to produce labor, to produce capital. We want more of those things. And there's that aphorism that if you want less of something, you should tax it. So I mean, maybe there is a case for some kind of galaxy brain take of, you know, taxing unrealized opportunity costs or whatever, but I'm less interested in that. And my moral principles are more about, let's start with just taxing the things nobody has made and that people are gatekeeping access to. Let's tax essentially monopolies and rent seeking. And then if we still need to raise more taxes, we can talk about that later. But let's start with, let's start with just taxing the worst things in society and then stop taxing things we actually want more of because we have this mentality right now where everything's a trade off and we have to accept the downsides of income taxes, of sales taxes, of capital taxes because we just need the revenue and it has to come from somewhere. And my argument is it's like, it can come from a much better somewhere. So let's start with that.Dwarkesh Patel - 00:10:39: Yeah, yeah. So I guess if it was the case that we've implemented a land value tax and we're still having a revenue shortfall and we need another kind of tax and we're going to have to keep income taxes or capital gains taxes. Would you in that situation prefer a sort of tax where you're basically taxed on the opportunity costs of your time rather than the actual income you generated or the returns you would interest your generate in your capital? Lars Doucet - 00:11:04: No, I think probably not. I think you would probably want to go with some other just like simpler tax \for the sake of it there's too many degrees of freedom in there. And it's like, we can talk about why I will defend the Georgist case for property tax assessments, you know, for land value tax. But I think it gets different when you start like judging what is the most valuable use of your time because that's a much more subjective question. Like you're like, okay, are you providing more value to society as being a podcaster or being a CS computer science person or creating a startup? It's like that may not be evident for some time. You know what I mean? Like I can't think of an example, but like think of people who were never successful during their lifetimes. I think the guy who invented what was it? FM radio, right? He threw himself out a window because he never got it really adopted during his lifetime but it went on to change everything, you know? So if we were taxing him during his lifetime based off of what he was doing of being a failure, like if Van Gogh was taxed of his like wasting his life as an artist as he thought he was, which ultimately led to his suicide, you know, a lot of these things are not necessarily realized at the time. And so I think that's, and you know, it would need a much bigger kind of bureaucracy to like figure that all out. So I think you should go with a more modest. I mean, I think after land value tax, you should do things like severance tax on natural resources and other taxes on other monopolies and rents. And so I think the next move after land value tax is not immediately to capital and income taxes and sales taxes, but to other taxes on other rents seeking and other land like assets that aren't literally physically land. And then only after you've done all of those, if you still, you know, absolutely then, then move on to, you know, the bad taxes. What is this, severance tax? Severance tax is a tax on the extraction of natural resources. Is what Norway does with their oil industry that has been massively successful and a key reason that Norway has avoided the resource curse? Yeah. Basically, it's, Georgist purist will say it's essentially a land value tax but of a different kind. A land value tax like you can't normally like extracts just like land like on this, in this house you're living on, you're like, you're not using up this land, but non-renewable resources you can use up. Yeah. You know, and so a severance tax is basically, Nestle should be charged a severance tax for the water they're using, for instance, you know, because all they're doing is enclosing a pre-existing natural resource that used to belong to the people that they've essentially enclosed and now they're just putting it in bottles and selling it to people. You know, they should be able to realize the value of the value add they give to that water, but not to just taking that resource away. Dwarkesh Patel - 00:13:53: No that makes sense. Okay, so let's go deep into the actual theory and logic of Georgism. Okay. One thing I was confused by is why property owners who have land in places that are really desirable are not already incentivized to make the most productive use of that land. So even without a property, sorry, a land tax, if you have some property in San Francisco incentives, let's go, why are you not incentivized to construct it to the fullest extent possible by the law, to, you know, collect rents anyways, you know what I mean? Like why are you keeping it that as a parking lot? Lars Doucet - 00:14:28: Right, right, right. So there's a lot of reasons. And one of them has to do with, there's an image in the book that this guy put together for me. I'll show it to you later. But what it does is that it shows the rate of return. What a land speculator is actually optimizing for is their rate of return, right? And so if land appreciates by 10% a year, you know, you're actually incentivized to invest in vacant land or a tear down property because the building of a tear down property is like worth negative value. So the land's cheaper because there's garbage on it, you know? Then you are to necessarily invest in a property and you're basically your marginal dollar is better spent on more land than it is on building up. Dwarkesh Patel - 00:15:16: But eventually shouldn't this be priced into the price of land so that the returns are no longer 10% or they're just like basically what you could get for any other asset. And at that point, then the rate of return is similar for building thingson top of your existing land than buying a new land because like the new land is like the, you know, that return has been priced into other land. Lars Doucet - 00:15:38: Well, I mean, arguably, empirically, we just don't see that, you know, and we see rising land prices as long as productivity and population increases. Those productivity and population gains get soaked into the price of the land. It's because of this phenomenon called Ricardo's Law of Rent and it's been pretty empirically demonstrated that basically, and it has to do with the negotiation power. But like why some people do of course, build and invest, you know, there's a lot of local laws that restrict people's ability to build. But another reason is just like, it also has to do with the existing part of it. It part of the effect is partially the existing property tax regime actively incentivizes empty lots because you have a higher tax burden if you build, right? So what actually happens is a phenomenon that's similar to oil wells, right? You have, it's not just because of property taxes, those do encourage you to keep it empty. But there's this phenomenon called land banking and waiting for the land to ripen, right? Sure, I could build it now, but I might have a lot of land parcels I've got. And I don't need to build it now because I think the prices might go up later and it would be better to build on it later than it is now. And it's not costing me anything to keep it vacant now. If I build now, I'm gonna have to pay a little bit more property taxes. And I know in three years that the price is gonna be even better. So maybe I'll wait to incur those construction costs then and right now I'm gonna focus more on building over here. And like I've got a lot of things to do, so I'm just gonna squat on it here. It's the same way I have, I'm squatting like, you know, I bought to my shame, like about 30 domain names, you know, most of them bought before I kind of got ontoGeorgism. And it's like, yeah, I'll pay 15 bucks a year to just hold it, why not? You know what I mean? I might use that someday. Right. And it's like, I should probably release all the ones I have no intent of using because I was looking for a domain for my startup the other day and every single two word.com is taken. Right, right. And it has been for like 10 years, you know, and it's a similar phenomenon. It's just like some of it is economic, rational following of incentives. And some of it is just it's like, well, this is a good asset. I'm just gonna hold on to it because why not? And no one is, and I don't have any pressure to build right now. And this happens on the upswing and on the downswing of cities. So while the population's growing and while the population's declining, people will just buy a lot of land and hold it out of use. Cause it's also just a great place to park money because it's an asset that you know if the population ever starts growing, it's gonna keep its value better than almost any other hard asset you have. Dwarkesh Patel - 00:18:16: Yep yep. I guess another like broader criticism of this way of thinking is, listen, this is all, and sorry for using these like podcast lingo of scarcity mindset, but this is all like scarcity mindset of, you know, land is limited. Well, why don't we just focus on the possibility of expanding the amount of usable land? I mean, there's like not really a shortage of land in you. Maybe there's a shortage of land in urban areas. But you know, why don't we like expand into the seas? And why don't we expand into the air and space? Why are we thinking in this sort of scarce mindset? Lars Doucet - 00:18:48: Right. Okay, so I love this question because actually our current status quo mindset is the scarcity mindset. And Georgism is the abundance mindset, right? And we can have that abundance if we learn to share the land. Because right now, you know, why don't we expand? And the answer is we've tried that. We've done it twice. And it's the story of America's frontier, right? And so like right now there's plenty of empty land in Nevada, but nobody wants it. And you have to ask why, right? You also have to ask the question of how did we have virtual housing crises in the Metaverse where they could infinitely expand all they want? Like how is that even possible, you know? And the answer has to do with what we call the urban agglomeration effect. What's really valuable is human relationships, proximity to other human beings, those dense networks of human beings. And so the idea is not necessarily that like, in a certain sense, the issue is that land is not an indistinguishable, fungible commodity. Location really matters. Or America has a finite amount of land, but it might as well be an infinite plane. We're not going to fill up every square inch of America for probably thousands of years if we ever do, right? But what is scarce is specific locations. They're non-fungible, you know? And to a certain extent, it's like, okay, if you don't want to live in New York, you can live in San Francisco or any other like big city. But what makes New York New York is non-fungible What makes San Francisco San Francisco is non-fungible That particular cluster of VCs in San Francisco until or unless that city completely explodes and that moves somewhere else to Austin or whatever, you know, at which point, Austin will be non-fungible. I mean, Austin is non-fungible right now. And so the point is that the way Georgism unlocks the abundance of it, let me talk about the frontier. We have done frontier expansion. That is why immigrants came over from Europe, you know, and then eventually the rest of the world, to America to, you know, settle the frontier. And the losers of that equation were, of course, the Indians who were already here and got kicked out. But that was theoriginal idea of America. And I like to say that America's tragedy, America's problem is that America is a country that has the mindset of being a frontier state, but is in fact a state which has lost its frontier. And that is why you have these conversations with people like boomers who are like, why can't the next generation just pull itself up by its bootstraps? Because America has had at least, I would say two major periods of frontier expansion. The first was the actual frontier, the West, the Oregon Trail, the covered wagons, you know, the displacement of the Indians. And so that was a massive time, that was the time in which Henry George was writing, was right when that frontier was closing, right? When all that land, that free land was being taken, and the advantages of that land was now being fully priced in. That is what it means for a frontier to close, is that now the good productive land, the value of it is fully priced in. But when the frontier is open, you can just go out there and take it, and you can get productive land and realize the gains of that. And the second frontier expansion was after Henry George's death, was the invention of the automobile, the ability to have a job in the city, but not have to live in the city. The fact that you could quickly travel in, like I commuted in to visit you here, right? That is because of the automobile frontier opening that has allowed me to live in some other city, but be able to do productive work like this podcast by driving in. But the problem is, sprawl can only take you so far, before that frontier as well closes, and by closes I don't mean suburban expansion stops. What I mean is that now, suburban homes, you fully price in the value of the benefits are able to accrue by having that proximity to a city, but still being able to live over here, through of course, for Ricardo's Law for it. Dwarkesh Patel - 00:22:37: Yeah, but I feel like this is still compatible with the story of, we should just focus on increased in technology and abundance, rather than trying to estimate how much rent is available now, given current status quo technologies. I mean, the car is a great example of this, but imagine if there were like flying cars, right? Like there's a, where's my flying car? There's like a whole analysis in that book about, you know, if you could, if people are still commuting like 20 minutes a day, you know, a lot more land is actually in the same travel distance as was before, and now all this land would be worth as much, even in terms of relationships that you could accommodate, right? So why not just build like flying cars instead of focusing on land rent? Lars Doucet - 00:23:21: Well, because these things have a cost, right? The cost of frontier expansion was murdering all the Indians and the cost of automobile expansion was climate change. You know, there has to be a price for that. And then eventually, the problem is you eventually, when you get to the end of that frontier expansion, you wind up with the same problem we had in the first place. Eventually, the problem is the first generation will make out like gangbusters if we ever invent flying cars, even better like Star Trek matter teleporters. You know, that'll really do it. Then you can really live in Nevada and have a job in New York. Yeah. There are some people who claim that Zoom is this, but it's not, you know, we've seen the empirical effects of that and it's like, it's the weakest like semi-frontier we've had and it's already closed. Because, because of Zoom, houses like this over in Austin have gone up in value because there is demand for them and there's demand for people to telecommute. And so anyone who, so the increased demand for living out in the suburbs is now basically priced in because of the Zoom economy. And so the thing is the first people who did that, who got there really quick, the first people to log in to the ultimate online server were able to claim that pace of the frontier and capture that value. But the next generation has to pay more in rent and more in home prices to get that. Dwarkesh Patel - 00:24:34: Actually, that raises another interesting criticism ofGeorgism, this is actually a paper from Zachary Gouchanar and Brian Kaplan, where it was titled the Cerseioretic critique of Georgism, and the point they made was one of these, like one way of thinking about the improvement to land is actually identifying that this land is valuable. Maybe because you realize it has like an oil well in it and maybe you realize that it's like the perfect proximity to these like Chinese restaurants and this mall and whatever. And then just finding which land is valuable is actually something that takes capital and also takes, you know, like you deciding to upend your life and go somewhere, you know, like all kinds of effort. And that is not factored into the way you would conventionally think of the improvements to land that would not be taxed, right? So in some sense, you getting that land is like a subsidy for you identifying that the land is valuable and can be used to productive ends. Lars Doucet - 00:25:30:Right, yeah, I know. So I've read that paper. So first of all, the first author of that Zachary Gouchanar yeah, I'm not been able to pin him down on what exactly meant on this, but he's made some public statements where he's revised his opinion since writing that paper and that he's much more friendly to the arguments ofGeorgism now than when he first wrote that paper. So I'd like to pin him down and see exactly what he meant by that because it was just a passing comment. But as regards Kaplan's critique, Kaplan's critique only applies to a 100% LVT where you fully capture all of the land value tax. And the most extreme Georgists I know are only advocating for like an 85% land value tax. That would still leave. And Kaplan doesn't account at all for the negative effects of speculation. He's making a speculation is good actually argument. And even if we grant his argument, he still needs to grapple with all the absolutely empirically observed problems of land speculation. And if we want to make some kind of compromise between maybe speculation could have this good discovery effect, there's two really good answers to that. First, just don't do 100% LVT, which we probably can't practically do anyway because of natural limitations just empirically, you know, in the signal. It's like you don't want to do 115% land value tax. That drives people off the land. So we want to make sure that we like have a high land value tax but make sure not to go over. And so that would leave a sliver of land rent that would still presumably incentivize this sort of thing. There's no argument for why 100% of the land rent is necessary to incentivize the good things that Kaplan was talking about. The second argument is when he talks about oil, well, we have the empirical evidence from the Norwegian massively successful petroleum model that shows in the case of natural resources how you should deal with this. And what Norway does is that they have a massive, massively huge severance tax on oil extraction. And according to Kaplan's argument, this should massively destroy the incentive for companies to go out there and discover the oil. And empirically, it doesn't. Now what Norway does is that they figured out, okay, so the oil companies, their argument is that we need the oil rents, right? We need these oil rents where we will not be incentivized for the massive capital cost of offshore oil drilling. Well, Norway's like, well, if you just need to cover the cost of offshore oil drilling, we'll subsidize that. We'll just pay you. We'll just pay you to go discover the oil. But when you find the oil, that oil belongs to the Norwegian people. Now you may keep some of the rents but most of it goes to the Norwegian people. But hey, all your R&D is free. All your discovery is free. If the problem is discovery, we just subsidize discovery. And then the oil companies are like, okay, that sounds like a great deal. We don't have to, because without that, what the oil companies do is that they're like, okay, we're taking all these risks. So I'm gonna sit on all these oil wells like people sitting on domain names because I might use them later and the price might go up later. But now because there's a huge severance tax, you're forced to drill now and you're actually, you're actual costs of discovery and R&D and all those capital costs are just taken care of. Dwarkesh Patel - 00:28:26: But isn't there a flip side to that where I mean, one of the economic benefits of speculation, obviously there's drawbacks. But one of the benefits is that it gets rid of the volatility and prices where our speculator will buy when it's cheap and sell when the price is high. And in doing so, they're kind of making the asset less volatile over time. And if you're basically going to tell people who have oil on their land, like we're gonna keep taxing you. If you don't take it out, you're gonna keep getting taxed. You're encouraging this massive glut of a finite resource to be produced immediately, which is bad. If you think we might need that reserve in the ground 20 years from now or 30 years from now, you know, went oil reserves were running low. Lars Doucet - 00:29:10: Not necessarily, you know? And so the problem is that speculation in the sense you're talking about if like encouraging people to do arbitrage is good for capital because we can make more capital. But we can't make more land and we can't make more non-renewable natural resources. And the issue in peer, and I just think the evidence just doesn't support that empirically because if anything, land speculation has causes land values to just constantly increase, not to find some natural part, especially with how easy it is to finance two thirds of bank loans just chase real estate up. And that's just like, if you just look at the history of the prices of, you know, of residential real estate in America, it's like, it's not this cyclical graph where it like keeps going back down. It keeps going back down, but it keeps going up and up and up, just on a straight line along with productivity. And it underlines and undergirds, major issues, everything that's driving our housing crisis, which then undergirds so much of inequality and pollution and climate change issues. And so with regards to speculations, like even if I just bite that bull and it's like, okay, speculation is good actually, I don't think anyone's made the case that speculators need to capture a hundred percent of the rents to be properly incentivized to do anything good that comes out of speculation. I think at some small reasonable percentage, you know, five to 10 percent of the rents, maybe 15 if I'm feeling generous, but I don't think anyone's empirically made the case that it should be a hundred percent, which is more or less a status quo. Dwarkesh Patel - 00:30:31:I mean, with regards to that pattern of the fact that the values tend to keep going up implies that there's nothing cyclical that the speculators are dampening. Lars Doucet - 00:30:41: Well, there are cycles to be sure, but it's not like, it's something that resets to zero. Dwarkesh Patel - 00:30:45: Yeah, but that's also true of like the stock market, right? Over time that goes up, but speculators are still have like an economic role to play in a stock market of making sure prices are, Lars Doucet - 00:30:55: I mean, the difference is that people are now paying an ever increasing portion of their incomes to the land sector. And that didn't used to be the case. And if it keeps going, it's going to be, I mean, you have people are now paying 50% of their income just for rent. And that's not sustainable in the long term. You're going to have the cycle you have there is revolution. You know, you, you know, Dwarkesh Patel - 00:31:16: (laughing) Lars Doucet - 00:31:17: I’m serious. like what happens is like you look through history, you either have land reform or you have revolution. And you know, it's, it's either like either you have a never ending cycle of, of, of transfers of income from the unlanded to the landed. And eventually the, the unlanded will not put up with that. You know, there was a real chance in the 19th century, at the end of the 19th century of America going full on socialist or communist and the only thing that saved us. What, and George's argument was like, it's either Georgism or communism. And if you want to save capitalism and not go toTotalitarian, we need Georgismand then what George failed to anticipate was, you, of course, the automobile. And the automobile kicked the can down another generation, another couple generations, right? And it came at the cost of sprawl. And that made everyone feel like we had solved the issue. But basically we just, and the cost of sprawl are enormous in terms of pollution and poor land use. Just look at Houston right now, right? But now we've come at the end of that frontier and now we're at the same question. And it's like, you see this research in interest in leftism in America and that's not a coincidence, right? Because the rent is too damn high and poor people and poor people and young people feel really, really shoved out of the promise and social contract that was given to their parents and they're jealous of it and they're wondering where it went. Dwarkesh Patel - 00:32:36: Yeah, yeah. Actually, you just mentioned that a lot of bank loans are given basically so you can like get a mortgage and get a house that's like towards land. There was an interesting question on Twitter that I thought was actually pretty interesting about this. I can't find the name of the person who asked it. So sorry, I can't give you credit, but they basically asked if that's the case and if most bank loans are going towards helping you buy land that's like artificially more expensive, but now you implement a land value tax and all these property values crash. Oh yeah. Well, when we see just, and then all these mortgages are obviously they can't pay them back. Lars Doucet - 00:33:13: Right, right, right. Are we gonna destroy the banking sector? Dwarkesh Patel - 00:33:15: Exactly. We'll have like a great, great depression.Lars Doucet - 00:33:17: Well, I mean, if you, okay, so like this is, this is kind of like, I mean, I'm not, I'm not trying to compare landlords to slave owners or something, but it's like, it's like the South had an entire economy based off of slavery. This thing that like we now agree was bad, right? And it's like we shouldn't have kept slavery because the, the South, the, like it really disrupted the Southern Economy when we got rid of slavery, but it was still the right thing to do. And so I mean, there is no magic button I could push as much as I might like to do so that will give us 100% land value tax everywhere in America tomorrow. So I think the actual path towards a Georgist Future is gonna have to be incremental. There'll be enough time to unwind all those investments and get to a more sane banking sector. So I mean, like if we were to go overnight, yeah, I think there would be some shocks in the banking sector and I can't predict what those would be, but I also don't think that's a risk that's actually gonna happen. Because like we just, we just cannot make a radical change like that on all levels overnight. Dwarkesh Patel - 00:34:13: Yeah yeah, yeah. Okay, so let's get back to some of these theoretical questions. One I had was, I guess I don't fully understand the theoretical reason for thinking that you can collect arbitrarily large rents. Why doesn't the same economic principle of competition, I get that there's not infinite landowners, but there are multiple landowners in any region, right? So if for the same reason that profit is competed away in any other enterprise, you know, if one landowner is extracting like $50 a profit a month, and another landowner is extracting, you know, like whatever, right? Like a similar amount of $50. One of them, and they're both competing for the same tenant. One of them will decrease their rent so that the tenant will come to them and the other one will do the same and the bidding process continues until all the profits are, you know,bidded away. Lars Doucet - 00:35:04: Right, so this is Ricardo's law front, right? And there's a section on in the book with a bunch of illustrations you can show. And so the issue is that we can't make more land, right? And so you might be like, well, there's plenty of land in Nevada, but the point is there's only so much land in Manhattan. Dwarkesh Patel - 00:35:19: But the people who have land inManhattan, why aren't they competing against themselves or each other? Lars Doucet - 00:35:23: Right, well, what they do is because the nature of the scarcity of there's only so many locations in Manhattan and there's so many people who want to live there, right? And so all the people who want to live there have to outbid each other. And so basically, so like, let me give a simple agricultural example model. And then I will explain how the agricultural model translates to a residential model. Basically, when you are paying to live in an urban area, or even a suburban area like here in Austin, what you're actually paying for is the right to have proximity to realize the productive capacity of that location. IE, I want to live in Austin because I can have access to a good job, you know what I mean? Or whatever is cool about Austin, a good school, those amenities. And the problem is you have to pay for those and you have to outbid other people who are willing to pay for those. And Ricardo's Rolf Rent says that the value of the amenities and the productivity of an area, as it goes up, that gets soaked into the land prices. And the mechanism by that is that it's like, okay, say I want to buy a watermelon, right? And there's only one watermelon left out bid that guy. But the watermelon growers can be like, oh, a lot of people want watermelon. So next season, there's going to be more watermelons because he's going to produce more watermelons. But because there's only so many locations in Austin, you know, within the natural limits of our transportation network, basically it forces the competition on the side of the people who are, essentially the tenants, right? It forces us into one side of competition with each other. And that, and so there's an example of like, a simple agricultural example is like, okay, say there is a common field that anyone can work on and you can make 100 units of wealth if you work on it, right? So, and there's another field that you can also learn 100 units of wealth in, but it's owned by a landowner. Why would you, why would you go and work on the landowners when you're going to have to pay them rent? You wouldn't pay them any rent at all. You would work on the field that's free, but if the landowner buys that field and now your best opportunity is a field that's only worth a free field that will produce 10 units of wealth, now he can charge you 90 units of wealth becauseyou have no opportunity to go anywhere else. And so basically as more land gets bought and subject to private ownership in an area, landowners over time get to increase the rent, not to a maximum level, there are limits to it. And the limits is what's called the margin of production, which is basically you can charge up to, and this is where the competition comes in, the best basic like free alternative, you know, and that's usually, you can realize that geographically, like out on the margins of Austin, there's marginal land that basically is available for quite cheap, you know, and it might be quite far away, and it used to be not so quite far away 20, 30 years ago, you know, and so as that margin slowly gets privatized, landowners can charge up to that margin. The other limit is subsistence, that can't charge more than you're actually able to pay, but the basic example is that, so this is why this is how frontier expansion works. When the entire continent's free, the first settler comes in, strikes a pick in the ground, keeps all of their wealth, but as more and more of it gets consolidated, then landowners are able to charge proportionately more until they're charging essentially up to subsistence. Dwarkesh Patel - 00:38:51: Yeah, does that explain property values in San Francisco? I mean, they are obviously very high, but I don't feel like they're that high where this offer engineers were working at Google or living as subsistence levels, neither are they at the margin of reduction where it's like, this is what it would cost to live out in the middle of California, and then commute like three hours to work or something. Lars Doucet - 00:39:13: Right, well, so it has to do with two things. So first of all, it's over the long run, and so it's like, you've had a lot of productivity booms in San Francisco, right? And so it takes some time for that to be priced in, you know, and it can be over a while, but given a long enough time period it'll eventually get there. And then when we're talking about stuff, it's also based off of the average productivity. The average resident of San Francisco is maybe not as productive as a high, and like basically doesn't earn as high an income necessarily as a high income product worker. And so this means that if you are a higher than productive, higher than average productivity person, it's worth it to live in the expensive town because you're being paid more than the average productivity that's captured in rent, right? But if you're a low, if you're lower than average productivity, you flee high productive areas. You go to more marginal areas because those are the only places you can basically afford to make a living. Dwarkesh Patel - 00:40:06: Okay, that's very interesting. That's actually one of the questions I was really curious about. So I'm glad to hear an answer on that. Another one is, so the idea is, you know, land is soaking up the profits that capitalists and laborers are entitled to in the form of rent. But when I look at the wealthiest people in America, yeah, there's people who own a lot of land, but they bought that land after they became wealthy from doing things that were capital or labor, depending on how you define starting a company. Like sure, Bill Gates owns a lot of land in Montana or whatever, but like the reason he has all that wealth to begin with is because he started a company, you know, that's like basically labor or capital,however you define it? Right. So how do you explain the fact that all the wealthy people are, you know, capitalists or laborers? Lars Doucet - 00:40:47: Well, so the thing is, one of the big missed apprehensions people have is that, when they think of billionaires, they think of people like Bill Gates and Elon Musk and Jeff Bezos, those are actually the minority billionaires, most billionaires or hedge funds are people involved in hedge funds. You know, bankers and what are bankers, most what are two thirds of banks? It's real estate, you know? And so, but more to your point, like if I, if it is like point that directly into it, it's like, I don't necessarily have a problem with the billionaire existing. You know what I mean? If someone like genuinely like bring something new into the world and like, you know, I don't necessarily buy the narrative that like billionaires are solely responsible for everything that comes out of their company, you know, I think they like to present that image. But I don't necessarily have a problem with a billionaire existing. I have a problem with, you know, working class people not being able to feed their families, you know, and so like the greater issue is the fact that the rent is too high rather than that Jeff Bezos is obscenely rich. Dwarkesh Patel - 00:41:45:No, no, I guess my point was in that, like, I'm not complaining that your solution would not fix the fact that billionaires are this. I also like that there's billionaires. What I'm pointing out is it's weird that, if you're theory of, like, where all the sort of plus in our society is getting, you know, given away is that it's going to landowners. And yet the most wealthy people in our society are not landowners. Doesn't that kind of contradict your theory? Lars Doucet - 00:42:11: Well, a lot of the wealthy people in our society are landowners, right? And it's just like, it's not the, so the, so the thing is is that basically making wealth off land is a way to make wealth without being productive, right? And so my point is is that, so like you said in your interview with Glazer that it's like, okay, the Googleplex, like the value of that real estate is probably not, you know, compared that to like the market cap of Google. But now compare the value of all the real estate in San Francisco to the market caps to some of those companies in there, you know, look at the people who are charging rent to people who work for Google. That's where the money's actually going, is that, and, and, you know, investors talk about this is that it's like, I have to, like, if you earn $100,000 in San Francisco as a family of four, you are below the poverty line, right? You know, the money is going to basically upper middle class Americans and upper class Americans who own tons of residential land and are basically, and also the old and the wealthy, especially, are essentially this entire class of kind of hidden landed gentry that are extracting wealth from the most productive people in America and young people, especially. And, and it is creates really weird patterns, especially with like service workers who can't afford to live in the cities where their work is demanded. Dwarkesh Patel - 00:43:30: Yeah. Okay. So what do you think of this take? This might be economically efficient. In fact, I think it probably is economically efficient, but the effect of the land value tax would be to shift, to basically shift our sort of societal subsidy away from upper middle class people who own, happen to own land in urban areas and shift that to the super wealthy and also super productive people who will like control the half acre that Google owns and like mountain view. So it's kind of like a subsidy, not subsidy, but it's easing the burden on super productive companies like Google and so that they can make even cooler products in the future. But it is in some sense that's a little aggressive, you're going from upper middle class to like, you know, tech billionaire, right? But it's still be economically efficient to do that. Lars Doucet - 00:44:18: Well, no, I don't quite agree with that because it's like, although there are a lot of upper middle class Americans who own a lot of the land wealth, it's not the case that they own where the majority of the land wealth is. The majority of the land wealth in urban areas is actually in commercial real estate. Is the central business district, if you, and I work in mass appraisal, so I've seen this myself in the models we build is that if you look at the transactions in cities and then you plot where the land value is and like a graph, it looks like this. And this is the city center and that's not a residential district. So the residential districts are sucking up a lot of land value and the rent is toodamn high. But the central business district and this even holds even in the age of Zoom, it's taken a tumble, but it's starting from a very high level. That central residential, I'm not residential, but commercial real estate is super valuable. Like orders, like an order of magnitude more valuable than a lot of the other stuff. And a lot of it is very poorly used.In Houston especially, it's incredibly poorly used. We have all these central parking lots downtown. That is incredibly valuable real estate. And just a couple of speculators are just sitting on it, doing nothing with it. And that could be housing, that could be offices, that could be amenities, that could be a million sorts of things. And so when you're talking about a land value tax, those are the people who are going to get hit first. And those are people who are neither nice, nice, friendly upper middle class Americans, nor are they hardworking industrialists making cool stuff. They're people who are doing literally nothing. Now, if you do a full land value tax, yeah, it's going to shift the burden in society somewhat. But I feel that most analyses of property taxes and land value taxes that conclude that they are regressive, I think that's mostly done on the basis of our current assessments. And I feel like our assessments could be massively approved and that if we improve the assessments, we can show where most of our land values actually concentrated. And then we can make decisions about exactly, are we comfortable with these tax shifts? Dwarkesh Patel - 00:46:18: Yeah, yeah. Hey guys, I hope you're enjoying the conversation so far. If you are, I would really, really appreciate it if you could share the episode with other people who you think might like it. Put the episode in a group chat you have with your friends, post it on Twitter, send it to somebody who think might like it. All of those things helps that a ton. Anyways, back to the conversation. So a while back I read this book, how Asia works. You know,Lars Doucet - 00:46:45: I'm a fan. Dwarkesh Patel - 00:46:47: Yeah, and one of the things, I think Joseph Steadwell was going out there, what are the things he talks about is he's trying to explain why some Asian economies grew, gangbusters in the last 20th century. And one of the things he points to is that these economies implemented land reform were basically, I guess they were distributed land away from, I guess the existing aristocracy and gentry towards the people who are like working the land. And while I was reading the book at the time, I was kind of confused because, you know, we've like, there's something called like the Kostian. The Kostian, I forget the name of the argument. Basically, the idea is, regardless of who initially starts off with a resource, the incentive of that person will be to, for him to like give that resource, lend out that resource to be worked by that person who can make most productive use of it. And instead of what was pointing out that these like small, you know, like these peasant farmers basically, they will pay attention to detail of crop rotation and making the maximum use of this land to get like the maximum produce. Whereas if you're like a big landowner, you will just like try to do something mechanized. It's not nearly as effective. And in a poor country, what you have is a shitton of labor. So you want something that's like labor intensive. Anyways, backing up a bit, I was confused while I was reading the book because I was like, well, wouldn't the, wouldn't, what you would expect to happen in a market that basically the peasants get alone from the bank to work to, I guess, rent out that land. And then they are able to make that land work more productively than the original landowner. Therefore, they are able to like make a profit and everybody benefits basically. Why isn't there a co-scient solution to that? Lars Doucet - 00:48:24: Because any improvement that the peasants make to the land will be a signal to the landowner to increase the rent because of Ricardo's law of rent. Yep. And that's exactly what happened in Ireland when, and George talks about this in progress and poverty, is that a lot of people were like, why was there famine in Ireland? It's because the Irish are bad people. Why didn't they, they're lazy? Why didn't they improve? And it's like because if you improve the land, all that happens is you still are forced into one side of competition and the rent goes out. Dwarkesh Patel - 00:48:50: Yep. OK. That makes sense. Is the goal that the taxes you would collect with the land value tax? Are they meant to replace existing taxes or are they meant to give us more services like UBI? Because they probably can't do both, right? Like you either have to choose getting rid of existing taxes or getting more.. Lars Doucet - 00:49:08: Well, it depends how much UBI you want. You know what I mean? It's like you can, you know, it's a sliding skill. It's like how many taxes do you want to replace versus how much? Like, I mean, you can have a budget there. It's like if you can raise, you know, I show in the book the exact figures of how much I think land value tax could raise. And I forget the exact figures, but like you can pull up a graph and overlay it here of, you know, whether you're talking about the federal level or federal local and state, you know, there's $44 trillion of land value in America. And I believe we can raise about $4 trillion in land rents annually with 100% land value tax. And we would probably do less than that in practice. But even on the low end, I forget what figure I quote for the low end, like you could fully pay for any one of social security, Medicare plus Medicaid together, so the second one is healthcare or defense. Entirely with the lowest estimate of what I think land rents could raise. And then I think you can actually raise more than that because I think, and I give an argument in the book for why I think it's closer to like $4 trillion. And that could pay for all three and have room over for a little bit of extra. And so I mean, it's up to you, like, that's a policy decision of whether you want to spend it on spending, whether you want to spend it on offsetting taxes or whether you want to spend it on UBI. I think the best political solution, because like if I bite the bullet that there might be some regressivity issues left over, you want to do what's called a UBI or what, you know, in George's time was called a citizen's dividend, right? You know, this will smooth over any remaining regressivity issues. And then, but I very much am in favor of getting rid of some of these worst taxes, you know, not just because they have dead weight loss and land value tax doesn't, but also because there's this tantalizing theory called ATCORE- All taxes come out of rent, which suggests that if you reduce other taxes, it increases land values, which means that if it's true in the strongest sense, it means the single tax,right? Land value tax replaced all taxes would always work. And I'm not sure if I buy that, I want to see some empirical evidence, but I think at least some weak form of it holds, so that when you offset other worst taxes, not only do you get rid of the dead weight loss from those, but you also wind up raising at least a little bit more in land value tax revenue. Dwarkesh Patel - 00:51:20: Yes, yeah. I mean, as a libertarian, or I guess somebody who has like libertarian tendencies, my concern would basically be like, this obviously seems better than our current regime of taxing things that are good, basically capital income. But my concern is the way I'm guessing something like this would be implemented is it would be added on top of rather than repealing those taxes. And then, yeah, I guess like we would want to ensure. Lars Doucet - 00:51:44: I get this one a lot. Yeah, no. And so I have, you know, I've been a libertarian in my past, and I have a soft spot for libertarianism. I used to be a Ron Paul guy, I went back in the day for a hot minute. And so I think the thing to suede your concerns there is what is land value tax? It's property tax without a tax on buildings. Yep. So the natural path to actually getting land value tax comes from reforming existing property tax regimes by reducing an entire category of taxation, which is the tax on buildings. And so that's what I think is the most plausible way to get a land value tax, like in Texas here, if we were to start by just capture the same, like what I actually proposed for our first step is not 100% land value tax federally. I don't know, even know how you get to there. I think what you actually do is you start in places like Texas and like here, legalized split-rate property tax, thus, re-tax buildings and land at separate rates, set the rate on buildings to zero, collect the same dollar amount of taxes. Let's start there. There's proposals to do this in various cities around the nation right now. I think there's one in Virginia. There's a proposal to do in Detroit. I think there's some talk of it in Pennsylvania and some places. And I'd like to see those experiments run and observe what happens there. I think we should do it in Texas. And that would be something that I think would be very friendly to the libertarian mindset, because very clearly we're no new revenue, right? And we're exempting an entire category of taxation. Most people are gonna see savings on their tax bill and the people who own those parking lots downtown in Houston are gonna be paying most of the bill. Dwarkesh Patel - 00:53:14: Yeah, by the way, what do you make of, is there a good, Georgist's critique of government itself? In a sense that government is basically the original land squatter and it's basically charging the rest of us rents or staying on rent that. It's neither productively improving. As much as at least it's getting rents or must work. Like if you think about, even your landlord usually is not charging you 40%, which is what the income tax rate is in America, right? And it's like almost, you can view the land lord of America. Lars Doucet - 00:53:46: Well, I mean, it's like, I mean, if you wanna take the full, like if you're asking is Georgism compatible with full anarcho capitalist libertarianism, probably not 100%, I think we can have a little government as a treat. But I think it's not a coincidence that if you look throughout America's founding, I don't think it's a coincidence that originally, like people talk about it's like, oh, it used to be only white men who could vote. White land-owning men could vote. Like a government by the landowners for the landowners of the landowners, right? And that's very much kind of the traditional English system of government, just neo-feudalism, right? And so I think Georgism certainly has a critique of that, that it's like government is often instituted to protect the interests of landowners. But what's interesting is that if you look throughout history, I'm very much a fan of democracy, rule of the people. And it's like, I think we, you know, I kind of sympathize with Milton Friedman here, where he's like, you know, he might want to have less government than we have now, but he doesn't believe we can have no government. And then he goes on to endorse, you know, the land value taxes, the least worse tax, because income tax especially, I feel like is a gateway drug to the surveillance state, you know, one of the advantages of land value taxes you don't even care necessarily who owns the land. You're just like, hey, 4732 Apple Street, make sure the check shows up in the mail. I don't care how many shell companies in the Bahamas, you've like obscured your identity with, just put the check in the mail, Mr. Address, you know, whereas the income tax needs to do this full anal probe on everyone in the country, and then audits the poor at a higher rate than the rich, and it's just this horrible burden we have, and then it'll, it gives the government this kind of presumed right to know what you're doing about everything you're doing in this massive invasion of privacy.Dwarkesh Patel - 00:55:42: Yeah, no, that's fascinating. I speak to you, I have shell companies in the Bahamas, by the way. Yes. There's an interesting speculation about what would happen if crypto really managed to divorce and private, I guess, make private your log of transactions or whatever. And then, I guess the idea is the only legible thing left to the government is land, right? So it would like force the government to institute a land value tax, because like you can't tax income or capital gains anymore, that's all on like the blockchain and the right, right? It's cured in some way. And yeah, yeah, so that, I mean, it's like crypto the gateway drug to George's own, because it'll just move income and capital to the other realm. Lars Doucet - 00:56:20: Yeah, it's just so weird. I've gone on record as being a pretty big crypto skeptic. But I have noticed a lot of crypto people get into Georgism home. I mean, not the least of which is Vitalik Buterin and you endorse my book, who's a huge fan of Georgism home. It's like, I'll take fans from anywhere, even from people I've had sparring contests with. I'm generally pretty skeptical that crypto can fulfill all its promises. I am excited by those promises, and if they can prove me wrong, that would be great. And I think there's some logic to what you're saying is that if we literally couldn't track transactions, then I mean, I guess we don't have much the tracks accept land. I don't think that'll actually come to pass just based off of recent events. You know, and that's basically my position on it. But I have noticed a lot of crypto people, just they’re some of the easiest people to convince about George's home, which was completely surprising to me. But I've learned a lot by talking to them. It's very interesting and weird. Yeah, yeah. Dwarkesh Patel - 00:57:16: So there was some other interesting questions from Twitter. Ramon Dario Iglesias asks, how do you transition from a world today where many Americans have homes where it really starts sparring to have homes to a world where, I mean, obviously, it would be like a different regime. They might still have homes, but who knows? Like, their property will be just be like, think I thought I'm going to complete a different way. How do you transition to that? Like, what would that transition look like for most Americans? Lars Doucet - 00:57:39: So there's this issue called that I have to grapple with, which is called Gordon Tullich's transitional gains trap. Right? So if you think about taxing medallions in New York City, right? You know, it's like it's this artificially scarce asset that allows you to operate a taxi, right? And the first generation that got their taxing medallions basically got in cheap. And then afterwards, like made out like gangbusters. But the second generation had to buy those taxi medallions at the fully priced in value. And now when you come in and you're like, oh, okay, we're going to abolish taxi medallions. If like, say you were going to do that, you would screw over that entire second generation who bought in in good faith after the value of the asset had been fully priced in. Even if you admit that the system is now unfair, removing that unfairness screws over the people who played by the quote unquote unfair rules. You know, so how do you grapple with that? And I think it's something that Georgeists need to grapple with because we can't just imagine a future utopia without accounting for being fairer to people who played by the rules, including people like myself. Like I'm a homeowner, right? Am I intending to screw over myself and everyone like me? And so I think this is where it's really important to do the math of knowing exactly who's going to be a winner, who's going to be a loser, who's going to pay more, who's going to pay less. I think it's really salient that a lot of the value of land is commercial downtown real estate. And I think that a revenue neutral property tax shift land where we exempt the taxation of all buildings, but collect the same amount in property taxes as we're doing now, but just from the land and then a modest citizen's dividend is a really good first step. And then over the years, you can raise the land value rate as you also decrease things like income tax and sales tax. I think that's a transition that gets us there without really screwing anyone over. And for any edge case, like a poor sympathetic widow who has no income and but has a high value home, you just make it so she doesn't have to pay the land value tax until she dies or sells the estate. Dwarkesh Patel - 00:59:32: Yeah, yeah. And like I guess even in there, the worst case scenario is the status quo where they don't have to pay land value taxes, which is already the case now, right?Lars Doucet - 00:59:42: I mean, nobody cares about the people who are being evicted and displaced by the status quo. Dwarkesh Patel - 00:59:47: One, like I guess, snafu in terms of like figuring out how to price the land is by the time that a land value tax was passed, it'll have been like years after this political talk of having a land value tax. And that talk will in turn affect the prices of homes that are sold in that time. Absolutely. And so then you'll look at the land selling value and be like, oh wow, this is this house. It's not like the outskirts of San Francisco only sold for $200,000. And does that mean that like the unimproved land there is only worth $100,000? And so that just can, that really conflate the data when you actually go about implementing this of like what the actual unimproved land is worth. Lars Doucet - 01:00:28: Well, so I'm so important to remember that land selling value is derived from land rental value, not the other way around. So land selling value is the net present value of the future flow of income that can be generated from the property. So the property's inherent productivity is kind of inherent to it. And the selling price of it is based off of the capitalization of that value minus the expectation of any taxes, right? And so 100% land value tax will theoretically reduce the selling price to zero. But the land will still be as productive as it always was. It's just that the flow of those rents are being redirected, right? And so that's the thing is that, and also in mass appraisal, one of the things you do is you decapitalize the effect of the tax. Dwarkesh Patel - 01:01:18: But I'm saying, how do you even figure out you don't know in the mind of the property owner or the property seller, like what is it? What do they think the probability is of a tax? And that, since you don't know that, it's like hard to estimate what is the actual like capitalization, you know, the right value.. Lars Doucet - 01:01:35: What are you concerned about like this is societal effects of the depreciation of land prices? Are you more concerned about just the calculation issue? So here's the thing. Empirically, if the land value, if the land value, basically, if the land selling price has dropped to zero, then you are fully capturing all of the land rents. And if it's above zero, you have not captured all of the land rents. Dwarkesh Patel - 01:02:00: Oh, okay. So like maybe in the first year, you implement this. It's like, not, you know, maybe you're a little implemented like a, you're like basically in the first two years, you implement this, you would like be trying to mess with the rate. Lars Doucet - 01:02:11: Right. It's like, it's like, I mean, it's more complicated than this. But if there's any vacant lots in the area, and they're selling for anything, yeah, there's still land rent in that in that property. Dwarkesh Patel - 01:02:21: Gotcha. But so this is not something you would be able to figure out day one. You would have to like over a course of years of fudging the numbers Lars Doucet - 01:02:26:We're doing property tax assessments right now. You know, we're doing mass praise all the time right now. And if you just keep it updated every year, I mean, you could do it every six months if you had the right technology, which is something I'm pushing for. You know, and so you can see the prices change in real time as transactions come in. And you can use multiple regression and geographic weighted regression to work out the difference between the improvements and the land prices. And if you had a rental registry and knew what everyone was paying in rent, so you'd be able to keep even better track on what's going on with that. Dwarkesh Patel - 01:02:56: Yeah, this might be actually a good point to talk about your new startup. This is actually something I don't know about either. So yeah, what is the idea? What are you up to? Lars Doucet - 01:03:04: So my new startup is, you know, so I'm transitioning out of video games and into master praise municipal property tax assessment, mass appraisal. And so my new startup, it's called Geo Land Solutions for now. We're probably have a new name for it by the time that this podcast airs. But the idea is that, you know, I think the best criticism to Georgism is, you know, well, how are you actually going to separate land value from improvement, from building value, right? You know, how like we can't do a land value tax till we put a price on every parcel of land, right? So how are you going to do that? And I thought that was the best, most good faith, you know, criticism remained. And it seemed like it's like, well, we gotta get good at that, right? And so I looked into it and I realized that there is a lot of research papers that have been posted in the last 15 years about how to practically do this. And then I went and I started interviewing a bunch of assessors and I realized that the state of the practice is pretty far behind. Only 15% of most property tax assessment offices even use multiple regression. A lot of them are using the cost approach, which is basically where you, it's what Ed Glazer talked about in your interview with him where you estimate the cost of building and you applied depreciation and you subtract it from the observed selling price to get, you know, the assumed land price networks, and that works okay. But a lot of assessment is not only using, essentially only that method, but also, um, another issue is that just, um, a lot of those cost tables are very out of date. Um, uh, assessments themselves are not always done every year in some, it's not imperative to find places that haven't done reassessments in, you know, more than 10 years. Um, most places it's like, you know, one to five. Um, but even that, I think we should be doing everything we can to get all the latest mass appraisal technology and research. Um, and so we've hired some people who have, like, I basically, one of our first hires was one of the guys who was just first author on all these papers we were reading. And,we're just here to update municipal property tax assessors on the latest methods so that we can accurately know what all the land in America is worth, you know, and then this will solve a lot of our aggressivity issues too, because we know that a lot of landlords are actually under assessed relative to homeowners, believe it or not, because they're more likely to protest their property taxes. And minorities tend to be over assessed and poor people tend to be over assessed. That's why property taxes are sometimes called regressive is the assessments need to be fixed. Dwarkesh Patel - 01:05:41: I see. I guess because if you have more property, getting your rate changed from like 1% to 1 point, uh, 0.8% is like worth thousands of dollars rather than like a hundreds of dollars. Lars Doucet - 01:05:54: Right. And there's, there's, there's a lot of other issues too. Is this is like, there's more, there's more value in the like the more pro, there's all sorts of reasons that you can have these things, you know, often from no malintent whatsoever. Right. You know, but just like just out of date assessments can, can also cause all sorts of issues. Dwarkesh Patel - 01:06:11: Yeah. Yeah. I guess one worry that people might have is, well, let's say an income taxing is like, you know, obviously very inefficient. What is the, I think you, in the book, you're talking about the percentage of income, uh, that, uh, of tax income that is literally just spent on figuring out how much income tax to collect and how, how many people have paid or whatever. So I get that. But at least it has a nice property of there is like, it feels like there's this hard figure that ought to exist. Like I made this much income this year. Whereas figuring out how much land is worth, you know, justlike, I get that it's basically like, yeah, if you, you know, figured out like the rent value, that's like the value of land, but it just feels much more murky. And therefore it might potentially enable corruption in the level of like, you know, like whoever's doing the assessment or however that method of assessment is happening, um, they'll just like use these fancy algorithms to nudge it one of your another that benefits big corporations or, you know, whoever they want. Lars Doucet - 01:07:09: So that's a really, that's a good argument. But the reply to that is that we need to move towards more transparency, right? Because land value follows certain rules that should logically make sense, right? We know some things that drive location without first of all, we should move towards open source models, right? Which is something that we want to do and open data whenever possible. A lot of these cities will post open data portals like my mission in life is to be able to like advance the state of the art of this technology and make it so anyone can kind of check on stuff. You should be able to in any city in America, some cities have this been on enough. You should be able to look up your property tax assessment on a map and compare it to your neighbor. And what you shouldn't see is a Christmas tree effect, where your neighborhood looks like Christmas tree lights of like green and red of people whose property tax assessments like massively differ. That's the case in a lot of cities. Like if the value, like if the land values have been correctly assessed in this neighborhood, most of these parcels should be about the same, like probably the cul-de-sacs worth a little bit more, you know, but like your prop, your neighbor's land shouldn't be worth 20% more than yours. And if it is, it'll stick out on a map like a sore thumb. And if the data and the algorithms are all open source and open data, you should be able to check anyone's math. And you should be able to use that to then protest your taxes if they seem off. And that's kind of the argument for land value taxes is that, I mean, you can hide all kinds of stuff in income taxes and capital taxes. I mean, that's what the Caymans and the Bahamas are for. But if you want to, I mean, it's very easy to find people are getting a break on their property taxes like all this corruption. I'm not saying it won't happen, but it'll be very easy to see because you'll be able to see just this mansion that suddenly has this discontinuity on the land value map. It's like, well, someone gave this person a break and maybe, maybe we should, maybe we should write an article in the local newspaper about this. Dwarkesh Patel - 01:09:01: Yeah, it'll be way better than how income taxes work. None of it's like open to potentially even the government itself, right? But okay, so another concern is that's fine for things that are like above ground and legible. But what about you find out through, like, yeah, I don't know, like some sort of surveying or whatever that this land has a lot of oil under it. And then you buy it. But obviously you're not going to tell the government that I just found like however many. Lars Doucet - 01:09:26: So this is the sort of theoretic critique… Dwarkesh Patel - 01:09:27: Not, not even that is literally like you won't declare it. So in a sense, you're still being a speculator, but in fact, you're incentivized even more to be speculator in the sense that as soon as you declare that there's oil underneath this ground, then the government is going to start taxing you for it. So you just want to like hang on to that for, you know, you forever as long as like you can like, you know, keep the private right Lars Doucet - 01:09:48: So we need to talk about mineral policy in America, because especially instead of Texas, like mineral rights and land rights are totally different, right? Usually when you buy land in Texas and in America, like you actually don't have the mineral rights.. Like those are, those are very severable. Like a lot of people are very interested in, in getting those mineral rights. And so usually like if you're not paying attention, generally speaking, you're not getting the mineral rights when you're buying land. And if you are, you're paying more for them. And so I mean, I think a good example of this is probably like, you know, you want to create some, I think with the case of minerals, you can't just have a full, I think as kind of in acknowledgement of Kaplan's like, theoretic thing, like you have something more like an Norwegian model where you need to basically give some incentive to someone to produce or to not withhold that resource, right? I'm a good example would be the treasure, the treasure law in England because England has all this ancient likeAnglo-Saxon treasure and Roman treasure. And so before what they would have as someone would find it and like go like hide it or melt it down because they didn't want the government to tax is treasure law, which is not perfect, but it's okay. But they're like, we, this is our heritage, right? We want that in a museum. So here's the deal. If you find treasure, you're going to get paid. And the landowner's going to get paid. So there's an incentive for people to go out with metal detectors. And there's an incentive for a landowner to let people do that. And then the government's going to put it in a museum. Yeah. You know, you're going to, you're going to be rewarded for the discovery of that thing. But that thing is itself, its value is going to be captured because it's the heritage of the British people. The opposite of this is the Spanish government. Whenever someone finds a ship full of gall, a galleon full of gold on the bottom of the ocean, if you go and you invest the capital, bring that up to the surface, you know, and you're in Spanish waters or the Spanish government finds you, or you like take it not to Spain, a Spanish admiral in court is going to try to get its claws on that gold. In the view of the Spanish government, like basically the incentives they're producing is to make sure that nobody ever, ever recovers a ship. Dwarkesh Patel - 01:11:59: Yeah. And if they do. It just ends up in some sort of like, you know, a foundry in another country. Lars Doucet - 01:12:05: Right, we're right, right. The Spanish government's approach to sunken treasure basically incentivizes people never to go after. Dwarkesh Patel - 01:12:11: Yeah. Yeah. I guess a general critique of Georgism, too, in general, or implementing it would be less than the reason America is wealthy and other developed countries are wealthy is because they are very strong in terms of honoring contracts, especially honoring people with property rights. And, you know, if we get to a scenario where the government is saying, okay, but in this case, we're going to, I mean, I guess it depends on how you think about the contract property. But in some sense, it's a contract you have the government that like, hey, I have this property. And once you don't honor that, like the people will get too concerned to want to invest in America or in American assets. And that will just have like all kinds of economic repercussions where people are like, oh, I guess like my property is not mine. Maybe like other things I thought I was investing in like my stocks are not mine. So why should I buy these stocks in America? Lars Doucet - 01:13:00: This is a fully general argument against change. And it also is like, I don't agree with all the assumptions. Like, you know, if America doesn't honor its agreements, what are they worth? Well, we've violated all kinds of treaties, with the Indians, especially, but also like all sorts of international treaties. And, you know, I mean, the like, we've made all kinds of times where we've like changed rules on things and changed asset classes. You know, we had an entire period where we just banned all sales of alcohol. And then we had a time where we completely undid that and brought it all back. You know, there's been times where we've like made major, major changes to the rules of what kind of asset classes we have. I mean, this is kind of like brought up with like, you know, any kind of like labor protections and things is, you know, is it's like, well, we have these rules. And therefore, we can never change them. And I think, I think the best answer to this is that you need to acknowledge Gordon Tullich's transitional gains trapif there's someone who's going to be, you know, put out, then you make sure that there's some compensation in the system to smooth over the transition. But the rule of law doesn't imply that any change to the status quo is going to undermine trust in it. And I don't think that, and I think it's important to remember that George is not interested in seizing land. That's a very big distinction from the Maoist position, which is murder of the landlords or the more like modest Asian reforms, Asian reforms, which is like, we're just going to, so first of all, when you're talking about how Asia works, like they took the land away from the big landowners, gave it to the peasants, and it made those countries way more productive, right? And like, I don't think anyone would like look at those Asian countries now and compare them to where they were going to be like, well, the rule of law is weaker now than it used to be. But George isn't even advocating for that. He's just advocating for raising taxes on land and exempting all of the building taxes.So I don't think it amounts to seizure of land. And I think for those reasons, but even if it did amount to that, I think, you know, sometimes it's worth biting some bullets. Dwarkesh Patel - 01:15:11: Yeah, yeah. Okay, let's move on to the dessert. Let's move on to some more fun interpretations and applications of Georgism. So one, I think Byrn obart had this blog post on the diff. I don't know if you follow, but he's like a great finance writer. And he was talking about how if you have a Facebook account or a YouTube channel with like millions of subscribers, you're in some sense, like you were like very early to YouTuber Facebook, and now you have this land. And Facebook punishes you if you're have a big account, but not hosting frequently or not getting enough engagement, it'll like in the future, you'll have a harder time reaching people. And, you know, Byrn Hobarthad this like Georgism and Georgism interpretation of that. Where it's like you have this productive asset of, you know, people's attend like this, this initial sort of profile that you're able to build on the early days of Facebook, if you're not like posting on it, we're not going to give you the advantage of having millions of buys. But anyway, so there's all kinds of like ways you can apply to Richardson to you can think of like the app store as this sort of like rent seeking from Apple or the charger was 30% tithe. And yeah, there's all kinds of other places in the digital world where you can think of this. Like what is your sort of like, how do you think about Georgism in the context of those kinds of things? Lars Doucet - 01:16:30: Right. So I've actually written a policy paper on how to apply the theories of land value tax to virtual worlds. And so the question is virtual real estate is when does something actually operate like a land like asset? And then to what extent does Georgist principles apply? Right. And it doesn't necessarily mean just do LVT. It means that, you know, so first of all, let me define what I mean by a land like asset. A land like asset has three properties. It is scarce and supply. It is necessary for production. And it obtains locational value by virtue of its position in some kind of graph. Right. And so as an example, I create like a fictional MMO and I give the example of a unicorn, a permit, and a plot of land. The unicorn is scarce, but it's not necessary for production. Any value you can get from the unicorn, you can get some other ways. It's really nice to have. And there's only like 10,000 on the server. A permit is like a permit to brew potions. You're part of the witches guild. You can brew potions. So like my apprentice, witch she has to pay rent to me to gain access to my permit to be allowed to brew potions, but all permits are fungible. So there's no locational value. And then a plot of land, right? Like we've talked about where you can also, and so this becomes the real speculative asset. Domain names are probably the closest thing to this. And Vitalik Buterin has actually written a post about how to apply Georgist theory to domain names and also all the wrinkles that are involved. Dwarkesh Patel - 01:17:55: Because we did this on your blog, right? As a guest post. Lars Doucet - 01:17:58: Well, progressandpoverty.substack.com is not technically my blog. It's a group blog where a lot of us, Georgism's post. But so yeah, so my blog in the sense of our blog. Yeah. And he cross posted it. He posted it also on his own blog. And so, but there's other considerations to remember when we go away from literal land is like, so for instance, in domain names, you know, especially with the Ethereum name system, you have issues of identity, right? That don't apply like, if someone buys this house from you, probably people aren't going to be like maybe the next person who lives here is going to get some of your mail for like a week or two. But like no one's going to think that they're you necessarily. But if I buy Vitalik.eth. Yeah. Like there might be some confusion. Like I might be able to get some transactions that were meant for him. And so there's these other considerations to like kind of and he deals with all of that. And so I wrote a policy paper about how to apply LVT and virtual worlds and stuff. That was more in these more kind of literal simulacra of the real world in these like virtual worlds than kind of the things you're talking about of like YouTube accounts and and charts in like in basically app stores and stuff which are user generated content platforms. But I haven't fully analyzed user generated content platforms. But I do think chart positions are a sort of virtual land. You know, and you do if essentially they do essentially charge rent for that. Not just to the platform in their flat 30% fee across everything, but also in the kind of advertising red queens race you have to do to stay on those charts. You essentially have to buy that position and then keep it. You know, and so basically like the fur there's this huge first mover advantage that turns into rent seeking. And I haven't fully analyzed exactly how you applied Georgist theory there. But I do think there's something to it. I also think there's something to extremely long live copyrights and patents. It's a little undercooked at the moment. I don't have a fully fledged theory of it. But certainly cases like othermonopoly assets like orbital real estate, radio spectrum, any kind of like being able to capture the right of the possibility space. Like especially like, you know how like John Carmack had a lot of algorithms like some of which were patented and he wasn't even allowed to use them in his own games. Because someone else had speculated patented like Yeah. It was like the, like Carmack's reverse was like the particular algorithm that they weren't allowed to use and like quake three or something because someone had speculatively patented it. And there's like no other way to do that thing. So quake three, this one particular sub routine had to be like 25% slower. Because they because someone had patented like essentially like, like imagine you get like patent that Pythagorean theorem. You know, yeah. So like that kind of nonsense. And you can just rent seek off that for 20 years. Dwarkesh Patel - 01:20:51: Jesus. That's funny. Anyway, I guess we're going to move on to another juicy implication that you were just talking about, which is space. There is like this idea. I mean, eventually, hopefully humanity will conquer space and like the rest of the galaxy. So and this is where like Georgism and will be really interesting and applicable because we obviously want to we want to encourage and incentivize people to like go to new worlds and make use of like stars and planets. But we obviously don't want it to be the case that if you got to Mars a year earlier, like if Musk gets to Mars a year before Bezos, he has you know, like forever rights to rights toEverything on Mars and all the resources, right? So yeah, Georgism in space would be I think I think is actually a place that makes a lot of sense. But I mean, have you put much thought into like, you know, interstellar Georgism? Lars Doucet - 01:21:41: Interstellar Georgism is actually current international law. So really the inner through the outer space treaty. The outer space treaty currently said, and I think the outer space treaty will last for about five minutes once the interplanetary space race gets going in earnest. But the current law, the law of the international order of the outer space treaty basically says that nobody's allowed to claim interstellar bodies like the moon or Mars for China or the US. Like we have a flag there, but it's not American territory. Yeah. Right. It's basically international waters, so to speak, right? And once the actual possibility of having permanent bases shows up, then we will have to hash that out. But so basically I think we should take that and run with it and basically be if you are going to, you know, take possession of interstellar bodies, you know, it will become a question of who exactly becomes the government in that scenario. Is it like some international coalition? Is it the UN? I'm not a huge fan of the UN, you know, or is it just like it turns out to be like whatever sovereign government gets their first just gets to claim it, but can you have Georgism and within those confines? I think we certainly should. Yeah. You know, because otherwise what you're going to get is that you're going to get under investment, you know, you're going to get so much under investment because the first people to get there are going to basically charge rent to all the people who come next. Dwarkesh Patel - 01:23:05: Yeah. Yeah. I mean, I just remember the other question I wanted to ask about copyright, which is that's a really interesting and complicated area because it's hard to think of what is the intrinsic sort of value of the land of the idea and what is the improvement you've made. Right. And so like what do you got to call like the improvement on like the song you discovered? Maybe like the melody is like the melody would have existed anyways, but like the specific lyrics that came up with. I don't know. Lars Doucet - 01:23:31: Well, so like copyright, it's not clear to me exactly what the implication of Georgism is. It's like Georgism if you Zoom out, it's not exactly just about land, right? That's where people a lot of people like kind of like why are you so obsessed about land? It's mostly about enclosure of, enclosure of natural monopolies, right? And and and and and and and and and economies just based entirely around rent seeking. And it's clear we have this with like eternal copyright. If we had eternal, if we had the copyright laws we had today, when Disney was first getting started, like the Brothers Grim would still be under copyright. And they would not have been able to get off the ground with a lot of their early properties. And then they pulled the ladder up right behind them. It's clear they're rent seeking in a lot of ways and refusing to give back to the comments from which they first enriched themselves. And the question then becomes like, you know, can you easily parse copyright as land? I mean, it's a very undercooked theory, but there'ssomething there of like probably what it catches out to is just copyright terms should be shorter. You know, like at some point when an idea has become part of the cultural consciousness for like so long it should become part of just the background collective commons, you know, because all ideas are essentially remixed and built on top of other ideas. But we want to incentivize people to create new ideas in the first place. It's not a perfect analogy to land, but there is something there about rent seeking that needs to be addressed. And it probably just catches out to just reducing copyright terms. Dwarkesh Patel - 01:25:02: Well, let's talk about the political feasibility of this idea. So, I mean, I just mean land value tax in general. Do you think it will be something that will get passed in a democracy? I, you know, there's like, you know, a lot of people have homes or want to have homes, but on the other hand, if you like just redistribute, if you don't have like, I don't know, many acres in the middle of San Francisco, you would maybe still come out net ahead, but could you be able to explain that to people? And obviously there's like tenants who would definitely benefit from this. Anyways, in general, what is, what is your thought and like, how politically feasible this is now it or would be in the future? Lars Doucet - 01:25:36: I think it's more politically feasible than we think. I think it just right now has low salience. And if more people start talking about it, I think it's going to make a lot of sense, especially if it's pitched as property tax reform. Like right now in Texas, you know, you have people who are trying to abolish property tax, which will turn this state into California like that. Dwarkesh Patel - 01:25:55: Why? Huh? Why? How come? How, well, why does he want to abolish property tax? Why would into California? Lars Doucet - 01:25:57: Because California has some of the lowest property taxes in the nation. Yeah. And proposition 13, and it creates a entire layer of landed gentry and really, really, really expensive housing. Like housing is already getting expensive in Austin and property taxes have an effect of lowering property prices. Property taxes are an imperfect land value tax. And so basically, I, it will just reproduce the economic conditions that empirically exist in California. Dwarkesh Patel - 01:26:21: You know, there's like, there's this like funny saying that the Texas Constitution is not a government document, but rather an anti government document. But one of the, I guess, the positive bi-products of you’re a Georgist is since the next taxing income so hard, governments are forced to tax property and hopefully eventually land. And therefore, Lars Doucet - 01:26:40: I'm going to pick on the Texas Constitution because Houston had a, had a single tax mayor in 1911 and had an active, Georgist land value tax. And it would have still had it today if it wasn't for the state const for, for a state judge who basically shut them down. Because there's a clause in this state constitution of Texas that says all property taxation has to be uniform. And that's interpreted as uniform across both the buildings and the land. You can't tax them at separate rates. Dwarkesh Patel - 01:27:09: Yeah. Wait, so does that mean that constitutionally you could just go into it and do it in a Texas Senate? Lars Doucet - 01:27:14:It's up to interpretation. There's some people interpreted that it's like, what, what, that that clause was written to mean you can't tax this guy at a higher rate than that guy. You have to tax them based on the value of their property. And then you could claim that it's still being uniform. We're just taxing land and we have all these exemptions and categorizations already. This is just another one of those. Why, you know, we tax agricultural land at a different rate, you know, what I mean? Like if you put a bunch of cows on a property suddenly, it's like it's magically less valuable. So why can't we, you know, like target just the land? And so if you have the right judge, maybe you could get away with that. But anyway, to go go towards political feasibility, I think it could be more feasible than we think, especially pitched as property tax reform, because people are like property taxes are too high. Hey, everyone, let's exempt all your buildings. I think you could build a coalition that's excited about that. And especially if you do the math and show who like, like what the change in your taxable rate is going to be, I think, you know, you know, just a revenue neutral property tax shift to land can be quite popular. There's a lot of cities around the US right now where this is being floated, you know, organizations like Strong Towns and the Center for Property Tax Reform are working on a lot and Lincoln Land Institute are like talking to places about it, Detroit is talking about it right now. And they could desperately use it. And I think it could pass, you know, and then in terms of, I think Henry George's salience is coming back, like, and especially in Norway, like the Ruling Center Party coalition just passed a, you know, they're very successful resource management policy with oil. They also have one from the early 1900s in hydro power, which was set up by Norwegian Georgists. And so the Ruling Center Party coalition just put one in for salmon farming aquaculture locations. A new severance tax on that. And they name check, Henry George, when they implemented it in the speech. And so I think if they are willing to, you know, stand up to the landowners in Oslo and pass a land value tax, that would be the next step. I'm not sure if they're brave enough to do that. But we're starting to see this kind of bubble up. And so I think a revenue neutral property tax shift to land is is the politically popular way to do it. Because it can be done on the local level without having to change a whole bunch of laws. You know, it's a little complicated in Texas because that's stupid state constitutional provision. But in other states, they don't have those thoughts. There's other states that any municipality could do it right now if they wanted. Dwarkesh Patel - 01:29:33: And I guess another part of this question then, or the answer is, well, one of the things you talk about in the book is, you know, in some sense the value of your land is caused by the other people around you, by the properties of like other amenities and companies or whatever that are in. So it's kind of like a publicly contributed. But if you think about it that way, doesn't it make sense that your land taxes should go to that community, which is the one that's creating all this value, rather than being say distributed federally. So maybe we should have land value taxers on local levels. But then it goes to pay towards local amenities. So it's like if you live right next to the subway and the reason there are properties of valuables because like you're right next to the subway, then that goes towards making the New York subway better. But it doesn't go towards like, you know, I don't know, like some sort of the city hall and Kentucky or something. Lars Doucet - 01:30:21: Right. I mean, it's like if you wanted to create a model for, you know, bottom up decentralized America, like I would take that bargain. We still got to like fund the federal government somehow, you know, and so like I would like to repeal, you know, the federal income tax and have that funded by land value tax. But it's like, I mean, if that's like as far as I could ever get, I'd shake your hand and take that deal right now. You know, it sounds good. Dwarkesh Patel - 01:30:42: Yeah, fair enough. One more question. This was naturally from Twitter for I'm Craig Bratric, which is the question is basically if, I mean, one of the reasons why we think of land as being sort of like a public thing is because it's your land value is contributed by people around you. But what if you own so much land that really you are the one that's contributing to the value of the all your land, right? So if you're thinking like the thing like Disney World, they like they basically own like half of a world land or something. And they're the ones that are creating nearby amenities, which are making the rest of Disney world valuable. So in that case, are they entitled to all the proceeds? Lars Doucet - 01:31:19: And what's funny is like in a way, yes. And so what's interesting is like this is often like posed a gotcha question for Georgists. But we actually like internally like this is called the the Disneyland or the Disney World question, you know,and it's actually a really interesting case. And the thing you have to realize now is who is Disney World in this situation? Disney World is the government in that case and point. Disney World is the community. Disney World is the city. It's a private city. And then there's all these questions of who is the citizen of Disney World and is it an equitable democracy or whatever, which will leave aside for the moment. But the point is is that Disney World has fully internalized the positive externalities of their own building, right? And so the incentive structure has changed. We fully acknowledge that we just bite that bullet. So the question then becomes, you know, what do you do about it? It's a really interesting city, which is essentially a private city, you know, and so there can be certainly issues with company towns, especially when they, you know, enforce local monopolies, essentially like bad local laws, where it's like you have to buy from the company store or whatever, you know, which is mostly an issue of governance. But in terms of like land use, actually if an entire landowner owns an entirely large enough area. And to internalize all of their positive building things that actually, you know, they are actually, you know, that does change the situation. And then you need to see them less as the private owner of a parcel and more as a private operator of a city, right? And that changes the governance question and it becomes a completely different category of problem. And so then there's questions of it's like, you know, what what what is the right mix of taxes and subsidies? And do you even want to have these sort of entities in the first place? And what is the governance question looks like? But the important thing to realize is that you are no longer dealing with a private landowner, you were dealing with a private city. Dwarkesh Patel - 01:33:09: Wait, okay. So is maybe one way to think about Georgism that somebody has to be collecting the rents? And what George is saying is we want the rents collected by the government and not by the person who is like a private landowner, presumably because the government will do more public-facing things with it. But like, rents have to be collected. We just have we're just trying to decide who will collect Lars Doucet - 01:33:32: Right, rents will be collected one way or another. And if we leave it to the status quo, private actors free writing off their neighbors will collect them and make everything worse. They will cause that they will cause less investment and they will hold the best land out of use and there'll be less building than there should be and the rent will be too damn hot. Yeah. And the rent has to be collected one way or another. So it might as well be collected on behalf of the community, right? Because not only will this fix the incentives, but then it also shares the wealth with the people actually produce the wealth. And if the community is itself this giant private city, then that kind of changes the equation a bit. And I have not like fully delved into the Disney World issue and the Disney World question. And that's a little separate academically from actually existing Disney World and how anyone feels about that institution in particular. But the important thing to realize is that we're now dealing with a different domain. You know, because then the question is it's like, you know, who is a citizen of Disneyland, who is a tenant of Disneyland? Who what is the governance of Disneyland? It's like you realize now Disneyland essentially is the government. And I think that's actually like kind of literally true in actually existing Disney World because they have their own like special district that operates essentially as a private government. And that's just it's just its own it's own kind of question. But the point is very much yes, the rents have to be collected one way or the other. So they might as well be collected on behalf of the community. One way to implement that is through a government, right? You know, because we have this nice little democracy we can use. But you can all there's also this movement, you know, there's this whole charter cities movement. And then a movement I like even better called starter cities, which is less like let's find some, you know, third world country to like hope our sovereignty doesn't get revoked in five years like, but let's like build cities somewhere in America, rezoning is pretty loose. You know, you could have everyone who lives there basically be a shareholder of a private entity and share out the land rents that way. Another way to implement it would just be ground leases rather than land value tax within a private city. And then everyone who lives there is de facto a shareholder of the city. And there's some people are trying to build stuff like that, which I'm very much interested in. ± Dwarkesh Patel - 01:35:32: vAwesome. Awesome. Okay. Final question. What is next for you? Lars Doucet - 01:35:35: So what is next for me? So I'm still a game developer and you know, so nights and weekends I'm overseeing a project that will release next year Defender's Quest two after a good decade of development. I'm happy for that to be finished. But then additionally, you know, I am working on a startup, which is called Geo Lands Solutions for now. Thename will almost certainly have changed by the time of time this podcast airs. But if you go to geolandsolutions.com it will redirect to whatever our new website is. And that is a municipal mass appraisal company. We're going to partner with local municipalities. We've already got a couple of customers are interested in what we're doing. And we're going to massively update the state of the practice of municipal mass appraisal in America to be more accurate, more efficient and more up to date with the latest models and more transparent, you know, leaning into open source and open data solutions wherever possible. And I think that can be the practical step towards Georgism not just to implement georgism but even to advocate for it. Because you know, in the Edward Glazer interview, you know, one of the pretty I'm super happy to have Glazer's endorsement. Even if he thinks Georgism is in a panacea. Yeah. One of the things about his critique of not being a panacea. And I think, you know, it's a poly-cia even if it's not a panacea, you know, I'll settle for curing multiple diseases even if I'm not curing literally all of them. Is that is that I think he's under the impression that land isn't a big deal. And how important you think georgism is depends on how much the land is worth. And to do that, we have to measure it. And we're not super good at measuring it right now. And I think we need to get super good at measuring it. And then I've decided, you know, when I was talking about this originally, you know, basically someone, you know, challenged me, it's like, if you really think you can do this, then the reason I don't think you can do this is because if you really could, then people would give you millions of dollars to go do it. And well, we just closed around. Led by Sam Altman, you know, and that's exactly what happened. And now we're going to do it. So I'm really grateful to that commenter for challenging me in that way because I'm like, okay, well, I really see my life's work as like making Georgism possible and practical. And I think the way to do that is to measure the value of the land and to put those tools out there for anybody to be able to pick up. Dwarkesh Patel - 01:37:50: Yep. Yep. Awesome. Okay. So the book is Land is a Big Deal. And where else can people find you? So you can find me at a couple of places on the website land is a big deal.com. You can find me on Twitter at large CS prime LARS I us PR IME. And the book is based on a series of articles that you can find at gameofrent.com. And one else we have another website. Yeah. Well, geolandsolutions.com, which will redirect you to whatever, whatever the new name is. And that's that's that's everything I do. Yeah. Dwarkesh Patel - 01:38:22: And this is one of those books. I mean, it's like there's books you read where like, oh, that's interesting. You know, like I guess I shifted my prior slightly. And there's books like, oh, f**k, why did I not think about it that way? That's like, wow, that's like changes everything about like how I think about in this case, you know, economics and it really is one of those things where I'm look, I think you're the metaphor in the book about like observing the cat in a picture. Lars Doucet - 01:38:43: Yeah. Seeing the cat. Yeah. Exactly. Dwarkesh Patel - 01:38:45: So yeah, anyways, I do highly recommend the book. It's one of those books you will read where you'll just have a completely new perspective on an entire field. Awesome. Okay. Thanks, Lars. Thanks for coming on today. Yeah. And thanks for making all your way all the way over here to do this Lars Doucet - 01:38:57: interview live. Yeah. Well, thanks for grilling me. Thanks for all the hard questions. You know, it's like I really, I really, I really like to be challenged in that way and like really engage with the best faith, you know, hard-hitting critiques, you know, to like make sure we like really understand what we're talking about here. Because none of this matters unless it works. Yeah. Right. And so it's like, I'm not here to like defend Henry George's honor. I'm here to like really explore whether this can actually be a solution to our problem. Yes. Yeah. Dwarkesh Patel - 01:39:22: Awesome. Hey, thanks for listening. If you enjoyed that episode, I would really, really, really appreciate it if you could share it. This is still a pretty small podcast. So it is a huge help when any one of you shares an episode that you like.Post it on Twitter, send it to friends who you think might like it, put it in your group chats, just let the word go forth. It helps out a ton. Many thanks to my amazing editor Graham Besselou for producing this podcast and to Mia Ayanna for creating the amazing transcripts that accompany each episode, which have helpful links. And you can find them at the link in the description below. Remember to subscribe on YouTube and your favorite podcast platforms. Cheers. See you next time. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Holden Karnofsky is the co-CEO of Open Philanthropy and co-founder of GiveWell. He is also the author of one of the most interesting blogs on the internet, Cold Takes.We discuss:* Are we living in the most important century?* Does he regret OpenPhil’s 30 million dollar grant to OpenAI in 2016?* How does he think about AI, progress, digital people, & ethics?Highly recommend!Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Timestamps(0:00:00) - Intro(0:00:58) - The Most Important Century(0:06:44) - The Weirdness of Our Time(0:21:20) - The Industrial Revolution (0:35:40) - AI Success Scenario(0:52:36) - Competition, Innovation , & AGI Bottlenecks(1:00:14) - Lock-in & Weak Points(1:06:04) - Predicting the Future(1:20:40) - Choosing Which Problem To Solve(1:26:56) - $30M OpenAI Investment(1:30:22) - Future Proof Ethics(1:37:28) - Integrity vs Utilitarianism(1:40:46) - Bayesian Mindset & Governance(1:46:56) - Career AdviceTranscriptDwarkesh Patel  All right, today I have the pleasure of speaking with Holden Karnofsky who is the co-CEO of Open Philanthropy. In my opinion, Holden is one of the most interesting intellectuals alive. Holden, welcome to the Lunar Society. Holden Karnofsky Thanks for having me. The Most Important CenturyDwarkesh PatelLet's start off by talking about The Most Important Century thesis. Do you want to explain what this is for the audience? Holden Karnofsky My story is that I originally co-founded an organization called GiveWell that helps people decide where to give as effectively as possible. While I’m no longer as active as I once was there, I'm on its board. It's a website called GiveWell.org that makes good recommendations about where to give to charity to help a lot of people. As we were working at GiveWell, we met Cari Tuna and Dustin Moskovitz. Dustin is the co-founder of Facebook and Asana and we started a project that became Open Philanthropy to try to help them give away their large fortune and help as many people as possible. So I've spent my career looking for ways to do as much good as possible with a dollar, an hour, or basically whatever resources you have (especially with money).I've developed this professional specialization in looking for ideas that are underappreciated, underrated, and tremendously important because a lot of the time that's where I think you can find what you might call an “outsized return on investment.” There are opportunities to spend money and get an enormous impact because you're doing something very important that’s being ignored by others. So it's through that kind of professional specialization that I've actively looked for interesting ideas that are not getting enough attention. Then I encountered the Effective Altruist Community, which is a community of people basically built around the idea of doing as much good as you can. It's through that community that I encountered the idea of the most important century. It's not my idea at all, I reached this conclusion with the help and input of a lot of people. The basic idea is that if we developed the right kind of AI systems this century (and that looks reasonably likely), this could make this century the most important of all time for humanity. So now let’s talk about the basic mechanics of why that might be or how you might think about that. One thing is that if you look back at all of economic history ( the rate at which the world economy has grown), you see acceleration. You see that it's growing a lot faster today than it ever was. One theory of why that might be or one way of thinking about it through the lens of basic economic growth theory is that in normal circumstances, you can imagine a feedback loop where you have people coming up with ideas, and then the ideas lead to greater productivity and more resources.When you have more resources, you can also have more people, and then those people have more ideas. So you get this feedback loop that goes people, ideas, resources, people, ideas, resources. If you’re starting a couple of hundred years ago and you run a feedback loop like that, standard economic theory says you'll get accelerating growth. You'll get a rate of economic growth that goes faster and faster. Basically, if you take the story of our economy to date and you plot it on a chart and do the kind of simplest thing you can to project it forward, you project that it will go that our economy will reach an infinite growth rate this century. The reason that I currently don't think that's a great thing to expect by default is that one of the steps of that feedback loop broke a couple hundred years ago. So it goes more people, more ideas, more resources, more people, more ideas, more resources. But, a couple hundred years ago, people stopped having more children when they had more resources. They got richer instead of more populous. This is all discussed on the Most Important Century page on my blog, Cold Takes. What happens right now is that when we have more ideas and we have more resources, we don't end up with more people as a result. We don't have that same accelerating feedback loop. If you had AI systems that could do all the things humans do to advance science and technology (meaning the AI systems could fill in that “more ideas” part of the loop), then you could get that feedback loop back. You could get sort of this unbounded, heavily accelerating, explosive growth in science and technology. That's the basic dynamic at the heart of it and a way of putting it that's trying to use familiar concepts from economic growth theory. Another way of putting it might just be, “Gosh, if we had AI systems that could do everything humans do to advance science and technology, that would be insane.” What if we were to take the things that humans do to create new technologies that have transformed the planet so radically and we were able to completely automate them so that every computer we have is potentially another mind working on advancing technology? So either way, when you think about it, you could imagine the world changing incredibly quickly and incredibly dramatically. I argue in the Most Important Century series that it looks reasonably likely, in my opinion, more than 50-50, that this century will see AI systems that can do all of the key tasks that humans do to advance science and technology. If that happens, we'll see explosive progress in science and technology. The world will quickly become extremely different from how it is today. You might think of it as if there was thousands of years of changes packed into a much shorter time period. If that happens, then I argue that you could end up in a deeply unfamiliar future. I give one example of what that might look like using this hypothetical technology idea called digital people. That would be sort of people that live in virtual environments that are kind of simulated, but also realistic and exactly like us. When you picture that kind of advanced world, I think there is a decent reason to think that if we did get that rate of scientific and technological advancement, we could basically hit the limits of science and technology. We could basically find most of what there is to find and end up with a civilization that expands well beyond this planet, has a lot of control over the environment, is very stable for very long periods of time, and looks sort of post-human in a lot of relevant ways. If you think that, then this is basically our last chance to shape how this happens. The most important century hypothesis in a nutshell is that if we develop AI that can do all the things humans do to advance science and technology, we could very quickly reach a very futuristic world that’s very different from today's. It could be a very stable, very large world, and this is our last chance to shape it.The Weirdness of Our TimeDwarkesh Patel Gotcha. I and many other people are going to find that very wild. Could you walk us through the process by which you went from working in global development to thinking this way? In 2014, for example, you had an interview or a conversation and this is a quote from there. “I have looked at the situation in Africa, have an understanding of the situation in Africa, and see a path of doing a lot of good in Africa. I don't know how to look into the far future situation, don't understand the far future situation, and don't see a path to doing good on that front I feel good about.” Maybe you can walk me through how you got from there to where you are today.Holden Karnofsky Firstly, I want to connect this back to how this relates to the work I was doing at GiveWell, and why this all falls under one theme. If we are on the cusp for this century of creating these advanced AI systems, then we could be looking at a future that's either very good or very bad. I think there are decent arguments that if we move forward without caution and we develop sloppily designed AI systems, they could end up with goals of their own. We would end up with a universe that contains very little that humans value or a galaxy that does or a world where very powerful technologies are used by ill-meaning governments to create a world that isn't very good. We could also end up with a world where we manage to eliminate a lot of forms of material scarcity and have a planet that's much better off than today's. A lot of what I ask is how can we help the most people possible per dollar spent? If you ask how we can help the most people possible per dollar spent, then funding some work to help shape that transition and make sure that we don't move forward too incautiously, and that we do increase the odds that we do get like a good future world instead of a bad future one, is helping a huge number of people per dollar spent. That's the motivation. You're quoting an argument I was having where we posted a transcript back in 2014–– a time that was part of my journey of getting here. I was talking to people who were saying, “Holden, you want to help a lot of people with your resources. You should be focused on this massive event that could be coming this century that very few people are paying attention to, and there might be a chance to make this go well or poorly for humanity.” So I was saying, “Gosh, like that sure is interesting.” And I did think it was interesting. That's why I was spending the time and having those conversations. But I said, “When I look at global poverty and global health, I see what I can do. I see the evidence. I see the actions I can take. I'm not seeing that with this stuff.” So what changed? I would say a good chunk of what changed is maybe like the most boring answer possible. I just kept at it. I was sitting there in 2014 saying, “Gosh, this is really interesting, but it's all a bit overwhelming. It's all a bit crazy. I don't know how I would even think about this. I don't know how I would come up with a risk from AI that I actually believed was a risk and could do something about today.” Now, I've just been thinking about this for a much longer time period. I do believe that most things you could say about the far future are very unreliable and not worth taking action on, but I think there are a few things one might say about what a transition to very powerful AI systems could look like. There are some things I'm willing to say would be bad if AI systems were poorly designed, had goals of their own, and ended up kind of running the world instead of humans. That seems bad.I am more familiar today than I was then with the research and the work people can do to make that less likely and the actions people can take to make that less likely–– so that's probably more than half the answer. But another thing that would be close to half the answer is that I think there have been big changes in the world of AI since then. 2014 was the beginning of what's sometimes called the “deep learning revolution”. Since then, we've basically seen these very computationally intensive (but fundamentally simple) AI systems achieve a lot of progress on lots of different unrelated tasks. It's not crazy to imagine that the current way people are developing AI systems, cutting-edge AI systems, could take us all the way to the kind of extremely powerful AI systems that automate roughly everything humans do to advance science and technology. It's not so wild to imagine that we could just keep on going with these systems, make them bigger, put more work into them, but basically stay on the same path and you could get there. If you imagine doing that, it becomes a little bit less daunting to imagine the risks that might come up and the things we could do about them. So I don't think it's necessarily the leading possibility, but it's enough to start thinking concretely about the problem. Dwarkesh Patel Another quote from the interview that I found appealing was “Does the upper crust of humanity have a track record of being able to figure out the kinds of things MIRI claims to have figured out?” By the way, for context for the viewers, MIRI is the organization Eliezer was leading, which is who you were talking to at the time. Holden Karnofsky I don't remember exactly what kinds of things MIRI was trying to figure out and I'm not sure that I even understood what they were that well. I definitely think it is true that it is hard to predict the future, no matter who you are, no matter how hard you think, and no matter how much you've studied. I think parts of our “world” or memeplex or whatever you want to call it, overblow this at least a little bit. I think I was buying into that a little bit more than I could. In 2014, I would have said something like, “Gosh, no one's ever done something like making smart statements about what several decades out of our future could look like or making smart statements about what we would be doing today to prepare for it.” Since then, I think a bunch of people have looked into this and looked for historical examples of people making long-term predictions and long-term interventions. I don't think it's amazing, but I think I wrote a recent blog post entitled The Track Record of Future. It seems… fine. “Fine” is how I put it, where I don't think there's anyone who has demonstrated a real ability to predict the future with precision and know exactly what we should do. I also don't think humans' track record of this is so bad and so devastating that we shouldn't think we are capable of at least giving it a shot. If you enter into this endeavor with self-awareness about the fact that everything is less reliable than it appears and feels at first glance and you look for the few things that you would really bet on, I think it's worth doing. I think it's worth the bet. My job is to find 10 things we could do, and have nine of them fail embarrassingly, on the off chance that one of them becomes such a big hit that it makes up for everything else. I don't think it's totally crazy to think we could make meaningful statements about how things we do today could make these future events go better, especially if the future events are crazily far away (especially if they're within the next few decades.) That's something I've changed my mind on, at least to some degree. Dwarkesh Patel Gotcha. Okay, so we'll get to forecasting in a second, but let's continue on the object-level conversation about the most important century. I want to make sure I have the thesis right. Is the argument that because we're living in a weird time, we shouldn't be surprised if something transformative happens in a century or is the argument that something transformative could happen this century? Holden Karnofsky It's a weird time. So something we haven't covered yet, but I think is worth throwing in is that a significant part of the ‘Most Important Century series’ is making the case that even if you ignore AI, there's a lot of things that are very strange about the time that our generation lives in. The reason I spent so much effort on this is because back in 2014, my number one objection to these stories about transformative AI wasn’t anything about whether the specific claims about AI or economic models or alignment research made sense. This whole thing sounded crazy and was just suspicious. It's suspicious if someone says to you, “You know, this could be the most important century of all time for humanity.” I titled the series that way because I wanted people to know that I was saying something crazy and that I should have to defend it. I didn't want to be backpedaling or soft-pedaling or hiding what a big claim I was making. I think my biggest source of skepticism was how I didn’t have any specific objection. It sounds crazy and suspicious to say that we might live in one of the most significant times of the most significant time for humanity ever. So a lot of my series is saying that it is weird to think that, but we already have a lot of evidence that we live in an extraordinarily weird time that would be on the short list of contenders for the most important time ever–– even before you get into anything about AI, and just used completely commonly accepted facts about the world. For example, if you chart the history of economic growth, you’ll see that the last couple hundred years have seen faster growth by a lot than anything else in the history of humanity or the world. If you chart anything about scientific and technological developments, you’ll see that everything significant is packed together in the recent past. There's almost no way to cut it. I've looked at many different cuts of this. There's almost no way to cut it that won't give you that conclusion. One way to put it is that the universe is something like 11 or 12 billion years old. Life on Earth is three billion years old. Human civilization is a blink of an eye compared to that. We're in this really tiny sliver of time, the couple hundred years when we've seen a huge amount of technological advancement and economic growth. So that's weird. I also talk about the fact that the current rate of economic growth seems high enough that we can't keep it going for that much longer. If it went for another 10,000 years, that's another blink of an eye and galactic time scales. It looks to me like we would run out of atoms in the galaxy and wouldn't have anywhere to go. So I think there are a lot of signs that we just live in a really strange time. One more thing that I'll just throw in there–– I think a lot of people who disagree with my take would say, “Look, I do believe eventually we will develop space colonization abilities. We could go to the stars, fill up the galaxy with life, and maybe have artificial general intelligence, but to say that this will happen in a century is crazy. I think it might be 500 years. I think it might be a thousand years. I think it might be 5000 years.” A big point I make in the series is how I say, “Well, even if it's 100000 years, that's still an extremely crazy time to be in in the scheme of things.” If you make a graphic timeline and you show my view versus yours, they look exactly the same down to the pixel. So there are already a lot of reasons to think we live in a very weird time. We're on this planet where there's no other sign of life anywhere in the galaxy. We believe that we could fill up the galaxy with life. That alone would make us among the earliest life that has ever existed in the galaxy–– a tiny fraction of it. So that’s a lot of what the series is about. I'll answer this question explicitly. You ask, “Is this series about whether transformative AI will come and make this century weird?” or is it about “This century could be weird, and therefore transformative AI will come?” The central claim is that transformative AI could be developed in this century and the sections about ‘how weird a time we live in’ are just a response to an objection. It's a response to a point of skepticism. It's a way of saying there are already a lot of reasons to think we live in a very weird time. So actually, this thing about AI is only a moderate quantitative update, not a complete revolution in the way you're thinking about things. Dwarkesh Patel There's a famous comedian who has a bit where he's imagining what it must have been like to live in 10BC. Let's say somebody comes with the proof that current deep learning techniques are not scalable for some reason and that transformative AI is very unlikely this century. I don't know if this is a hypothetical where that would happen, but let's just say that it is. Even if this is a weird time in terms of economic growth, does that have any implications other than transformative AI? Holden Karnofsky I encourage people to go to my series because I have a bunch of charts illustrating this and it could be a little bit hard to do concisely now. But having learned about just how strange the time we live in is when you look at it in context, I think the biggest thing I take away from this is how we should really look for the next big thing. If you'd been living 300 years ago and you'd been talking about the best way to help people, a lot of people might have been talking about various forms of helping low-income people. They probably would have been talking about spreading various religious beliefs. It would have seemed crazy to think that what you should be thinking about, for example, was the steam engine and how that might change the world, but I think the Industrial Revolution was actually an enormous deal and was probably the right thing to be thinking about if there's any way to be thinking about it how that would change the world and what one might do to make that a world that could be better.So that's basically where I'm at. I just think that as a world, as a global civilization, we should place a really high priority on saying that we live in a weird time. Growth has been exploding, accelerating over the last blink of an eye. We really need to be nervous and vigilant about what comes next and think about all the things that could radically transform the world. We should make a list of all the things that might radically transform the world, make sure we've done everything we can to think about them and identify the ways we might be able to do something today that would actually help. Maybe after we're done doing all that, we can have a lot of the world's brightest minds doing their best to think of stuff and when can't think of any more, then we can go back to all the other things that we worry aboutRight now the world invests so little in that kind of speculative, “Hey, what's the next big thing?” Even if it's not super productive to do so, even if there's not that much to learn, I feel the world should be investing more in that because the stakes are extremely high. I think it’s a reasonable guess that we're living in a world that's recently been incredibly transformed by the Industrial Revolution and the future could be incredibly transformed by the next thing. I just don't think this gets a lot of discussion in basically any circles. If it got some, I would feel a lot more comfortable. I don't think the whole world should just obsess over what the next transformative event is, but I think right now there's so little attention to it. The Industrial Revolution Dwarkesh Patel I'm glad you brought up the Industrial Revolution because I feel like there are two implicit claims within the most important century thesis that don't seem perfectly compatible. One is that we live in an extremely wild time and that the transition here is potentially wilder than any other transition there has been before. The second is we have some sense of what we can be doing to make sure this transition goes well. Do you think that somebody at the beginning of the Industrial Revolution, knowing what they knew then, could have done something significant to make sure that it went as favorably as possible? Or do you think that that's a bad analogy for some reason? Holden Karnofsky It's a pretty good analogy for being thought-provoking and for thinking, “Gosh, if you had seen the Industrial Revolution coming in advance and this is when economic growth really reached a new level back in the 1700s and 1800s, what could you have done?” I think part of the answer is it's not that clear and I think that is a bit of an argument we shouldn’t get too carried away today by thinking that we know exactly what we can do. But I don't think the answer is quite nothing. I have a goofy cold-taste post that I never published and may never publish because I lost track of it. What it basically says is “What if you'd been in that time and you had known the Industrial Revolution was coming or you had thought it might be?” You would ask yourself what you could be doing. One answer you might have given is you might have said, “Well, gosh, if this happens, whatever country it happens in might be disproportionately influential. What would be great is if I could help transform the thinking and the culture in that country to have a better handle on human rights and more value on human rights and individual liberties and a lot of other stuff–– and gosh, it kind of looks like people were doing that and it looks like it worked out.” So this is the Enlightenment.I even give this goofy example–– I could look it up and it's all kind of a trollish post. But the example is someone's thinking, “Hey, I'm thinking about this esoteric question about what a government owes to its citizens” or, “When does a citizen have a right to overthrow a government or when is it acceptable to enforce certain beliefs and not?” Then the other person in the dialogue is just like, “This is the weirdest, most esoteric question. Why does this matter? Why aren't you helping poor people?” But these are the questions that the Enlightenment thinkers were thinking about. I think there is a good case that they came up with a lot of stuff that really shaped the whole world since then because of the fact that the UK became so influential and really laid the groundwork for a lot of stuff about the rights of the governed, free speech, individual rights, and human rights. Then I go to the next analogy. It’s like we're sitting here today and someone is saying, “Well, instead of working on global poverty, I'm studying this esoteric question about how you get an AI system to do what you want it to do instead of doing its own thing. I think it's not completely crazy to see them as analogous.” Now, I don't think this is what the Enlightenment thinkers are actually doing. I don't think they were saying this could be the most important millennium, but it is interesting that it doesn't look like there was nothing to be had there. It doesn't look like there's nothing you could have come up with. In many ways, it looks like what the Enlightenment thinkers were up to had the same esoteric, strange, overly cerebral feel at the time and ended up mattering a huge amount. So it doesn't feel like there's zero precedent either.Dwarkesh Patel Maybe I'm a bit more pessimistic about that because I think the people who are working on individual rights frameworks weren’t anticipating an industrial revolution. I feel like the type of person who’d actually anticipate the industrial revolution would have a political philosophy that was actually probably a negative given, you know… Karl Marx. If you saw something like this happening, I don’t think it would be totally not obvious. Holden Karnofsky I mean, I think my basic position here is that I'm not sitting here highly confident. I'm not saying there's tons of precedent and we know exactly what to do. That's not what I believe. I believe we should be giving it a shot. I think we should be trying and I don't think we should be totally defeatist and say, “Well, it's so obvious that there's never anything you could have come up with throughout history and humans have been helpless to predict the future.” I don't think that is true. I think that's enough of an example to kind of illustrate that. I mean, gosh, you could make the same statement today and say, “Look, doing research on how to get AI systems to behave as intended is a perfectly fine thing to do at any period in time.” It's not like a bad thing to do. I think John Locke was doing his stuff because he felt it was a good thing to do at any period in time, but the thing is that if we are at this crucial period of time, it becomes an even better thing to do and it becomes magnified to the point where it could be more important than other things. Dwarkesh Patel The one reason I might be skeptical of this theory is that I could say, “Oh, gosh, if you look throughout history, people were often convinced that they were living in the most important time,” or at least an especially important time. If you go back, everybody could be right about living in the most important time. Should you just have a very low prior that anybody is right about this kind of thing? How do you respond to that kind of logic?Holden Karnofsky First of all, I don't know if it’s really true that it's that common for people to say that they're living in the most important time in history. This would be an interesting thing to look at. But just from stuff I've read about past works on political philosophy and stuff, I don't exactly see this claim all over the place. It definitely happens. It's definitely happened. I think a way of thinking about it is that there are two reasons you might think you are especially important. One is that you actually are and you’ve made reasonable observations about it. Another is that you want to be or you want to think you are so you're self-deceiving. So over the long sweep of history, a lot of people will come to this conclusion for the second reason. Most of the people who think they're the most important will be wrong. So that's all true. That certainly could apply to me and it certainly could apply to others. But I think that's just completely fine and completely true. I think we should have some skepticism when we find ourselves making these kinds of observations. At the same time, I think it would be a really bad rule or a really bad norm that every time you find yourself thinking the stakes are really high or that you're in a really important position, you just decide to ignore the thought. I think that would be very bad.If you imagine a universe where there actually are some people who live in an especially important time, and there are a bunch of other people who tell stories to themselves about whether they do, how would you want all those people to behave? To me, the worst possible rule is that all those people should just be like, “No, this is crazy, and forget about it.” I think that’s the worst possible rule because the people who are living at the important time will then do the wrong thing. I think another bad rule would be that everyone should take themselves completely seriously and just promote their own interests ahead of everyone else's. A rule I would propose over either of them is that all these people should take their beliefs reasonably seriously and try to do the best thing according to their beliefs, but should also adhere to common sense standards of ethical conduct and not do too much “ends justify the means’ reasoning.” It's totally good and fine to do research on alignment, but people shouldn't be telling lies or breaking the law in order to further their ends. That would be my proposed rules. When we have these high stake, crazy thoughts, we should do what we can about them and not go so crazy about them that we break all the rules of society. That seems like a better rule. That's the rule I'm trying to follow. Dwarkesh Patel Can you talk more about that? If for some reason, we can be convinced that the expected value calculation was immense, and you had to break some law in order to increase the odds that the AI goes well, I don't know how hypothetical this would be. Is it just that you're not sure whether you would be right and so you’d just want to err on the side of caution? Holden Karnofsky Yeah, I'm really not a fan of ends justify the means’ reasoning. The thing that looks really, really bad is people saying it's worth doing horrible things and coercing each other and using force to accomplish these things because the ends we're trying to get to are more important than everything else. I'm against that stuff. I think that stuff looks a lot worse historically than people trying to break the future and do helpful things. So I see my main role in the world as trying to break the future and do helpful things. I can do that without doing a bunch of harmful, common sense, unethical stuff. Maybe someday there will be one of these intense tradeoffs. I haven't really felt like I've run into them yet. If I ever ran into one of those intense tradeoffs, I'd have to ask myself how confident I really am. The current level of information and confidence I have is, in my opinion, not enough to really justify the means. Dwarkesh Patel Okay, so let's talk about the potential implausibility of continued high growth. One thing somebody might think is, “OK, maybe 2 percent growth can't keep going on forever, but maybe the growth slows down to point five percent a year.” As you know, small differences in growth rates have big effects on the end result. So by the point that we've exhausted all the possible growth in the galaxy, we'll probably be able to expand to other galaxies. What’s wrong with that kind of logic where there's point five percent growth that still doesn't imply a lock-in or would it be weird if that implied a lock-in?Holden Karnofsky I think we might want to give a little bit more context here. One of the key arguments of the most important century is that it's just part of one of the arguments that we live in a strange time. I'm also arguing that the current level of economic growth just looks too high to go on for another 10,000 years or so. One of the points I make, which is a point I got from Robin Hanson, is that if you just take the current level of economic growth and extrapolate it out 10,000 years, you end up having to conclude that we would need multiple stuff that is worth as much as the whole world economy is today–– multiple times that per atom in the galaxy. If you believe we can't break the speed of light, then we can't get further than that. We can't get outside the galaxy. So in some sense, we run out of material. So you're saying, “Alright but what if the growth rate falls to 0.5 percent?” Then I'm kind of like, “OK, well, so the growth rate now I ballparked it in the post is around 2 percent. That's the growth rate generally in the most developed countries. Let's say it falls to 0.5 percent.” Just like for how long? Did you calculate how long it would take to get to the same place? Dwarkesh Patel I think it was like 25,000 years. 0.5 percent gets you like one world-size economy. It's 10,000 versus 25,000, but 25,000 is the number of light years between us and like the next galaxy. Holden Karnofsky That doesn't sound right. I don't think this galaxy calculation is very close. There's also going to be a bunch of dead space. As you get to the outer reach of the galaxy, there's not going to be as much there. That doesn't sound super right, but let's just roll with it. I mean, sure, let's just say that you had 2 percent today and then growth went down to 0.5 percent and stayed there forever. I'm pretty sure that's still too big. I'm pretty sure you're still going to hit limits in some reasonable period of time, but that would still be weird on its own. It would just be like, “Well, we lived in the 200-year period when we had 2 percent growth and then we had 0.5 percent growth forever.” That would still make this a kind of an interesting time. It would be the most dynamic, fastest-changing time in all of human history. Not by a ton, but it's also like you pick the number that's the closest and the most perfectly optimized here. So if it went down to 0.1 percent or even down to 0.01 percent, then it would take longer to run out of stuff. But it would be even stranger with the 2 percent versus the 0.01 percent. So I don't really think there's any way out of “Gosh, this looks like this looks like it's probably going to end up looking like a very special time or a very weird time.”Dwarkesh Patel This is not worth getting hung up on, but from that perspective, then the century where we had 8 percent growth because of the Industrial Revolution–– would you say that maybe that's the most important century?Holden Karnofsky Oh, sure. Yeah, totally. No, the thing about rapid growth is it’s not supposed to be on its own. By growth standards, this century looks less special than the last one or two. It's saying that the century is one of a handful or I think when I say “One of 80 of the most significant centuries,” or something by economic growth standards. That's only one argument, but then I look at a lot of other ways in which this century looks unusual. To say that something is the most important century of all time sounds totally nuts because there are so many centuries in the history of humanity, especially if you want to think about it on galactic time scales. Even once you narrow it down to 80, it's just much way less weird. If I've already convinced you using kind of non-controversial reasoning that we're one of the 80 most important centuries, it shouldn't take me nearly as much further evidence to say, actually, this one might be number one out of 80 because you're starting odds are more than 1 percent. So to get you up to 10 percent or 20 percent or 30 percent doesn't necessarily require a massive update the way that it would if we're just starting from nowhere. Dwarkesh Patel I guess I'm still not convinced that just because this is a weird century, this has any implications for why or whether we should see transformative AI this century. If we have a model about when transformative AI happens, is one of the variables that goes into that “What is the growth rate in 2080?” It just feels weird to have this as a parameter for when the specific technological development is going to happen. Holden Karnofsky It's just one argument in the series. I think the way that I would come at it is I would just say, “Hey, look at AI systems. Look at what they're doing. Look at how fast the rate of progress is. Look at these five different angles on imagining when I might be able to do all the things humans do to advance science and technology.” Just imagine that we get there this century. Wouldn't it be crazy to have AI that could do all the things humans do to advance science and technology? Wouldn't that lead to just a lot of crazy stuff happening? There's only ever been one species in the history of the universe that we know of that can do the kinds of things humans do. Wouldn't it be weird if there were two? That would be crazy. One of them was a new one we built that could be copied at will, and run at different speeds on any hardware you have. That would be crazy. Then you might come back and say, “Yeah, that would be crazy. This is too crazy. Like I'm ruling this out because this is too crazy.” Then I would say, “OK, well, we have a bunch of evidence that we live in an unusual, crazy time.” And you actually should think that there's a lot of signs that this century is not just a random century picked from a sample of millions of centuries. So that's the basic structure of the argument. As far as the growth rate in zero AD, I think it matters. I think you're asking the question, why do the dynamics of growth in zero AD matter at all for this argument? I think it's because it's just a question of, “How does economic growth work generally and what is the trend that we're on, and what happens if that trend continues?” If around zero AD growth was very low but accelerating, and if that was also true at one hundred AD and a thousand AD and negative a thousand or, you know, a thousand BC, then it starts to point to a general pattern. Growth is accelerating and maybe accelerating for a particular reason, and therefore you might expect more acceleration.AI Success ScenarioDwarkesh Patel Alright, let’s talk about transformative AI then. Can you describe what success looks like concretely? Are humans part of the post-transformative AI world? Are we hoping that these AIs become enslaved gods that help us create a utopia? What does the concrete success scenario look like? Holden Karnofsky I mean, I think we've talked a lot about the difficulty of predicting the future, and I think I do want to emphasize that I really do believe in that. My attitude to the most important century is not at all, “Hey, I know exactly what's going to happen and I'm making a plan to get us through it.” It's much more like there's a general fuzzy outline of a big thing that might be approaching us. There are maybe two or three things we can come up with that seem good to do. Everything else we think about, we're not going to know if it's good to do or bad to do. So I'm just trying to find the things that are good to do so that I can make things go a little bit better or help things go a little bit better. That is my general attitude. It's like if you were on a ship in a storm and you saw some very large, fuzzy object obscured by the clouds, you might want to steer away from it. You might not want to say, “Well, I think that is an island and I think there's probably a tiger on it. So if we go and train the tiger in the right way, blah, blah, blah, blah, blah,” you don't want to get into that. Right? So that is the general attitude I'm taking.What does success look like to me? Success could look like a lot of things, but one thing success would look like to me would frankly just be that we get something not too different from the trajectory we're already on. So, in other words, if we can have systems that behaved as intended, acted as tools and amplifiers of humans, and did the things they're supposed to do. If we could avoid a world where those systems got sort of all controlled by one government or one person, we could avoid a world where that caused a huge concentration of power. If we could have a world where AI systems are just another technology that helps us do a lot of stuff, and we’d invent lots of other technologies and everything is relatively broadly distributed and everything works roughly as it's supposed to work, then you might be in a world where we continue the trend we've seen over the last couple of hundred years, which is that we're all getting richer. We're all getting more tools. We all hopefully get an increasing ability to understand ourselves, study ourselves, and understand what makes us happy, what makes us thrive. Hopefully, the world just gets better over time and we have more and more new ideas that thus hopefully make us wiser. I do think that in most respects, the world of today is a heck of a lot better than the world of 200 years ago. I don't think the only reason for that is wealth and technology, but I think they played a role. I think that if you'd gone back to 200 years ago and said, “Holden, how would you like the world to develop a bunch of new technologies as long as they're sort of evenly distributed and they behave roughly as intended and people mostly just get richer and discover new stuff?” I'd be like, “That sounds great!” I don't know exactly where we're going to land. I can't predict in advance whether we're going to decide that we want to treat our technologies as having their own rights. That's stuff that the world will figure out. But I'd like to avoid massive disasters that are identifiable because I think if we can, we might end up in a world where the future is wiser than we are and is able to do better things. Dwarkesh Patel The way you put it, AI enabling humans doesn't sound like something that could last for thousands of years. It almost sounds as weird as chimps saying “What we would like is humans to be our tools.” At best, maybe they could hope we would give them nice zoos. What is the role of humans in this in this future? Holden Karnofsky A world I could easily imagine, although that doesn't mean it's realistic at all, is a world where we build these AI systems. They do what they're supposed to do, and we use them to gain more intelligence and wisdom. I've talked a little bit about this hypothetical idea of digital people–– maybe we develop something like that. Then, after 100 years of this, we've been around and people have been having discussions in the public sphere, and people kind of start to talk about whether the AIs themselves do have rights of their own and should be sharing the world with us. Maybe then they do get rights. Maybe some AI systems end up voting or maybe we decide they shouldn't and they don't. Either way, you have this kind of world where there's a bunch of different beings that all have rights and interests that matter. They vote on how to set up the world so that we can all hopefully thrive and have a good time. We have less and less material scarcity. Fewer and fewer tradeoffs need to be made. That would be great. I don't know exactly where it ends or what it looks like. But I don't know. Does anything strike you as unimaginable about that? Dwarkesh Patel Yeah, the fact that you can have beings that can be copied at will, but also there's some method of voting..Holden Karnofsky Oh, yeah. That's a problem that would have to be solved. I mean, we have a lot of attention paid to how the voting system works, who gets to vote, and how we avoid things being unfair. I mean, it's definitely true that if we decided there was some kind of digital entity and it had the right to vote and that digital entity was able to copy itself–– you could definitely wreak some havoc right there. So you'd want to come up with some system that restricts how many copies you can make of yourself or restricts how many of those copies can vote. These are problems that I'm hoping can be handled in a way that, while not perfect, could be non-catastrophic by a society that hasn't been derailed by some huge concentration of power or misaligned systems. Dwarkesh Patel That sounds like that might take time. But let's say you didn't have time. Let's say you get a call and somebody says, “Holden, next month, my company is developing or deploying a model that might plausibly lead to AGI.” What does Open Philanthropy do? What do you do? Holden Karnofsky Well, I need to distinguish. You may not have time to avoid some of these catastrophes. A huge concentration of power or AI systems don't behave as intended and have their own goals. If you can prevent those catastrophes from happening, you might then get more time after you build the AIs to have these tools that help us invent new technologies and help us perhaps figure things out better and ask better questions. You could have a lot of time or you could figure out a lot in a little time if you had those things. But if someone said–– wait how long did you give me?Dwarkesh Patel A month. Let's say three months. So it's a little bit more. Holden Karnofsky Yeah, I would find that extremely scary. I kind of feel like that's one of the worlds in which I might not even be able to offer an enormous amount. My job is in philanthropy (and a lot of what philanthropists do historically or have done well historically), is we help fields grow. We help do things that operate on very long timescales. So an example of something Open Philanthropy does a lot of right now is we fund people who do research on alignment and we fund people who are thinking about what it would look like to get through the most important century successfully. A lot of these people right now are very early in their careers and just figuring stuff out. So a lot of the world I picture is like 10 years from now, 20 years from now, or 50 years from now. There's this whole field of expertise that got support when traditional institutions wouldn't support it. That was because of us. Then you come to me and you say, “We've got one week left. What do we do?” I’d be like, “I don't know. We did what we could do. We can’t go back in time and try to prepare for this better.” So that would be an answer. I could say more specific things about what I'd say in the one to three-month time frame, but a lot of it would be flailing around and freaking out, frankly. Dwarkesh Patel Gotcha. Okay. Maybe we can reverse the question. Let's say you found out that AI actually is going to take much longer than you thought, and you have more than five decades. What changes? What are you able to do that you might not otherwise be able to do? Holden Karnofsky I think the further things are, the more I think it's valid to say that humans have trouble making predictions on long time frames. The more I’d be interested in focusing on other causes of very broad things we do, such as trying to grow the set of people who think about issues like this, rather than trying to specifically study how to get AI systems like today's to behave as intended. So I think that's a general shift, but I would say that I tend to feel a bit more optimistic on longer time frames because I do think that the world just isn't ready for this and isn't thinking seriously about this. A lot of what we're trying to do at Open Philanthropy is create support that doesn't exist in traditional institutions for people to think about these topics. That includes doing AI alignment research. That also includes thinking through what we want politically, and what regulations we might want to prevent disaster. I think those are a lot of things. It's kind of a spectrum. I would say, if it's in three months, I would probably be trying to hammer out a reasonable test of whether we can demonstrate that the AI system is either safe or dangerous.If we can demonstrate it's dangerous, use that demonstration to really advocate for a broad slowing of AI research to buy more time to figure out how to make it less dangerous. I don't know that I feel that much optimism. If this kind of AI is 500 years off, then I'm kind of inclined to just ignore it and just try and make the world better and more robust, and wiser. But I think if we've got 10 years, 20 years, 50 years, 80 years, something in that range, I think that is kind of the place where supporting early careers and supporting people who are going to spend their lives thinking about this would be beneficial. Then we flash forward to this crucial time and there are a lot more people who spent their lives thinking about it. I think that would be a big deal. Dwarkesh Patel Let's talk about the question of whether we can expect the AI to be smart enough to disempower humanity, but dumb enough to have that kind of goal. When I look out at smart people in the world, it seems like a lot of them have very complex, nuanced goals that they've thought a lot about what is good and how to do good. Holden Karnofsky A lot of them don't. Dwarkesh Patel Does that overall make you more optimistic about AIs? Holden Karnofsky I am not that comforted by that. This is a very, very old debate in the world of AI alignment. Eliezer Yudkowsky has something called the orthogonality thesis. I don't remember exactly what it says, but it's something like “You could be very intelligent about any goal. You could have the stupidest goal and be very intelligent about how to get it.” In many ways, a lot of human goals are pretty silly. A lot of the things that make me happy are not things that are profound or wonderful. They're just things that happen to make me happy. You could very intelligently try to get those things, but it doesn't give me a lot of comfort. I think basically my picture of how modern AI works is that you're basically training these systems by trial and error. You're basically taking an AI system, and you're encouraging some behaviors, while discouraging other behaviors. So you might end up with a system that's being encouraged to pursue something that you didn't mean to encourage. It does it very intelligently. I don't see any contradiction there. I think that if you were to design an AI system and you were kind of giving it encouragement every time it was getting more money into your bank account, you might get something that's very, very good at getting money into your bank account to the point where you'd going to disrupt the whole world to do that. You will not automatically get something that thinks, “Gosh, is this a good thing to do?” I think with a lot of human goals, there's not really a right answer about whether our goals actually make sense. They're just the goals we have.Dwarkesh Patel You've written elsewhere about how moral progress is something that's real, that's historically happened, and it corresponds to what actually counts as moral progress. Do you think there's a reason to think the same thing might happen with AI? Whatever the process is that creates moral progress?Holden Karnofsky I kind of don't in particular. I've used the term moral progress as just a term to refer to changes in morality that are good. I think there has been moral progress, but I don't think that means moral progress is something inevitable or something that happens every time you are intelligent. An example I use a lot is attitudes toward homosexuality. It's a lot more accepted today than it used to be. I call that moral progress because I think it's good. Some people will say, “Well, you know, I don't believe that morality is objectively good or bad. I don't believe there is any such thing as moral progress. I just think things change randomly.” That will often be an example I'll pull out and I'll say, “But do you think that was a neutral change?” I just think it was good. I think it was good, but that's not because I believe there's some underlying objective reality. It's just my way of tagging or using language to talk about moral changes that seem like they were positive to me. I don't particularly expect that an AI system would have the same evolution that I've had in reflecting on morality or would come to the same conclusions I've come to or would come up with moralities that seem good to me. I don't have any reason to think any of that. I do think that historically there have been some cases of moral progress. Dwarkesh Patel What do you think is the explanation for historical progress? Holden Karnofsky One thing that I would say is that humans have a lot in common with each other. I think some of history contains cases of humans learning more about the world, learning more about themselves, and debating each other. I think a lot of moral progress has just come from humans getting to know other humans who they previously were stereotyping and judging negatively and afraid of. So I think there's some way in which humans learning about the world and learning about themselves leads them to have kind of conclusions that are more reflective and more intelligent for their own goals. But, if you brought in something into the picture that was not a human at all, it might be very intelligent and reflective about its goals, but those goals might have zero value from our point of view. Dwarkesh Patel Recent developments in AI have made many people think that AI could happen much sooner than they otherwise thought. Has the release of these new models impacted your timelines? Holden Karnofsky Yeah, I definitely think that recent developments in AI have made me a bit more freaked out. Ever since I wrote The Most Important Century series and before that, there were years when Open Philanthropy was very interested in AI risk, but it's become more so as we've seen progress in AI. I think what we're seeing is we're seeing these very generic, simple systems that are able to do a lot of different tasks. I think people are interested in this. There are a lot of compilations of what GPT-3 is–– a very simple language model that, by the way, my wife and brother-in-law both worked on. This very simple language model just predicts the next word it's going to see in a stream of text. People have gotten it to tell stories. People got similar (though not identical) models to analyze and explain jokes. People have gotten it to play role-playing games, write poetry, write lyrics, answer multiple-choice questions, and answer trivia questions. One of the results that I found most ridiculous, strange and weird was this thing called Minerva, where people took one of these language models and with very little special intervention, they got it to do these difficult math problems and explain its reasoning and get them right about half the time. It wasn't really trained in a way that was very specialized for these math problems, so we just see AI systems having all these unpredictable human-like abilities just from having this very simple training procedure. That is something I find kind of wild and kind of scary. I don't know exactly where it's going or how fast. Dwarkesh Patel So if you think transformative AI might happen this century, what implications does that have for the traditional global health and well-being stuff that OpenPhilanthropy does? Will that have persistent effects of AI if it gets aligned? Will it create a utopia for us anyway? Holden Karnofsky I don't know about utopia. My general take is that anything could happen. I think my general take on this most important century stuff, and the reason it's so important is because it's easy to imagine a world that is really awesome and is free from scarcity and we see more of the progress we've seen over the last 200 years and we end up in a really great place. It's also easy to imagine a horrible dystopia. But my take is that the more likely you think all this is, the more likely you think transformative AI is, the more you should think that that should be the top priority, that we should be trying to make that go well instead of trying to solve more direct problems that are more short term. I'm not an extremist on this. So, OpenPhilanthropy does both.OpenPhilanthropy works on speculative far-off future risks and OpenPhil also does a bunch of more direct work. Again, we do direct and recommend a lot of money to give to those top charities, which do things like distributing bed nets in Africa to help prevent malaria and treat children for intestinal parasites. OpenPhilanthropy does a lot of advocacy for more money going to foreign aid or for better land use policies to have a stronger economy. We do a bunch of scientific research work that is more aimed at direct medical applications, especially in poor countries. So I support all that stuff. I'm glad we're doing it. It's just a matter of how real and how imminent do you think this transformative AI stuff is? The more real and more imminent, the more of our resources should go into it. Dwarkesh Patel Yeah, that makes sense to me. I'm curious, whatever work you do elsewhere, do those still have persistent effects after transformative AI comes? Or do you think they’ll basically wash out in comparison to the really big stuff? Holden Karnofsky I mean, I think in some sense, the effects are permanent in the sense that if you cause someone to live a healthier, better life, that's a significant thing that happened. Nothing will ever erase that life or make that life unimportant, but I think in terms of the effects on the future, I do expect it mostly to wash out. I expect that mostly whatever we do to make the world better in that way will not persist in any kind of systematic, predictable manner past these crazy changes. I think that's probably how things look pre and post-industrial revolution. There are probably some exceptions, but that's my guess.Competition, Innovation , & AGI BottlenecksDwarkesh Patel You've expressed skepticism towards the competition frame around AI or you try to make capabilities go faster for the countries or companies you favor most. But elsewhere, you've used the “innovation as mining metaphor,” and maybe you can explain that when you're giving the answer. It seems like this frame should imply that the second most powerful AI company is probably right on the heels of the first most powerful. So if you think the first most powerful is going to take safety more seriously, you should try to boost them. How do you think about how these two different frames interact? Holden Karnofsky I think it's common for people who become convinced that AI could be really important to just jump straight to, “Well, I want to make sure that people I trust build it first.” That could mean my country, that could mean my friends, people I'm investing in. I have generally called that the competition frame which is “I want to win a competition to develop AI”, and I've contrasted it with a frame that I also think is important, called the caution frame, which is that we need to all work together to be careful to not build something that spins out of control and has all these properties and behaves in all these ways we didn't intend. I do think that if we do develop these very powerful AI systems, we're likely to end up in a world where there are multiple players trying to develop it and they're all hot on each other's heels. I am very interested in ways for us all to work together to avoid disaster as we're doing that. I am maybe less excited than the average person who first learns about this is and is like “I’m picking the one I like best and helping them race ahead.”Dwarkesh Patel Although I am someone interested in both, if you take the innovation as mining metaphor seriously, doesn't that imply that actually the competition is really a big factor here?Holden Karnofsky The innovation mining metaphor is from another bit of Cold Takes. It's an argument I make that you should think of ideas as being somewhat like natural resources in the sense of once someone discovers a scientific hypothesis or once someone writes a certain great symphony, that's something that can only be done once. That's an innovation that can only be done once. So it gets harder and harder over time to have revolutionary ideas because the most revolutionary, easiest-to-find ideas have already been found. So there's an analogy to mining. I don't think it applies super importantly to the AI thing because all I'm saying is that success by person one makes success by person two harder. I'm not saying that it has no impact or that it doesn't speed things up. Just to use a literal mining metaphor, let's say there's a bunch of gold in the ground. It is true that if you rush and go get all that gold, it'll be harder for me to now come in and find a bunch of gold. That is true. What's not true is that it doesn't matter if you do it. I mean, you might do it a lot faster than me. You might do it a lot ahead of me. Dwarkesh Patel Fair enough. Maybe one piece of skepticism that somebody could have about transformative AI is that all this is going to be bottlenecked by the non-automatable steps in the innovation sequence. So there won't be these feedback loops that speed up. What is your reaction? Holden Karnofsky I think the single best criticism and my biggest point of skepticism on this most important century stuff is the idea that you could build an AI system that's very impressive and could do pretty much everything humans can do. There might be one step that you still have to have humans do, and that could bottleneck everything. Then you could have the world not speed up that much and science and technology not advance that fast because they are doing almost everything. But humans are still slowing down this one step or the real world is slowing down one step. Let's say real-world experiments to invent new technologies take how long they take. I think this is the best objection to this whole thing and the one that I'd most like to look into more. I do ultimately think that there's enough reason to think that if you had AI systems that had human-like reasoning and analysis capabilities, you shouldn't count on this kind of bottleneck causing everything to go really slow. I write about that in this piece called Weak Point in the Most Important Century: Full Automation. Part of this is how you don't need to automate the entire economy to get this crazy growth loop. You can automate just a part of it that specifically has to do with very important tech like energy and AI itself. Those actually seem, in many ways, less bottlenecked than a lot of other parts of the economy. So you could be developing better AI algorithms and AI chips, manufacturing them, mostly using robots, and using those to come up with even better designs. Then you could also be designing more and more efficient solar panels, and using those to collect more and more energy to power your eyes. So a lot of the crucial pieces here just actually don't seem all that likely to be bottlenecked. You can be at the point where you have something that has the ability to have creative new scientific hypotheses the way a human does, which is a debate over whether we should ever expect that and when. Once you have that, I think you should figure that there are just a lot of ways to get around all your other bottlenecks because you have this potentially massive population of thinkers looking for them. So an example is that you could, with enough firepower, enough energy, enough AI, and enough analysis, you could probably find a way to simulate a lot of the experiments you need to run, for example. Dwarkesh Patel Gotcha. Now, it seems like the specific examples you used of energy and AI innovations are probably the hardest things to automate, given the fact that those are the ones that humanity's only gotten around to advancing most recently. Can you talk us through the intuition about how those might be easier? Holden Karnofsky I think some of the stuff that might be hardest to automate would just be stuff that in some sense doesn't have anything to do with software or capabilities. So an example of something that might just be extremely hard to automate is trust, making a business deal, or providing care for someone who's sick. It might just be that even if an AI system has all the same intellectual capabilities as a human, and can write poetry just as well, have just as many ideas, and have just as good a conversation, it just doesn't look like a human. So people don't want that. Maybe you can create a perfect representation of a human on a screen, but it's still on the screen. In general, I see the progress in AI as being mostly on the software front, not the hardware front. So AIs are able to do a lot of incredible things with language, things with math, and things with board games. I also wouldn't be surprised if they could write hit music in the next decade or two.But these people really are not making the same kind of progress with robotics. So weirdly, a task that might be among the hardest to automate is the task of taking this bottle of water and taking off the cap. Because I have this hand that is just well designed for that. Well, it's clearly not designed for that, but it's like these hands can do a lot of stuff. We aren't seeing the same kind of progress there. So I think there are a lot of places where AI systems might have the kind of brains that can do roughly everything human brains can. There's some other reason they can't do some key economic tasks, but I think these are not the tasks I see likely to bottleneck the R&D as much. Dwarkesh Patel Gotcha. Holden Karnofsky This is an argument I make in one of my more obscure Cold Takes posts. I say that AI that could actually take everyone's job, like every human's job, might be a lot harder than AI and could radically transform the galaxy via new technology. It might be easier to take a scientist's job than a teacher's job or a doctor's job because the teachers and the doctors are regulated. People might just say, “I want human teachers. I don't want an AI teacher.” Whereas you can sit there in your lab with your scientists and find new theories that change the world. So some of this stuff, I think, is very counterintuitive, but I can imagine worlds where you get really wacky stuff before you get self-driving cars out on the road just because of the way the regulations work. Lock-ins and Weak PointsDwarkesh Patel Gotcha. OK, let's talk about another weak point or the one you identify as a weak point. Lock-in. What do you think are the odds of lock-in given transformative AI? Holden Karnofsky So lock-in is a term I use to talk about the possibility that we could end up with a very stable civilization. I talk about that in another post. It's called Weak Point in the Most Important Century. I wrote posts about the weakest points in the series and the idea is that throughout history so far, when someone becomes in charge of a government and they're very powerful and they're very bad, this is generally considered to be temporary. It’s not going to go on forever. There are a lot of reasons the world is dynamic and the world tends to just not stay that way completely. The world has changed a lot throughout history. It's kind of a dumb thing to say, but I'll get to why this might be important. If someone is running a country in a really cruel, corrupt way, at some point they're going to get old and die and someone else is going to take over. That person will probably be different from them.Furthermore, the world is changing all the time. There are new technologies, new things are possible, there's new ideas. The most powerful country today might not be the most powerful tomorrow. The people in power today might not be the ones in power tomorrow. I think this gets us used to the idea that everything is temporary, and everything changes. A point I make in the Most Important Century series is that you can imagine a level of technological development where there just aren't new things to find. There isn't a lot of new growth to have. People aren't dying because it seems like it should be medically possible for people not to age or die. So you can imagine a lot of the sources of dynamism in the world actually going away if we had enough technology. You could imagine a government that was able to actually serve everyone, which is not something you can do now, with a dictator who actually doesn't age or die, who knows everything going on, who's able to respond to everything. You could imagine that world just being completely stable.I think this is a very scary thought. It's something we have to be mindful of–– if the rate of technological progress speeds up a lot, we could quickly get to a world that doesn't have a lot more dynamism and is a lot more stable. What are the odds of this? I don't know. It's very hard to put a probability on it. But I think if you imagine that we're going to get this explosion in scientific and technological advancement, you have to take pretty seriously the idea that we could end up hitting a wall and there could not be a lot of room for more dynamism. We could have these very stable societies. What does seriously mean in terms of probability? I don't know–– a quarter, a third, a half, something like that–– I'm making up numbers. I think it's serious enough to think about as something that affects the stakes of what we're talking about. Dwarkesh Patel Gotcha. Are you concerned about lock-in just from the perspective of locking in a negative future, or do you think that might intrinsically be bad to lock in any kind of future? If you could press a button right now and lock in a reasonably positive future that won't have any dynamism, or one where dynamism is guaranteed but net expected positive is not, how would you make that determination? Holden Karnofsky Well, I don't think a lot about what I would do with unrealistic buttons where I have crazy amounts of power that I'll never have and shouldn't have. I think of lock-in by default as mostly a bad thing. I feel like we’d want to at least kind of preserve optionality and have a world where it's not just one person running the show with their values set up the way they want forever. I think of it mostly that way. I can imagine some future world where civilization's been around long enough and we've learned what there is to learn, and we know what a good world looks like, so most people feel pretty confident about that, and they're right to feel confident. Maybe then, lock-in's wouldn’t be so bad. But I do mostly think of lock-in as a bad thing. I also imagine that you could lock in some things about the world in order to avoid locking in others. So I can imagine if you had this enormous amount of power over how the world works––some of this is more explained in my digital people series–– but if you had this kind of world where you completely control the environment, you might want to lock in the fact that you should never have one person with all the power. That might be a thing you might want to lock in, and that prevents other kinds of lock-in. Dwarkesh Patel Do you worry about AI alignment as being a form of lock-in? In some sense, if the goal of the research is to prevent drift from human values, then you might just be locking in values that are suboptimal. Holden Karnofsky Yeah, I mostly think of AI alignment as just trying to avoid a really bad thing from happening. What we don't want to happen is we have some AI system we thought we were designing to help us, but in reality, we're actually designing it to do some extremely random thing. Again, these systems work by trial and error, by encouragement, discouragement, or positive and negative reinforcement. So we might have not even noticed that through the pattern of reinforcement we were giving, we trained some system to want to put as much money as possible into one bank account, gain as much power as possible, or control as much energy as possible, or something like that. Maybe it’d set its own reward number, its own score to the highest possible number. I think that would be a form of lock-in if we had systems more powerful than humans that had these kinds of random goals. That would be like locking in a kind of future that is not related to the things that humans value and care about. That's an example of a future I think would be really bad. Now, if we got these systems to behave as intended, we still might have problems because we might have humans doing really stupid things and locking in really bad futures. I think that's an issue too. I feel reasonably comfortable, though not 100% confident, saying that we'd like to avoid that just like slip-ups. We'd like to avoid having these systems that have these random goals we gave them by accident. They're very powerful, and they're better at setting up the world than we are. So we get this world that's just doing this random thing that we did by accident. I think that's a thing worth avoiding. Predicting the FutureDwarkesh Patel What is your biggest disagreement with Will MacAskill's new book on long-termism? Holden Karnofsky I like Will's book. I think it's worth reading Will MacAskill's book about how the future could be very large and very important. In my opinion, if you want to talk about the long-run future and how to make the long-run future go well, you're starting from a place of, by default, “almost nothing I can do will actually make sense.” I do really believe it's hard to understand the long-run future, and it's hard to make specific plans about it. So I would say that compared to Will, I am very picky about which issues are big enough and serious enough to actually pay attention to. I feel the issue of AI would be transformative enough. It looks likely enough that it'll be soon. If it's soon, that means there might actually be things we can do that have predictable effects. I think this misaligned AI thing is a real threat. The way people design AI systems today could be really bad. I am ready to put some resources into preventing this, but that's kind of crossing my threshold. Most things don't. So if you make a list of ways to make the next million years go well, I'll look at most of them and be like, “I don't know. I don't really believe in this.” I wouldn't really invest in this. I think Will is a bit broader than I am in a sense. He's interested in more things, and I am pickier than he is because I think it's so hard to know what's really going to affect the long-run future that I'm just looking for a really short list of things that are worth paying special attention to. Dwarkesh Patel Is there a specific thing that he points out in the book you think would be hard to grapple with? Holden Karnofsky I don't remember super well. The book is a really broad survey of lots of stuff. An example I might give is he talks about the risk of stagnation, for example. The risk that growth might just stop or growth might slow to very low levels. That implies that what we should be trying to do is make sure we continue to innovate and continue to have growth, but then there's other parts of the book that make it sound like we shouldn't move too fast and we shouldn't innovate too much because we don't want to get to our future before we've like kind of achieved some sort of civilizational maturity beyond what we have now to decide what we want that future to look like. We don't want to build these powers before we have a better idea of what to do with them. So I think these are examples where I'm just like, “Gosh, I don't know. It could be good to have more growth. It could be bad to have less growth. It could be that stagnation is a big threat. It could be that building powerful technologies too fast is a big threat.” I just don't really know. I'll tell you what I'm thinking about. I'm thinking about AI because I think it's a big enough deal and likely enough and that we've got enough traction on some of the major risks. Dwarkesh Patel Right, right. When I look throughout history, it often seems like people who predict long-term trends are too pessimistic. In the 70s, you might have been too pessimistic about the ability to find more oil or feed a growing population because you couldn't have predicted the technological breakthroughs that might have made these things possible. Does this inform some sort of vague optimism about the future for you with regards to AI or not? Holden Karnofsky I think historically, people have been overly pessimistic about future technologies. I think by default, the picture with AI looks really scary. It just looks like it would be really easy to get a bad future in a lot of different ways if we just didn't move cautiously. These two considerations balance each other out a little bit for me. I know a lot of people who believe that we're in deep, deep, enormous trouble, and this outcome where you get AI with its own goals wiping humanity off the map is almost surely going to happen. I don't believe that and this is part of the reason I don't believe it. I actually think the situation looks very challenging, very scary by default, and I think we're tending to overestimate how bad and how dire things are. So they balance out a little bit for me.Dwarkesh Patel Okay, gotcha. In many of these cases, it seems like it would be impossible to see the positive scenario come about. For example, if you were forecasting population in the 70s, is there some reasonable method by which you would have predicted this was not going to lead to some massive famine that kills a billion people? Or would that have been your focus in the 70s if Open Philanthropy was a thing back then? Holden Karnofsky I think it's really hard to know how “knowable” the future was in the past and what that means for today. I do think that when you look back at people trying to predict the future in the past, it just looks deeply unserious. You could say that future people will say the same about us. I'm sure they'll think we look less serious than they are, but I think there's a difference. I really do think there haven’t been attempts to rigorously make predictions about the future historically. I don't think it's obvious that people were doing the best they can and that we can't do better today. So this population is an example. It doesn't seem necessarily true to me that you couldn't have said “Gosh, the population has been going up for a while now and people keep inventing new ways to come up with more resources. Maybe that will keep happening.” I'm just really not convinced you couldn't have said that. I'm definitely not convinced no one did say it. I think some people did say it. So I think I'm hesitant to get too defeatist just from the fact that some people were wrong about the future in the past. I think it's hard to know if there was really no way to know or if they just weren't trying very hard. Dwarkesh Patel One thing you just said a minute ago was that we are better at making predictions than people in the past were. So that alone should make us more optimistic about what we need to predict in the future. Holden Karnofsky It's just a guess. I mean this is what society is. We have had a lot of progress on all kinds of intellectual fronts. I think there has been a lot of progress on what it looks like to make good, reasonable predictions about the future. I think that's something that's happened. So I think we should be expecting ourselves to do a bit better than people did in the past and future people will probably do better than we do. Dwarkesh Patel Right. When I look at a report like Biological Anchors, I often wonder whether Asimov is just shooting the s**t about screens and what you're able to do with them. Maybe he had less sources of error than this eight-step methodology where you might not even be aware that there's a ninth or tenth missing step that might make the whole thing invalid, and where many of the inputs have multiple orders of magnitude, wide confidence intervals. What do you think of that general skepticism? Holden Karnofsky I mean Biological Anchors is a very important input into my thinking, but it's not the only input. I think my views on AI timelines are a mix of A, looking at AI systems today, looking at what they did 50 years ago, looking at what they did 10 years ago, and just kind of being like, “Well, gosh, it sure looks plausible that these will be able to do all the things humans can do to advance science and technology pretty soon.” That's one input into my thinking. Another input into my thinking is what we call the semi-informative priors analysis, which is a complex report because it looks from a lot of different angles. I think you can summarize the highlights of the report as just saying that most of the effort that has ever in the history of humanity has gone into making AI because the field of AI is not very old and the economy and the amount of effort invested have gone up dramatically. I think that's a data point in favor of not being too skeptical that we could be on the cusp of transformative AI. In some sense, the world has not been trying very hard for very long. So that's an input. Another input is expert surveys when people ask AI researchers when they think AI will be able to do everything humans can. They tend to come out saying it's a few decades. That can be biased and unreliable in all kinds of ways, and all these things have their problems, but that's a data point. Dwarkesh Patel Then there's biological anchors. Holden Karnofsky Biological anchors isn’t a report I would summarize on a podcast. It's a very complex report. There are a lot of different angles it uses. There are a lot of different questions it asks. There are a lot of different numbers. However, I do think you can boil it down to some fairly simple observations. You can say that in some important sense (which could be debated and analyzed but seems true most ways you look at it), we've never built AI systems before that do as much computation per second as a human brain does. So it shouldn't be surprising that we don't have AI systems that can do everything humans do because humans are actually doing more work in their brains than a normal AI system is doing. However, it also looks like within this century, we probably will have AI systems that are that big. If we estimate how much it would take to train them, how much it would cost to build them, that looks like it will probably be affordable this century. Then you could just talk about all the different ways you could define this and all the different ways you could quantify that and all the different assumptions you could put in. But my bottom line is like almost any way you slice it, and however you want to define what it means for an AI brain to be as big as a human's and what it would mean to get that brain sort of trained, most angles on it suggest that it looks reasonably likely it will happen this century. That's a data point for me. That matters. So all these are data points feeding into my view. Dwarkesh Patel Okay. So I'm stealing this from Eliezer who asked on Twitter, “Has there literally ever in the entire history of AI been any case of anybody successfully calling the development timing of literally any novel AI capability using a bio-anchored or bio-inspired calculation?” He has very complex sentences. Holden Karnofsky I saw some discussion of this on his Facebook and I think the answer might be yes. However, I mostly want to attack the premise. I just want to say that there haven't been a lot of cases of people predicting AI milestones with great precision and that's also not what I'm trying to do. A lot of what I'm trying to say is “Gosh, in this century, it looks more likely than not that we'll get something hugely transformative.” He's asking about some history of AI that's like a few decades old and there haven’t even been a lot of people trying to make predictions. A lot of the predictions have been way more narrow and specific than that. So I mostly think that this isn't a very important or informative question. I think all the work he's doing… has there ever been an example of someone using the kind of reasoning Eliezer is using to predict the end of the world or something? That’s what he's predicting. So I mostly just want to challenge the premise and say, “Look, we're not working with a lot of sample size here. This isn’t some big, well-developed field where people have tried to do the exact same thing I'm trying to do 25 times and failed each time.” This is mostly people in academia trying to advance AI systems. They don't try to predict when AI systems can do much and do what? We're not working with a lot here. We have to do the best we can, make our best guess, use our common sense, use our judgment, and use the angles we've got. That's my main answer. Another answer I would give is that Hans Moravec was the original biological anchors person. I think he predicted artificial general intelligence around 2020. From Eliezer's own views, it's going to look like he was unbelievably close. Maybe Eliezer believes we'll see it by 2030. I think that's plausible. So if that's what you believe, then we'll look back on that as like the greatest technology prediction ever by a lot. I think the answer is maybe. There was also some discussion in the comments about whether Moravec called that big progress on AI was doing well at vision by examining the retina. There was some debate about that. I think it's all very muddy. I don't think this is much of a knockdown argument against thinking about biological anchors. It is only one input into my thinking. I do think it looks kind of good for biological anchors that we have seen this deep learning revolution and we’ve seen these brute force AI training methods working really well when they didn't use to work well. This happened when AI systems started to be about the size of an insect or small animal brains within range, within a few orders of magnitude of human brains. You could call that a wild coincidence, but these numbers are probably all off by 10x, 100x, 1000x. I mean, we're talking about very important things and trying to get our best handle and our best guess. I think biological anchors looks fine so far. It doesn't look amazing, but it looks fine. Dwarkesh Patel Now, I'm sure many people have proposed that increasing progress in science, technology, and economic growth are the most compelling things to be doing instead of working on transformative AI. I just want to get your broad reaction to that first. Holden Karnofsky Sure. I think we're talking about the progress studies crowd here. I wrote a piece about this on Cold Takes called Rowing, Steering, Anchoring, Equity and Mutiny, where I discuss different ways of thinking about what it means to make the world good. I do have some sympathy for the idea that a lot of the way the world has gotten better over the last couple hundred years is just that we've gotten richer. We've had more technological capabilities, so maybe we should try and do more of that. I don't think this is a nutty thing to think. I think this is somewhat reasonable, but I feel that even a couple hundred years is not that big a percentage of the history of humanity.I wrote a series called Has Life Gotten Better? that asks what the whole graph of quality of life looks like over the course of humanity. There is precedent for technological development seeming to make things worse. That's what it looks like happened in the agricultural revolution so I have some sympathy for saying, “Hey, this thing has been good for 200 years, let's do more of it,” but I don't think it's the tightest, most conclusive argument in the world. I think we do have some specific reasons to believe that developing some particular new technologies, not only AI, but also potentially bioweapons, could just be catastrophically dangerous. I think Toby Ord uses the analogy of humanity being like a child who's becoming an adolescent. It's like it's great to become stronger up to a certain point. That's fun. That feels good, but then at a certain point, you're strong enough to really hurt yourself and really get yourself in trouble, or maybe strong enough that you don't know your own strength. I think there's a pretty good case that humanity is reaching that point. I think we're reaching the point where we could have a nuclear war or a bioweapon or AI systems that really change the world forever. So it might have made sense 300 years ago when we were all struggling to feed ourselves to say, “Hey, we want more power. We want more technology. We want more abilities.” Today, I think we're starting to enter the gray area. We're starting to enter the gray zone, or maybe we should slow down a little bit, and be a little bit more careful. I'm not saying to literally slow down, but I'm talking about priorities. I would rather look at what I think are dramatically neglected issues that might affect all of humanity's future and at least do the best we can to have a handle on what we want to do about them. Then put my effort into throwing more juice and more gas behind this ongoing technological progress, which I think is a good thing. It's just a matter of priority. Dwarkesh Patel Okay. Do you think that the entire vision of increasing progress is doomed if ideas get harder to find? Holden Karnofsky I’ve talked about the atoms of the galaxy argument before–– I think a broader common sense take would be that the world over the last couple of hundred years has changed incredibly dramatically. We've had new exciting technologies and capabilities every year. I think a good guess would be that that hits a wall at some point. It might be the atoms of the galaxy, or it might just be something much more boring. What we seem to observe when we look at the numbers is that we are seeing a bit of stagnation, a bit of slowing down that probably will keep slowing down by default. So, yeah, I think it’s probably a good guess that the world is changing at an incredible pace that has not been the case for most of history and it probably won't be the case for the whole future. Choosing Which Problem To SolveDwarkesh Patel Okay. Gotcha. I guess there are several reactions somebody could have to the idea that ideas are getting harder to find and therefore that this makes progress studies less relevant. If you look at your own blog, the entire thing is about you complaining about all this low-hanging fruit that people are not plucking. Nobody's thinking seriously about transformative AI. Nobody's thinking seriously about utopia. Nobody's thinking seriously about ideal governance. How do you square this with the general concept of ideas getting harder to find? Holden Karnofsky I think there's just a ton of really important stuff today that not enough people are paying attention to. That was true 50 years ago, and that was also true a hundred years ago. It was probably more true 50 years ago than it is today. It was probably more true a hundred years ago than 50 years ago. Gradually, the supply of amazingly important ideas that are not getting any attention is probably getting harder to do, but harder doesn't mean impossible. I do actually think that if people want to do something that's really new and world changing and dramatic and revolutionary, the worst way to do that is to go into some well-established scientific field and try to revolutionize that. I think it's better to just use your common sense and ask an important question about the world that no one's working on because it isn't a scientific field (because it isn't a field of academia, because it doesn't have institutions) and work on that. A lot of my blog does advocate that. For example, AI itself is a very well-established field, but AI alignment is a weird field that doesn't really have academic departments right now. A lot of what I'm talking about, like trying to predict what the future is going to look like, is a weird, low prestige thing that you can't easily explain to your extended family. I do think that's probably the best place to look if you want to do something that's going to be super significant or super revolutionary. That is why I've professionally been drawn to it–– looking for potential big wins that philanthropy could get. Dwarkesh Patel You’ve once said that we shouldn't follow in the footsteps of the greats to be a great person, and should instead have great achievements yourself. Isn't another way to think about that, that you should probably also ignore the advice that the optical advice you're giving or 80,000 hours gives, because those specific things that aren’t what's going to make you the next Einstein?Holden Karnofsky I mean, a fair number of your questions are part of the dialogue I see in those skeptical of the futurism world–– it feels to me like it's almost just getting unnecessarily fancy. I kind of just want to say “Who's someone who really revolutionized the way the world thinks about stuff?” Darwin. Now, what was Darwin doing? Was Darwin saying, “Well, I really don't want to think about this thing because I don't believe humans are capable of thinking about that thing and I don't want to think about this topic because I think it's too hard to know the future and blah, blah, blah.” Was he doing all that stuff or was he just asking an interesting question? Was he just saying, “Hey, this thing seems important. I'm going to use my common sense and judgment to figure out how it works and I'm going to write about it.” I think some of this stuff gets too fancy.So I think today, if I just look at the world and I say, “What are the most important things that could matter for the world to be a good or bad place in the future?” I've looked at a lot of possibilities. I think AI alignment is one of the leading examples and I don't see a lot of people paying attention to it, so that's what I want to work on. I think a lot of the people who have done revolutionary work that we now look back on (whom a lot of people try to imitate), weren't trying to imitate what usually worked and stay away from the stuff that wasn't. They were just asking interesting, important questions and working on them. As far as myself in 80,000 hours, I just don't feel that we're well known enough or influential enough that our advice that that stuff we're interested in is obvious is automatically, therefore not neglected. I think the stuff we're talking about is very neglected, but if you find something that's even more neglected and more important, more power to you. Dwarkesh Patel Let's say the total amount of money given to EA just increased by an order of magnitude or something. What could be possible at that point that's not possible now?Holden Karnofsky I don't know. I think even then, the amount of money we'd be working with would be really small by the standards of any kind of government budget. In general, with philanthropy, I'm always looking for things where it's like, “Can we see the creation of a field? Can we fund people to introduce new ideas?” But, we're very small compared to the overall economy and the overall government. I think even multiplying everything by 10, that would still be true. I’m not sure exactly what we do with 10x as much money. I'm not even sure what we're going to do with the money that already exists. Dwarkesh Patel Yeah, but do you think there will be more billionaires in the future and does that imply you should be spending money faster now if you are? Holden Karnofsky In theory, we have all these models that say, “Here's our guess at how much money is eventually going to be available, and here's our guess at how many giving opportunities will eventually be there to fund. This is our guess about what's good enough to fund and what's not.” That's a very tentative guess. A lot of it is just really really, really imprecise stuff, but we have to have some view on it–– anyone who's spending money does. So, I mean, yeah, I do tend to assume that Sam Bankman Fried, Dustin Moskovitz and Cari Tuna are not the last billionaires who are interested in doing as much good as possible–– but it is really hard to model this stuff. Frankly, we have various rough models we've made over the years but we’ll also sometimes use our intuition and just say we fund the stuff that seems quite good and exciting and we don't fund stuff that doesn't. That's an input into our thinking too.$30M OpenAI InvestmentDwarkesh Patel Gotcha. How do you think about the risk that some of your giving might have negative impacts? People have brought this up in the context of your 30 million dollar investment in OpenAI, but in all sorts of context, especially when you're talking about political advocacy, people might think that the thing you do has negative side effects that counteract the positive effects. Is it just a straight calculation? How do you think about this? Holden Karnofsky I think in theory, what we want is to make grants that have more upside than downside or have expected net positive effects. I think we tend to be, in a common sense way, a little bit conservative with the negative effects. What we don't want to do is enter some field on a theory that's just totally messed up and wrong in a way that we could have known if we had just done a little bit more homework. I think that there's just something irresponsible and uncooperative about that. So in general, when we are making big decisions like big dollar decisions or going into a new cause, we’ll often try really hard to do everything we can to understand the downsides. If after we've done roughly everything we can up to some reasonable diminishing returns, we still believe that the upsides outweigh the downsides, then we're generally going to go for it. Our goal is not to avoid harm at all costs. Our goal is to operate in a cooperative, high-integrity way–– always doing our best, always trying to anticipate the downsides, but recognizing that we're going to have unintended side effects sometimes. That's life–– anything you do has unintended side effects. I don't agree with the specific example you gave as an example of something that was net negative, but I don't know. Dwarkesh Patel Are you talking about OpenAI? Yeah. Many people on Twitter might have asked if you were investing in OpenAI. Holden Karnofsky I mean, you can look up our $30 million grant to OpenAI. I think it was back in 2016–– we wrote about some of the thinking behind it. Part of that grant was getting a board seat for Open Philanthropy for a few years so that we could help with their governance at a crucial early time in their development. I think some people believe that OpenAI has been net negative for the world because of the fact that they have contributed a lot to AI advancing and to AI being sort of hyped, and they think that gives us less time to prepare for it. However, I do think that all else being equal, AI advancing faster gives us less time to prepare. It is a bad thing, but I don't think it's the only consideration. I think OpenAI has done a number of good things too, and has set some important precedents. I think it's probably much more interested in a lot of the issues I'm talking about and risks from advanced AI than like the company that I would guess would exist if they didn't, would be doing similar things.I don't really accept that the idea that OpenAI is a negative force. I think it's highly debatable. We could talk about it all day. If you look at our specific grant, it's even a completely different thing because a lot of that was not just about boosting them, but about getting to be part of their early decision making. I think that was something that there were benefits and was important. My overall view is that I don't look back on that grant as one of the better grants we've made, not one of the worse ones. But certainly we've done a lot of things that have had, you know, that have not worked out. I think there are some times shortly when we've done things that have consequences we didn't intend. No philanthropist can be free of that. What we can try and do is be responsible, seriously do our homework to try to understand things beforehand, see the risks that we're able to see, and think about how to minimize them. Future Proof EthicsDwarkesh Patel Let's talk about ethics. I think you have a very interesting series of blog posts about future proof ethics. Sure. You want to explain what this is first? Holden Karnofsky Sure. I wrote a short blog post series trying to explain some of the philosophical views and ethical views that are common among people who call themselves effective altruists. One of the ideas I appealed to is (I'm not sure I'm getting this right) how a lot of people I know are trying to come up with a system of morality and a system of ethics that would survive a lot of moral progress. They’re trying to come up with a system where if they later became a lot wiser and learned a lot more and reflected on their morality, they wouldn't look back on their earlier actions and think they were doing horrible, monstrous mistakes. A lot of history has just people doing things they thought were fine and right at the time, but now we look back and we're horrified. You could think of yourself asking “What morality can I have that would make it not so likely that if there was a bunch more moral progress and if people learned a lot more, the future won't look back on me and be horrified of what I did.” So I wrote a bit of a series about what it might look like to try to do that, and laid out a few principles of it trying to use this to explain the moral systems a lot of effective altruists tend to use–– which tends to be some flavor of utilitarianism that is often very expansive about like whose rights count. So effective altruists are very interested in future generations that don't exist yet. They're interested in animals being mistreated on factory farms. They're interested in various populations that a lot of people don't care about today, but that there are large numbers of. So I try to explain that. A thing that's important is I laid this view out partly so I could argue against it later and I haven't done the latter yet. So I have a lot of reservations too about the ethical systems that are common with effective altruists. Dwarkesh Patel Alright, so let's talk about some of the pillars you laid out in this piece. Sentientism seems pretty reasonable to me. Holden Karnofsky There are three principles that I roughly outlined that you might want for a morality that is going to stand up to scrutiny or you won't be so likely to change your mind about if you learn more and get better. One principle is systemization. It's better to have morality based on simple general principles that you apply everywhere than have a morality that's just always you just deciding what feels right in the moment. The latter could be subject to a lot of the biases of your time and the former lets you stress test the core ideas. Two of the core ideas I propose are what I call “thin utilitarianism”, which is basically the greatest good for the greatest number and sentientism, which is basically saying that someone counts or someone matters if they're able to suffer or have pleasure. I think you just said sentientism seems reasonable to you. I think sentientism might be the weakest part of the picture to me. I think you if you have a morality where you are insistent on saying that everyone counts equally in proportion to the amount of pain or pleasure they're able to have, you run into a lot of weird dilemmas that you wouldn't have to run into if you didn't have that view. So I think it's very strange, but I think it is actually one of the more questionable parts of the view. It's kind of saying, “When I'm deciding whether I care about someone, it doesn't matter at all if they're way in the future, if they're way far away, if they're totally different from me, if they're not human, if I've never met them, all that matters is if they can have pain or pleasure.” I think it sounds great, and I completely get why someone listening to me would say, “How could you ever disagree with that?” But I do think there's various challenges with it which I have not had the chance to write about yet. I doubt I can be very convincing on this podcast as of right now because I haven't thought enough about it.Dwarkesh Patel Alright––yeah, sounds good. Let's talk about systemization. Doesn't the fact that you have lots of complex and sometimes contradictory moral intuitions suggest that maybe the whole goal of having some fundamental principles you extrapolate the rest of morality from is kind of doom project? Holden Karnofsky I think it does somewhat suggest that. I am somewhat partial to that view and that's something I may be writing in my rebuttal. I also think it's possible to be confused and I think it's possible to have lots of stuff going on in your brain and some of it might be based on really good really good intentions of treating other people fairly and being good to other people. Some of it might be based on just other weird stuff about wanting to stand up for people who look like you or help people who look like you, etc. So I do have some sympathy for the project of trying to say, “My intuitions contradict each other, but some of them are coming from a good place. Some of them are coming from a bad place.” If I thought more about it, I would realize which ones are which, and I want to try and do that. Dwarkesh Patel Yeah. Let's talk about new totalitarianism. There’s this question from an old Scott Alexander post where he asks, would you rather the medieval church spent all of its money helping the poor rather than supporting the arts? So maybe there were fewer poor people back in the medieval times, but you wouldn't have any cathedrals or you wouldn't have the Sistine Chapel. I don't know how you would answer that if you were in medieval times. Holden Karnofsky It doesn't sound like the strongest version of this argument to me, to be honest. Maybe that would be fine or good. I don't know. My wife really loves these like old churches–– if I had more of her attitude, I would be more horrified by this idea. Low income people had a rough time in the past so them having better lives seems pretty appealing, so I don't really know if that's the best version of this argument. Dwarkesh Patel How much of future proof ethics is basically that you're very confident that a future Holden will have a much more developed and better set of ethics? How much do you think people in general or humanity in general will get better ethics over time? Holden Karnofsky Thhis has been definitely a point of confusion in this series and partly something I think I didn't communicate well about and which makes the series like not that amazing. I use the term moral progress and I just use it to refer to like things “getting better.” I think sometimes there is such a thing as thinking more about your morality, gaining some insight and ending up in a better place as a result. I think that is a thing that is real. There are some people who believe morality is an objective truth, but I'm not one of those people. However, even though I believe morality is not objective, I still think there's a meaningful notion of moral progress. There's such a thing as having more reasonable moral views than I used to. What I didn't mean to say is that moral progress has any inevitability about it. I didn't mean to say that moral progress necessarily happens just because time goes on. I don't think that. I just think it's a thing that can happen. So I do think a future Holden will probably be better at morality just because I'm really interested in the topic–– I'm going to keep trying to improve it. I think that we have some reason to think that actually does help a bit–– a really tiny bit, but I'm not confident in that at all. I certainly don't think that society is going to have moral progress necessarily, but I do think we've had some in the past. Dwarkesh Patel Ok, but then it seems weird to label the system of ethics future proof ethics, right? Maybe it would just be future “Holden-proof ethics.” Holden Karnofsky Yeah, possible. I talk about this a bunch in the series and I think I just didn't do a great job with this. I think what I was trying to do is use a term that you didn't have to be a moral realist to to get behind. What I was really trying to capture was, “Can I think now to reduce the odds that if later I improve, I'll be horrified by my early actions?” That was what I was trying to capture the concept of. I'm not sure I really did it successfully. Integrity vs UtilitarianismDwarkesh Patel Gotcha. OK, so you had a recent post on the E.A. forum that I thought was really interesting. A quote from that is, “My view is that for the most part, people who identify as E.A. tend to have unusually high integrity–– but my guess is that this is more despite utilitarianism than because of it.” So what do you think is the explanation for this coincidence where a group of reasonable, non fanatical, high integrity people also happen to be a community of utilitarians? Holden Karnofsky You might have a set of people who are who think of themselves as trying really hard to be like the kind of person they should be or really hard to bring their actions in line with their beliefs and their statements–– so that drives them to be kind of like honest a lot of the time and follow a lot of our common sense rules of morality. It also drives them to really try to get that ethics right and land on ideas like utilitarianism that are very systematic and pure and like give you sort of this clear theoretical guidance. So it could drive both those things. Whereas I believe that if you're a utilitarian, it's really unclear whether utilitarianism actually tells you to do things like avoiding lying. Some people think it does. Some people think it doesn't. I think it's very unclear. Dwarkesh Patel You've advocated for the moral parliament's approach when you're trying to make decisions. What is the right level of organization at which to use that approach? Should individuals be making decisions based on having multiple different moral parties inside them? Is that the right approach for entire movements but individuals should be specializing? What is the right level to be applying this approach at? Holden Karnofsky Moral uncertainty is something I hope to write about in the future. The basic idea is that there might be a bunch of different ways about thinking about what the right thing is to do in the world. You might look at the world from one angle and say, “Well, what matters is like the total sum of all the pleasures. So therefore a bigger world would be better. So therefore I should be like really obsessed with getting the world to be as big as possible.” There might be another perspective that says that what really matters is suffering. “We should minimize suffering. We should want the world to be small.” There might be another perspective that says it doesn't matter what happens to the world. “It matters how I act. What matters is that I act with integrity, that I tell the truth, things like that.” There's these interesting debates asking what should you do when you think you have some sympathy for all these views. How do you choose an action that some perspectives would say is the best thing you've ever done and some would say is the worst thing you've ever done? The moral parliament idea is an idea that was laid out by Nick Bostrom in an Overcoming Bias post a decade ago that I like. I think about it as if I'm just multiple people. I just think about it as if there's multiple people all living inside my head arguing about what to do and they all are friends and they all care about each other and they want to get along. So they're trying to reach a deal that all of them can feel fairly good about. That is how I tend to think about dealing with different moral views. I tend to want to do things that are really good according to one and not too bad according to the rest and try to have the kind of different parts of myself making deals with each other. So that relates to something I said at the beginning about not being into ends justify the means. I put a lot of effort into doing things that would be like really, really good. If this most important century stuff came out true, that would be good but it also would not be too catastrophic if it didn't. So there are lines I'm not willing to cross. There are behaviors I'm not willing to engage in to promote the kind of goals of people who worry about AI safety. So it's a moderating approach I think. Bayesian Mindset & Governance Dwarkesh Patel It makes a lot of sense for somebody who is the CEO of Open Philanthropy to want the decisions you make to reflect uncertainties about your decisions. However, if it's just somebody like me where I'm not in some sort of leadership position where I have a large amount of resources to dedicate to, should I just specialize in that particular moral view I have or should I also be trying to allocate my time and resources according to different moral views? Holden Karnofsky I think no matter what position I was in in the world and however many resources I had, I would feel that my decisions were significant in some sense and affected people and were important in the way that they affect those around me. So I think it's just very natural to me to think there are a lot of different perspectives on what it means to be a good person rather than trying to turn them into a single unifying mathematical equation and take the expected value–– which is another approach I think is interesting. I do think the approach I do tend to prefer is to imagine the different perspectives as different people trying to get along and make a deal with each other. Dwarkesh Patel Let's talk about governance and management. In software, as I'm sure you're aware, there's a concept of a 10X engineer. Is there something similar in the kinds of work a research analyst at Open Philanthropy does? Is it meaningful to say that when two people are doing the same job, one can be orders of magnitude more effective than another? Holden Karnofsky At any given thing in open philanthropy, some people are much better at it than others. I don't think that's very surprising. I think this is true fot many jobs and I don't really know the reasons for it. It could be any combination of talent, interest, and how hard someone works at it. I certainly think there's a lot of variance and hiring people who can do a great job at the work Open Phil does has been a lifelong challenge. Dwarkesh Patel You've written about the Bayesian mindset. You know many billionaires, and many of them are donors to Open Philanthropy. In your experience, do these startup founders who end up becoming very successful have a Bayesian mindset or is that the wrong way to characterize their – Holden Karnofsky Yeah, I wrote about this idea called the Bayesian mindset, which is basically about being willing to put a probability on anything and use your probabilities and say your probabilities as a way of discovering why it is you think what you think and using expected value calculations similarly. I think this is like much more common among successful tech founders than it is among like the general population, but there's plenty of tech founders who don't think this way at all. I say in the Bayesian mindset. I don't think it's like a super well-tested, well-proven social technology that does amazing things, but I do think it's more like an interesting thing to be experimenting with. Dwarkesh Patel Well, to the general population, the Bayesian mindset is practically unheard of.Holden Karnofsky Yeah, I mean it’s not even just the name. This whole idea of like thinking about expected value and subjective probabilities all the time–– almost no one does that. However, I do think tech founders probably do it more than the average person. Dwarkesh Patel That makes sense. Do you think that adopting more of a Bayesian mindset would help somebody get to the top levels and be more successful? Holden Karnofsky It's really TBD and unclear. I think the Bayesian mindset is a cool thing to experiment with. I experiment with it a lot. I feel like it helps me sometimes. Like most things, it's good in moderation and with taste and not using it for every single thing. Maybe 10 years from now as it gets more popular, we'll have a better sense of where the actual applied strengths and weaknesses are. Dwarkesh Patel As I'm sure you're aware, there are many prizes floating around for all kinds of intellectual work in effective altruism. Some of them even have come from open philanthropy. Are you optimistic about their ability to resurface new ideas? Holden Karnofsky I would say I'm medium-optimistic about the impact of all these prizes. I've been part of designing some of them, but I've just seen some other ones… people say, “Hey, we'll pay you X dollars if you can give us a good critique of our…” GiveWell will pay people to give them a good critique of their reasoning about what the best charities are to give to. Open Philanthropy has a prize for showing us a cause we should be looking at that we're not. I think I'm medium optimistic. I think it will get some interest and it will get some people to pay attention who weren't otherwise and some of those people might have good ideas, but I don't think it's like the only way to solve these problems or that it will automatically solve them. That's generally how the people designing the prizes think about them too. Dwarkesh Patel You have an interesting post about stakeholder management that says that over time, institutions will have to take into account the interests of more and more stakeholders. Do you expect that this will be something that will be a major factor in how Open Philanthropy acts in the future? What will be the impact on how Open {hilanthropy runs overall? Holden Karnofsky Yeah, I think in general the bigger your organization is, the bigger your city is, the bigger your society is–– if you want everyone to be happy, there are more people you're going to have to make happy. I think this does mean that in general by default as a company grows, it gets less able to make a lot of disruptive quick changes. A lot of people would use the term “nimble”. A lot of people in the tech world like to use these very negative terms for big company properties and very positive terms for small company properties. So small companies are nimble and quick and practical and adaptive and dynamic and high productivity and big companies are bureaucratic and slow and non-adaptive. I think that's all fair. I also think that big companies often at the end of the day just produce more stuff than they could if they were small.I think if Apple were still 10 people, it might be a more exciting place to work at— but they wouldn't be able to make all those iPhones. There are a lot of iPhones going out to a lot of people, serving a lot of different people's needs, and abiding by a lot of regulatory requirements. There's a lot of work to be done. So I don't think it's necessarily a bad thing but I think there’s a tradeoff when a company grows. I do think Open Philanthropy is in the business of doing kind of unconventional giving and using a lot of judgment calls to do it. So I tend to think we benefit a lot from staying as small as we can and I generally have fought for us to stay as small as we can while doing our work–– but we still have to grow from where we are. Dwarkesh Patel Gotcha. Do you mean stay small in terms of funds or do you mean people?Holden KarnofskyPeople. Dwarkesh Patel Okay yeah, people. It seems odd to say that in the organization you have the most experience with, your inside view is that more stakeholders would be bad–– but overall it's been a net zero or positive. Holden Karnofsky Well, it's not clear – we are growing. We're bigger than we were a year ago and we'll be bigger in a year. So it's definitely not true that I’m trying to minimize the size of the company. We're growing, but I think we want to watch it. I think we want to treat each hire as something that we only do because we had a really good reason to. I think there are some companies that may have more to gain from being 10,000 people. I don't think we'll ever be 10,000 people. Career AdviceDwarkesh Patel Right. Now your written career advice emphasizes building aptitudes and specializing, but when I look at your career––, it's all over the place, right? We were just talking about it at the beginning of the interview. You started off in GiveWell, then you were working at Open Philanthropy and now you're forecasting AI. So how do you think about this kind of thing? Are you specializing? What's going on here? Holden Karnofsky I don't know if I really forecast AI. I mostly distill and bring together analyses that others have done, and I manage people who work on that sort of thing. The career advice I often give is that it's really good to have something you're very focused on that you're specializing in, and that you're trying to be the best in the world at. The general theme of my career is just taking questions, especially questions about how to give effectively, where it's just like no one's really gotten started on this question. Even doing a pretty crappy analysis can be better than what already exists. So often what I have done in my career, what I consider myself to have kind of specialized in, in a sense, is I do the first cut crappy analysis of some question that has not been analyzed much and is very important. Then I build a team to do better analysis of that question. That's been my general pattern. I think that's the most generalizable skill I've had, but I have switched around because I do think that I've kind of at various points in my career just said, “Hey, here's something that's getting very little attention and it's very important, and it's worth the sacrifice of the specialized knowledge I built up in one area to switch into this other area that I think I ought to be working on.” Dwarkesh Patel What does the logo on the Cold Takes blog mean?Holden Karnofsky  There is no logo. I think you're talking about the browser icon. Dwarkesh Patel Yeah, yeah. Holden Karnofsky That is a stuffed animal named Mora. At some point, if I get enough subscribers, I will explain who all these stuffed animals are, but my wife and I basically use a stuffed animal personality classification system where we will compare someone to various stuffed animals to explain what their strengths and weaknesses are. Mora is a pink polar bear who's very creative but also very narcissistic and loves attention. So she's kind of the mascot of the blog because it's this blog that's just very crazy, very out there, and is just me writing in public. So it just felt like her spirit. Dwarkesh Patel Gosh, okay. So let me ask, what is the goal of the blog? Why have a second job as a blogger in addition to being the CEO of a big organization? Holden Karnofsky I think it fits into my job reasonably well. I didn't want it to be Open Philanthropy branded. I just wanted the freedom to write about things the way I wanted and how I wanted. I do think that we make these high-stakes decisions based on very unconventional views about the world. So I think it's good for us to be trying to make those views have contact for the rest of the world. I think there would be something not ideal about being a large foundation giving you large amounts of money but then just quietly going around believing these enormously important and true things that no one else believes. If we put the views out into the world, A, I think all the people seeking money from us would just have a better idea of where we're coming from and why is it that we're interested in funding what we're interested in funding. I think to an extent, if people can find the arguments compelling or even just understand them, this helps us understand our thinking and can help create more grantees for us. It can help cause the world to be a place where there's more good stuff for us to fund because more people see where we're coming from, hopefully, agree with it, and are trying to work on the things we consider important. Then to the extent that my stuff is actually just screwed up and wrong and I've got mistakes in there and I've thought it all through wrong, this is also the best way I know of to discover that. I don't know how else I'm going to get people to critique it except by putting it out there and maybe getting some attention for it. So that's how I kind of think of it–– it's taking views that are very important to the decisions we're making and trying to express them so that we can either get more people agreeing with us who were able to fund and support and work with or learn more about what we're getting wrong. Dwarkesh Patel Alright. So let me actually ask you–– has that happened? Has there been an important view expressed on the blog that because of feedback that you’ve change your mind on? Or is it mostly about the communication part? Holden Karnofsky I mean, there's definitely been a lot of interesting stuff. An example is I put up this post on the track record of futurists and there was a post by Dan Luu recently that I haven't read yet. It has its own analysis of the track record of futurists and I need to compare them to think about what I really think about how good humans have historically been at predicting the future. He certainly has a ton of data in there that I was not aware of that feels like a bit of a response or may not have been prompted by it. There's been a lot of commentary. There's been a lot of critiques about some of the stuff I've written in the most important century. There have been other critiques. I think a lot of the stuff I wrote about the biggest weak points of the most important century was based on the public criticism that was coming in. So I think I have become more aware of a lot of the parts of my thinking that are the least convincing or the weakest or the most in need of argument. I have like paid more attention to those things because of that. Dwarkesh Patel Yeah. This may just be me talking, but it actually does sound like if you've learned about how people react to the most important century thesis, but it doesn't seem like something has surfaced–– which has made you change your mind on it a lot. Holden Karnofsky That would be a big, a big change, to drop my view that we could be in the most important century for humanity. That's still what I believe. I mean, I think I've also heard from people who think I'm like underselling the whole thing–– crazy people who just think that I should be planning on transformative AI much sooner than what I kind of implied in the series. So, yeah, I put out “Most Important Century” and I don't believe any of the critiques have been deep enough and strong enough to make me just drop that whole thing. It's a big picture with a lot of moving parts and I have deepened my understanding of many of the parts. Dwarkesh Patel Yeah. One thing I find really interesting about your work is how much it involves the CEO having a deep understanding of all the issues involved. You’re the one who has to deeply understand, for example, moral parliaments or specific forecasts about AI, biological anchors, and whatever else, right? It seems perhaps in other organizations, the CEO just delegates this kind of understanding and just asks for the bullet points. Is this something you think more leaders should be doing or is there something special about your position? Holden Karnofsky I know much less about any given topic than the person who specializes in the topic. I think what I try to do is I try to know enough about the topic that I can manage them effectively, and that's a pretty general corporate best practice. I think it just varies a lot. So, for example, something like keeping our books, keeping our finances, doing the financial audits, and all that stuff–– that's something that's really easy to judge the outputs by without really knowing much about finance at all. You can just say, “Look, was this compliant? Did we do our audit? Did we pass the audit? Do we still have money in the bank? How much money do we have in the bank?” You don't need to know much about it to judge it effectively. However, at any other company, you may need to know a fair amount about some other topics in order to judge them very effectively. If your company is making computers or phones, and design is very important, it would be really bad if the CEO just had like no opinions on design and just thought “I'm going to let our design person decide the design.” It's a central thing to the company. It matters to the company and they should know some things about it. So I do know things that are really central to open philanthropy. What does it mean to do good? How do we handle uncertainty about how to do good? What are the most important causes? If AI might be one of the most important causes, then when might we see transformative AI? What would that mean? How big is the risk of misaligned AI? I think I need to understand those issues well enough to effectively manage people who know a lot more about them than I do. I'm curious–– what do you think about this whole most important century stuff? Does it just strike you as like crazy? What do you think when you read the series? Dwarkesh Patel Yeah, obviously through the entire interview, I've been trying to like nitpick at small things, but when I really think about the main claim you're making, it’s that this could be the most important century and transformative AI could happen in the century. If it does, then it's a really big deal and yeah, I don't disagree. That makes a lot of sense. Throughout preparing for the interview and trying to come up with objections, I've just been a little bit more convinced with thinking about, “Is there actually something I could do over my early career that matters? Or is that something that maybe I should just hold off on thinking about?” Holden Karnofsky Glad to hear it. Do you have any ideas about what you might do? Dwarkesh Patel No.Holden Karnofsky Really? Literally no ideas? You haven't been like, “Can I work on AI alignment?”Dwarkesh Patel Well, yeah in that sense, I’ve thought a little bit about it. In probably like two months or three months, I'll think really hard about what I actually want to do for a career. Many thanks to my amazing editor, Graham Bessalou, for producing this podcast and to Mia Aiyana for creating the amazing transcripts that accompany each episode, which have helpful links and you can find them at the link in the description below. Remember to subscribe on YouTube and your favorite podcast platforms. Cheers. See you next time.  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

This was one of my favorite episodes ever.Bethany McLean was the first reporter to question Enron’s earnings, and she has written some of the best finance books out there. We discuss:* The astounding similarities between Enron & FTX,* How visionaries are just frauds who succeed (and which category describes Elon Musk),* What caused 2008, and whether we are headed for a new crisis,* Why there’s too many venture capitalists and not enough short sellers,* And why history keeps repeating itself.McLean is a contributing editor at Vanity Fair (see her articles here) and the author of The Smartest Guys in the Room, All the Devils Are Here, Saudi America, and Shaky Ground.Watch on YouTube. Listen on Spotify, Apple Podcasts, or your favorite podcast platform.Follow McLean on Twitter. Follow me on Twitter for updates on future episodes. If you enjoyed this episode, please share. Helps out a ton.Timestamps(0:04:37) - Is Fraud Over? (0:11:22) - Shortage of Shortsellers(0:19:03) - Elon Musk - Fraud or Visionary?(0:23:00) - Intelligence, Fake Deals, & Culture(0:33:40) - Rewarding Leaders for Long Term Thinking(0:37:00) - FTX Mafia?(0:40:17) - Is Finance Too Big?(0:44:09) - 2008 Collapse, Fannie & Freddie(0:49:25) - The Big Picture(1:00:12) - Frackers Vindicated?(1:03:40) - Rating Agencies(1:07:05) - Lawyers Getting Rich Off Fraud(1:15:09) - Are Some People Fundamentally Deceptive?(1:19:25) - Advice for Big Picture ThinkersTranscriptThis transcript was autogenerated and thus may contain errors.Dwarkesh Patel: the rapid implosion of a company worth tens of billions of dollars. Insider dealing and romantic entanglements between sister companies, a politically generous c e o, who is well connected in Washington, the use of a company's own stock as its collateral, the attempt, the short-lived attempt to get bought out by a previous competitor, and the fraudulent abuse of mark to market account.[00:01:00] We are not talking about ftx, we are talking about Enron, which my guest today, Bethany McClean, uh, first broke the story of and has written an amazing and detailed book about, uh, called The Smartest Guys in the Room. And she has also written, uh, a book about the housing crisis. All the devils are here, a book about Fannie and Freddy Shaky Ground, and a book about fracking Saudi America, all of which we'll get into.She's, in my opinion, the best finance nonfiction writer out there, and I'm really, really excited to have this conversation now. So, Bethany, thank you so much for coming on the podcast. Bethany McLean: Thank you so much for the, for the probably Undeserved Conference, for having me on the show. Dwarkesh Patel: My first question, what are the odds that Sbf read the smartest guys in the room and just followed it as a playbook, given the similarities there?Bethany McLean: You, you know, I, I love that idea. I have to, I have to admit, I guess I love that idea. I don't know. That would make me responsible for what, for what happened, . So maybe I don't love that idea. L let me take that back . [00:02:00] Anyway, but I, I, I actually think that, that, that even if he had read the book, it would never have occurred to him that, that there was a similarity because self-delusion is such a, Strong component of all of these stories of business gone wrong.It's very rare that you have one of the characters at the heart of this who actually understands what they're doing and understands that they're moving over into the dark side and thinks about the potential repercussions of this and chooses this path. Anyway, that's usually not the way these stories go.So it's entirely possible that Sbf studied Enron, knew all about it, and never envisioned that there were any similarities between that and what he was doing. Dwarkesh Patel: Oh, that's a fascinating, um, which I guess raises the question of what are we doing when we're documenting and trying to learn from books like yours?If somebody who is a, about to commit the same exact kind of thing can read that book and not realize that he's doing the same exact thing, is there something that just [00:03:00] prevents us from learning the lessons of history that we, we can never just, uh, get the analogy right, and we're just guided by our own delusions.Bethany McLean: Wasn't there a great quote that history rhymes, but it doesn't repeat. I'm Yeah. Relying on who it is who said that, but I think that's, that's absolutely true. Oh, I think it's important for all of us, those of us who are not gonna find ourselves at the center of, uh, giant fraud or, so, I hope, I think my time for that has passed.Maybe not you, but, um, I think it's important for all of us to understand what went wrong. And I, I do think these, I do think just there, there's a great value and greater understanding of the world without necessarily a practical payoff for it. So I think when something goes wrong on a massive societal level, it's really important to try to, to try to explain it.Human beings have needed narrative since the dawn of time, and we need narrative all, all, all the more now we need, we need to make sense of the world. So I like to believe. Process of making, trying to make sense of the world. , um, [00:04:00] has a value in, in and of itself. Maybe there is small, some small deterrence aspect to it in that I often think that if people understand more the process by which things go go wrong, that it isn't deliberate, that it's not bad people setting out to do bad things.It's human beings, um, at first convincing themselves even that they're doing the right thing and then ending up in a situation that they, they never meant to be in. And maybe on the margin that does, maybe on the margin that does, that does help because maybe it has deterred some people who, who would've started down that path, but for the fact that they now see that that's the, that's the usual path.Dwarkesh Patel: Yeah. Yeah. That actually raises the next question I wanted to ask you. Bern Hobart, uh, he's a finance writer as well. He wrote a blog post, um, about, uh, I mean this was before FTX obviously, and he was talking about Enron and he said in the end, it actually looks like we fixed the precise problem. Enron represented.Nobody I know solely looks at gap [00:05:00] financials. Everybody ultimately models based on free cash flow, we're much more averse to companies that set up a deliberate conflict of interest between management and shareholders. And I guess there's a way in which you can read that and say, oh, it doesn't FTX prove I'm wrong.But, you know, there's another way you can look at it is that FTX deliberately set up outside the us. So there's a story to be told that actually we learned the lessons of Enron and, you know, uh, so remains obviously worked. Uh, that's why, you know, they were in The Bahamas and we haven't seen the scale fraud of that scale in, you know, the continental United States.Um, do, do you think that the FTX saga and I guess the absence of other frauds of that scale in America shows that. The regulations and this changed business and investment practices in the aftermath of Enron have actually. Bethany McLean: Well, I think they've probably worked in narrowly, written in, in the way in which the writer you quoted articulated, I think it would be very hard for the cfo, F O of a publicly traded company to set up other private [00:06:00] equity firms that he ran, that did all their business with his company.Because everybody would say That's Enron and it would be completely. On the nose. And so, and Sarbanes Oxley in the sense of, in the sense of helping to reign in corporate fraud of the sort that was practiced by Enron, which was this abuse of very specific accounting rules. Um, I think I, I, I think that worked.But you know, you say there hasn't been fraud on a scale like Enron up until perhaps f ftx, but you're forgetting the global financial crisis. Yeah. And then the end, the line between what happened at Enron. and, and what happened in the global financial crisis. It's not a matter of black and white. It's not a matter of, one thing was clear cut fraud and one thing great.We love these practices. Isn't this fantastic? This is the way we want business to operate. They're both somewhere in the murky middle. You know, a lot of what happened at Enron wasn't actually outright fraud. I've coined this phrase, legal fraud to describe, um, to describe what it is that, that, that, that happened at Enron.And a lot of what [00:07:00] happened in the global financial crisis was legal, hence the lack of prosecutions. But it's also not behavior that that leads to a healthy market or mm-hmm. , for that matter, a a a a healthy society. And so there's a reason that you had Sarbanes Oxley and what was it, eight short, short years later you had Dodd-Frank and so Riri broadly.I'm not sure Sarbanes actually did that much good. And what I mean by that is when President George Bush signed it into law in the Rose Garden, he gave this speech about how investors were now protected and everything was great and your, your ordinary investors could take comfort that the laws were meant to protect them from wrongdoing.And you compare that to the speech that President Barack Obama gave eight years later when he signed Don Frank into law in the Rose Garden. And it's remarkably similar that now ordinary investors can count on the rules and regulations keeping themself from people who are prey on their financial wellbeing.[00:08:00] And I don't think it was, it's, it's true in either case because our markets, particularly modern markets move and evolve so quickly that the thing that's coming out of left field to get you is never gonna be the thing you are protecting against. Mm. . Dwarkesh Patel: , but given the fact that Enron, as you say, was committing legal fraud, is it possible that the government, um, when they prosecuted skilling and Fastow and lay, they in fact, We're not, uh, they, they prosecuted them to a greater extent than the law as written at the time would have warranted.In other words, were, uh, was there something legally invalid in the, in this, in the quantity of sentence that they got? Is it possible? Bethany McLean: So that's a really, it, it's, it's a, I I get what you're asking. I think it's a really tricky question because I think in absolute terms, um, Enron needed to be prosecuted and needed to be prosecuted aggressively.And while I say it was legal fraud, that is for the most part, there was actually real fraud around, around, uh, but it's on the margin. It doesn't [00:09:00] entire, it doesn't explain the entirety of Enron's collapse. Much of what they did was using and abusing the accounting rules in order to create an appearance of economic reality.Nothing to do with actual, with actual reality. But then there was actual fraud in the sense that Andy Fasta was stealing money from these partnerships to benefit himself. And they were, if you believe, the core tenant of the prosecution, which was their, this agreement called Global Galactic that was signed by, that was between Andy fau and Jeff Skilling, where Jeff agreed that Andy's partnerships would never lose money.Then that invalidated all of the, all of the accounting, and that's the chief reason that that. That skilling was, was, was convicted, um, was that the jury believed the existence of this, of this, of this agreement that in, um, one set of insider stock sales, which, which we can talk about, which was also a really key moment relative to the, so in absolute terms, I don't know, it's, it's hard for me to, to say there was [00:10:00] such, Enron was such a, to a degree that is still surprising to me, such a, a watershed moment in our, in our country, far beyond business itself.it, it, it caused so much insecurity that about our retirements, our retirement assets safe. Can you trust the company where you work? That I think the government did, did have to prosecute aggressively, but relative to the financial crisis where a lot of people made off with a lot of money and never had to give any of it back, does it seem fair that, that, that Jeff Skilling went to jail for over a decade and no one involved in a major way in the financial crisis paid any price whatsoever?People didn't even really have to give up that much of the money they made then. Then it seems a little bit unfair. Yes, so I think it's, it's an absolute versus a relative Dwarkesh Patel: question. Yeah. Yeah. By the way, who do you think made more money? Um, the investment banks, uh, like, uh, Goldman Sachs and Morgan Stanley, um, from doing, [00:11:00] providing their services to Enron as the stock was going up, or Jim Chanos from shorting the stock?In absolute terms, who made more money? Bethany McLean: Oh, I think the investment banks for sure. I mean, they made, they made so much money in investment banking fees from, from, from Enron. But, you know, it's a good question. . , it's a good question actually, because I think Jim made a lot of money too, so, Dwarkesh Patel: Yeah. Yeah. I mean, I, I, you've spoken about, I guess the usefulness and the shortage of short sellers des a sort of, uh, corrective on irrational exuberance.And I'm curious why you think that shortage exists in the first place. Like, if you believe in the efficient market hypothesis, you should think that, you know, if some company has terrible financials and implausible numbers, then people would be lining up to short it. And then you would never have a phenomenon like Enron.And so it's, it's, you know, it's so odd that you can. , you know, reporters who are basically ahead of the market in terms of predicting what's gonna happen. Uh, well, uh, how do you square that with like the efficient [00:12:00] market hypothesis? Well, do you Bethany McLean: believe in the efficient market hypothesis, ? Dwarkesh Patel: I, I, I'd like to, but I'm like trying to , trying to wrap my head around Enron.Bethany McLean: I, I'm, I'm, I'm, I'm not sure how you. Can, unless you, unless you adopt Warren Buffett's point of view, and I'm gonna mangle the quote because, uh, but, but it's that the market in the short term is a voting machine in the long term. It's a weighing machine, right? Mm-hmm. , or is it the other way around? . Anyway, but the idea is that the market may be very efficient for a long, very inefficient, for a long period of time.But, but it does actually, rationality does actually work in, in, in the end. And I think I might believe that, but isn't it John Maynard Cas who said the market can remain irrational for a lot longer than you can remain solvent. And so I think that's true too. I think believing that the market is efficient and rational in the short term is just obviously wrongUm, but back to your question about short sellers, which is, which is interesting, you know, I think part of it is that there is still this, um, there certainly was a couple of [00:13:00] decades ago, and I think it still exists, this idea that. Owning stocks is Mom, American, and apple pie in shorting stocks somehow is bad and evil and rooting, rooting against America.And I remember going back to the Enron days, someone, people criticizing me, even other people in the press saying, but you took a tip from a short seller. They're biased. And I. , I would say. But, but, but wait, the analysts who have buy ratings on stocks and the portfolio managers who own those stocks, they're biased too.They want the stocks to go up. Everybody's biased. So the trick as a journalist is getting information from all sides and figuring out who you think is right and what makes sense. But it's not avoiding anybody with any bias. But it was really interesting that people saw the bias on the part of short sellers and did not see it on the part of, of, of Longs.And I think there is that preconception that exists broadly, that somehow you are doing something wrong and you're somehow rooting for a company's failure. And that this is, I don't know, anti-American if you, if, if you [00:14:00] short a stock. And so I think that's part of why there's, there's, there's a shortage of shortage of, of, of short sellers.Um, I think also, I mean, we've had. Incredible, unprecedented bull market for the last four decades as a result of falling interest rates, and especially in the decade before the pandemic hit, it was very, very difficult to make money shorting anything because everything went to the moon. Didn't matter if its numbers were good, if it was eventually unmasked to be somewhat fraudulent, , it stocks just went to the moon anyway.The riskier the better. And so it is only diehard short sellers that have managed to stick it out . Yeah, and I think, I think lastly, Jim Chano said this to me once, and I, I think it's true that he could find, dozens of people who were skilled enough to come, smart enough to come work for him.There's no shortage of that. People who are technically skilled and really smart, but being able to be contrarian for a long period of time, especially when the market is going against you, is a different sort [00:15:00] of person. It that it requires a completely different mindset to have everybody in the world saying, you're wrong to be losing money because the stock is continuing to go up and to be able to hold fast to your conviction.And I think that's another, uh, part of the explanation for why there are fewer short sellers. Dwarkesh Patel: Yeah, and that raised an interesting question about. Uh, venture capital, for example, where, or private markets in general? Um, at least in the public markets, there's shorting maybe in shortage, but it, it is a possible mechanism, whereas, uh, I'm a programmer.So, you know, if, if like a one guy thinks the company's worth a hundred million dollars and everybody else thinks it's not, you know, the company will still be, uh, the price will still be said by the, you know, the person who's a believer. Um, does that increase the risk of some sort of bubble in venture capital and in technology?Um, and I guess in private markets generally, if they're, they're not public, is that something you worry about that they're, they will be incredible bubbles built up if there's a lot of money that's floating around in these Bethany McLean: circles. . Well, I think we're seeing that now, [00:16:00] right? And I don't think it's a coincidence that FTX and Theranos were not publicly traded companies, right?Mm-hmm. . Um, there's a certain sort of, uh, black box quality to these companies because people aren't charting them and aren't, aren't, and aren't, you know, whispering to journalists about that. That there's something wrong here and there aren't publicly available financials for people to dig through and look, look, and look at the numbers.So now I don't think that's a coincidence. And I do think this gigantic move into private assets has been, um, probably not great for the, for the, for the, for the. for the, for the safety of the system. And you'd say, well, it's just institutional investors who can afford to lose money who are losing money.But it's really not because institutional investors are just pension fund money. Mm-hmm. and in some cases now mutual fund money. So that distinction that the people who are investing in this stuff can afford to lose it is not really true. Um, so I don't, I don't like that rationalization. I think we're gonna see how that plays out.There was [00:17:00] just a really good piece in the Economist about private equity marks on their portfolio companies and how they are still looked to be much higher than what you would think they should be given the carnage in the market. And so all of what, what actually things are really worth in private markets, both for venture capital firms and for private equity firms, Is absent another, another bubble starting, starting in the markets.I think we're gonna see how that plays out over, over the next year. And it might be a wake up call for, for a lot of people. Um, you know, all that, all that said, it's an interesting thing because investors have been very complicit in this, right? In the sense that a lot of investors are absolutely delighted to have prep, to have their, their private, um, their private investments marked at a high level.They don't have to go to the committee overseeing the investments and say, look, I lost 20% of your money the way they might, um, if, if the numbers were public. And so that the ability of these of private investors to smooth as they call it, the, the, the returns is, is it's [00:18:00] been, it's been part of the appeal.It hasn't been a negative, it's been a positive. And so I would say that investors who wanted this moving are. Art might be getting what they deserve except for the pointing made earlier that it isn't, it isn't their money. It's, it's the money of, of teachers and firefighters and individual investors a around the country, and that's, that's problematic.Dwarkesh Patel: Yeah. Yeah. Being in the world of technology and being around people in it has. made me, somewhat shocked when I read about these numbers from the past. For example, when I'm reading your books and they're detailing things that happened in the nineties or the two thousands, and then you realize that the salary that Hank Paulson made a c e o of Goldman, or that skilling made as, you know, um, c e o of Enron, you know, I, it's like I have friends who are my age, like 22 year olds who are raising seed rounds, , that are as big as like these people's salaries.And so it just feels like the, these books were, you have $50 billion frauds or, you know, hundreds of billions of dollars of collapse and the individuals there, um, it just feels like they, it's missing a few zeros, uh, [00:19:00] because of the delusion of the private markets. But, um, but speaking of short sellers and speaking of private equity, um, I think it'd be interesting to talk about sbf.So, you know, your 2018 Vanity Fair article I thought was really interesting about, you know, sbf factory in Buffalo H How, how do you think back on Tesla and sbf now, given the fact that. The stock did continue to rise afterwards, and the factory, I believe, was completed and it's, I hired the 1500 or so people that had promised New York State, uh, is sbf just a fraud?Who can pull it off? And so he's a visionary. How, how do you think about sbf in the aftermath? Bethany McLean: So I don't think that's right about Buffalo and I have to look, but I don't think they ended up, I mean, the Solar City business that Tesla has pretty much collapsed. I don't think people haven't gotten their roofs.There was just a piece about how they're canceling some of their roof installations. So sbf has repeatedly made grand visions about that business that haven't played out. And I will check this for you post the podcast, but I don't think [00:20:00] if there is employment at that factory in, in Buffalo, it's not because they're churn out solar, solar, solar products that are, that are, that are doing.What was originally promised. So I guess I, I think about that story in a, in a couple of ways. It definitely, um, it was not meant to be a piece about Tesla. It was meant to be a piece that shown a little bit of light on how sbf operates and his willingness to flout the rules and his reliance on government subsidies, despite the fact that he, um, presents himself as this libertarian free, free, free market free marketeer, and his willingness to lie to, to, to, on some level enrich himself, which also runs counter to the Elon sbf narrative that he doesn't care about making money for, for himself.Because the main reason for Teslas to by Solar City was that Solar City had the main reason, was it Tes, that was, that Solar City had, that, that sbf and his, and his and his relatives had extended the these loans to Solar City that were gonna go. [00:21:00] There were gonna be lo all the money was gonna be lost at Solar City when bankrupt.And by having Tesla buy it, sbf was able to bail himself out, um, as, as as well. And I also think a good reason for the, for the, for, and it brings us to the present time, but a reason for the acquisition was that sbf knows that this image of himself as the invincible and vulnerable who can always raise money and whose companies always work out in the end, was really important.And if Solar City had gone bankrupt, it would've cast a big question mark over over sbf, over over the sbf narrative. And so I think he literally couldn't afford to let Solar City go bankrupt. Um, all of that said, I have, I have been, and was I, I was quite skeptical of Tesla and I thought about it in, in, in, in.And I always believed that the product was great. I just, mm-hmm. wasn't sure about the company's money making potential. And I think that, that, it's something I started thinking about, um, background, the Solar City time, maybe earlier, but this line, something I've talked about [00:22:00] before. But this line between a visionary and a fraudster.You know, you think that they're on two opposite ends of the spectrum, but in reality they're where the ends of the circle meet. Characteristics of one. One has that many of the characteristics of the other. And sometimes I think the only thing that really separates the two is that the fraudster is able to keep getting mo raising money in order to get through the really difficult time where he or she isn't telling the truth.And then they, that person goes down in history as a visionary. Um, but because no one ever looks back to the moment in time when they were lying, the fraudster gets caught in the middle. Um, so Enron's Lo lost access to to the capital markets lost AC access to funding as the market collapsed after the.com boom.And people began to wonder whether skilling was telling the truth about Enron's broadband business. And then there were all the disclosures about Andy fasa partnerships if Enron had been able to continue raising money, Business of Enron's called Enron Broadband might well have been Netflix. It was Netflix ahead of its time.So Enron just got caught in the middle and all [00:23:00] the fraud, all the fraud got exposed . Um, but that's not because Jeff Skilling wasn't a visionary who had really grand plans for, for, for, for the future. So I think sbf falls somewhere in that spectrum of, of, of fraudster and visionary. And what's gonna be really interesting why I said that this, we bring it to the present time about what happens to the mu narrative.If something fails is what happens. Yeah. Is as the world watch watches Twitter implode, um, what does that mean then for the Elon sbf narrative overall? Dwarkesh Patel: Yeah. Yeah. Um, going back to the Smartest Guys is the Room, the title obviously suggests something about. The, I guess in general, the ability and the likelihood of very smart people committing fraud or things of that sort.Um, but you know, Begar Jones has this book called Hi Mind, where he talks about how the smarter people are more likely to cooperate in prisoners dilemma type situations. They have longer time preference. And one of the things you've written about is the problem in corporate America is people having shorter, [00:24:00] um, uh, you know, doing two too big time discounting.So, uh, given that trend we see in general of greater Cooperativeness, um, and other kinds of traits of more intelligent people, do you think the reason we often find people like S B F and skilling running big frauds just by being very intelligent, is it just that on, on average smarter people, maybe less likely to commit fraud, but when they do commit fraud, they do it at such garat scales and they're able to do it at such gar scales that it just brings down entire empires?How, how, how do you think about the relationship between intelligence and fraud? . Bethany McLean: That's interesting. Um, I'm not sure I know a coherent answer to that. Um, smartest guys in the room as a title was a little bit tongue in cheek. It wasn't meant to say, these guys actually are the smartest guys in the room. It was, it, it was a little bit, it was a little bit ironic, but that doesn't take away from the really good question that you asked, which is what, what, what is that relationship?I, I mean, I think if you look at the history of corporate fraud, you are not going to find unintelligent people having [00:25:00] been the masterminds behind this. You're gonna find really, really, really smart, even brilliant people having, having, having been, been behind it, maybe some at part of that is this linkage between the visionary and the fraud star that so many of these, of these corporate frauds are people who have qualities of the visionary and to.The qualities of, of a visionary, you have to have a pretty, pretty, pretty, pretty high intelligence. Um, and I do think so many of these stories are, are about then self delusion. So I don't think smart people are any less likely to suffer from self delusion than dumb people. And they're probably more likely to, because you can rationalize, you know, the smart person's ability to rationalize just about anything they wanna rational rationalize is pretty profound.Whereas perhaps someone who doesn't have quite the same, the same brain power isn't gonna be able to create a narrative under which their actions are blameless and they're doing the right thing. So I think sometimes, so maybe there is some sort of relationship [00:26:00] there that somebody more qualified than I am would have to study between smart people's ability to, to, to rationalize just about anything as a way of, as part of the path to self delusion and part of the path by which these things happen.Yeah, that's completely, that's completely , that's Bethany theory. There's absolutely nothing to back that . I'm just Dwarkesh Patel: well clear. Let's do some more speculation. So, um, one of the things, uh, John Ray talked about in his testimony, um, was it two days ago where he said that, you know, FTX had done $5 billion of investments and deals in the last year, and most of those investments were worth a fraction of the value that FTX paid for them.And we see this also in, obviously in Enron, right? With, uh, broadband and with, um, ul, or is that how pronounce it, but basically their international department. Yeah. Um, what is this, uh, this obsession with deal making for its own sake? Is that to appease investors and make them think a lot's going on, is that because of [00:27:00] the hubris of the founder, of just wanting to set up a big empire as fast as possible, even if you're getting a bad sticker price?What, why do we see this pattern of just, you know, excessive deal making for its own sake? Bethany McLean: That's an interesting question too. I'm not sure that that's, um, limited to companies that go splat dramatically. There's a lot of, a lot of deal making in, in corporate America has that same frenzied quality. Um, I haven't seen an updated study on, on this in a, in a long time, but, you know, I began my career working as an analyst in an m and a department at at at Goldman Sachs.And. Definitely deals are done for the sake of doing deals. And I once joked that synergies are kind of like UFOs. A lot of people claim to have seen them, but there's no proof that they actually exist. , and again, I haven't seen an updated study on, on, on this, but there was one years back that showed that most m and a transactions don't result in increased value for shareholders.And most synergies, most promised synergies never materialize. [00:28:00] Just getting bigger for the sake of getting bigger and doing deals for the short term value of showing Wall Street a projection. That earnings are gonna be so much higher even after the cost of the debt that you've taken on. And that they're these great synergies that are gonna come about from, from combining businesses.So I don't know that either the frenzy deal doing or deal doing deals gone wrong is, um, solely limited to people who are committing fraud. , I think it's kinda across the spectrum. , . Dwarkesh Patel: Um, um, well one, one thing I find interesting about your books is how you detail that. And correct me if this is the wrong way to read them, but that, uh, incentives are not the only thing that matter.You know, there there's this perception that, you know, we've set up bad incentives for these actors and that's why they did bad things. But also, um, the power of one individual to shape a co co company's culture and the power of that culture to enable bad behavior, whether scaling at Enron or with Clarkson Right at Moody's.Yeah. Um, is that a good, good way of reading your books or how, how do you think [00:29:00] about the relative importance of culture and incentive? Bethany McLean: I think that's really fair. But incentives are part of culture, right? If, if you've set up a culture where, where how you're valued is what you get paid, I think it's a little, it's a little difficult to separate those two things out because, because the, the incentives do help make the culture, but for sure culture is incredibly, um, incredibly compelling.I've often thought and said that if I had, when I was leaving my short lived career in investment banking, if I had, if I had gotten in some of the head hunters I was talking to, if one of them had said, there's this great, really energetic, interesting energy company down in Houston, , why don't interview there?If I had gone there, would I have been a whistleblower or would I have been a believer? And I'd like to believe I would've been a whistleblower, but I think it's equally likely that I would've been a believer. Culture is so strong. It creates this. What's maybe a miasma that you can't see outside?I remember a guy I talked to who's a trader at Enron, really smart guy, and he [00:30:00] was like, after the, after the bankruptcy, he said, of course, if we're all getting paid based on creating reported earnings and there's all this cash going out the door in order to do these deals that are creating reported earnings, and that's the culture of the entire firm, of course it's not gonna work economically.He said, I never thought about it. . It just didn't, it didn't, it didn't occur to me. And I think the more compelling the CEO o the more likely you are to have that kind of mass delusion. I mean, there's a reason cult exist, right? . We, we are as human beings, remarkably susceptible to.Visionary leaders. It's just, it's the way the human brain is wired. We, we wanna believe, and especially if somebody has the ability to put a vision forward, like Jeff Gilling did at Enron, like Elizabeth Holmes did it Theranos like SPF F did, where you feel like you are in the service of something greater by helping this, vision, , actualize then, then you're, particularly susceptible.And I think that is the place where [00:31:00] incentives don't quite explain things. That is, there is this very human desire to matter, to do something important. Mm-hmm to be doing something that's gonna change the world. And when somebody can tap into that desire in people that feeling that what you're doing isn't just work in a paycheck and the incentives you have, but I mean, I guess it is part of the incentive, but that you're part of some greater good.That's incredibly powerful. Yeah. Dwarkesh Patel: It's what we all speaking of. We all wanna matter. . Yeah. Speaking of peoples psychology, uh, crime and punishment, underrated or overrated as a way to analyze the psychology of people like scaling and S B F or maybe SBF specifically because of the utilitarian nature of SB F'S crime?Um, Bethany McLean: I think it's, I think it's underrated, overrated. I'm not sure anybody. , I'm not sure anybody has ever proven that jail sentences for white collar criminals do anything to deter subsequent white collar crime. Mm-hmm. , and I think one part of this is the self delusion that I've, that I talked about. Nobody thinks, [00:32:00] oh, I'm doing the same thing as Jeff Skilling did at Enron, and if I, and if I do this, then I too might end up in jail.Therefore, I don't wanna do this. I just don't think that's the way the, the, the, the, the thought process works. I think Elizabeth Holmes at Theranos, probably for the most part, convinced herself that this was going to work, and that if you just push forward and push hard enough and keep telling people what they wanna hear and keep being able to raise money, it's gonna work.You know, if. . If, if you pause to think, well, what if it doesn't work and I've lied and I go to jail, then, then you'd stop right, right then and there. So I think that, I think that, that I'm, I'm not, I'm not sure it's much of a deterrent. I remember, and partly I'm, I'm biased because I remember a piece, my co-author Peter Alkin, and I wrote out right after Jess Gilling and Kenley were, were convicted and can lay, we're we're convicted.And we wrote a piece for Fortune in which we said that the entire world has changed. Now that corporate executives are, um, are, are put on high alert that behavior in the gray area will no longer be tolerated and that it will be aggressively prosecuted. And this was spring of [00:33:00] 2006 and the events that caused the global financial crisis were pretty well underway.It didn't. Do much to prevent the global financial crisis. Mm-hmm. , Enron's, Enron's jail time, didn't do anything to present, prevent, Elizabeth Holmes doesn't seem to have done anything to change what Sbf was doing. So I just, I, I just, I'm, I'm, I'm not sure, I'm sure a psychologist or somebody who specializes in studying white color crime could probably make a argument that refutes everything I said and that shows that has had a deterring effect.But I just, I just don't think that people who get themselves into this situation, con, con, consciously think, this is what I'm doing. Dwarkesh Patel: Yeah. Yeah. Um, speaking of other incentives, stock options, uh, you've spoken about how that creates short-term incentives for the executives who are making decisions. If you wanted to set up an instrument that aligned an executive or a leader's compensation with the long-term performance of a company, what would that look like?W would you have the options of less than 10 years instead of a [00:34:00] year? H how would you design it? How do you usually design a compensation scheme to award long-term thinking? Bethany McLean: If I could do that, I should ru rule the world . I think that very sweet. I think that is one of the really tough, um, problems confronting boards or anybody who is determining anybody who's determining stock options and that almost anybody who's determining compensation and that most compensation schemes seem to have really terrible unintended consequences.They look really good on paper. And then as they're implemented, it turns out that there was a way in which they accomplished exactly the opposite of, uh, thing the people who designing them wanted, wanted them to accomplish. I mean, if you think back to the advent of stock options, what could sound better?Right. Giving management a share of the company such that if, if, if shareholders did well, that they'd do well, nobody envisioned the ways in which stock options could be repriced. The ways in which meeting earnings targets could lead to gaming the ways in which the incentive of stock-based [00:35:00] compensation could lead to people trying to get anything they could in order to get the stock price higher and cash out when they're, as soon as their stock options vested.So, and even there was, there was, the whole valiant saga was fascinating on this front because the people who designed Mike Pearson's compensation package as ceo e o Valiant, they were convinced that this was absolutely the way to do it. And he got bigger and bigger, um, stock option incentives for hitting certain, for having the stock achieve certain levels.But of course, that creates this incredible bias to just get the stock to go up no matter, no matter what else you do. Um, it does seem to me that vesting over the long term is. is, is a much better way to go about things. But then do you create incentives for people to play games in order to get the stock lower at, at various points where there's about to be a stock optional board so they have a better chance of having directions be, be worth, be worth something over the long term.And do you, particularly on Wall Street there is this, or in firms where this sort of stuff matters the most? There [00:36:00] is this, there was this clearing out of dead wood that happened where people got paid and they got outta the way and made way for younger people. And I don't know, it was a harsh culture, but maybe it made sense on some level.And now at least I've been told with much longer vesting periods, you have people who don't wanna let go. And so you have more of a problem with people who should have retired, stick sticking around instead of in, in, instead of clearing out. And then it also becomes a question, How much money is, is enough.So if somebody is getting millions of dollars in short-term compensation and then they have a whole bunch more money tied up in long-term compensation, do the long-term numbers matter? At what point do they, do they, do they really matter? I mean, if you gave me $5 million today, I'm not so sure I'd really care if I were getting another $5 million in 10 years.Right. ? Yeah. So, so I think all of that is, is it, it's, I'm not, I'm not sure there's a perfect compensation system. All things considered though, I think longer term is, is probably better, [00:37:00] but. Dwarkesh Patel: Yeah, I didn't think about that downside of the long investing period. That's so interesting there. I guess there is no free lunch.Uh, so with Enron, um, it, it was clear that there was a lot of talent at the firm and that you had these companies and these trading firms launch at the aftermath by people who left Enron, kinder Morgan and John Arnold's, um, uh, Sintas, uh, that were wildly profitable and did well. Do you think we'll see the same thing with FTX, that while Sbf himself and maybe the, his close cadre were frauds, there actually was a lot of great trading and engineering talent there that are gonna start these very successful firms in the aftermath.Bethany McLean: That's, that's interesting. And just, just for the sake of clarification, kinder Morgan was actually started years before Enron's collapsed, when Rich Kinder, who was vying with Jeffs skilling in a sense, to become Chief Operating Officer. Um, Ken Lay, picked Jeffs skilling and Kinder left. Mm-hmm. and took a few assets and went to create Kinder, kinder Morgan.But your overall point, I'm just clarifying your overall point holds, there were a lot of people who [00:38:00] left Enron and went on to do, to have pretty, pretty remarkable careers. I think the answer with ftx, I bet there will be some for sure. But whether they will be in the crypto space, I guess depends on your views on the long-term viability of, of, of the crypto space.And I have never , it's funny is crypto exploded over the last couple of years. I was, I've been working on this book about the pandemic and it's been busy and difficult enough that I have not lifted my head to, to think about much else. And I always thought, I don't get it. I don't understand , I mean, I understand the whole argument about the blockchain being valuable for lots of transactions and I, I get that, but I never understood crypto itself and I thought, well, I just need to, as soon as this book is done, I just need to put a month into understanding this because it's obviously an important, important enough part of our world that I need to figure it out.So now I think, oh, Okay, maybe I didn't understand it for a reason and maybe, um, maybe there isn't anything to understand and I've just saved myself a whole life of crime because it's all gone. And you have [00:39:00] people like Larry Fink at BlackRock saying, whole industry is gonna implode. It's done. And certainly with the news today, this morning of finances auditor basically saying We're out.Um, I, I don't, I don't know how much of it was, how much of it was, is, was a Ponzi scheme. You might know better than I do. And so I don't know what's left after this whole thing implodes. It's a little bit like, there is an analogy here that when Enron imploded, yes, a lot of people went on to start other successful businesses, but the whole energy trading business is practiced by kind of under capitalized, um, um, energy firms went away and that never came back.Yeah. And so I, I, I don't, I don't know, I'm, it'll be, I, I don't know. What do you. The Dwarkesh Patel: time to be worried will be when Bethany McLean writes an article titled Is Bitcoin Overvalued for the Audience. My Moments on That ? Yeah, for the audience that, that was, I believe the first skeptical article about Enron's, um, stock price.Yeah. Uh, and it was titled [00:40:00] Is Enron Overvalued. In aftermath understated, , title. But , Bethany McLean: , I joked that that story should have won, won, won awards for the NICU title and business journalism history. , given that the company was bankrupt six months later was overpricedDwarkesh Patel: Um, uh, well, let me ask a bigger question about finance in general. So finance is 9% of gdp, I believe. How much of that is the productive use and thinking and allocation of the, uh, the capital towards their most productive ends? And how much of that is just zero sum or negative sum games? Um, if, if you had to break that down, like, is 9% too high, do you think, or is it just.I think it's Bethany McLean: too high. I have no idea how to think about breaking it down to what the proper level should be. But I think there are other ways to think about how you can see that in past decades it hasn't been at the right level when you've had all sorts of smart kids. Um, Leaving, leaving business school and leaving college and heading into [00:41:00] finance and hedge funds and private equity is their career of choice.I think that's a sign that that finance is too big when it's sucking up too much of, of, of the talent of the country. Um, and when the rewards for doing it are so disproportionate relative to the rewards of of, of doing other things. Um, the counter to that is that there've also been a lot of rewards for starting businesses.And that's probably, I think, how you want it to be in a, in a product. In a productive economy. So I think the number is, is too high. I don't know how to think about what it should be other than what a, actually, a former Goldman Sachs partner said this to me when I was working on all the devils are here, and she said that finance is supposed to be like the, the substrata of our world.It's supposed to be the thing that enables other things to happen. It's not supposed to be the world itself. So the, the role of a financial system is to enable businesses to get started, to provide capital. That's what it's supposed to be. It's the lubricant that enables business, but it's not supposed to be the thing itself.Right. And it's become the thing itself. [00:42:00] You've, you've, you've, you've, you've got a problem. Um, um, and I think the other, Dwarkesh Patel: there's your article about crypto , that paragraph right there. . Bethany McLean: There you go. That's, that's a good, um, and I think, I think the other way, you, you, you can see, and perhaps this is way too simplistic, but the other way I've thought about it is that how can it be if you can run a hedge fund and make billions of dollars from, and have five people, 10 people, whatever it is, versus starting a company that employs people mm-hmm.and changes a neighborhood and provides jobs and, you know, provides a product that, that, that, that, that improves people's lives. It, it is a shame that too much of the talent and such a huge share of the financial rewards are going to the former rather than the latter. And that just can't mean good things for the future.Dwarkesh Patel: Yeah. Yeah. And I, you know, when people criticize technology, for example, for the idea that, you know, these people who would've been, I don't know, otherwise teachers or something, they're, you know, making half a million dollars at Google. [00:43:00] Um, and I think like when I was in India, people were using Google Maps to get through the streets in Mumbai, which is, which is unimaginable to me before going there that, you know, you would be able to do that with, um, a service built out of Silicon Valley.And so, Yeah, I think that actually is a good allocation of capital and talent. I, I'm not, I'm not sure about finance. Um, yeah, Bethany McLean: I think I, I, I agree with you. I think there are other problems with Google and with the, the social media giants, but, but they are real businesses that employ people, that make products that have had, uh, huge.Um, impact on on, on people's, on people's lives. So in, in that sense, it's very different than a private equity firm, for instance, and especially private equity, even more so than hedge funds draws my ire. Mm-hmm. , because I think one of the reasons they, that it, they've been able to make part of the financialization of our economy has been due to super, super low interest rates and low interest rates that have enabled so many people to make so much money in finance are not, they're just a gift.It wasn't because these people were uniquely smart, they just [00:44:00] found themselves in a great moment in time. And the fact that they now think they're really smart because money makes me crazy. Dwarkesh Patel: Um, are Fanny and Freddy America special purpose entities? Are they our Alameda? It's just the way we hide our debt and uh, that's interesting.Yeah. Bethany McLean: Well, I guess we, you know what? I don't know anymore because, so I last wrote about them when was it in 2016 and I don't know now. No, you're right. Their, their debt is still off, off, off balance sheet. So Yeah, in a lot of ways they, they were. . I would argue though that the old Fanny and Freddy were structured more honestly than, than the new Fanny and Freddy, that it really is conservatorship that have made them, um, that have made them America's off balance sheet entities, because at least when they were their own independent entities.Yes, there was this odd thing known as the implicit guarantee, which is when you think about, back to your point about efficient markets, how can you possibly believe there's an as such a thing as an efficient market when their [00:45:00] Fanny and Freddy had an implicit guarantee, meaning it wasn't real. There was no place where it was written down that the US government would bail Fanny and Freddie out in a crisis, and everybody denied that it existed and yet it did exist.Yeah. Dwarkesh Patel: No, but we, I feel like that confirms the official market hypothesis, right? The, the market correctly, they thought that mortgages backed by Fannie and Freddy would have governments. Uh, okay, okay. You might be father Bethany McLean: and they did . You might be right. I, I, I think what I was getting at you, you might be right.I think what I was getting at is that it is such a screwed up concept. I mean, how can you possibly, when I first, when people were first explaining this to me, when I first read about Fanny and Freddie, I was like, no, no, wait. This is American capitalism . This is, no, wait. What? I don't, I don't understand . Um, um, so yeah, but I, I, I, I think that Fanny and Freddie, at least with shareholders that were forced to bear some level of, of the risks were actually a more honest way of going about this whole screwed up American way of financing mortgages than, than the current setup is.Dwarkesh Patel: What [00:46:00] is the future of these firms? Or are they just gonna say in conservatorship forever? Or is there any developments there? Well, what's gonna happen to them? Bethany McLean: The lawsuit, the latest lawsuit that could have answered that in some ways ended in a mistrial. Um, I don't think, I don't, I don't think unfortunately anybody in government sees any currency in, and I mean, currency in the broad sense, not in the literal sense of money in, in taking this on.And unfortunately, what someone once said to me about it, I think remains true and it's really depressing, but is that various lawmakers get interested in Fannie and Freddy. They engage with it only to figure out it's really, really goddamn complicated. Mm-hmm. and that, and that any kind of solution is gonna involve angering people on one side of the aisle or another and potentially angering their constituent constituents.And they slowly back away, um, from doing anything that could, that, that could affect change. So I think we have a really unhealthy situation. I don't think it's great for these two [00:47:00] entities to be in conservatorship, but at this point, I'm not sure it's gonna change. Dwarkesh Patel: Yep. Speaking of debt and mortgages, um, so total household debt in the United States has been, uh, climbing recently after it's, it's like slightly d decline after 2008, but I think in quarter three alone it increased 350 billion and now it's at 16.5 trillion.Uh, the total US household debt, should we worried about this? Are, are, are we gonna see another sort of collapse because of this? Or what, what should we think about this? Bethany McLean: I don't know. I don't know how to think about that because it's too tied up in other things that no one knows. Are we going to have a recession?How severe is the recession going to be? What is the max unemployment rate that we're gonna hit if we do, if we do have a recession? And all of those things dictate how to, how to think about that number. I. Think consumer debt is embedded in the bowels of the financial system in the same way mortgages were.And in the end, the, the, the [00:48:00] problem with the financial crisis of 2008, it wasn't the losses on the mortgages themselves. It was the way in which they were embedded in the plumbing of the financial system. Mm-hmm. and ways that nobody understood. And then the resulting loss of confidence from the fact that nobody had understood that slash lies had been told about, about that.And that's what caused, that's what caused everything to, to collapse. Consumer debt is a little more visible and seeable and I, I don't think that it has that same, um, that same opaque quality to it that, that mortgage backed securities did. I could be, I could be wrong. I haven't, I haven't, I haven't dug into it enough, enough to understand enough to understand that.But you can see the delinquencies starting to climb. Um, I mean, I guess you could on, on, on mortgages as well, but there was this, there was this profound belief with mortgages that since home prices would never decline, there would never be losses on these instruments because you could always sell the underlying property for more than you had [00:49:00] paid for it, and therefore everything would be fine.And that's what led to a lot of the bad practices in the industry is that lenders didn't think they had to care if they were screwing the home buyer because they always thought they could take the home back and, and, and, and, and make more money on it. And consumer debt is, is unsecured. And so it's, it's, it's different.I think people think about it differently, but I'd have. I'd have to, I'd have to do some more homework to understand where consumer debt sits in the overall architecture of the financial industry. Dwarkesh Patel: I, I, I'm really glad you brought up this theme about what does the overall big picture look like? I feel like this is the theme of all your books that people will be, So obsessed with their subsection of their job or, or that ar area that they won't notice that, um, broader trends like the ones you're talking about.And in Enron it's like, why, why, why do we have all these special purpose entities? What is the total debt load of Enron? Um, or with the, you know, mortgage back securities a similar kind of thing, right? What, what, uh, maybe they weren't correlated in the past, [00:50:00] but what's that? Do we really think that there's really no correlation, um, uh, between, uh, delinquencies across the country?Um, so that, that kind of big picture, think. Whose job is that today? Is it journalists? Is it short sellers? Is it people writing on ck? Who's doing that? Is it anybody's job? Is, is it just like, uh, an important role with nobody assigned to it? Bethany McLean: I think it's the latter. I think it's an important role with nobody, with nobody assigned to it, and there there is a limit.I mean, , I hate to say this, it is not, uh, um, it is not an accident that many of my books have been written. That's probably not fair. It's not true of my book un fracking, but that some of my books have been written after the calamity happened. So they weren't so much foretelling the calamity as they were unpacking the calamity after it happened, which is a different role.And as I said at the start of our conversation, I think an important one to explain to people why this big, bad thing took, took place. But it's not prediction, I don't know, as people that were very good at, at prediction, um, they tried [00:51:00] to set up, what was it called? In the wake of the global financial crisis, they established this thing called fsoc, and now I'm forgetting what the acronym stands for.Financial Security Oversight Committee. And it's supposed to be this, this body that does think about these big picture. That thinks about the ways, the ways an exam, for example, in which mortgage backed securities were, um, were, were, were, were, were, were, were repopulating through the entire financial system and ways that would be cause a loss to be much more than a loss.That it wouldn't just be the loss of money and that security, it would echo and magnify. And so that there are people who are supposed to be thinking about it. But I think, I think it's, it's, it's really hard to see that and. In increasingly complex world, it's even, it's even harder than it was before, because the reverberations from things are really hard to map out in, in, in advance, and especially when some part of those reverberations are a loss of confidence, then all bets [00:52:00] are off because when confidence cracks, lots of things fall apart.But how do you possibly analyze in any quantitative way the the risk that that confidence will collapse? Mm-hmm. . So I think it's, I think, I think, I think it's difficult. That said, and of course I am talking my own book here, I don't think that the lack of the, the increased financial problems of journalism really help matters in that respect, because in an ideal world, you want a lot of people out there writing and thinking about various pieces of this, and then maybe somebody can come along and see the.Pieces and say, oh my God, there's this big picture thing here that we all need to be thinking about. But there's, there's a kind of serendipity in the ability to do that one, that one that the chances, I guess the best way to say that is the chances of that serendipity are dramatically increased by having a lot of people out there doing homework, um, on the various pieces of the puzzle.And so I think in a world, particularly where local news has been decimated mm-hmm. , um, the [00:53:00] chances of that sort of serendipity are, are definitely lower. And people may think, oh, it doesn't matter. We still got national news. We've got the Washington Post, we've got the Wall Street Journal, we've got the New York Times.Um, I would love to have somebody do a piece of analysis and go back through the New York Times stories and see how many were sparked by lp, a piece in the local paper that maybe you wouldn't even notice from reading the New York Times piece, because it'd be in like the sixth paragraph that, oh yeah, credit should go to this person at this local paper who started writing about this.But if you no longer have the person at the local paper who started writing about this, You know, it's, it's, it's, it's less likely that the big national piece gets written. And I think that's a part of the implosion of local news, that people, a part of the cost of the implosion of local news that people don't really understand the idea that the national press functions at, at the same level, um, without local news is just not true.Dwarkesh Patel: Yeah. And, but even if you have the local news, and I, that's a really important point, but even if you have that local news, there still has to be somebody whose job it is to synthesize it all together. And [00:54:00] I'm curious, what is the training that requires? So you, I mean, your training is, you know, math and English major and then working at working in investment banking.Um, is that the, uh, I mean, obviously the anecdotal experience then equals one, seems that that's great training for synthesizing all these pieces together. But what is the right sort of education for somebody who is thinking about the big picture? Bethany McLean: I, I don't, I don't know.And there may be, there may be, there are probably multiple answers to that question, right? There's probably no one, one right answer for me. In, in the end. My, my math major has proven to be pivotal. Even though , my mother dug up these, um, my, my parents were moving and so my mother was going through all her stuff and she dug up these, some my math work from, from college.Literally, if it weren't for the fact that I recognized my own handwriting, I would not recognize these pages on pages of math formula and proofs. And they're like, get gibberish to me now. So , but I, but I still think that math has, so I do not wanna exaggerate my mathematical ability at this stage of [00:55:00] the game.It's basically no. But I do think that doing math proofs any kind of formal, any kind of training and logic is really, really important because the more you've been formally trained in logic, the more you realize when there are piece is missing and when something isn't quite, isn't quite adding on, it just forces you to think in, in a way that is, that in a way that connects the dots.Um, because you know, if you're moving from A to B and B doesn't follow a, you, you understand that B doesn't follow a And I think that that, that, that kind of training is, is really, really important. It's what's given. , whatever kind of backbone I have as a journalist is not because I like to create controversy and like to make people mad.I actually don't. It's just because something doesn't make sense to me. And so maybe it doesn't make sense to me because I'm not getting it, or it doesn't make sense to me because B doesn't actually follow, follow away, and you're just being told that it does. And so I think that, I think that training is, is really, really important.Um, I also have, have often thought [00:56:00] that another part of training is realizing that basic rule that you learned in kindergarten, which is, um, you know, believe your imagination or you know, your imagine follow your imagination. Because the truth is anything can happen. And I think if you look at business history over the last couple of decades, it will be the improbable becoming probable.Truth over and over and over again. I mean, the idea that Enron could implode one of the biggest, supposedly most successful companies in corporate America could be bankrupt within six months. The, from its year, from its stock price high. The idea that the biggest, most successful, um, financial institutions on wall, on Wall Street could all be crumbling into bankruptcy without the aid of the US government.The idea that a young woman with no college degree and no real experience in engineering could create, uh, uh, um, could create a machine that was going to revolutionize blood testing and land on the cover of every business magazine, and that this [00:57:00] whole thing could turn out to be pretty much a fraud. The entire idea of ftx, I mean, over and over again, these things have happened.Forget Bernie Madoff if you had told people a year ago that FTX was gonna implode six months ago, three months ago, people would've been like, no, no, no, no, no, no, no. And so I think just that, that, that, that knowledge that the improbable happens over and over again is also a really fundamental, fundamentally important.Dwarkesh Patel: If we're con continuing on the theme of ftx, I, I interviewed him about four or five months ago.Wow. And this is one of these interviews that I'm really, I'm, I don't know if embarrass is the right word, but I knew things then that I could have like asked, poked harder about. But it's also the kind of thing where you look back in retrospect and you're. If it had turned out well, it's, it's not obvious what the red flags are.Um, while you're in the moment, there's things you can look back at the story of Facebook and how, you know, Marcus Zuckerberg acted in the early days of Facebook and you could say, if the thing fell apart, that this is why, or, you know, this is a red flag. So [00:58:00] I have a hard time thinking about how I should have done that interview.Bethany McLean: Cliches are often cliches for a reason. And the one about hindsight being 2020 is, is, is one of the best cliches ever. And I am so fundamentally annoyed by stories that say, here were all the red flags. Why didn't anybody see it?Well, Oftentimes the person writing that story didn't see the red flags either. And it's really easy in retrospect to pick up all the signs that there wa that there was a problem. And it's really hard in the moment. And there's, there's a little bit of a, of a, of, I think in all of us, a subconscious sense that this doesn't sound quite right, but getting the subconscious suspicion to rise to the level of conscious thought is, is also really difficult.So I think, I think again, there is, there is, it is one value of, and I hope we're coming back to a world that appreciates old people because I'm getting older . But, um, there is something, there is some value in having, having seen it before that I think the red flags do maybe tend to rise to the level of conscious, um, conscious thought.That said, if I [00:59:00] had gotten interested in crypto a year ago, would I have seen the problems with Ft. Doubtful. I, I don't know. Mm-hmm. , you just, you just, you just can never know. Sometimes these things also depend on the way in which they're presented to you and by whom. And I think that shouldn't be, I think it's not, not intellectually honest, but if somebody you really respect comes to you and tells you, this business is the next greatest thing, and this person is brilliant, chances are that preconception is gonna be lodged in your mind in a way that's gonna make it really hard for you to see the red flags. Whereas if first you heard of this company with somebody coming to you, somebody really smart, you like coming to you and saying, yeah, I don't, I don't think this makes sense.These, these are my problems with this. You're gonna be far more apt to see the red flags. And I say, it's not, that's not the right way, not the right phrase. I say it's not intellectually honest or not smart, because really you kind of wanna strip that away. You wanna strip those biases away because even really smart people, Make mistakes all the time.And so you want to the extent possible to think for yourself, but, [01:00:00] but of course, or it's, it goes back to math, right? Order of operations, , in some order. The order in which information is presented to you unfortunately is gonna have an effect on how you see that, how you see that in information. Mm-hmm.Dwarkesh Patel: Yeah. Um, let's talk about fracking. So in this year, uh, I think quarter two, was it the first time that fracking and SHA shield finally became profitable? Um, were the fracking investors, right? That, that there would be an oil shock and now it is actually profitable? Or how do you think about Saudi America in the aftermath of the events?Bethany McLean: Well, I, at least from my understanding of it, and again, because I have been, um, out to lunch on this difficult book I'm writing, I haven't actually, I'm not as up to date on this as I should be. So take what I'm saying with, with the grain of salt. Um, but I think actually it proves the underlying thesis because fracking is profitable, but at a much smaller scale than it was [01:01:00] when people were saying, this is, this is gonna change the world.So it hasn't, the idea that us shale oil was the swing factor in world oil prices, I don't think anybody believes that anymore because it can't profitably produce the amount of oil required for it to be the major force that it was, that it was supposed to be. So I think what has happened actually proves the point instead of negating the point and for. For how long it can be profitable. Um, um, and at what level of oil prices is also, was also part of the, under the, under the underlying thesis, which is how much oil is there actually that can be extracted at, at, at this price. And so the fact that that very high oil prices, there is a certain amount that can be extracted profitably.Um, that's, that's not, that's not surprising. I think the way in which the book's thesis would be wrong is if it turned out US shale oil, oil could be the, the, the, the swing producer for the world. And we could be the world's largest oil producer and there could, the [01:02:00] Permian could continue to grow at whatever it was, 20% a year and grow profitably.And then I would have to say I, yeah, the, the, the investors were right. Um, or the people who believed in this were right. So. Dwarkesh Patel: Yep. Um, if you could have a Robert Carro like biography of anybody in finance in the last a hundred years, especially somebody who we feel hasn't been talked about or covered enough, who to be, who do we need?A thousand pages? Bethany McLean: About a thousand pages. I don't know that we need a thousand pages about anybody. , . Um, Um, who would I like to write about? Um, let me think about that. There are, there are some books I've been mulling over that I'd like to do, but I'm not sure I I think I might prefer to keep those to myself for, for, for a little while.I don't know. I'm also always gonna be, at least I'm trying to change my orientation, but I'm always gonna be biased toward the, the thing that went badly wrong rather than the thing that, that, that worked out. I don't know, maybe that betrays some underlying darkness in my personality, but [01:03:00] I always find that more fun.So I'm, I'm probably not the right person to ask about, uh, uh, a glowing biography. I don't, you know, I don't, I don't know. You could say, you could say Warren Buffet, but Pliny has been written about buffet. I dunno if there's anything to be. added to that. So let me, let me think. If I come up, if I come up with a great answer that I'm prepared to share, I will, I will tell you, I don't know that, maybe it goes back to your question about how big a role that finance should play in our economy overall, too.Maybe. I just don't think that anybody in finances necessarily worthy of that, of mm-hmm. of that kind of, of that kind of, um, that kind of sustained focus. Dwarkesh Patel: Yeah. Yeah. Um, I wanna talk about the rating agencies because they have featured heavily in both the story about the housing crisis and Enron. And as a libertarian leading person, that's really been, um, that, that, that's been kind of devastating in the sense that, you know, there's a hope that you can maybe replace [01:04:00] things like the F D A or at least functions of it, um, with agencies, private agencies that are tasked with like, rating, how good is this food?Or, uh, you know, how safe is this airplane? Things like that. And, I I'm curious if you think that there is any possibility of having any private agency that is being paid by the person they're evaluating, being able to give fair evaluations. And this even brings us, it doesn't even have to be, um, rating agencies.It can be things like, you know, now we have the big four accounting firms. I'm curious how much trust you put in them in terms of being able to do evaluations fairly. Do we think, do, have you passed through the Art Arthur Anderson Anderson days? Um, how, how credible are Bethany McLean: these institu. Look at EYs roll and Wirecard, right?And then mm-hmm. I think you can, uh, and some of the scandals PWC has been involved in over the last bunch of years. I mm-hmm. . Yeah. Um, um, it is, it is a really good question. I thought you were gonna go somewhere different with the rating agencies, which is why in a supposedly free market you have so many investors Yeah.Who rely [01:05:00] on credit ratings. Dwarkesh Patel: That's a good Bethany McLean: question. And I, and I do think that there's, uh, this is another perhaps counter to your efficient. Theory or maybe counter to a libertarian view of the world. But you know, a lot of big investors who complain about the rating agencies after there, there's been a disaster, really want the cover provided by the rating agencies because they can say, well, you told me this was aaa.Mm-hmm. , I bought it, therefore I can't be blamed. And so once the crisis has passed, the appetite of big investors to reform the rating agencies or do away with them, meaning then they would have to do their own work and not just say, well, I bought a AAA rated security. It's really next to nil. And that's a good part of the reason why reform doesn't, doesn't happen.I mean, remember the credit rating agencies were reformed in 2006. In the wake of interim, the Credit Rating Agency Reform Act was passed. And yet the rating agency sat at the center of the global financial crisis just a few years later. They, they, I, I'm not sure they, I'm not sure they really, they, they, they [01:06:00] can be reformed, but I'm also not sure there is a perfect, um, , maybe it goes back to your question about the ability to see the big picture and foresee a problem.I'm not sure there is a perfect regulator who, mm-hmm. wasn't being paid by companies who could then do a better job. You'd like to believe that's true, that if they were a government agency in charge of credit rating and they weren't paid by the companies and the securities. They weren't, they weren't they, they, and they weren't paid by, by the companies that, that would lead to better ratings, would it?Mm-hmm. . I, I don't, I dunno, right? , so I'm, I'm not, I'm not, I'm not sure. There's, I guess another way of saying this is very easy to criticize the current system as really problematic. And it's certainly the fact that credit rating agencies were making so much money by rating subprime, mortgage backed securities for sure played an enormous role in, in, in what happened.But then if you ask the next question, well, what's the alternative ? That's, that's [01:07:00] when it starts, that's when it starts to get to get pretty complicated. Dwarkesh Patel: Yeah. Yeah. Um, now that we're going to have this long proceeding on FTX in terms of compensating the people who are harmed, looking back at Enron, I mean, that was a long process.And I think you said in the book that a billion dollars of the remaining sum that should have been doled out to the victims was actually spent in legal fees and the procedures. If, if I read about that number. Bethany McLean: I think so. I'm not sure. I have to admit I don't remember, but it was some enormous side of it.Yeah. Dwarkesh Patel: So what should be the procedure when an implosion like this happens because it seems suboptimal that so much. I mean, it goes back to their finance discussion, right? Like, so much of the capital that these people are supposed to be doling out is just going to themselves. Um, do we need something like the F FAA when the plane crashes, they have a body of experts that kind of figures out what happened?Do we need a completely non legalistic or a different, uh, sort of procedure in these kinds of situations? How should the ftx, um, uh, [01:08:00] the, the, the dis disbursement of the remaining assets and so forth, how should that be done? Bethany McLean: It's a really interesting question and a really interesting analogy and something people have brought up to me that I've never really dug into, which is the incredible success of the f a a in cutting down, on, , problems with planes because of the incredibly thorough job they do in investigating the cause of a CRA crash afterwards.And so maybe somebody's written about this, but to really get inside that process and the incredibly powerful, profound role it's played might provide an interesting roadmap for, for corporate America and, and, and how to do this sort of thing and how to, how to prevent it in the future. Maybe, maybe the analogy doesn't hold up in some kind of, in some kind of subtle way, but for sure that's, that's, that's, that's a really, that's a really interesting question because you do, you, you need this to happen, right?You need the bankruptcy. You, you need. You need the excavation and even if it costs a great deal of money to just, for all of us, the worst possible outcome would be for everybody to throw their hands up and say, [01:09:00] okay, it's done. , nobody, no, no work. Because, because the truth of the matter is even journalists who excavate, who try to excavate this stuff, we depend on the work done by by others.I mean, I could not have written my Enron book if it weren't for the Justice Department investigating and their indictments for the role of Congress in getting all these documents from, from all these internal documents from Enron, including by the way, the list of executives and their cell phone numbers, which turned out to be incredibly valuable.Um, um, um, but you can't, you the, the role of the bankruptcy examiner and getting in there and really uncovering, um, all of what Enron was doing in order to manipulate its, its earnings. There's no way that a journalist, you could do that without, without all of that data that's provided by all these entities that are doing their own investigation.Because the journalist, you don't have subpoena power. You can't, you literally can't do this. And it becomes an incredibly important part of, of, of telling the overall story. So it's hard for me to say [01:10:00] when it's a calamity like this, that those dollars are wasted. But is there a better way to go about it?Maybe. Dwarkesh Patel: Maybe. Yeah. Uh, another similarity between Enron and FTX is that the bankruptcy is being overseen by John Ray, and this is a rather mysterious person. I, I believe I, the, one of the first times you see in a photo of him is when he appeared in front of Congress a few days ago. Um, and I checked the index of the smartest guys in the room.Um, and I, I don't think he was mentioned in the book. Who is this guy? . What, what's his deal? Bethany McLean: I don't actually really know. I feel like people have made a really big deal over the bankruptcy administrator being the same person. I'm not really sure how much that that matters.Okay. I mean, the bankruptcy administrator, when people, it was all over the press, you know, he says this is a bigger disaster than, than whatever it was. I can't remember the exact quote, but that's his incentive to say that because then any money that he can recoup looks like, due to his genius in administrating this thing in [01:11:00] bankruptcy.If you say, oh, this wasn't that big a deal, everybody's gonna get their money back, and then they don't, then you've got a huge problem. Right? , if you say, this is the, this is, this is terrible and it's awful, and there will be no money left because the the, then any money you get back, people are like, look, what a great job he did.So I, yeah, I, I, I, I don't know, I don't know, I don't remember him being a really pivotal figure in the, in, in, in, in the un in the excavation of Enron. Dwarkesh Patel: Yeah. Yeah. Um, I, I, I wanna ask you a bit about your writing process. Do you go into the book with some sort of thesis about the actors? And if so, is it often that you realize that somebody you thought was a bad actor is actually one, one of the good guys and or the other way around?Uh, or is basically the, your initial picture confirmed by further invest. Bethany McLean: Well, I guess that's a tough question about the books I've done because the books I have done, especially the two big ones, were after the fact and it was pretty [01:12:00] clear, a, that something went badly wrong, and B, that the people who were in power had to be responsible for it because they weren't responsible.Who else was the ways in which they were responsible and the degree to which they were responsible. Um, open questions that I don't think I had a, a view on going, going in. Uh, to that point on the financial crisis, I actually ended up changing my mind pretty, pretty radically. I wrote a piece in the early stages of the financial crisis saying that basically homeowners were equally, equally to blame because homeowners had cashed out, had had homeowners, took out risky mortgage mortgages, and without personal responsibility what were lost.And homeowners had also cashed out and people had made a lot of money. So the idea that this was all the faults of the banks was, was absurd. . And I still think that's true to some extent because without personal responsibility mm-hmm.we, we are lost. But I remember coming across this presentation that had been given by Washington Mutual, where they were, which was one of the big lenders at the time, um, no longer exists. And they were trying to get [01:13:00] people to take out, it was a whole internal presentation about how you got someone to take out a risky mortgage.And what they really wanted was the same 30 year fixed rate mortgage that their, that their parents had had. And it was all the tactics and, and tips you could use to twist their arm to take out this, this riskier mortgage because those were the ones that were in demand to be packaged up into subprime mortgage backed securities.And so Wamo could turn around and sell those mortgages for more money to Wall Street than they could the say 30 year fixed rate mortgages. And then I remember thinking there's just something wrong with a world where all of the responsibility is on consumers to understand and none of the responsibility is on the people selling the product.Mm-hmm. To be honest mm-hmm. About, about what this thing is. So anyway, that was a case where I. Where I changed, I changed my mind over, over the course of reporting a book. I try to, I try not to work on for stories. I try not to work on stories where there has to be an answer. Because, because if you're working on a story where it has to be one way for it to be a good story, then if it's not that, then you're biased to wanna see it one way.[01:14:00] And if it's not that way, you no longer have a story. So I always prefer to work on things where it's just really interesting and whatever you end up thinking or saying about it, it's still a really interesting story. So I can't say it's always been, so, I, I guess one of the last stories I did for Vanity Fair was when David Sackler of the, of the, uh, wanted to talk to me about what had of the Sacklers in Purdue and the opioid crisis, wanted to talk about his view of, of what had gone wrong and that in a way.It was, it was a weird story for me because usually I'm working from the outside in. I don't get stories where people wanna cooperate with me for, I guess all these reasons, . But, um, but in a way it was my favorite type of story because it was really interesting that he was willing to speak publicly. And if I had ended up thinking the slackers were totally blameless and the whole opioid crisis, I could have written that because it was really interesting that he was speaking publicly.And so I like, I like stories where that's where, where, where it's a [01:15:00] story no matter how you end up viewing the main characters and how you end up viewing the arc of the thing. Does that make sense? Dwarkesh Patel: Yeah. Yeah, it does. And I guess it raises another question, is that the people you've studied, um, in your books and your journalism, ha, have you concluded afterwards that, you know, there's some people who are fundamentally deceptive and there's some people who are, you know, ethical and that there's sort of this line, or, uh, do you feel like if anybody was put into skilling shoes at the time or SVF shoes, There's a good chance they would've done the same kinds of things.Bethany McLean: I think we all have the capacity to be deceptive. I think it's part of human nature. Some people are more inclined toward truth telling and transparency than other people. Maybe just by, by by nature, maybe by nurture.And what's been rewarded in your career and your life, um, inclines you to either be open and honest or to try to try to hide things. And maybe that's, maybe that's more the experiences that you've had, but I think we are all capable of a fundamental level of [01:16:00] deception for, for CEOs. Whenever people look at a Jeff Skilling or an Angela Mozilla or any of these characters and say, I could never have done that.I mean, there's a fundamental rationalization. Skilling by manipulating Enron's money was, and Enron's earnings was trying to keep the stock price, stock price high. So he didn't hurt investors by having the stock go down the way it would've been if he had been radically honest about all of Enron's problems.And so we're all capable of that kind of rationalization, that what we're doing is really in the long-term interests of somebody else and really in their best interest, even if it's, even if it's not telling the truth. Um, and I think, I think to say that you're not capable of that. I, I mean, I don't know, I almost think that's more dangerous than admitting that you're capable of it because Yeah.Yeah. Admit that if you admit that you're capable of it, then you can make a fundamental choice to either behave that way or, or, or not to behave that way. But there's also another component of, um, human nature that I think is more [01:17:00] prevalent in some people than others. And it's not, uh, I don't know if you'd characterize it as dishonesty, but it's very deeply believing something in the moment and convincing other people because you so deeply believe it, and a month later you don't believe it anymore because you're somebody who changes their mind.So is what you told people a month earlier a lie, or was it a truth at its moment in time? And so there's, there's that too that makes it more difficult to label somebody fundamentally deceptive, right? And they look like a lie to the person who believed what that person was saying and acted on that person's advice and belief.And a month later finds out that the person sold their stock or no longer believes that. But was was the person being dishonest in there in that moment? Dwarkesh Patel: Not necessarily. Yeah. And it raises the interesting question of moral luck, I'm sure there were tons of CEOs and there are tons of CEOs today who are like Ken Le who are just basically disconnected from the business they started and are kind of hanging on.And it just so happened that Ken Le was the [01:18:00] ceo e o of the one that was committing massive fraud. Uh, but it, it, it's kinda like texting in. Texting and driving. Yeah. Where lots of people do it. One guy crashes and obviously he should be punished, but he's no more culpable than the rest of us who do it, Bethany McLean: I like that concept of moral luck. I think that's incredibly true. Yeah. Um, it goes with the concept of, you know, somebody who is an investor over the last 40 years. Sure. Probably most people did, did really, really well. Right? With the tailwind of declining interest rates. Does that mean that these people were brilliant or that they lucked into the right field?And of course, some people didn't look into it. They saw what was going on and chose it and, and you know, so there, so there's that too. But, but. , maybe that trivializes your, your question because I think that's a very profound question, and I think there really is, um, there definitely is such a thing as moral luck, and the only way in which you can tip the scales is by trying to be aware of bad people and bad situations and keeping yourself clear of them.Because back to your earlier question about culture, , [01:19:00] it's a trite cliche, but you are who you're, you surround yourself with either in a job or, or in your friendships. And so if you wanna have the best chance possible of, of, of steering clear of accidents, you do have to be careful about the situations you choose to put yourself into.Um, because the, i the idea that you can remain an island in a, in a bad situation is, is not true of most of us. Dwarkesh Patel: Yep. Yep. Uh, final question, or I guess second to final question. What advice would you give to people who. Want to do something similar to what you've done over your career, whether that's investigative journalism or some other role in maybe finance or technology that involves putting together the big picture.What advice do you have for themBethany McLean: that's, that's an interesting question. I can't give advice for journalists anymore because the world in which I grew up no longer exists. Hmm. I once would've told anybody to go work on, and maybe that's, maybe, maybe that's leading me to the right answer, but the world in which I grew up in journalism no longer exists.And so to [01:20:00] go off and be a writer, um, back when I did it, you know, you could get a job at a magazine and you could take home a paycheck that would enable you to cover your rent. And if you were like me and didn't have any family money, then you needed that . And so the idea now of telling somebody to go off and pursue a career as a writer, well, if you don't have any other source of, um, source of external support, that it's, it's a lot more difficult than it, than it, than it, than it once was, but, actually for me, I think that does lead to a better and deeper answer to your question, which is that right?Don't allow yourself to be seduced by the quick ease of PowerPoints and putting together bullet points. Force yourself to when you're dealing with something complicated, force yourself to write it out. Um, and maybe that would be different for other people, but for me, writing forces a level of intellectual honesty and um, a clarity about the big picture that nothing else does.It's really hard work. I've never understood people who say, I just love to write. It's so fun. I always like what? , it's [01:21:00] one of the most difficult things you can do because to write clearly requires thinking clearly and thinking clearly is really, really hard. , at least for me, but. , it is really only in writing that I realized that I didn't understand something that I was pretending to understand.And so it's really easy to, to pretend to yourself that you understand something. And if you have to write it and write it clearly in a way that somebody else can understand it, that often forces you, um, to, that forces you to realize your own, your own lack of comprehension. And I think that exercise in terms of an understanding of the world and a chance of seeing the big picture is really, really critical.Maybe there's something for somebody else that would work that isn't writing. Maybe it would be turn turning the world into a math proof, you know, , . But, um, but, but there is, I, for me, that's what it is. Dwarkesh Patel: Yeah. Yeah. Um, and final question, what is your next book about and when will be, have, when will we have the pleasure to read it?Bethany McLean: Hope it's a pleasure. I'm not sure at this point. It's kinda a pleasure. Um, so I'm [01:22:00] writing it with Jon Oser again, who I wrote All the devils are here with, and we set out to write about the economic consequences of the pandemic, but it's really become a broad look at how. Capitalism is and isn't functioning, um, in our, in our modern society.And then underneath that, a look at how government is and isn't setting the right rules for capitalism to function. Because back to your point about being a libertarian. . I do think there's this lovely idea that markets exist independently of the rules set for them by society, but I'm not really sure that that's true.If you think about everything from the existence of a limited liability corporation to bankruptcy law, these are all rules laid down by society that dictate how the market. How the market functions. And so in the end, if the market isn't functioning the way we want it to, chances are it's the results of the improper, the improper conditions having, having been set.So that's what the book is turned into as a, as a way of looking at [01:23:00] the flaws and capitalism even leading up to the pandemic, um, and how those were exposed and exacerbated by the pandemicDwarkesh Patel: yeah. Okay. Uh, I, I'm really, um, I'm really excited to read it. That's a, that's an exciting thesis. I'm , but, but do you know when it's gonna be out, by the way?Bethany McLean: October, 2023? Dwarkesh Patel: Yes. Okay. You'll have to come back on the podcast. And I, I would love that. Yeah. Yeah. Bethany McLean: I would love that. Awesome. [01:24:00] [01:25:00]  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Nadia Asparouhova is currently researching what the new tech elite will look like at nadia.xyz. She is also the author of Working in Public: The Making and Maintenance of Open Source Software.We talk about how:* American philanthropy has changed from Rockefeller to Effective Altruism* SBF represented the Davos elite rather than the Silicon Valley elite,* Open source software reveals the limitations of democratic participation,* & much more.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Timestamps(0:00:00) - Intro(0:00:26) - SBF was Davos elite(0:09:38) - Gender sociology of philanthropy(0:16:30) - Was Shakespeare an open source project?(0:22:00) - Need for charismatic leaders(0:33:55) - Political reform(0:40:30) - Why didn’t previous wealth booms lead to new philanthropic movements?(0:53:35) - Creating a 10,000 year endowment(0:57:27) - Why do institutions become left wing?(1:02:27) - Impact of billionaire intellectual funding(1:04:12) - Value of intellectuals(1:08:53) - Climate, AI, & Doomerism(1:18:04) - Religious philanthropyTranscriptThis transcript was autogenerated and thus may contain errors.Nadia Asparouhova 0:00:00You start with this idea that like democracy is green and like we should have tons of tons of people participating tons of people participate and then it turns out that like most participation is actually just noise and not that useful. That really squarely puts SPF into like the finance crowd much more so than startups or crypto. Founders will always talk about like building and like startups are like so important or whatever and like what are all of them doing in their spare time? They're like reading books. They're reading essays and like and then those like books and essays influence how they think about stuff. Dwarkesh Patel 0:00:26Okay, today I have the pleasure of talking with Nadia Asperova. She is previously the author of Working in Public, the Making and Maintenance of Open Source Software and she is currently researching what the new tech elite will look like. Nadia, welcome to the podcast. Thanks for having me. Yeah, okay, so this is a perfect timing obviously given what's been happening with SPF. How much do you think SPF was motivated by effective altruism? Where do you place them in the whole dimensionality of idea machines and motivations? Nadia Asparouhova 0:01:02Yeah, I mean, I know there's sort of like conflicting accounts going around. Like, I mean, just from my sort of like character study or looking at SPF, it seems pretty clear to me that he is sort of inextricably tied to the concepts of utilitarianism that then motivate effective altruism. The difference for me in sort of like where I characterize effective altruism is I think it's much closer to sort of like finance Wall Street elite mindset than it is to startup mindset, even though a lot of people associate effective altruism with tech people. So yeah, to me, like that really squarely puts SPF in sort of like the finance crowd much more so than startups or crypto. And I think that's something that gets really misunderstood about him. Dwarkesh Patel 0:01:44Interesting. Yeah, I find that interesting because if you think of Jeff Bezos, when he started Amazon, he wasn't somebody like John Perry Barlow, who was just motivated by the free philosophy of the internet. You know, he saw a graph of internet usage going up into the right and he's like, I should build a business on top of this. And in a sort of loopholy way, try to figure out like, what is the thing that is that is the first thing you would want to put a SQL database on top of to ship and produce? And I think that's what books was the answer. So and obviously, he also came from a hedge fund, right? Would you play somebody like him also in the old finance crowd rather than as a startup founder? Nadia Asparouhova 0:02:22Yeah, it's kind of a weird one because he's both associated with the early computing revolution, but then also AWS was sort of like what kicked off all of the 2010s sort of startup. And I think in the way that he's started thinking about his public legacy and just from sort of his public behavior, I think he fits much more squarely now in that sort of tech startup elite mindset of the 2010s crowd more so than the Davos elite crowd of the 2000s. Dwarkesh Patel 0:02:47What in specific are you referring to? Nadia Asparouhova 0:02:49Well, he's come out and been like sort of openly critical about a lot of like Davos type institutions. He kind of pokes fun at mainstream media and for not believing in him not believing in AWS. And I think he's because he sort of like spans across like both of these generations, he's been able to see the evolution of like how maybe like his earlier peers function versus the sort of second cohort of peers that he came across. But to me, he seems much more like, much more of the sort of like startup elite mindset. And I can kind of back up a little bit there. But what I associate with the Davos Wall Street kind of crowd is much more of this focus on quantitative thinking, measuring efficiency. And then also this like globalist mindset, like I think that the vision that they want to ensure for the world is this idea of like a very interconnected world where we, you know, sort of like the United Nations kind of mindset. And that is really like literally what the Davos gathering is. Whereas Bezos from his actions today feels much closer to the startup, like Y Combinator post AWS kind of mindset of founders that were really made their money by taking these non-obvious bets on talented people. So they were much less focused on credentialism. They were much more into this idea of meritocracy. I think we sort of forget like how commonplace this trope is of like, you know, the young founder in a dorm room. And that was really popularized by the 2010s cohort of the startup elite of being someone that may have like absolutely no skills, no background in industry, but can somehow sort of like turn the entire industry over on its head. And I think that was sort of like the unique insight of the tech startup crowd. And yeah, when I think about just sort of like some of the things that Bezos is doing now, it feels like she identifies with that much more strongly of being this sort of like lone cowboy or having this like one talented person with really great ideas who can sort of change the world. I think about the, what is it called? The Altos Institute or the new like science initiative that he put out where he was recruiting these like scientists from academic institutions and paying them really high salaries just to attract like the very best top scientists around the world. That's much more of that kind of mindset than it is about like putting faith in sort of like existing institutions, which is what we would see from more of like a Davos kind of mindset. Dwarkesh Patel 0:05:16Interesting. Do you think that in the future, like the kids of today's tech billionaires will be future aristocrats? So effective altruism will be a sort of elite aristocratic philosophy. They'll be like tomorrow's Rockefellers. Nadia Asparouhova 0:05:30Yeah, I kind of worry about that actually. I think of there as being like within the US, we were kind of lucky in that we have these two different types of elites. We have the aristocratic elites and we have meritocratic elites. Most other countries I think basically just have aristocratic elites, especially comparing like the US to Britain in this way. And so in the aristocratic model, your wealth and your power is sort of like conferred to you by previous generations. You just kind of like inherit it from your parents or your family or whomever. And the upside of that, if there is an upside, is that you get really socialized into this idea of what does it mean to be a public steward? What does it mean to think of yourself and your responsibility to the rest of society as a privileged elite person? In the US, we have this really great thing where you can kind of just, you know, we have the American dream, right? So lots of people that didn't grow up with money can break into the elite ranks by doing something that makes them really successful. And that's like a really special thing about the US. So we have this whole class of meritocratic elites who may not have aristocratic backgrounds, but ended up doing something within their lifetimes that made them successful. And so, yeah, I think it's a really cool thing. The downside of that being that you don't really get like socialized into what does it mean to have this fortune and do something interesting with your money. You don't have this sort of generational benefit that the aristocratic elites have of presiding over your land or whatever you want to call it, where you're sort of learning how to think about yourself in relation to the rest of society. And so it's much easier to just kind of like hoard your wealth or whatever. And so when you think about sort of like what are the next generations, the children of the meritocratic elites going to look like or what are they going to do, it's very easy to imagine kind of just becoming aristocratic elites in the sense of like, yeah, they're just going to like inherit the money from their families. And they haven't also really been socialized into like how to think about their role in society. And so, yeah, all the meritocratic elites eventually turn into aristocratic elites, which is where I think you start seeing this trend now towards people wanting to sort of like spend down their fortunes within their lifetime or within a set number of decades after they die because they kind of see what happened in previous generations and are like, oh, I don't want to do that. Dwarkesh Patel 0:07:41Yeah, yeah, yeah. Well, it's interesting. You mentioned that the aristocratic elites have the feel that they have the responsibility to give back, I guess, more so than the meritocratic elites. But I believe that in the U.S., the amount of people who give to philanthropy and the total amount they give is higher than in Europe, right, where they probably have a higher ratio of aristocratic elites. Wouldn't you expect the opposite if the aristocratic elites are the ones that are, you know, inculcated to give back? Nadia Asparouhova 0:08:11Well, I assume like most of the people that are the figures about sort of like Americans giving back is spread across like all Americans, not just the wealthiest. Dwarkesh Patel 0:08:19Yeah. So you would predict that among the top 10 percent of Americans, there's less philanthropy than the top 10 percent of Europeans? Uh, there's... Sorry, I'm not sure I understand the question. I guess, does the ratio of meritocratic to aristocratic elites change how much philanthropy there is among the elites? Nadia Asparouhova 0:08:45Yeah, I mean, like here we have much more of a culture of like even among aristocratic elites, this idea of like institution building or like large donations to like build institutions, whereas in Europe, a lot of the public institutions are created by government. And there's sort of this mentality of like private citizens don't experiment with public institutions. That's the government's job. And you see that sort of like pervasively throughout all of like European cultures. Like when we want something to change in public society, we look to government to like regulate or change it. Whereas in the U.S., it's kind of much more like choose your own adventure. And we don't really see the government as like the sole provider or shaper of public institutions. We also look at private citizens and like there's so many things that like public institutions that we have now that were not started by government, but were started by private philanthropists. And that's like a really unusual thing about the U.S. Dwarkesh Patel 0:09:39There's this common pattern in philanthropy where a guy will become a billionaire, and then his wife will be heavily involved with or even potentially in charge of, you know, the family's philanthropic efforts. And there's many examples of this, right? Like Bill and Melinda Gates, you know, Mark Zuckerberg. Yeah, yeah, exactly. And Dustin Moskovitz. So what is the consequence of this? How is philanthropy, the causes and the foundations, how are they different because of this pattern? Nadia Asparouhova 0:10:15Well, I mean, I feel like we see that pattern, like the problem is that what even is philanthropy is changing very quickly. So we can say historically that, not even historically, in recent history, in recent decades, that has probably been true. That wasn't true in say like late 1800s, early 1900s. It was, you know, Carnegie and Rockefeller were the ones that were actually doing their own philanthropy, not their spouses. So I'd say it's a more recent trend. But now I think we're also seeing this thing where like a lot of wealthy people are not necessarily doing their philanthropic activities through foundations anymore. And that's true both within like traditional philanthropy sector and sort of like the looser definition of what we might consider to be philanthropy, depending on how you define it, which I kind of more broadly want to define as like the actions of elites that are sort of like, you know, public facing activities. But like even within sort of traditional philanthropy circles, we have like, you know, the 5.1c3 nonprofit, which is, you know, traditionally how people, you know, house all their money in a foundation and then they do their philanthropic activities out of that. But in more recent years, we've seen this trend towards like LLCs. So Emerson Collective, I think, might have been maybe the first one to do it. And that was Steve Jobs' Philanthropic Foundation. And then Mark Zuckerberg with Chan Zuckerberg Initiative also used an LLC. And then since then, a lot of other, especially within sort of like tech wealth, we've seen that move towards people using LLCs instead of 5.1c3s because they, it just gives you a lot more flexibility in the kinds of things you can fund. You don't just have to fund other nonprofits. And they also see donor advised funds. So DAFs, which are sort of this like hacky workaround to foundations as well. So I guess point being that like this sort of mental model of like, you know, one person makes a ton of money and then their spouse kind of directs these like nice, feel good, like philanthropic activities, I think is like, may not be the model that we continue to move forward on. And I'm kind of hopeful or curious to see like, what does a return to like, because we've had so many new people making a ton of money in the last 10 years or so, we might see this return to sort of like the Gilded Age style of philanthropy where people are not necessarily just like forming a philanthropic foundation and looking for the nicest causes to fund, but are actually just like thinking a little bit more holistically about like, how do I help build and create like a movement around a thing that I really care about? How do I think more broadly around like funding companies and nonprofits and individuals and like doing lots of different, different kinds of activities? Because I think like the broader goal that like motivates at least like the new sort of elite classes to want to do any of this stuff at all. I don't really think philanthropy is about altruism. I just, I think like the term philanthropy is just totally fraud and like refers to too many different things and it's not very helpful. But I think like the part that I'm interested in at least is sort of like what motivates elites to go from just sort of like making a lot of money and then like thinking about themselves to them thinking about sort of like their place in broader public society. And I think that starts with thinking about how do I control like media, academia, government are sort of like the three like arms of the public sector. And we think of it in that way a little bit more broadly where it's really much more about sort of like maintaining control over your own power, more so than sort of like this like altruistic kind of, you know, whitewash. Dwarkesh Patel 0:13:41Yeah. Nadia Asparouhova 0:13:42Then it becomes like, you know, there's so many other like creative ways to think about like how that might happen. Dwarkesh Patel 0:13:49That's, that's, that's really interesting. That's a, yeah, that's a really interesting way of thinking about what it is you're doing with philanthropy. Isn't the word noble descended from a word that basically means to give alms to people like if you're in charge of them, you will give alms to them. And in a way, I mean, it might have been another word I'm thinking of, but in a way, yeah, a part of what motivates altruism, not obviously all of it, but part of it is that, yeah, you influence and power. Not even in a necessarily negative connotation, but that's definitely what motivates altruism. So having that put square front and center is refreshing and honest, actually. Nadia Asparouhova 0:14:29Yeah, I don't, I really don't see it as like a negative thing at all. And I think most of the like, you know, writing and journalism and academia that focuses on philanthropy tends to be very wealth critical. I'm not at all, like I personally don't feel wealth critical at all. I think like, again, sort of returning to this like mental model of like aristocratic and meritocratic elites, aristocratic elites are able to sort of like pass down, like encode what they're supposed to be doing in each generation because they have this kind of like familial ties. And I think like on the meritocratic side, like if you didn't have any sort of language around altruism or public stewardship, then like, it's like, you need to kind of create that narrative for the meritocratically or else, you know, there's just like nothing to hold on to. So I think like, it makes sense to talk in those terms. Andrew Carnegie being sort of the father of modern philanthropy in the US, like, wrote these series of essays about wealth that were like very influential and where he sort of talks about this like moral obligation. And I think like, really, it was kind of this like, a quiet way for him to, even though it was ostensibly about sort of like giving back or, you know, helping lift up the next generation of people, the next generation of entrepreneurs. Like, I think it really was much more of a protective stance of saying, like, if he doesn't frame it in this way, then people are just going to knock down the concept of wealth altogether. Dwarkesh Patel 0:15:50Yeah, yeah, yeah. No, that's really interesting. And it's interesting, in which cases this kind of influence has been successful and worse not. When Jeff Bezos bought the Washington Post, has there been any counterfactual impact on how the Washington Post has run as a result? I doubt it. But you know, when Musk takes over Twitter, I guess it's a much more expensive purchase. We'll see what the influence is negative or positive. But it's certainly different than what Twitter otherwise would have been. So control over media, it's, I guess it's a bigger meme now. Let me just take a digression and ask about open source for a second. So based on your experience studying these open source projects, do you find the theory that Homer and Shakespeare were basically container words for these open source repositories that stretched out through centuries? Do you find that more plausible now, rather than them being individuals, of course? Do you find that more plausible now, given your, given your study of open source? Sorry, what did? Nadia Asparouhova 0:16:49Less plausible. What did? Dwarkesh Patel 0:16:51Oh, okay. So the idea is that they weren't just one person. It was just like a whole bunch of people throughout a bunch of centuries who composed different parts of each story or composed different stories. Nadia Asparouhova 0:17:02The Nicholas Berbaki model, same concept of, you know, a single mathematician who's actually comprised of like lots of different. I think it's actually the opposite would be sort of my conclusion. We think of open source as this very like collective volunteer effort. And I think, use that as an excuse to not really contribute back to open source or not really think about like how open source projects are maintained. Because we were like, you know, you kind of have this bystander effect where you're like, well, you know, someone's taking care of it. It's volunteer oriented. Like, of course, there's someone out there taking care of it. But in reality, it actually turns out it is just one person. So maybe it's a little bit more like a Wizard of Oz type model. It's actually just like one person behind the curtain that's like, you know, doing everything. And you see this huge, you know, grandeur and you think there must be so many people that are behind it. It's one person. Yeah, and I think that's sort of undervalued. I think a lot of the rhetoric that we have about open source is rooted in sort of like early 2000s kind of starry eyed idea about like the power of the internet and the idea of like crowdsourcing and Wikipedia and all this stuff. And then like in reality, like we kind of see this convergence from like very broad based collaborative volunteer efforts to like narrowing down to kind of like single creators. And I think a lot of like, you know, single creators are the people that are really driving a lot of the internet today and a lot of cultural production. Dwarkesh Patel 0:18:21Oh, that's that's super fascinating. Does that in general make you more sympathetic towards the lone genius view of accomplishments in history? Not just in literature, I guess, but just like when you think back to how likely is it that, you know, Newton came up with all that stuff on his own versus how much was fed into him by, you know, the others around him? Nadia Asparouhova 0:18:40Yeah, I think so. I feel I've never been like a big, like, you know, great founder theory kind of person. I think I'm like, my true theory is, I guess that ideas are maybe some sort of like sentient, like, concept or virus that operates outside of us. And we are just sort of like the vessels through which like ideas flow. So in that sense, you know, it's not really about any one person, but I do think I think I tend to lean like in terms of sort of like, where does creative, like, creative effort come from? I do think a lot of it comes much more from like a single individual than it does from with some of the crowds. But everything just serves like different purposes, right? Like, because I think like, within open source, it's like, not all of open source maintenance work is creative. In fact, most of it is pretty boring and dredgerous. And that's the stuff that no one wants to do. And that, like, one person kind of got stuck with doing and that's really different from like, who created a certain open source projects, which is a little bit more of that, like, creative mindset. Dwarkesh Patel 0:19:44Yeah, yeah, that's really interesting. Do you think more projects in open source, so just take a popular repository, on average, do you think that these repositories would be better off if, let's say a larger percentage of them where pull requests were closed and feature requests were closed? You can look at the code, but you can't interact with it or its creators anyway? Should more repositories have this model? Yeah, I definitely think so. I think a lot of people would be much happier that way. Yeah, yeah. I mean, it's interesting to think about the implications of this for other areas outside of code, right? Which is where it gets really interesting. I mean, in general, there's like a discussion. Sorry, go ahead. Yeah. Nadia Asparouhova 0:20:25Yeah, I mean, that's basically what's for the writing of my book, because I was like, okay, I feel like whatever's happening open source right now, you start with this idea that like democracy is green, and like, we should have tons and tons of people participating, tons of people participate, and then it turns out that like, most participation is actually just noise and not that useful. And then it ends up like scaring everyone away. And in the end, you just have like, you know, one or a small handful of people that are actually doing all the work while everyone else is kind of like screaming around them. And this becomes like a really great metaphor for what happens in social media. And the reason I wrote, after I wrote the book, I went and worked at Substack. And, you know, part of it was because I was like, I think the model is kind of converging from like, you know, Twitter being this big open space to like, suddenly everyone is retreating, like, the public space is so hostile that everyone must retreat into like, smaller private spaces. So then, you know, chats became a thing, Substack became a thing. And yeah, I just feel sort of like realistic, right? Dwarkesh Patel 0:21:15That's really fascinating. Yeah, the Straussian message in that book is very strong. But in general, there's, when you're thinking about something like corporate governance, right? There's a big question. And I guess even more interestingly, when you think if you think DAOs are going to be a thing, and you think that we will have to reinvent corporate governance from the ground up, there's a question of, should these be run like monarchy? Should they be sort of oligarchies where the board is in control? Should they be just complete democracies where everybody gets one vote on what you do at the next, you know, shareholder meeting or something? And this book and that analysis is actually pretty interesting to think about. Like, how should corporations be run differently, if at all? What does it inform how you think the average corporation should be run? Nadia Asparouhova 0:21:59Yeah, definitely. I mean, I think we are seeing a little bit, I'm not a corporate governance expert, but I do feel like we're seeing a little of this like, backlash against, like, you know, shareholder activism and like, extreme focus on sort of like DEI and boards and things like that. And like, I think we're seeing a little bit of people starting to like take the reins and take control again, because they're like, ah, that doesn't really work so well, it turns out. I think DAOs are going to learn this hard lesson as well. It's still maybe just too early to say what is happening in DAOs right now. But at least the ones that I've looked at, it feels like there is a very common failure mode of people saying, you know, like, let's just have like, let's have this be super democratic and like, leave it to the crowd to kind of like run this thing and figure out how it works. And it turns out you actually do need a strong leader, even the beginning. And this, this is something I learned just from like, open source projects where it's like, you know, very rarely, or if at all, do you have a strong leader? If at all, do you have a project that starts sort of like leaderless and faceless? And then, you know, usually there is some strong creator, leader or influential figure that is like driving the project forward for a certain period of time. And then you can kind of get to the point when you have enough of an active community that maybe that leader takes a step back and lets other people take over. But it's not like you can do that off day one. And that's sort of this open question that I have for, for crypto as an industry more broadly, because I think like, if I think about sort of like, what is defining each of these generations of people that are, you know, pushing forward new technological paradigms, I mentioned that like Wall Street finance mindset is very focused on like globalism and on this sort of like efficiency quantitative mindset. You have the tech Silicon Valley Y company or kind of generation that is really focused on top talent. And the idea this sort of like, you know, founder mindset, the power of like individuals breaking institutions, and then you have like the crypto mindset, which is this sort of like faceless leaderless, like governed by protocol and by code mindset, which is like intriguing to me. But I have a really hard time squaring it with seeing like, in some sense, open source was the experiment that started playing out, you know, 20 years before then. And some things are obviously different in crypto, because tokenization completely changes the incentive system for contributing and maintaining crypto projects versus like traditional open source projects. But in the end, also like humans are humans. And like, I feel like there are a lot of lessons to be learned from open source of like, you know, they also started out early on as being very starry eyed about the power of like, hyper democratic regimes. And it turned out like, that just like doesn't work in practice. And so like, how is CryptoGhost or like Square that? I'm just, yeah, very curious to see what happened. Dwarkesh Patel 0:24:41Yeah, super fascinating. That raises an interesting question, by the way, you've written about idea machines, and you can explain that concept while you answer this question. But do you think that movements can survive without a charismatic founder who is both alive and engaged? So once Will McCaskill dies, would you be shorting effective altruism? Or if like Tyler Cowen dies, would you be short progress studies? Or do you think that, you know, once you get a movement off the ground, you're like, okay, I'm gonna be shorting altruism. Nadia Asparouhova 0:25:08Yeah, I think that's a good question. I mean, like, I don't think there's some perfect template, like each of these kind of has its own sort of unique quirks and characteristics in them. I guess, yeah, back up a little bit. Idea machines is this concept I have around what the transition from we were talking before about, so like traditional 5.1c3 foundations as vehicles for philanthropy, what does the modern version of that look like that is not necessarily encoded in institution? And so I had this term idea machines, which is sort of this different way of thinking about like, turning ideas into outcomes where you have a community that forms around a shared set of values and ideas. So yeah, you mentioned like progress studies is an example of that, or effective altruism example, eventually, that community gets capitalized by some funders, and then it starts to be able to develop an agenda and then like, actually start building like, you know, operational outcomes and like, turning those ideas into real world initiatives. And remind me of your question again. Dwarkesh Patel 0:26:06Yeah, so once the charismatic founder dies of a movement, is a movement basically handicapped in some way? Like, maybe it'll still be a thing, but it's never going to reach the heights it could have reached if that main guy had been around? Nadia Asparouhova 0:26:20I think there are just like different shapes and classifications of like different, different types of communities here. So like, and I'm just thinking back again to sort of like different types of open source projects where it's not like they're like one model that fits perfectly for all of them. So I think there are some communities where it's like, yeah, I mean, I think effective altruism is maybe a good example of that where, like, the community has grown so much that I like if all their leaders were to, you know, knock on wood, disappear tomorrow or something that like, I think the movement would still keep going. There are enough true believers, like even within the community. And I think that's the next order of that community that like, I think that would just continue to grow. Whereas you have like, yeah, maybe it's certain like smaller or more nascent communities that are like, or just like communities that are much more like oriented around, like, a charismatic founder that's just like a different type where if you lose that leader, then suddenly, you know, the whole thing falls apart because they're much more like these like cults or religions. And I don't think it makes one better, better or worse. It's like the right way to do is probably like Bitcoin, where you have a charismatic leader for life because that leader is more necessarily, can't go away, can't ever die. But you still have the like, you know, North Stars and like that. Dwarkesh Patel 0:27:28Yeah. It is funny. I mean, a lot of prophets have this property of you're not really sure what they believed in. So people with different temperaments can project their own preferences onto him. Somebody like Jesus, right? It's, you know, you can be like a super left winger and believe Jesus did for everything you believe in. You can be a super right winger and believe the same. Yeah. Go ahead. Nadia Asparouhova 0:27:52I think there's value in like writing cryptically more. Like I think about like, I think Curtis Yarvin has done a really good job of this where, you know, intentionally or not, but because like his writing is so cryptic and long winded. And like, it's like the Bible where you can just kind of like pour over endlessly being like, what does this mean? What does this mean? And in a weird, you know, you're always told to write very clearly, you're told to write succinctly, but like, it's actually in a weird way, you can be much more effective by being very long winded and not obvious in what you're saying. Dwarkesh Patel 0:28:20Yes, which actually raises an interesting question that I've been wondering about. There have been movements, I guess, if I did altruism is a good example that have been focused on community building in a sort of like explicit way. And then there's other movements where they have a charismatic founder. And moreover, this guy, he doesn't really try to recruit people. I'm thinking of somebody like Peter Thiel, for example, right? He goes on, like once every year or two, he'll go on a podcast and have this like really cryptic back and forth. And then just kind of go away in a hole for a few months or a few years. And I'm curious, which one you think is more effective, given the fact that you're not really competing for votes. So absolute number of people is not what you care about. It's not clear what you care about. But you do want to have more influence among the elites who matter in like politics and tech as well. So anyways, which just your thoughts on those kinds of strategies, explicitly trying to community build versus just kind of projecting out there in a sort of cryptic way? Nadia Asparouhova 0:29:18Yeah, I mean, I definitely being somewhat cryptic myself. I favor the cryptic methodology. But I mean, yeah, I mean, you mentioned Peter Thiel. I think like the Thielverse is probably like the most, like one of the most influential things. In fact, that is hard. It is partly so effective, because it is hard to even define what it is or wrap your head around that you just know that sort of like, every interesting person you meet somehow has some weird connection to, you know, Peter Thiel. And it's funny. But I think this is sort of that evolution from the, you know, 5163 Foundation to the like idea machine implicit. And that is this this switch from, you know, used to start the, you know, Nadia Asparova Foundation or whatever. And it was like, you know, had your name on it. And it was all about like, what do I as a funder want to do in the world, right? And you spend all this time doing this sort of like classical, you know, research, going out into the field, talking to people and you sit and you think, okay, like, here's a strategy I'm going to pursue. And like, ultimately, it's like, very, very donor centric in this very explicit way. And so within traditional philanthropy, you're seeing this sort of like, backlash against that. In like, you know, straight up like nonprofit land, where now you're seeing the locus of power moving from being very donor centric to being sort of like community centric and people saying like, well, we don't really want the donors telling us what to do, even though it's also their money. Like, you know, instead, let's have this be driven by the community from the ground up. That's maybe like one very literal reaction against that, like having the donor as sort of the central power figure. But I think idea machines are kind of like the like, maybe like the more realistic or effective answer in that like, the donor is still like without the presence of a funder, like, community is just a community. They're just sitting around and talking about ideas of like, what could possibly happen? Like, they don't have any money to make anything happen. But like, I think like really effective funders are good at being sort of like subtle and thoughtful about like, like, you know, no one wants to see like the Peter Thiel foundation necessarily. That's just like, it's so like, not the style of how it works. But you know, you meet so many people that are being funded by the same person, like just going out and sort of aggressively like arming the rebels is a more sort of like, yeah, just like distributed decentralized way of thinking about like spreading one's power, instead of just starting a fund. Instead of just starting a foundation. Dwarkesh Patel 0:31:34Yeah, yeah. I mean, even if you look at the life of influential politicians, somebody like LBJ, or Robert Moses, it's how much of it was like calculated and how much of it was just like decades of building up favors and building up connections in a way that had no definite and clear plan, but it just you're hoping that someday you can call upon them and sort of like Godfather way. Yeah. Yeah, that's interesting. And by the way, this is also where your work on open source comes in, right? Like, there's this idea that in the movement, you know, everybody will come in with their ideas, and you can community build your way towards, you know, what should be funded. And, yeah, I'm inclined to believe that it's probably like a few people who have these ideas about what should be funded. And the rest of it is either just a way of like building up engagement and building up hype. Or, or I don't know, or maybe just useless, but what are your thoughts on it? Nadia Asparouhova 0:32:32You know, I decided I was like, I am like, really very much a tech startup person and not a crypto person, even though I would very much like to be fun, because I'm like, ah, this is the future. And there's so many interesting things happening. And I'm like, for the record, not at all like down in crypto, I think it is like the next big sort of movement of things that are happening. But when I really come down to like the mindset, it's like I am so in that sort of like, top talent founder, like power of the individual to break institutions mindset, like that just resonates with me so much more than the like, leaderless, faceless, like, highly participatory kind of thing. And again, like I am very open to that being true, like I maybe I'm so wrong on that. I just like, I have not yet seen evidence that that works in the world. I see a lot of rhetoric about how that could work or should work. We have this sort of like implicit belief that like, direct democracy is somehow like the greatest thing to aspire towards. But like, over and over we see evidence that like that doesn't that just like doesn't really work. It doesn't mean we have to throw out the underlying principles or values behind that. Like I still really believe in meritocracy. I really believe in like access to opportunity. I really believe in like pursuit of happiness. Like to me, those are all like very like American values. But like, I think that where that breaks is the idea that like that has to happen through these like highly participatory methods. I just like, yeah, I haven't seen really great evidence of that being that working. Dwarkesh Patel 0:33:56What does that imply about how you think about politics or at least political structures? You think it would you you elect a mayor, but like, just forget no participation. He gets to do everything he wants to do for four years and you can get rid of in four years. But until then, no community meetings. Well, what does that imply about how you think cities and states and countries should be run? Nadia Asparouhova 0:34:17Um, that's a very complicated thoughts on that. I mean, I, I think it's also like, everyone has the fantasy of when it'd be so nice if there were just one person in charge. I hate all this squabbling. It would just be so great if we could just, you know, have one person just who has exactly the views that I have and put them in charge and let them run things. That would be very nice. I just, I do also think it's unrealistic. Like, I don't think I'm, you know, maybe like modernity sounds great in theory, but in practice just doesn't like I really embrace and I think like there is no perfect governance design either in the same way that there's no perfect open source project designer or whatever else we're talking about. Um, uh, like, yeah, it really just depends like what is like, what is your population comprised of? There are some very small homogenous populations that can be very easily governed by like, you know, a small government or one person or whatever, because there isn't that much dissent or difference. Everyone is sort of on the same page. America is the extreme opposite in that angle. And I'm always thinking about America because like, I'm American and I love America. But like, everyone is trying to solve the governance question for America. And I think like, yeah, I don't know. I mean, we're an extremely heterogeneous population. There are a lot of competing world views. I may not agree with all the views of everyone in America, but like I also, like, I don't want just one person that represents my personal views. I would focus more like effectiveness in governance than I would like having like, you know, just one person in charge or something that like, I don't mind if someone disagrees with my views as long as they're good at what they do, if that makes sense. So I think the questions are like, how do we improve the speed at which like our government works and the efficacy with which it works? Like, I think there's so much room to be made room for improvement there versus like, I don't know how much like I really care about like changing the actual structure of our government. Dwarkesh Patel 0:36:27Interesting. Going back to open source for a second. Why do these companies release so much stuff in open source for free? And it's probably literally worth trillions of dollars of value in total. And they just release it out and free and many of them are developer tools that other developers use to build competitors for these big tech companies that are releasing these open source tools. Why did they do it? What explains it? Nadia Asparouhova 0:36:52I mean, I think it depends on the specific project, but like a lot of times, these are projects that were developed internally. It's the same reason of like, I think code and writing are not that dissimilar in this way of like, why do people spend all this time writing, like long posts or papers or whatever, and then just release them for free? Like, why not put everything behind a paywall? And I think the answer is probably still in both cases where like mindshare is a lot more interesting than, you know, your literal IP. And so, you know, you put out, you write these like long reports or you tweet or whatever, like you spend all this time creating content for free and putting it out there because you're trying to capture mindshare. Same thing with companies releasing open source projects. Like a lot of times they really want like other developers to come in and contribute to them. They want to increase their status as like an open source friendly kind of company or company or show like, you know, here's the type of code that we write internally and showing that externally. They want to like recruiting is, you know, the hardest thing for any company, right? And so being able to attract the right kinds of developers or people that, you know, might fit really well into their developer culture just matters a lot more. And they're just doing that instead of with words or doing that with code. Dwarkesh Patel 0:37:57You've talked about the need for more idea machines. You're like dissatisfied with the fact that effective altruism is a big game in town. Is there some idea or nascent movement where I mean, other than progress ideas, but like something where you feel like this could be a thing, but it just needs some like charismatic founder to take it to the next level? Or even if it doesn't exist yet, it just like a set of ideas around this vein is like clearly something there is going to exist. You know what I mean? Is there anything like that that you notice? Nadia Asparouhova 0:38:26I only had a couple of different possibilities in that post. Yeah, I think like the progress sort of meme is probably the largest growing contender that I would see right now. I think there's another one right now around sort of like the new right. That's not even like the best term necessarily for it, but there's sort of like a shared set of values there that are maybe starting with like politics, but like ideally spreading to like other areas of public influence. So I think like those are a couple of like the bigger movements that I see right now. And then there's like smaller stuff too. Like I mentioned, like tools for thought in that post where like that's never going to be a huge idea machine. But it's one where you have a lot of like interesting, talented people that are thinking about sort of like future of computing. And until maybe more recently, like there just hasn't been a lot of funding available and the funding is always really uneven and unpredictable. And so that's to me an example of like, you know, a smaller community that like just needs that sort of like extra influx to turn a bunch of abstract ideas into practice. But yeah, I mean, I think like, yeah, there's some like the bigger ones that I see right now. I think there is just so much more potential to do more, but I wish people would just think a little bit more creatively because, yeah, I really do think like effective altruism kind of becomes like the default option for a lot of people. Then they're kind of vaguely dissatisfied with it and they don't like think about like, well, what do I actually really care about in the world and how do I want to put that forward? Dwarkesh Patel 0:39:53Yeah, there's also the fact that effective altruism has this like very fit memeplex in the sense that it's like a polytheistic religion where if you have a cause area, then you don't have your own movement. You just have a cause area within our broader movement, right? It just like adopts your gods into our movement. Nadia Asparouhova 0:40:15Yeah, that's the same thing I see like people trying to lobby for effective altruism to care about their cause area, but then it's like you could just start a separate. Like if you can't get EA to care about, then why not just like start another one somewhere else? Dwarkesh Patel 0:40:28Yeah, so, you know, it's interesting to me that the wealth boom in Silicon Valley and then tech spheres has led to the sound growth of philanthropy, but that hasn't always been the case. Even in America, like a lot of people became billionaires after energy markets were deregulated in the 80s and the 90s. And then there wasn't, and obviously the hub of that was like the Texas area or, you know, and as far as I'm aware, there wasn't like a boom of philanthropy motivated by the ideas that people in that region had. What's different about Silicon Valley? Why are they, or do you actually think that these other places have also had their own booms of philanthropic giving? Nadia Asparouhova 0:41:11I think you're right. Yeah, I would make the distinction between like being wealthy is not the same as being elite or whatever other term you want to use there. And so yeah, there are definitely like pockets of what's called like more like local markets of wealth, like, yeah, Texas oil or energy billionaires that tend to operate kind of just more in their own sphere. And a lot of, if you look at any philanthropic, like a lot of them will be philanthropically active, but they only really focus on their geographic area. But there's sort of this difference. And I think this is part of where it comes from the question of like, you know, like what forces someone to actually like do something more public facing with their power. And I think that comes from your power being sort of like threatened. That's like one aspect I would say of that. So like tech has only really become a lot more active in the public sphere outside of startups after the tech backlash of the mid 2010s. And you can say a similar thing kind of happened with the Davos elite as well. And also for the Gilded Age cohort of wealth. And so yeah, when you have sort of, you're kind of like, you know, building in your own little world. And like, you know, we had literally like Silicon Valley where everyone was kind of like sequestered off and just thinking about startups and thinking themselves of like, tech is essentially like an industry, just like any other sort of, you know, entertainment or whatever. And we're just kind of happy building over here. And then it was only when sort of like the Panopticon like turned its head towards tech and started and they had this sort of like onslaught of critiques coming from sort of like mainstream discourse where they went, oh, like what is my place in this world? And, you know, if I don't try to like defend that, then I'm going to just kind of, yeah, we're going to lose all that power. So I think that that need to sort of like defend one's power can kind of like prompt that sort of action. The other aspect I'd highlight is just like, I think a lot of elites are driven by these like technological paradigm shifts. So there's this scholar, Carlotta Perrins, who writes about technological revolutions and financial capital. And she identifies like a few different technological revolutions over the last, whatever, hundred plus years that like drove this cycle of, you know, a new technology is invented. It's people are kind of like working on it in this smaller industry sort of way. And then there is some kind of like crazy like public frenzy and then like a backlash. And then from after that, then you have this sort of like focus on public institution building. But she really points out that like not all technology fits into that. Like, not all technology is a paradigm shift. Sometimes technology is just technology. And so, yeah, I think like a lot of wealth might just fall into that category. My third example, by the way, is the Koch family because you had, you know, the Koch brothers, but then like their father was actually the one who like kind of initially made their wealth, but was like very localized in sort of like how he thought about philanthropy. He had his own like, you know, family foundation was just sort of like doing that sort of like, you know, Texas billionaire mindset that we're talking about of, you know, I made a bunch of money. I'm going to just sort of like, yeah, do my local funder activity. It was only the next generation of his children that then like took that wealth and started thinking about like how do we actually like move that onto like a more elite stage and thinking about like their influence in the media. But like you can see there's like two clear generations within the same family. Like one has this sort of like local wealth mindset and one of them has the more like elite wealth mindset. And yeah, you can kind of like ask yourself, why did that switch happen? But yeah, it's clearly about more than just money. It's also about intention. Dwarkesh Patel 0:44:51Yeah, that's really interesting. Well, it's interesting because there's, if you identify the current mainstream media as affiliated with like that Davos aristocratic elite, or maybe not aristocratic, but like the Davos groups. Yeah, exactly. There is a growing field of independent media, but you would not identify somebody like Joe Rogan as in the Silicon Valley sphere, right? So there is a new media. I just, I guess these startup people don't have that much influence over them yet. And they feel like, yeah. Nadia Asparouhova 0:45:27I think they're trying to like take that strategy, right? So you have like a bunch of founders like Palmer Luckey and Mark Zuckerberg and Brian Armstrong and whoever else that like will not really talk to mainstream media anymore. They will not get an interview to the New York Times, but they will go to like an individual influencer or an individual creator and they'll do an interview with them. So like when Mark Zuckerberg announced Meta, like he did not get grant interviews to mainstream publications, but he went and talked to like Ben Thompson at Strategory. And so I think there is like, it fits really well with that. Like probably mindset of like, we're not necessarily institution building. We're going to like focus on power of individuals who sort of like defy institutions. And that is kind of like an open question that I have about like, what will the long term influence of the tech elite look like? Because like, yeah, the human history tells us that eventually all individual behaviors kind of get codified into institutions, right? But we're obviously living in a very different time now. And I think like the way that the Davos elite managed to like really codify and extend their influence across all these different sectors was by taking that institutional mindset and, you know, like thinking about sort of like academic institutions and media institutions, all that stuff. If the startup mindset is really inherently like anti-institution and says like, we don't want to build the next Harvard necessarily. We just want to like blow apart the concept of universities whatsoever. Or, you know, we don't want to create a new CNN or a new Fox News. We want to just like fund like individual creators to do that same sort of work, but in this very decentralized way. Like, will that work long term? I don't know. Like, is that just sort of like a temporary state that we're in right now where no one really knows what the next institutions will look like? Or is that really like an important part of this generation where like, we shouldn't be asking the question of like, how do you build a new media network? We should just be saying like, the answer is there is no media network. We just go to like all these individuals instead. Dwarkesh Patel 0:47:31Yeah, that's interesting. What do you make of this idea that I think, let's say, that these idea machines might be limited by the fact that if you're going to start some sort of organization in them, you're very much depending on somebody who has made a lot of money independently to fund you and to grant you approval. And I just have a hard time seeing somebody who is like a Napoleon-like figure being willing long term to live under that arrangement. And that so there'll just be the people who are just have this desire to dominate and be recognized who are probably pretty important to any movement you want to create. They'll just want to go off and just like build a company or something that gives them an independent footing first. And they just won't fall under any umbrella. You know what I mean? Nadia Asparouhova 0:48:27Yeah, I mean, like Dustin Moskovitz, for example, has been funding EA for a really long time and hasn't hasn't walked away necessarily. Yeah. I mean, on the flip side, you can see like SPF carried a lot of a lot of risk because it's your point, I guess, like, you know, you end up relying on this one funder, the one funder disappears and everything else kind of falls apart. I mean, I think like, I don't have any sort of like preciousness attached to the idea of like communities, you know, lasting forever. I think this is like, again, if we're trying to solve for the problem of like what did not work well about 5.1c3 foundations for most of recent history, like part of it was that they're, you know, just meant to live on to perpetuity. Like, why do we still have like, you know, Rockefeller Foundation, there are now actually many different Rockefeller Foundations, but like, why does that even exist? Like, why did that money not just get spent down? And actually, when John D. Rockefeller was first proposing the idea of foundations, he wanted them to be like, to have like a finite end state. So he wanted them to last only like 50 years or 100 years when he was proposing this like federal charter, but that federal charter failed. And so now we have these like state charters and foundations can just exist forever. But like, I think if we want to like improve upon this idea of like, how do we prevent like meritocratic elites from turning into aristocratic elites? How do we like, yeah, how do we actually just like try to do a lot of really interesting stuff in our lifetimes? It's like a very, it's very counterintuitive, because you think about like, leaving a legacy must mean like creating institutions or creating a foundation that lasts forever. And, you know, 200 years from now, there's still like the Nadia Asparuva Foundation out there. But like, if I really think about it, it's like, I would almost rather just do really, really, really good, interesting work in like, 50 years or 20 years or 10 years, and have that be the legacy versus your name kind of getting, you know, submerged over a century of institutional decay and decline. So yeah, I don't like if you know, you have a community that lasts for maybe only last 10 years or something like that, and it's funded for that amount of time, and then it kind of elbows its usefulness and it winds down or becomes less relevant. Like, I don't necessarily see it as a bad thing. Of course, like in practice, you know, nothing ever ends that that neatly and that quietly. But, but yeah, I don't think that's a bad thing. Dwarkesh Patel 0:50:44Yeah, yeah. Who are some ethnographers or sociologists from a previous era that have influenced your work? So was there somebody writing about, you know, what it was like to be in a Roman Legion? Or what it was like to work in a factory floor? And you're like, you know what, I want to do that for open source? Or I want to do that for the New Tech Elite? Nadia Asparouhova 0:51:02For open source, I was definitely really influenced by Jane Jacobs and Eleanor Ostrom. I think both had this quality of, so yeah, Eleanor Ostrom was looking at examples of common pool resources, like fisheries or forests or whatever. And just like, going and visiting them and spending a lot of time with them and then saying like, actually, I don't think tragedy of the commons is like a real thing, or it's not the only outcome that we can possibly have. And so sometimes commons can be managed, like perfectly sustainably. And it's not necessarily true that everyone just like treats them very extractively. And just like wrote about what she saw. And same with Jane Jacobs sort of looking at cities as someone who lives in one, right? Like she didn't have any fancy credentials or anything like that. She was just like, I live in the city and I'm looking around and this idea of like, top down urban planning, where you have like someone trying to design this perfect city that like, doesn't change and doesn't yield to its people. It just seems completely unrealistic. And the style that both of them take in their writing is very, it just it starts from them just like, observing what they see and then like, trying to write about it. And I just, yeah, that's, that's the style that I really want to emulate. Dwarkesh Patel 0:52:12Interesting. Nadia Asparouhova 0:52:13Yeah. I think for people to just be talking to like, I don't know, like Chris just like just talking to like open source developers, turns out you can learn a lot more from that than just sitting around like thinking about what open source developers might be thinking about. But... Dwarkesh Patel 0:52:25I have this, I have had this idea of not even for like writing it out loud, but just to understand how the world works. Just like shadowing people who are in just like a random position, they don't have to be a lead in any way, but just like a person who's the personal assistant to somebody influential, how to decide whose emails they forward, how they decide what's the priority, or somebody who's just like an accountant for a big company, right? It's just like, what is involved there? Like, what kinds of we're gonna, you know what I mean? Just like, random people, the line manager at the local factory. I just have no idea how these parts of the world work. And I just want to like, yeah, just shadow them for a day and see like, what happens there. Nadia Asparouhova 0:53:05This is really interesting, because everyone else focuses on sort of like, you know, the big name figure or whatever, but you know, who's the actual gatekeeper there? But yeah, I mean, I've definitely found like, if you just start cold emailing people and talking to them, people are often like, surprisingly, very, very open to being talked to because I don't know, like, most people do not get asked questions about what they do and how they think and stuff. So, you know, you want to realize that dream. Dwarkesh Patel 0:53:33So maybe I'm not like John Rockefeller, and that I only want my organization to last for 50 years. I'm sure you've come across these people who have this idea that, you know, I'll let my money compound for like 200 years. And if it just compounds at some reasonable rate, I'll be, it'll be like the most wealthy institution in the world, unless somebody else has the same exact idea. If somebody wanted to do that, but they wanted to hedge for the possibility that there's a war or there's a revolt, or there's some sort of change in law that draws down this wealth. How would you set up a thousand year endowment, basically, is what I'm asking, or like a 500 year endowment? Would you just put it in like a crypto wallet with us? And just, you know what I mean? Like, how would you go about that organizationally? How would you like, that's your goal? I want to have the most influence in 500 years. Nadia Asparouhova 0:54:17Well, I'd worry much less. The question for me is not about how do I make sure that there are assets available to distribute in a thousand years? Because I don't know, just put in stock marketers. You can do some pretty boring things to just like, you know, ensure your assets grow over time. The more difficult question is, how do you ensure that whoever is deciding how to distribute the funds, distributes them in a way that you personally want them to be spent? So Ford Foundation is a really interesting example of this, where Henry Ford created a Ford Foundation shortly before he died, and just pledged a lot of Ford stock to create this foundation and was doing it basically for tax reasons, had no philanthropic. It's just like, this is what we're doing to like, house this wealth over here. And then, you know, passed away, son passed away, and grandson ended up being on the board. But the board ended up being basically like, you know, a bunch of people that Henry Ford certainly would not have ever wanted to be on his board. And so, you know, and you end up seeing like, the Ford Foundation ended up becoming huge influential. I like, I have received money from them. So it's not at all an indictment of sort of like their views or anything like that. It's just much more of like, you know, you had the intent of the original donor, and then you had like, who are all these people that like, suddenly just ended up with a giant pool of capital and then like, decided to spend it however they felt like spending it and the grandson at the time sort of like, famously resigned because he was like, really frustrated and was just like, this is not at all what my family wanted and like, basically like, kicked off the board. So anyway, so that is the question that I would like figure out if I had a thousand year endowment is like, how do I make sure that whomever manages that endowment actually shares my views? One, shares my views, but then also like, how do I even know what we need to care about in a thousand years? Because like, I don't even know what the problems are in a thousand years. And this is why like, I think like, very long term thinking can be a little bit dangerous in this way, because you're sort of like, presuming that you know what even matters then. Whereas I think like, figure out the most impactful things to do is just like, so contextually dependent on like, what is going on at the time. So I can't, I don't know. And there are also foundations where you know, the donor like, writes in the charter like, this money can only be spent on you know, X cause or whatever, but then it just becomes really awkward over time because it's like, I don't know, they're spending money on like, lighthouse keepers or something like that. And it's like, you know, like, this is just like, not a thing that actually really like, you know, should be the main focus anymore. So yeah, I don't know. I think I would probably try to figure out a way to like, select for like, thoughtful, somehow select for like, thoughtful people. But like, how to determine, like, I wonder if there's like a committee that like, short appointment terms and then like, there's some committee that can like, run a contest or something to determine like, who gets to run this money or distribute this money every generation or something like that. I don't know. I'd have to call it something pretty crazy like that. Dwarkesh Patel 0:57:17But yeah, yeah, that that would be the biggest challenge I think. Yeah, I just started reading the foundation, the book about the Ford Foundation. I haven't got that far. It's so fascinating. But you know, that raises an interesting question. There is the problem of value drift in charities, but it's a very particular kind of value drift, right? So there's famously conquest second law, that any institution that is not constitutionally and explicitly a right wing becomes left wing over time. And this seems especially true of NGOs and charitable organizations. What's the explanation? Why is conquest second law seems true in this arena? Nadia Asparouhova 0:57:52I have to ask Curtis that. I mean, I don't I don't know that I have. I think we can observe that that is maybe what is happening. I don't think I have an amazing answer to that. I think. I mean, my best guess if I had to come to an answer is I think that the values of. Like democracy and peace and freedom and whatever, like there's a set of sort of like pacifying social values that are very hard to disagree with. And so there's always this sort of like natural drift towards that. I do find that like I think the most thoughtful people I know are often like there is a strong like intellectual conservative movement. But I think people that love nuance where, you know, where the there is no like there is no mindless playbook that you can use to just sort of like the answer is not always like direct democracy or peace or whatever. If that's not your like guiding star and you are actually interested in like a fair bit of nuance, like you're not going to really run institutions. And I say that as someone who is like I am much more on the nuance side. But like I like I think the trade off of that is like it just doesn't necessarily have mainstream appeal always because you don't have these really simplified messages. So, yeah, if you think about sort of like institutions are need to have like simplified messages that they pass on to people and those simplified messages work much better when they're things that make people feel good about themselves. And you're always going to have that kind of more or less word drift. Yeah. Dwarkesh Patel 0:59:39Yeah. Yeah. It raises a question of how you would set up. I mean, it's like the two monarchs problem of like, you know, like you need somebody who's like a good a good director, but then you also need him to be able to appoint somebody who's a good director. Yeah. Yeah. Yeah. It's really interesting. Let's talk about like, I guess, what you and I do or no before that, actually. All right. I'm just gonna make a note from my editor right here. But it's the next question is, do you think this new funding for science and thinkers, is that going to lead to a resurgence of the gentleman's collar category? Or has the nature of science just become too different and science has just gotten much more specialized now that that's no longer possible? Nadia Asparouhova 1:00:29Yeah, I mean, I think within the realm of science specifically, the sort of gentleman scientist era, you know, the Charles Darwin type era, it feels a little bit bygone in the sense of, yeah, I don't know, it feels like there was a lot of low hanging fruit then that maybe like science is just so much bigger. It is funded in a completely different way that is sort of unrecognizable from where it was before. I think when people talk about problems in science, they like to romanticize the past, or that's probably true for any sort of institutional problem of just, you know, why can't we just have it the way that it was like 100 years ago or whatever? And, you know, there's usually good reasons why we don't, things don't run the way they did before. And like, I always try to think about, like, how do we actually take the conditions that we're in right now and like, come up with something new? That being said, like, even if we don't have sort of like a return to, you know, the literal gentleman scientist as default way of doing things in science, there's, you know, ton of room to go from the current model of how science is funded and the sort of like extremely constrained environments that people have to work in to like giving people a little bit more academic freedom, a little bit more creative freedom to experiment. So, but I think like, yeah, science doesn't really have any easy answers. I spent a bunch of time trying to understand it this summer. And yeah, it's I think because like, like government funding of science became a thing right around like the middle of the 20th century after sort of like World War II. And like the way that science ran before then where there was very little government funding and very little involvement to where now like the fact of the matter is that like a lot of it is government funded or most of it is government funded just means that it's like, yeah, completely different kind of ballgame. Dwarkesh Patel 1:02:24Yeah. But I guess then for public intellectuals, there's a change in, especially if you're making content that is tech adjacent or something, there's a change in funding from it's no longer, you know, Kevin Kelly's 10,000 true fans, but more like one tech billionaire who likes your work and will, you know, write you a check to investigate it for a year. What is the consequence of that kind of change? And you have much more concentrated sources of funding in terms of what areas one can focus on and one does focus on and like the ways in which they engage with their audience and publish their content. Yeah. What impact does that have? Nadia Asparouhova 1:03:04That I'm pretty excited about and like can only really speak within my relatively narrow sort of like tech and tech adjacent creator world, but I definitely have noticed as someone who's been sort of independently or weirdly funded in a lot of ways for a while now. Like it feels like that was extremely uncommon when I started and now I meet a lot of people that are like me. I don't know if that's just because I am meeting more people like me or if that's really a shift, but I thought like, yeah, you know, five years ago, even it was like hard to identify a lot of people with that kind of situation. And so, yeah, I think it's a really cool like people talk about like, you know, how do we bring back the Medici's? How do you bring back this like model of patronage? Like it's already happening, I think, in a lot of ways. It's just that people don't talk about it. People don't, you know, unless you're being funded on Patreon or you have sub-size subscriptions or there's something some very legible way to point out like how you're making money. Like, there's so many people that are just being quietly funded that just don't talk about it. I do actually think like the model of patronage is very alive and well right now. It's just not super obvious. Dwarkesh Patel 1:04:12Yeah, yeah. And how do you think about the value of like, I guess, what you and I, obviously we do different things, but in terms of like doing podcasts or writing essays and how do you think about the value of that? Like, should we just like be writing code and digging dishes and doing something else that is more legibly useful to society? Like, what is the, you know what I mean? Like, how do you think about what is the value of this? Nadia Asparouhova 1:04:34Yeah, you know, I'm like very, like, I only know how to do a handful of things in this world. And so like, I feel like I should be doing the thing that I cannot help myself, but I have to do all the time. Like, I don't really think, I don't have a very like, rosy relationship with writing, to be perfectly honest. I hate writing. Writing makes me crazy. Like, it's like, I don't find it to be enjoyable. It's always enjoyable once it's over, but like, that's a little miserable. But like, you know, you would think like, why do you do this thing that makes you miserable? But like, it's just like, it's the thing I know how to do. And I don't think there's anything glamorous about it. I don't think there's anything special. It might not be the best thing to do. Like, there's probably more impactful things I could be doing with my time. But like, it's the thing I like, have to do. And I think everyone should just be doing the thing that they like, absolutely have to do, whatever that is, that would make me happy in the world is if everyone was just like, yeah, leaning into their obsession. So that's my obsession. I do think like, when I think about my own impact, I don't know how you think about it. But like, I think about, I want to, I want my ideas to be heard by people that I think can do something about them. So in other words, like, I care much more about, like, quality than quantity. I don't, I'm not very active on Twitter. I don't really focus on like, needing to reach some kind of like, mass mainstream audience. When I published my book, like, I told myself, I really, like, the people that need to hear about how open source works are people that work at tech companies, software developers that use open source software. Like, it mattered less to me that there's like, this is not the kind of book that needs to be in like, an airport bookstore would print. And it's like essays and stuff. Like, I think it's much more important to me that people whose opinions I care about, read it. And hopefully, you know, and I make my essays public because I hope everyone reads them. But like, what I think about sort of how do I measure my impact? It's not like, how many page views that I get on an essay. It's more of like, who ended up talking about it? And are those people that I wanted to talk about it? Yeah. Yeah. And they're like, reading books, they're reading essays, and like, and then those like, books and essays influence how they think about stuff. And so it is very, like, indirect sort of influence or in Yeah, like, but like, you can't like, I just like, you know, you can't sort of have out of one mouth saying like, the only important thing in the world is like, starting startups and then at the same time, talk about like, the cool new book you read at a cocktail party, like both those things are important in different ways. Right? Dwarkesh Patel 1:07:18Yeah, no, I totally agree. And I don't want to repeat myself, because I talked about this on my burn episode. But one of the things we're talking about, you know, Carol's books, Robert Caro's books. And one, one interesting thing is, you know, this guy was nominated for a Pulitzer Prize before he wrote the power broker. So he was like a top tier investigative journalist. And can you imagine you crunching the numbers as a top tier investigative journalist at the peak of your career? And you're like, you know, what would be a good use of my time? I'm going to spend the next seven years in almost poverty, writing about this one guy who had a lot of influence in New York. And I'm going to talk to any person who had conceivably even been in the same room as him or had been indirectly affected by his policies in any way. I'm gonna do that obsessively for the next seven years. Yeah, there's no way the number crunching would get you there. But it's probably been one of the most influential books in terms of how urban governance is done. I mean, like presidents have praised and read the book and said it like changed how they think about politics. So you know, like, it is the kind of thing where you wouldn't have gone to that conclusion just from Yeah, yeah, thinking about it beforehand. And like, this is the most effective thing I could do. Yeah, totally. Yeah. But okay, you had this recent post about, you know, climate tribes. I was like, that was really interesting, especially the addendum. And by the way, I have noticed this, this tendency of writers to hide the most interesting thoughts, it footnotes and addendums. And I'm curious why that is what I think it might be because your most interesting thoughts are digressions that you feel like you have to take out the main text. But anyways, what I thought was interesting. You're comparing climate dumerism to other kinds of dumerisms that are yet to become fully mature. And I am wondering what is your predictions about the different tribes that will emerge when thinking about AI, as both capabilities grow and as public awareness of those capabilities grows? Nadia Asparouhova 1:09:19Oh, gosh, I think it's definitely just too early to say on and I know that sounds like a cut out, but I don't want to say things that I don't feel confident about. I think it's too early to say even within like AI, though, like, if you think about, say, I had these sort of like, different tribes that are influencing the climate discourse today. There's some parallel version of that for AI, for AI more broadly, I think, where, because right now, I feel like AI safety gets really constrained to sort of like, I don't know, like Miri or something like very, very specific. I imagine like as AI becomes more widespread and more people have experiences with it and have opinions on it, then that might sort of like, lead to other, you know, philosophies kind of forming around that. And then we'll kind of see this one very narrow view of like, I think the sort of like Miri mindset is equivalent to like the Dumer tribe that identified in climate where it's like, that is one specific tribe, but there are a lot of other people that are really interested in climate that like, don't feel Dumer-y at all, even though that's sort of like the most flashy, like media friendly kind of version of it. So yeah, I mean, other than saying, like, as more people interact with AI, I imagine there will be more philosophies emerging there. I think it's still too early to say what that will be. AI is still kind of like a big mystery box to me right now. So it's there, but I don't really know what's inside. Dwarkesh Patel 1:10:49Having studied these different sorts of Dumerisms, whether they're right or not, by the way, it's like a separate question, but just in terms of the sociology of them, has it always been true that smart, talented people tend to get a lot of meaning by working on things that are seen as existential catastrophes? Or is that a property of tech adjacent areas or modern tech adjacent areas? Like how unique is this sort of sociological phenomenon? Nadia Asparouhova 1:11:21Yeah, I think it is pretty new. And that's why it's kind of gnawing at my brain a little bit. Like, I think it's really new, like, last five years it's new. Yeah, well, and so I tried to sort of track this a little bit. And I'm not super high confidence, but like, there's this one, you know, sort of theory around, okay, we used to have sort of like shared, broader narratives that were actually Dumer-esque. So we had world wars, we had the Cold War, whatever. And so like, you know, super smart, talented people that need to be pointed in a direction somewhere, they're going to go work on those kinds of problems. And like, there's a shared understanding that like, we really are like, you know, saving our country or protecting our country or whatever, by working on these different things. And so yeah, I don't know, like stem talent in the Cold War or whatever. And then you see, okay, after the Cold War, now we're not so like, you know, we don't have these like deep existential threats anymore. So we have to find them somewhere else. And that's where like, environmentalism kind of became much more like alarmist, whereas in the past, it was kind of like this niche social cause, it became much more like we need to save the planet. And coming out of sort of like World War Two and, yeah, just sort of like manufacturing chemicals, like, whatever, suddenly, like, people are just grappling with the after effects of that. But like, that doesn't explain sort of like, in the last five years or so where it's like, it's not like a weird activist-y thing to work in climate, it can even be like a very boring thing for people to work in climate. But it's like all connected to this idea of like, this is the most important thing I need to be working on. And so I think like, maybe in the absence of having some like bigger narrative that is like, all consuming for everyone, you kind of have to make your own meaning somewhere. And, but it is funny to me that like, we don't just say, like, again, I mean, you go back to, you know, we talked about like writing, it's like, I have no defense as to like, why I write all day. Like, it's just like what I have to do. Like, I cannot defend it as like, the most like, you know, needle moving thing in the world or whatever. I don't really relate to this sort of need to have like, a like, doomer narrative. There is no doomer narrative attached to why I write, I just write because like, I think it's important. And I think I have like ideas that are like, questions I want to answer. And to me, that is how I define impact, though. Like to me, like that matches my model of like, what I think is most impactful thing in the world. If I didn't have that model, then yeah, maybe I would try to say, okay, like, what is the most impactful thing to be doing in the world that is like, sort of external to my own personal curiosity or whatever. And I think that's where those sort of like, doomer narratives come from. I am I did bury in another footnote at the end of this question about like, okay, like, if we think maybe like, early 2010s or something, I feel like there was, there's always like, there's this other grouping of industries that's not doomer-esque, but also attracts smart, talented people. So you have like advertising and trading and, and playing video games. I don't really know if that's like an industry, but like, there's that mindset of like, those people end up like, like, that some shared set of skills across all those different industries or practices that attracts like smart, talented people. Like, why do so many smart, talented people just go into like, trading? And I wonder if there's some other sort of similar gravity well effect there that is also attracting smart, talented people into like climate, maybe from like a different crowd or whatever. But so I wonder maybe if like, before the last five years or whatever, like, maybe there was maybe that was where everyone was dumping into? I don't really know. Dwarkesh Patel 1:14:49Yeah. Do you have some general theory of what these gravity wells for talent are? Like, what connects trading to climate? Nadia Asparouhova 1:14:59I don't know. And maybe they're different crowds. Like I, yeah, and that's why I just like stuck it in a footnote because I was lazy. And I was like, I don't know what to do. I need to put it somewhere. But it just seems like it like, yeah, I don't. There's just something about these, like all these sorts of industries where it's like, if they were starting with a blank slate, they could be doing like anything. And for some reason, they just all end up in these sort of like, non obvious places. Like, why is like, why are there so many people that work that end up in trading? Like, it's just like, so specific when you really think about it. And then like, same with like climate where, I mean, depending on how literally you take sort of like climate, do more predictions or whatever. But if you don't think the world is going to end in 30 years, like then why is everyone so focused on this one specific thing when they could be working on like lots of different things? And so in both cases, it feels like they kind of like flop in there somehow. I did put in that addendum and just sort of thinking about like, what is the shape of a doomer industry? Like, I think one of the under discussed aspects of it is that it is like adjacent to some kind of like commercial opportunity. So like, the reason why everyone doesn't just go off and work on like global poverty is because there's like, no money to be made and working on that. But like, if you think about like, misinformation and the threat of like deep fakes or something upending democracy, or you think about AI safety or climate or whatever, like they are adjacent to commercial industries where you can actually like, make a real salary and feel like you're like, you know, you're not getting paid. You can make a real salary and feel like, relevant to the business world or whatever, or to like all your peers, while still also working on the social cause area. So yeah, I don't know if that that helps at least somewhat. And that's probably the simplest, you know, like, sort of like non overthinking it answer for like, why it is like advertising and trading attracts people is just because you can make a lot of money in it. And that's that simple. Dwarkesh Patel 1:16:47I have one theory about trading and video games that connects them. Bernhobart, funny enough, another footnote, Bernhobart, it was actually like a blog post about SaaS products or something. And one of the footnotes was, you know, one of the positive things about finance might be that it gives a sort of venting for talented people who just like to play zero sum or negative sum games. And that otherwise, it would have been used up in a war. But this is a there's no wars, they would be doing something else destructive in our world. And if we can just put them in front of a trading screen and make them, you know, get the get the microsecond efficiency of some like equity market better, it's like better than anything else that could be doing with that mentality. Nadia Asparouhova 1:17:31I kind of like that. There's some parallel with this for like, content creators too. And I will cringingly put myself in that category. But it's just like, where it's also this grouping of people where it's like, I don't really know like what like, they are kind of just like bodies in a room again, myself included. That's what I'd be doing if not this at least there's a way to like kind of make money in this. But it's like a much more amorphous and yeah, non non coherent industry that like, Dwarkesh Patel 1:18:00trading, but different, different set of people. Yeah. One interesting area that is not included one, I guess, philosophy that is not in any of these influential IGM machines in Silicon Valley is religion. I mean, you know, they've been like some of the most important ideas in history. And yet somehow they're so far, they've had like very little influence in terms of what kinds of things the new elite is funding and paying attention to. Do you think that will change? Or have we just had a complete change in terms of what kinds of ideas get promoted? Nadia Asparouhova 1:18:35Yeah, TBD. I think like, the new right is bringing at least some of those underlying like Christian religious values back. Maybe they're not like literally funding churches or something. But like, how do we sort of like, yeah, bring Christian values back to public society? I think there's a lot there is a lot going on there, even if it's not explicitly called religion. And then so yeah, I mean, that's one question of like, among elites that are, you know, explicitly religious, how are they sort of like encoding those, those values into public institutions? I think that is sort of happening on that front. I also just think like, if we take a broader view of like, how does religion factor into our day to day life? I feel like it's a weirdly, like, people ask this question more than they need to ask it or something like, where like, you know, everyone just sort of says, oh, like, you know, people aren't religious anymore. They're not going to church. They need to find meaning. Like, how do we like create new religions today? And I just I feel like people are religious. They're just religious about different things. And that was sort of one of my conclusions with climate is like, in the early 2000s, you had Michael Crichton criticizing environmentalism as a religion and saying, saying that, you know, it's distracting people from the science and, and maybe we shouldn't treat environmentalism as religion, we should really get back to the science. Whereas I think like, you know, 20 years later, it's like, I think it just is a religion for a lot of people. And why not just lean into that and say, like, I don't like that is how people are finding meaning. That is how people are finding community. So I don't know, like, there it is, there's, there's a religion, like, we may not literally have like actively practicing Christians in America or something. And, you know, there's the question of what else is religion need to fulfill that it's not through something like climate. But I also think that religious practice is very, like, active and around us everywhere. And like, I don't think I don't think that's like sad or bad. I think that's just like, how it's evolved. Dwarkesh Patel 1:20:41Yeah, yeah. Interesting. Okay, final question. You have a great blog post about shamelessness as a strategy. What are you most shameless about in public? What is your most shameful strategy? Yeah. Nadia Asparouhova 1:20:55Oh, I don't know that I, oh, man, I wish I had a really good juicy answer. I'm, we have to ask someone else that knows me what am I most shameless about in public? Dwarkesh Patel 1:21:09I think it's on property of being shameless. It's like, you don't even realize it's shameful. You're so shameless. It's, you know, it's like, beyond you even keep track of it that way. Nadia Asparouhova 1:21:17Just the fact. Yeah. Yeah, I'm sure I have something. I think I'm a very shameful person. I don't know that I have. Yeah, I'm not. I'm not the best at being shameless. Yeah, you're gonna have to ask your friend to tell them to tell you what I'm most shameless about. Dwarkesh Patel 1:21:41It sounds good. Sounds good. Okay, Nadia, thank you so much for being on the podcast. So tell people where they can find your, your blog, your Twitter, anywhere else that they should look for you. Nadia Asparouhova 1:21:54My blog is at Nadia, N-A-D-I-A dot xyz. And I'm on Twitter at N-I-F-I-A, N-A-Y-A-F-I-A. Dwarkesh Patel 1:22:04Awesome. Okay. Awesome, Nadia. This was a lot of fun. Thanks for coming on. Yeah. Thanks, Chen. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Perhaps the most interesting episode so far.Byrne Hobart writes at thediff.co, analyzing inflections in finance and tech.He explains:* What happened at FTX* How drugs have induced past financial bubbles* How to be long AI while hedging Taiwan invasion* Whether Musk’s Twitter takeover will succeed* Where to find the next Napoleon and LBJ* & ultimately how society can deal with those who seek domination and recognitionWatch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow me on Twitter for updates on future episodes.If you enjoy this episode, I would be super grateful if you shared it. Post it on Twitter, send it to your friends & group chats, and throw it up wherever else people might find it. Can’t exaggerate how much it helps a small podcast like mine.A huge thanks to Graham Bessellieu for editing this podcast.Timestamps: (0:00:50) - What the hell happened at FTX?(0:07:03) - How SBF Faked Being a Genius:  (0:12:23) - Drugs Explain Financial Bubbles (0:17:12) - On Founder Physiognomy (0:21:02) - Indexing Parental Involvement in Raising Talented Kids (0:30:35) - Where are all the Caro-level Biographers? (0:39:03) - Where are today's Great Founders?  (0:49:05) - Micro Writing -> Macro Understanding (0:52:04) - Elon's Twitter Takeover (1:01:28) - Does Big Tech & West Have Great People? (1:12:10) - Philosophical Fanatics and Effective Altruism  (1:17:54) - What Great Founders Have In Common (1:20:24) - Thinkers vs. Analyzers (1:26:17) - Taiwan Invasion bets & AI Timelines TranscriptAutogenerated - will not be perfectly accurate.Dwarkesh Patel 0:00:00Okay, today I have the pleasure of interviewing Bern Hobart again for the second time now, who writes at thediff.co. The way I would describe Bern is every time I have a question about a concept or an event in finance, I Google the name of that event or concept into Google, and then I'd put in Bern Hobart at the end of that search query. And nine times out of 10, it's the best thing I've read about that topic. And it's just so interesting. It's just like the most schizophrenic and galaxy brain it takes about like how, you know, the discourses of, you know, Machiavelli's discourses relate to big tech or like how source of serial reflexivity explains hiring in finance and tech. So just very interesting stuff. I'm glad to have him back on again.Byrne Hobart 0:00:47Yeah, great to be back. Awesome.Dwarkesh Patel 0:00:50Okay. So first, I really want to jump into the FTX saga. What the hell happened? Let me just like leave an open ended question for you.Byrne Hobart 0:00:59Yeah, so I think the first thing to say is that there's a lot we don't know. There's a lot we may never know, because so many of the decisions at FTX were made through self like auto deleting encrypted chat. So like there are some holes we will never be able to fill in. The lack of accounting is also going to make it tough. Like basically, I think you can tell a bunch of different stories here. The really obvious one is fraud. And you can debate over exactly when it started, like one version of the story, which is getting some currency is that SPF had this entity Alameda, and it was supposed to be this really hot crypto trading fund, but maybe it was a Ponzi scheme all along. And then maybe at some point that Ponzi scheme started to run short on cash. So he decided to start an exchange and the exchange got more cash, and then he used the cash to pay off previous bachelors, whatever. I think that's one version. And then kind of the maximally exculpatory version, which actually is still really bad is Alameda was a real company. They really made money trading. They took tons of risks. And SPF has talked about why he thinks that's a good thing, that FTX cut some corners when they were raising money and that they had really bad internal accounting. And that basically the extended entity of Alameda and FTX sort of lost track of whose money was where and it ended up with Alameda spending FTX customer money, which I think is like, one way to look at that is like, if you think, okay, fraud is like twice as bad as just incompetently losing money. Well, it's not as if we had a $4 billion fraud instead of $8 billion fraud, everyone would be like, well, that's fine. That's normal. Like, why are you giving sky high time? It's bad no matter what. Running a big company that is systemically important in crypto and then having that company completely vaporize over the course of a couple of days, really, really bad and worth understanding what happened. But it's partly worth understanding what happened because there are just different solutions that present themselves depending on what you think the story is. Like if the story is fraud, it's actually a lot harder to solve because there are just a lot of people who are willing and able to commit fraud and to lie. If the story is bad accounting, then that's actually a lot more solvable because then you could say things like, the solution is make sure you never invest in a crypto exchange that doesn't have a real auditor and make sure that they have their proof of reserves calculation and it's happening consistently and that you can audit that. There are different solution sets. And then I think the actual story is going to be somewhere in the middle of extreme risk tolerance plus extremely poor accounting plus fraud at some point. But I suspect the fraud actually happened pretty late. If it happened, which I think there's like 80, 90% chance that there was some level of fraud versus pure incompetence. But if so, I think may have happened fairly late in the story and as kind of a last desperate move. I think part of what drives the response to what happened with FTX and Alameda is that if you think the story is pure fraud, it's very easy to say you would never do that. I can say very easily, I would definitely never start a Ponzi scheme and then start another bigger Ponzi scheme to pay off the first Ponzi scheme. That's not me. That's not most people. But I think if you draw the scenario where they discover at some point like a couple months ago or even a month ago, they realized, hey, we actually there's a billion dollars plus that was supposed to be customer money, but we thought it was Alameda money and we actually spent it and now it's gone. We've lost it. What would you do in that circumstance? And I think the ideal answer is, well, I'd immediately come clean and step down and commit myself to getting everyone paid back and made whole. And I think there's also the possibility that the realistic answer is more like, well, I would scramble and try to make sure that that didn't cause the company to collapse and try to pick up later. And so at that point, you've sort of backed your way into fraud through earlier episodes of incompetence. But I think like one of the problems with the fraud story is frauds have to be good at accounting because they have to like, you know, there's very rough schematic sense. They have to be twice as good at accounting as everybody else, because not only do they have to have the real books that tell them how much money the business has and whether or not the next check they're at will bounce, but they have to have the fake set of books and they have to have a way to make those tie out with one another. So they actually like frauds, accounting frauds tend to be fairly sophisticated. They tend to really dive into edge cases. I was reading up on MF Global, which was a big futures brokerage that collapsed in part because they were dipping into customer funds and making some investments they shouldn't have. And they did a lot of clever and shady stuff. Like one of the things they would do is there was one point where they were transferring money at the last minute out of their consumer, out of their customer funds in order to make margin calls. And what they would do is they would send the wire from the customer account to a different company account. And they'd send it a couple of minutes before the wires closed for the night. And then they would send this email right after the wires closed saying, Hey, we just realized we set this transfer fraud account got to reverse tomorrow. So that gave them at least one night of enough liquidity to survive. Now, you can only do that kind of fraud if you are actually keeping really close track of where your money is, where it's supposed to be, what the rules are, so that you know exactly how to break those rules. I don't think FDX was in any position to commit that kind of fraud. I think that if they tried to do something like that, like they wire the money from an account that didn't have any money in it or something or send it to the wrong account. There are these stories about them accidentally burning a bunch of USDC by sending it to an address that didn't exist or something like that. The operational slip ups actually make it harder for them to have committed fraud. And it's unquestionable at this point that their record keeping was very bad.Dwarkesh Patel 0:07:03Yeah, to your point about the fraud being harder. I mean, it's like a classic story about if you just tell the truth, it's just gonna be much easier for you. You just don't have to keep track with that many things. But the one thing I've been thinking about, I interviewed him for like an hour. And before that, I tried to do quite a bit of research into how FDX worked and what was going on. And I had this impression that this guy was like the most competent genius that had ever graced finance. And this was like a common impression. This wasn't just... And then, but it turns out that, you know, they were like, it just like out of sheer incompetency loses track of billions of dollars, the internal operations, it just like him putting together spreadsheets and throwing them around and putting emojis on slack messages, asking for payments. And I just like, I want to understand how it is that this guy put out the impression out there that he is just hyper competent. And it turns out that it's like the opposite. It's not even that he's mediocre. It's the opposite.Byrne Hobart 0:08:09Right. Yeah. So I think you can tell a couple stories there, like one story. And I know I've been saying a lot, like you can tell multiple stories. There are multiple stories that fit the facts. We have lots of different weird things to explain and therefore many different weird explanations that fit them. So I think one version is, okay, he's never all that smart and decided that he could just play up this weird, you know, eccentric genius thing. And that would be able to get away with it. And there are these anecdotes about how someone told him to cut his hair and he said, no, I have to look kind of crazy for this. And so that fits in. And it is kind of an MIT thing to do that, to play up your eccentricity because you know there are these super brilliant, very eccentric people and you can be like them. It's kind of like, a lot of people, they read about Steve Jobs and they're like, well, the secret to success is be this brilliant perfectionist who can always see the future and also be just a giant a*****e to everyone you meet. And I'm going to try to do both of those things. And it turns out one of those is really, really easy to do. And then one of them is really, really hard and you have to do both to be Steve Jobs. But you can sort of give this surface level impression of Jobsy and this by just being really obnoxious to everyone. So I think some of it is that. But the other is that if you get really good at just very narrow domain specific stuff, you might miss what other stuff people have to be good at for that skill set to be valuable. And so I think thinking about his previous background where he worked at a prop trading firm and seemed to do well there. It's Jane Street. They're very, very selective with who they hire, very hard to get in and they're very profitable. So good to get in. It's entirely possible that part of what happened was just that Jane Street has its operations people, they have their trading people. And it may there may have been enough siloing within that, that if your job is just identify discrepancies in ETF prices and take advantage of them, you don't actually have to know things like how do we figure out which counterparties are credit worthy? How do we make sure we have enough liquidity? How do we have backup plans upon backup plans upon backup plans in case something goes wrong with our liquidity situation? Because part of the Jane Street model seems to be there. They're very, very opaque, but like very opaque in terms of their trading operations. But part of the model seems to be that they want to be the trader who is there and trading and making a market when everything fell apart. And what that means is that like the way you make the most money in trading is when markets are insanely volatile, volume is very, very high, and you're still trading. But the reason that markets get really volatile when prices collapse and there's a lot of trade going on is that other people who would love to be trading can't trade because maybe the broker they use is suddenly insolvent and they can't get to a new broker, their money is frozen. So if you're planning to be there when everybody else is out of the market, then you have to have lots and lots of contingency plans. And it's not enough to buy lots of deep out of the money put options as Jane Street does. You also have to make sure that you're buying those options from counterparty who will actually send you the money when you need it or that you want to structure those things so the actual cash gets to your account at the time that needs to be there. And that maybe is something that a prop trader should not be spending most of their time thinking about. Like, it's one of those things where it's like, if you own a house and you like if over the last 24 hours, you learned a whole lot about electrical wiring, or you learned a whole lot about how plumbing works or how septic tanks work, like, that's not good. That means something very, very bad happened in your house. And it could be nice to be an expert on those things. But if you suddenly became an expert, it's because somebody else wasn't doing their job. So I think you could you could be a trader like that where they can be very good at the finding little pricing discrepancies thing and have just no awareness of what the operation stuff is, especially because the better the operations team is, the less anyone else needs to be aware of them. Like they like you only email them when something is going wrong. So if nothing is going wrong, you never email them and then you forget they exist.Dwarkesh Patel 0:12:23Yeah, yeah, no, that's a good point. In fact, in the interview I did of him, he mentioned that I asked him what is the difference between Jane Street and FTX. And he mentioned that at Jane Street, there was like this button he could press to like buy. And all that's all the intermediaries, all the servers, it was just taken care of. And what was really funny is then he said, and just getting a bank account and he goes, and let's talk about that. Just getting a bank account is so hard when you're in an infinite. It apparently turns out it's so hard that you might have like commingled funds because you couldn't manage to separate them out. Yeah, no, that's crazy. You had this really interesting take. I think one point we were talking about how every single market crash can be explained by the drug that was common in the industry at the time. And we finally achieved like the hypergrade meth stage of I forgot the name of like that patch you was taking, but it's like stronger than Adderall or whatever.Byrne Hobart 0:13:23So it was, I think it's saying every crash can be explained by the drug they're taking at the time. That takes a little, but I do think that the impact of drugs, of new drugs on financial markets is underrated. And you can have examples of this going back pretty far. Like there is some connection between caffeine consumption and like extroversion and risk taking like you temporarily get a little bit more willing to do deals when you consume caffeine and in Lloyd's of London before it was this insurance consortium, it was a coffee shop. It was Lloyd's coffee shop. So you do have some history of coffee shops being associated with financial centers. And then you have to zoom forward because we just haven't had that many novel stimulants, I guess depressants, deliriums, whatever, like other drug categories probably just don't lead to that much financial activity. Like I don't know how someone would trade differently or invest differently if they had a really strong acid trip or took ecstasy or something. But the stimulants where people can just consistently reuse them, they keep people alert, they make them active and wanting to do things. It seems like stimulants would have a connection to financial markets. So yeah, that theory is like if you look at the 1980s where there were a lot of these hostile takeover deals where someone would find a company that's underperforming and when you look at the spreadsheets and say this company is underperforming, what you're often looking at is a story that is more like this company believes that they have this social obligation to the community where people work and that they have an obligation to give their customers a fairly priced product and maybe they give them really good customer service that doesn't really pay for itself and it's the right thing to do. Well maybe especially if you are a coke head with kind of coke head morality, you decide well that's not the right thing to do at all. You should actually just take the money and we should fire these people and replace them with cheaper employees. So you know levering up a company and then like levering up in order to buy out a bigger company and then firing everyone and you know shutting down the pension plan and distributing the surplus to shareholders like it is just very standard coke head behavior. Whereas if you look at the mortgage backed securities boom and structured products generally in the mid-2000s, the way that people made money in that was just by being very very detail oriented and being able to make these incredibly fine grained distinctions between different products that were basically similar but one of them pays 5.7% and one of them pays 5.75% and if you lever up that difference enough times you're actually making really good money consistently. It's super boring but maybe with enough Adderall it's actually very tolerable work that you can enjoy. So I do think that just like within stimulants the difference between short acting stimulants and long acting stimulants does mean the difference between a hostile takeover boom and a structured products boom. And then yeah there's I think the drug is called M-sem or something which is like a Parkinson's treatment and there's some evidence from pretty small sample size studies that one of the side effects of this drug is compulsive gambling. So yeah and the drug story there have been very very fun tweets about this claim and then there have been these official denials from the company doctor on the other hand if you're a company that has a company doctor maybe that says something about the level of medication you're consuming and maybe the company doctor's job is partly to say as a doctor I can assure you I would never give someone three times the normal dose of Adderall just because their boss hired me to do that specifically. I think dealers don't exactly have patient confidentiality norms, doctors do so maybe you hire a doctor instead of a dealer specifically to get that plausible deniability.Dwarkesh Patel 0:17:12Other than drugs I also want to ask you about the phenotype of the founder. You wrote a post I think it was like just a couple of weeks before this crash happened where you were pointing out that this idea of a founder who comes in shorts and a t-shirt and a crazy haircut. By the way so FTX had a barber who would come in every Tuesday to cut everybody's hair it might have been Thursday and that so he could have just like sat in line and gotten his haircut like that was that was completely unnecessary the way he dressed and it was like very purposeful. But yeah so if that archetype of a founder who's in a t-shirt and shorts if that's been priced in and that's beta instead of alpha now what is the new phenotype and physiognomy of the founder? Where are you looking for alpha?Byrne Hobart 0:17:58Well I guess I would draw the distinction between like the physical type of someone versus their presentation and their dress. Yeah I don't know I'm sure someone could run some interesting numbers on that but I don't have a good sense of what exactly they'd get from that but in terms of you know how people public people publicly present that present themselves my guess is that yeah there will be this swing towards investing in people who look a little bit more formal a little bit more boring and these things are somewhat cyclical. Like I think part of you know part of the norm on investing in or you know treating basically treating the suit as a negative signal is that a lot of investors have this view that when the MBAs come into an industry a lot of the alpha is gone and it is true that MBAs at least you know there's it's like a decent market timing signal apparently that if a lot of people from Harvard Business School go straight into some field that field is probably peaking. So there's a little bit to that where the suit is some example of conformity on the other hand wearing a suit in Silicon Valley is an example of non-conformity and I guess outside of outside of New York within the US most of the time wearing a suit as a tech company founder would be this weird sign that you know you're either like you don't know what you're doing you don't know what the right signals are or you know you're about to testify to Congress and that's why you have a suit now. You're not not generally a great sign but maybe it is a sign that you are willing to do some more conformist things and that you could pay attention to details the details are boring and also that you are putting some you're making some kind of financial investment in in that particular appearance. So yeah I would I would guess that there is there will be a tilt away from the hyper informal founders but I also think that if you treat that hyper informality as either this attempt to gain the system and just say like I'm going to be as much I'm going to try to remind people of Mark Zuckerberg circa 2005 as much as possible so I can raise money and pretend to be the next big thing that is that's one thing people are signaling and then the other thing is they're just accidentally signaling total indifference to anything except the thing they're working on and maybe that's a good thing but maybe maybe it's a good thing in unregulated domains and then a really really bad thing in regulated domains like if you're investing in a medical devices company you you probably don't want a founder who just cannot focus on anything except the product because there are rules they have to follow and you know norms and things and yeah it gets bad if all they're focused on is this one element you know if the hyper focus is like just right perfectly calibrated that's good but then maybe maybe adjusting your appearances this way to say that you have correctly calibrated your hyper focus and you're going to get one thing right and it's going to be really really right like you're going to get things right they're going to be really really right and you've identified what things matter what things don't.Dwarkesh Patel 0:21:02Yeah you'll lose track of your bank accounts. That's the dress itself but I also want to ask about the other characteristics you had this really interesting point in that blog post about how you know when you try to scout for talent when the talent is young you're over indexing for parental involvement and I'm curious if you had to identify somebody who had to be under the age of 18 or under the age of 20 what is the metric you're looking at that least indexes for parental involvement where they're being forced or encouraged by their parents to do it?Byrne Hobart 0:21:35I think the closest you could get is something that is either totally illegible to the parent's status like understanding of status or something that is actively low status and it's hard to hard to enumerate those and not just get swamped in well should this thing be low status the high status is actually terrible to say that you ever want to hire someone who was really good at x for some value of x but I do think that you so basically the origin of that point was that I was arguing that when you if you look at people who are at some percentile and they're in their 20s or 30s like a lot of like at a high percentile like a lot of it has to be that they have some combination of talent and have tried really hard there's probably been some element of luck but over time the luck starts to starts to wash out hopefully but the younger you go and this is probably just my experience of having kids like if you talk to your kids every day about multiplication they will start doing multiplication at a pretty early age and it's not that they are you know really really smart and they got to multiplication a couple years early it's that you push them in that direction and they were able to do it early so like the earlier you go the more you are over indexing on what the parents did what they emphasized and also what they told the kids was just part of the script and there are anecdotes about this from none of the specifics coming to mind but I remember anecdotes about people who grew up in lower middle class or below circumstances but would have one distant relative who owned a business and that made them aware that they could own a business and this is like a thing they could do it's part of the script now and that wasn't the only reason that they would have started business but it could be a reason that they decided to do that when they did and you have to imagine that for everyone who had one uncle who owned a scrap dealer or something that maybe there are five or ten or fifty people who grew up in similar circumstances had a similar level of innate ability and just didn't have anyone in their social circle who demonstrated to them that this was something you could actually do so I think like getting getting back to the talent identification problem but part of my thesis there was that it's it's really hard and it's getting harder that you had Y Combinator going after the relatively young talent versus what the medium BC was going after when YC started and then stuff like Pioneer and Emergent Ventures is going even younger and the younger you get the more it is this luck driven thing that is about what they got exposed to with the exception of prodigies so I'd like to think that if I encountered an eight-year-old Mozart I would be able to identify this person as just an extraordinary talent where like even if their parents were making them practice ten hours a day they couldn't be that good without talent and maybe something similar with the Polar Sisters where okay if I you know encounter a six-year-old who can routinely beat me at chess and so I go Google some you know read some chess books and then go back and try to beat them again and they're actually better and they're laughing at me and things like at some point you decide that this is actually natural talent but there's for a lot of other domains there's just so much room for parents to push one thing and do some combination of their kids talent and their own emphasis to get their kids really good at it and that's very hard to adjust for especially because if you ask the parents they're going to underestimate how much they overemphasize things because to them this is just a normal thing that everyone should be interested in and so you won't you won't get a good signal from asking parents and then you won't get a good signal from asking other people because they don't know how this family spends time at home and you know if if the medium family has more more YouTube and Netflix time and less you know less math practice time that family's just going to assume it's pretty pretty much their behavior is normal.Dwarkesh Patel 0:25:25It's a bit confusing because you also want to potentially include parental involvement in your estimate of how good this person will end up being if you think for example that giving somebody a shot to get started programming early is actually a big factor in putting them on that sort of like loop where they get better by practicing and they enjoy it more so on you might expect momentum more than mean reversion in that kind of like early start.Byrne Hobart 0:25:54Sure so I think part of part of what this gets to is the question of what are you optimizing for when you're doing a talent search and I think this is maybe one reason there could be some alpha left in talent search among people who are super young is that a lot of the academic institutions that are doing some form of talent search what they're pretty much optimizing for is how does this person do over the next year so you know if someone is a math prodigy and they get to join the math team at that school the school is not trying to optimize for will this person be proving novel theorems when they're 25 it's really will this seven-year-old be doing you know algebra by the time they're eight and that's that is still very tied to parental involvement especially once you know parents like kids they like structure and if you tell them this is the appropriate next thing to do with your kid then they're more likely to do it so you can post on that momentum for a while but what I think you the trap you can run into is that you identify people who are like 95th percentile talent with 99th percentile just super aggressive parents and that combination gets them to 99th percentile performance until they leave home and then they never do whatever that thing is ever again because they didn't really like it it was just something their parents pressured them into now maybe the ideal would be you get 99 percentile on both so the parents are putting them on this trajectory but the parents are actually aiming you know a very powerful rocket ship and it's going to go right in the right direction which is ideal and I think there's a there's a reasonable possibility that like I think there are there's like some level of just imprinting that young kids have where a lot of kids learn about programming when they're very young and that's something that they do from a very very early age and then it becomes the thing that they work on for their entire career obviously that has to be fairly new because it's not like they're you know from like anyone who was born before 1970 just had this constant yearning to program computers and could never satisfy it like those kids found something else to do maybe a generation before it was repairing transistor radios like mine did when he was a kid and maybe a century before that it was experimenting by building little internal combustion engines and seeing whether or not they explode like Henry Ford did with his friends at school and maybe before that like the earlier you got the harder it gets to really map these activities to anything concrete that we understand and can relate to but there's there's probably some extent to which you can you can sort of direct kids into whatever the modern instantiation of this long-term enduring tendency is and I guess one so one interesting example of that I've been reading the Robert Caro LBJ biography and there's this bit towards the end of the first volume where LBJ is put in charge of this fundraising organization for Democrats in Congress and when you read about it he sounds like a traitor he sounds like someone who was just born to be slinging currency derivatives or something because he is constantly on the phone constantly picking up rumors constantly sending money here and there and everywhere else and he's like always sending money overnight and then sending someone a telegram the day before saying you're going to get a package from Lyndon Baines Johnson and you're welcome so he's like he's doing this thing where he's constantly relentlessly optimizing every little tiny detail of some very complicated process clearly requires enormous working memory requires a very strong basically a very strong poker face like he has to be able to differentiate between someone who is begging for money because they are at they're pulling at 49% and with a little bit more money for newspaper ads they get to 50.1% versus someone who just wants the money or just is constantly freaking out by their nature so it requires a lot of the same character traits but 1930s were just not a great time to go to Wall Street maybe if LBJ had been born at a slightly different time that's that's just what he would have done and it would have been a very successful private equity executive or something but sometimes those these general skills they can translate into a lot of different areas and they get honed into very specific skills through through deliberate practice in those areas so if you have that combination of natural tendency and some level of motivation which in LBJ's case his dad was also a politician so he had this example of this is part of the life script you can't do it but he also had the example of his dad was broke after a while and so he he had this example of what not to do and ended up making good money for himself in addition to his political career yeah yeahDwarkesh Patel 0:30:35I'm glad you brought up the biography I'm reading it right now as well and the other biography by Robert Caro the power broker just for the audience the last episode or the second to last episode in the feed is we go deep into deep into that biography and talk about why it might be inaccurate in certain respects but what is what it is accurate and I think what Caro has a genius in is talking about the personalities of these great great men about the people who have really shaped their cities or their countries for decades and centuries there's many places where I mean I'm sure this is true for you if you understand like the economics of an issue he's talking about there's a lot to be left to care his explanation but the actual like the sort of breakdown of the personalities is just so fascinating and worth a reading care for but you know come to think of it so maybe the difference between the cases where you want to price in the parents involvement and the ones where you don't is where in situations like maybe being a politician where it really is about building a network building know-how building this sort of inarticulable knowledge from an early age it might be the case that in those situations just having connections and having parental involvement gets you far but if it's like becoming a programmer sure you'll like have done data structures by the time you're 16 but eventually you'll get to the point where you know everybody knows the basics and now you actually how to do interesting and cool things in computer science and now you're like a 95th percentile of spatial reasoning IQ is not going to get you that far but let me ask you about the care of biography because you had a really interesting comment that I've been warning you about as well in your in your review of the book or in your comment about the book you said it's worth speculating on how many lbg level figures exist today perhaps in domains outside of politics and how many caro level biographers there are who could do them justice so do you have some idea of who these figures are or if not that at least what areas you'd expect them to beByrne Hobart 0:32:34in I think a lot of people who are close to that tier and have some of the same personality types are in sales and corporate development and stuff like that where they you know they're they're building a big network they are constantly building out this giant levered balance sheet of favors you know favors out to them favors they owe to other people and like all forms of leverage it does allow you to grow a lot faster but you occasionally want these big big blowups so that's that's one place I would look I think if you try to look at the more you know pure executive founder types then it gets harder to find someone who would have exactly that kind of personality it's like part of what made lbj's methods work was that he was adjacent to a bunch of these really big institutions and he could sort of siphon off some of the power that these institutions had and in some cases could make them more powerful so I'm about a third of the way through master of the senate right now so it's it's just getting to the point where he's really getting cooking and really making the senate more more effective than it used to be and also making it an organization where someone where it's less seniority based so you kind of you need to be attached to something much bigger than yourself for that particular skill set to work really well that said you could have a really big impact because it is it's another form of leverage so if you are one of a hundred senators or I guess at the point at that point it was 96 senators and you're you're able to exert a lot more influence and be you know be the equivalent to 40 senators for example then you can get a whole lot done because it's it's the us senate but if you have that same kind of skill set and you're the ceo of your company well you're you're already in front of the company like there's only so much extra force you can exert so you you kind of see a figure with exactly that kind of personality trait in a case where there are big institutions that have slowed down somewhat and this is another interesting point that is raised early master at the senate is that the senate was getting old and if you look at these long-term charts of average age of politicians we're we're definitely in a bull market for extremely extremely old politicians in the u.s right now but we've gone through cycles before and one of the things that that tends to cause a reset is the war where wars among other things cause this huge reset in social capital so the people who made mistakes in the early stages all get discredited and then the the social bonds that people forge from actually fighting alongside one another and the the prestige you get from actually being part of the winning side that is very hard to replicate and so you end up with much younger people in much you know in positions of a lot more power whereas the the way that that worked a decade and a half earlier was the 1930s there just weren't a lot of organizations that were hiring heavily and looking for really ambitious young people who are going to shake things up but the u.s government was so that's that's how lbj got in and started on his path was that the new deal created these big programs like the national youth administration and they needed people like johnson to to run them so when you look at um you look at an industry that is aging it's usually an industry where um ambitious people stay away from it like they recognize it's becoming more seniority focused and there's just less going on but there becomes this huge opportunity when the aging stops because a bunch of people either retire or they get discredited and have to leave and suddenly the average age of the industry ratchets down and you can basically look at the set of opportunities that were missed over the previous decade for example because um because the industry was like the whatever this institution was was too risk averse you you get to take all of those opportunities at once so you have tons and tons of low-hanging fruit when that shift happens so i think that's that's the other thing to look for is look for cases where there's some some institution some part of the economy or society that has just been slowing down for a long time clearly getting to the limit of whatever its current operating model is hasn't found a new model and there's someone young and disruptive who's just entering it so i mean maybe maybe the place to look for the next lbj is um someone doing independent films and someone who looks at the top box office results and sees that everything is a spin-off of a spin-off of a spin-off and it's you know 50 percent marvel and says this is disgusting we have to destroy it and i'm going to build something completely different like maybe that person is actually the kind of lbj archetype now the other half of this question is the caro archetype and part of what i found fun about this was that um i felt like caro had this kind of um like he was kind of disgusted with himself when he realized how similar his some of his methods were to lbj's because he's writing this story about this guy who's will do anything to make a sort of friendship but it's really a fake friendship just to accomplish his goals and he's constantly doing doing the reading that other people aren't doing and doing the work and making the calls and reiterating and reiterating iterating just endless patience and then you read about how caro works and he does things like moves to dc for a while talks to everyone in dc befriends people goes to um texas talks you know moves to the hill country and gets to know people there he has these anecdotes in the book because the book is like um it's sort of has these hints of gonzo journalism where sometimes caro will just narrate it's that he'll he will go from here's what happened in 1946 to here's what happened to me in the 70s while i was talking to this guy about what he did in 1946 and sometimes he he will basically come out and say i waited until the person who paid this bribe had alzheimer's and then i asked him if he remembered paying the bribe and he remembered that he did it and didn't remember he wasn't supposed to say it so that's how i know and um there's this line that caro keeps quoting from lbj which i think was from lbj's speech coach days or speech like debate team coach days where his line was if you do everything you will win and caro does everything um so i think probably the population of caros is smaller than the population of lbj's because the people who have that skill set probably have ambitions other than writing a canonical book about one particular person or you know writing two canonical books two canonical works on um two important people but maybe a lot of those people are just doing thingsDwarkesh Patel 0:39:03other than typing man there's so many threads there that i i'm like tempted to just spend the rest of the episode just digesting um and talking about that but one thing that i like there's so many interesting things about caro's story uh and i guess the impact is that one of them is there's been this focus in terms of thinking about impact especially in like circles like effective altruism of trying to crunch the numbers and there's no reasonable crunching into the numbers you could have come up with before the power broker is written where you say i'm going to spend by the way this is he tries to downplay his accomplishments as a journalist before he wrote the power broker but he was nominated for the pulitzer prize for his journalism before the power broker so he's like a top level uh investigative journalist and then you say here's i'm going to spend my talents i'm going to spend eight years looking into and researching every conceivable person who has even potentially been in the same room as or been impacted by robert moses and i'm going to document all this i'm going to write a book where that's like million words or something and but in fact that's he probably didn't think about it this way right but what was the result he probably that book probably changed how many of the most influential people who came up through politics uh think about politics think it probably changed how urban governance is done how we think about accountability and transparency for good or ill right depending on your perspective um and just that example alone really makes me suspect the sort of number crunching way of thinking about what to do and rather just like i don't know i gotta understand how the you know from procurus perspective i gotta understand how this guy accumulated this power he doesn't and it like completely transforms uh you know how urbanByrne Hobart 0:40:41governance has been yeah you know it actually uh kind of looping back to the the parental influence thing i think part of what happened was that the more caro dug into it the more he realized this is actually a big and compelling project and there's there's this kind of fun phenomenon that you can get when you're researching something where you you you've read enough that when you read something new and you see that there's a footnote you actually know what is going to be cited in that footnote and maybe you've also read the thing about how the thing in that footnote is wrong and here's why and um you know you're picking up information a lot faster you get that that nice convexity where you can skim through the stuff you know and everything you read is new information and challenges something about what you what you previously knew and that's just a really intoxicating feeling and i can imagine that it's even more fun if you're actually digging up the primary sources so you know if you're caro you've gone through the new york times archives you've read through all of the all the external coverage of what people said about most time and then you start talking to people and you realize here are things that were we got completely wrong like we thought moses didn't want x to happen and it turns out that he kept scheming and plotting to make x happen and just wanted to pretend that it wasn't his doing um you so i think that but what happens is you you build this ongoing motivation and then you can you can make something that you just wouldn't be able to make before and i think if um if you start out saying i'm going to write a million words about how cities are run um you will probably fail but if you keep writing another 500 words a day about how robert moses operated and what he did and then you have some reflections throughout that on what that means for cities then then maybe maybe you actually get there and yeah so um and and maybe some of this is like you you want to have an adversary like a lot of these like the carol books do seem partly to be this cross-examination of of who he's writing about and often he he seems to have very mixed feelings like he you know with um i think one of the one of the really interesting things in um in the years of lyndon johnson is the carol's description of um coke stevenson and how they contrast him with lbj because it's really clear that uh carol's politics are completely opposed to stevenson's and that when carol's writing about lbj there's like the good stuff he did which is the great society and his his participation in the new zealand and there's a bad stuff which is anything that wasn't bad and um so he clearly like he likes what lbj accomplished and despises the person and then really likes the person of coke stevenson and kind of wishes him well but also doesn't actually want people like that to be in charge of anything and so it's like a you know it's partly partly carol debating with his subject and interrogating his subject and partly debating with himself and asking these very long-standing questions about whether or not justify the ends and you know would it be worth it to not have a great society in exchange for not letting lbj steal an election in 1948 and i don't think that like if he's good at his writing he shouldn't be coming to firm conclusions on that and he should be presenting this very very mixed picture where you really only get the things you really want if you also accept that there are some very bad things that come along with that as long as as long as the things you want come from powerful ambitious people who will do anything to win hey guysDwarkesh Patel 0:44:14i hope you're enjoying the conversation so far if you are i would really really appreciate it if you could share the episode with other people who you think might like it this is still a pretty small podcast so it's basically impossible for me to exaggerate how much it helps out when one of you shares the podcast you know put the episode and the group chat you have with your friends post it on twitter send it to somebody who you think might like it all of those things helps out a ton anyways back to the conversation yep yep no and it's worth remembering that it takes him a decade to write each of those volumes and each of that i guess in the case of the power broker or that entire book but in the course of a decade just imagine how many times you would change your mind on a given subject and you really notice this when you read different paragraphs of like for example the power broker where you notice um early on if you just read the first third or the first half the power broker you're like clearly caro is like writing about uh uh robert moses the way he writes about robert linden johnson where it's like yeah this guy had some flaws but like look at the cool s**t he did and the awesome stuff he did for new york um and then the tone completely changes but you gotta remember it's he's just writing this so many years and uh in between i do want to uh talk about the thing about you know young people being able to you know young people i guess a war being a catalyst for young people entering an arena i did an interview of um alexander mikorovitsky i forgot his last name but anyways he wrote a really interesting book about the polyonic wars and this is actually one of the things we talked about um there's a line from war and peace where one of the russian aristocrats is mad that his son is joining uh is joining the war and he goes you know it's is that man napoleon you you've all seen him and now you all want to like go off to war and i'm curious um like filmmaking doesn't seem like we're super quantitative and super smart and super competent like somebody who has thymus and the desire to dominate and the desire to achieve recognition uh i mean do you really think he's making films like where where is he really i mean is he like still trying to start a startup or is that like now a decade too old and now he's trying to dominate some other arena i mean maybe the lame answer is we don'tByrne Hobart 0:46:31actually know because um the way like you know paul graham has that essay about the trope of startups starting in garages and i think it's called the power of the marginal and it's all about how the the really interesting projects are the ones that can barely get off the ground because they're so weird and so out there that there is no infrastructure to support them and what that ends up doing is selecting for people who are extremely passionate about that project and also people who are extremely willful and will get impossible things done so you it's hard to just rattle off a bunch of examples of that because you your hit rate would be like 99 things out of 100 are just like things you read one fun blog post speculating about and they're actually never going to happen and then you know one of them maybe maybe you're right but it's very hard to tell which one it is and you know if it were very easy venture capital would not have such such skewed returns so yeah so maybe maybe it is like harder to harder to optimize for what area do you look for maybe it's actually easier to do the meta optimization of identifying the things you would quit you know quit podcasting and go work on given the opportunity and you know it's like good to have that sort of dread list like I I had that mental list of like you know if someone at Spotify ping me and they're like we really need a product manager who can help us display classical music such that we don't list like tons of redundant information and the first 50 characters of the track name and the actual incremental useful information in the 10 characters you have to wait for it to scroll through unless it doesn't actually scroll through like if someone pinged me it was like we really need someone to fix that can you come and do this I'd be sorely tempted feel the same way about Google Finance like if if if someone emails me and says you have a mandate to make Google Finance good I'd be tempted but I think thinking of like what industries would have that kind of pull for you and then what can you do to really dig into those industries you probably find the the the proto successful people in spaces like that versus trying to optimize in advance for well if I were you know if I were someone who thinks like nobody else thinks and we're a true natural contrarian and also had spent several years learning about different opportunities which one would I have ended up picking because then you're sort of magicking away all of the things that actually make the person you're looking for it's looking for so yeah can't quite be done that way yeah yeah yeah I want to go backDwarkesh Patel 0:49:05to that thing you said a moment ago about how you couldn't have written a million words that were as impactful about just you know how cities work but if you just wrote 500 words at a time about how Robert Moses accumulated power did the things he did you can actually have a really interesting and influential piece of work is that how you see the diff that you can't write one million words at a time about where where technology is going what's happening with the productivity slowdown what's happening with all these emerging industries but if you just write 2,000 words a day about what's happening with any particular you know company or industry then you can compile this really interesting overall worldview aboutByrne Hobart 0:49:44finance and tech that's the hope and I might be projecting things about my own attention span on to on to Cairo when I say that you can't just set out to do a million words on topic X and then do it but I do think you know I hope that I am by increments producing something that is a lot more than the sum of a bunch of business profiles and a bunch of you know strategy breakdown things like that like and that's that's one of the reasons that I spent time on things like reading Machiavelli and thinking about how Machiavelli's thoughts not just not just the the totally cynical amoral stuff but the other stuff you wrote at the same time which he may have met more seriously about how to build a sustainable and good republic rather than how to be a completely amoral monarch I try to read that kind of thing because I do think that it's valuable to have that more rounded view of the human condition and and I think that it contributes a lot to to writing about these individual companies like you know technology changes a lot humans change very slowly so if you if you want to understand technology you do have to study that this specific object level case of what is this thing what does it do differently what is it a substitute for what are the compliments to it etc but if you're trying to understand things like why did this company do X like why why did they fire fire this person and not that person and why did they choose to acquire this other business why is the CEO dumping tons of money into this thing that seems like it's it doesn't make much sense well you can find lots of historical examples of people in power making these decisions that just get continuously worse and continuously more costly and they refuse to back down sometimes they turn to be right sometimes they turn to be very very wrong but you'll find more examples of that if you go back further in history and they're often just a lot more fun to read about whereas like you know if you you can read about things like board spending too much money on the pencil and it not working out or IBM investing a ton in the 360 and that working out very nicely but you know you can also go back to the Iliad and read another case where sunk cost fallacy dominated rational strictly rational decision making and you know only divine intervention could ultimately lead to a good outcome for for the attacker and even then maybe not suchDwarkesh Patel 0:52:04great outcome often considered the that particular question about where trying to predict if somebody is overstepping or if they're making the best bet of their life is something that I've been trying to think about and I really have no reasonable method for I mean if you think about like what Elon Musk is doing with Twitter is this like Napoleon trying to conquer Russia and it's this super ego filled and pride filled you know completely illogical bet from somebody who has just had like 20 consecutive wins in a row and he thinks he's invincible or is it like Elon Musk like 20 years ago where he's like yeah I did PayPal and now let's you know let's build some rockets and let's build some electric vehicles yeah exactly and in each of these cases there's there's like so many analogies to like complete bust and there's so many analogies to oh this is just like part one of this grand plan and how do you figure out what which one is happening like how do you distinguish the visionary from the collapsing you know star the cynical answer is you wait about 200 years and thenByrne Hobart 0:53:18you write about how it was obvious all along like yeah you you really don't and I mean even there are a lot of cases that are actually still ambiguous so like Alexander you know conquered most of the known world at least most of the world that that people knew of around where he grew up and and then just goes to Babylon and drinks himself to death and that's the end right you know there there could have been an alternate story where he gets his life together a little bit and runs a giant sprawling empire on the other hand like reading the story battle to battle a lot of it it actually is basically this Ponzi scheme where every time he conquers a city he gets enough enough to pay off the people he hired to help him conquer the city and then has to move to the next city because they want to get paid again and so he's sort of you know was sort of being chased by his his obligations the entire way through until he finally got got just ahead of them enough to get a lot of loot and and a lot of land that could give people instead of just giving money so giving them like bars of silver and things so so yeah even even that story it's very hard to say you know he he rolled the dice a bunch of times and he won every time so clearly he was just one of those people who's born to win maybe it was sort of like he actually backed himself into a bunch of corners over and over and over again and then desperately fought his way out every single time and then was just completely sick of it and burnt out by the time he was in his early 30s in terms of how you would figure it out in advance like I think some of it does come down to getting a sense of whether they're responding to circumstances or whether they actually have have a long-term plan but then lots of like you know there's probably nothing more dangerous than a long-term plan that someone actually has the means to execute you know five-year plan does not have a good connotation Stalin had some of those and didn't turn out well for for a lot of people so even within that there's there's some difficulty in evaluating like I think there's kind of that that meta-cynical layer where if they don't know what they're doing then probably it's dumb luck they keep succeeding on the other hand if they do know what they're doing then maybe you hope that the world is lucky enough that they get unlucky and can't actually pull off whatever it is that they're they're planning to do maybe I guess another thing would be is there is there like an end state that they can get to because I think you know someone like Alexander he basically just kept going until he couldn't go any farther until his troops were basically on the point of mutiny and then just turned around and went not all the way home but went to like the nicest place halfway home and hung out there and partied but you know if if the story if you look at someone if the story is less about conquest and more about reconquest and restoration of something then there are these natural limits you can say like you go this far and you don't go any farther because you've actually finished your task so something like you know I think like I don't actually know who was who what which generals were on the other side of Napoleon but the ones who chased him out of Russia like for them the master plan was not we're going to conquer all of Europe the master plan was like we're getting our country back and then we're going to chase him far enough that he doesn't feel like he can just wait a year and do this again when it's not winter so so maybe that's that's another way to constrain it but then then you end up naturally selecting for less ambitious people it's like one way to one way to have these guardrails on your behavior is just don't have very big ambitions so you might and in that case those people are also stuck responding to circumstances so so maybe maybe you just end up with many different iterations of the same thing on different scales where everyone is stuck in certain historical circumstances they have they have their skills they have their opportunities they can they can go after some things maybe they achieve great things maybe they fail but either way eventually their luck runs out or they run out of ideas and then there's nothing to do except go home or just keep trying to keep keep being bolder until you eventually fail on most particularly I I don't really I don't really understand it I think there's like a remote possibility that he actually has a bunch of specific concrete ideas for how to increase Twitter's free cash flow and how to pay down the debt and make it a more profitable company maybe he just had that sense that it was overstaffed and that it should survive with a smaller headcount and if you cut headcount enough then you you end up with with a profitable business it could also just have been fun and seems fun so far and I think like that you know the the pursuit of fun is is not to be discounted like you if you're super rich you can afford to do all sorts of things varying levels of entertainment but it may be that the only thing that is actually like truly novel thrill seeking fun opportunity is something like buy Twitter and then turn it into you know what it is and it is like there's I think Rostad that at this this point about how the nature of Twitter's legitimacy has changed and that now it is a it is under the rule of a single monarch instead of ruled by these sort of faceless bureaucracies so now you know if something if Twitter does something you don't like there's actually a specific person you can blame and because you have Twitter you can actually yell at that person and potentially get an answer whereas if Twitter bans you because you made a joke and the joke looked like it was serious there's really there's no recourse and you know there's there's nothing lower status than someone like arguing with someone in authority about how serious or they should take your jokes there's like you know it's like a weird component of and it works both ways so like there's I think I started noticing this years ago because there are these underscore TXT Twitter accounts where they're just posting out of context comments from some niche community and the comments always sound deranged in a lot of cases to me the comments read as someone who is doing a bit they're playing a role they know it's funny they're exaggerating for their friends and then you take it out of context and read it as totally seriously and then you get to say these people are all like this they're all crazy but it is like it is a marker of high status to be able to not get jokes and to you know be able to be like righteously angry at someone because they made a joke and if they've been serious that would have been an appalling thing to say but they obviously weren't if you if you can get away with saying no I actually don't think it was a joke at all these people are humorless and they must have been totally serious then that's that's actually you know that's cool that's high status makes you impressive but yeah must like must must rule as this more you know personal monarch I think it's a it speaks to this question of legitimacy like why do people trust moderation and why do they trust sites to operate in the way that they do and you can either say these are like really high quality institutions so you know you can take the discourse as the oblivion approach and say we built these systems such that anyone can be dropped in and can do a reasonably good job it's very hard for bad people to do a very bad job because there are so many checks and balances or you could say no we actually trust this one person to do a really exceptional job that nobody else could do and we don't want institutional constraints on them those those philosophies go in and out of fashion and like even within even within systems that nominally don't change you know there the US was a lot closer to that kind of centralized system with personal legitimacy invested in one person in under FDR than it was under Calvin Coolidge and under Coolidge was a lot more of like there's this institution there are a bunch of rules people follow the rules you have this nice New England guy who you know he gives a an annual update of State of the Union but it's just written down and then he has a clerk read it to Congress you know it's you're not betting on charisma you're not betting on judgment you're just betting that thing the rules are pretty good and as long as things keep working according to the rules they'll keep on working yeah yeah yeahDwarkesh Patel 1:01:28no the the musk example is like the sort of consumption by like playing this game it's similar to how some people will load up like a horribly broken game of Civ where their civilization is losing is it gone so good at the game that they just need like some noob to send them their save file which is like complete complete carnage and they're losing their cities and stuff and then then the fun is you like load this up and you try to win anyways but you know one thing you've written about and I find really interesting we're both fans of Fukuyama's book the end of history and if you read the last quarter of that book you'll come up with the impression that he actually I mean it just like completely contradicts I don't know the first three quarters of the book where he's just saying you know what actually these men at the end of the end of history are these pathetic last men who have no desire for recognition they just want to be comfortable and you've made the comparison with that and big tech at least before the crash and one of the things Fukuyama talks about in the book is once there is a great war once there is a struggle that requires the first men of history who can withstand adversity and can accomplish great things you won't have them around by the time that you know like things have gotten comfortable for a while are there enough first men left in companies like Twitter and Facebook that now they do face adversity they can you know just like reboot and go into wartime again?Byrne Hobart 1:02:56Yeah I suspect they are I think Tolkien gets it right that you know just because someone is born a hobbit and they live in Hobbiton and they have this nice comfortable life like they still have that capacity for and yearning for adventure and that in the right circumstances they will they will rise to the occasion and go ahead and do it and this seems to happen with a lot of countries and they face these great stresses like sometimes a civilization just can't withstand it and it collapses and you know the sea people just take everything and then you have no civilization left and you're all just back to farming but in a lot of other cases they even if they ultimately don't survive they go through a very long decline because they do fight to fight to maintain what they have for an extended period so I think yeah like even trying to determine a mechanism by which you can you can eradicate that that thirst for glory and that ability to rise to the occasion it's it's hard to think of I mean you know unless you think there's like unless it's like microplastics or something maybe maybe that does constitute the end of history in which case you know hopefully we we export it up microplastics to make sure that we don't have any you know any last pockets of thumos yeah sort of like the the scott alexander riff about the step nomad invasion risk where it's an existential risk that comes along every couple hundred years yeah you you want to avoid that but it yeah it's like part of I think part of having that kind of thumos and thirst for glory should be that you can't actually habituate you're you can't be so habituated to a life of ease and comfort and lack of difficulty that you just you won't actually respond appropriately when there's an external threat that you need to respond to then you know maybe maybe you weren't you weren't first man material after all if if you can't and you just want to stay on your couch so so yeah I don't I I'm sure we can sort of deplete that reserve and then there were I think definitely like post post world war ii us was definitely a country where there were a lot more people who had taken very serious risks they've gone through you know a lot of hardship on the other hand so I recently read that book the economics of world war ii which was comparing a bunch of countries and how their economies performed in world war ii and one of the things that sort of out of the u.s was that in a lot of terms of material consumption the the u.s wasn't really that much didn't really look like a country going through a war like in most other countries you saw this decline in literally how much food people had to eat and especially how much protein and fat they had to eat and so I think like a lot of places calories calorie intake had dropped by like a third by the end of the year or by the end of the war and then in the u.s calorie consumption actually went up so u.s was like on the home front was inconvenienced by the war and things like gas and tires were hard to get but people were still eating well whereas in a lot of other parts of the world people they were literally going hungry so that their country could continue to fight the war so maybe there's like you know there's some level of hormetic response where you you suffer a bit because your country is contributing to this and then you're you're you're heartier for it and the country has accumulated a lot of social capital and you had to get really good at organizing and building things and then maybe there is some level of there's some level of suffering from conflict where you've just you've totally had enough and you're never doing anything like that ever again and you're just too done and then I think one of the interesting things to to consider is like the extent to which different countries fit into that model so one of my I'm very interested in Japan and Japanese industrial policy and how how the Japanese post-war recovery went and one of the annoying things about that is like I thought that was the question was how did Japan have this wonderful post-war recovery but when you look at a lot of the institutions involved they don't start in 1945 or 1951 or whatever they actually started before World War II and so you can actually sort of see World War II as part of this arc of the same historical process that continued post-war which is Japan wanted to be economically self-sufficient and independent and a country that could determine its own fate and the you know in the during the last gasp of imperialism one way to do that was invade countries with lots of natural resources take those resources and then manufacture things at home but when that became untenable then the next best option was be within the sphere of influence of the most the most powerful military in the world and be very closely tied to their import and export markets and then import everything you need under the protection of the the US military and then export things to the US in order to pay for those imports and basically run run the same strategy just with someone else during the military part so you know in one sense that was like a total defeat of the imperialist model in another sense it was like this strategic realignment but actually basically same end goal and you know very very different external facing view of that goal but yeah same same ultimate idea there's a there's this book called princes of the end which is mostly about Japanese central banking policy but it has some early bits about how the structure of Japan's economy works and the way the author describes it is that Japan post-war Japan had a war economy in peacetime with lots of centralized control and suppressed consumption and lots of heavy heavy industry heavy manufacturing that also a lot of companies in Japan their modern structure dates back to the wartime period sometimes the post-war but sometimes literally the wartime period including the biggest biggest advertising agency in Japan was apparently like this this wartime or immediately pre-war attempt to agglomerate all the smaller ad companies into one big more efficient company that would free up resources that could be used for building battleships and other other stuff like that so yeah it's kind of kind of the same story just being being expressed in a bunch of different ways and I think you can you can look at other countries and and try to see like what what threads of continuity there are between the post-war and between the pre-war and post-war order Tony Jutt's post-war book is a really phenomenal look at that question and in a lot of cases there's like there's a surprising level of continuity there are some things that totally broke and had to be totally reformed and there are some things that just kept going exactly the wayDwarkesh Patel 1:09:33they've been going before yeah yeah everybody wants to be a first man but nobody wants to go on a diet yeah but but you've mentioned this line before but there's a line from how Asia works where they're talking about the reparations that Korea got after World War Two from Japan and how they're using that to build up their industrial capacity and there's like a line from one of the line managers or in the factory he goes listen you guys had to work like 14 hours a day seven days a week and the reason is this money is blood money it's our blood it's like this money was like gotten from like ripping your mother and killing your father and if you can't use that money to like rebuild our country like what good are you you might as well just kill yourself right yeah but yes yeah and based but there's and then you read about lean production I was reading about lean production when I was before I interviewed Austin Vernon and in all these books they're talking about how America's America was never able to replicate the productivity of Japanese lean production and it's just because you're talking about Americans who have you know like trying to save up their pensions and working eight hours a day and have hour-long lunches and you just have these hardcore Japanese who they just got it like World War Two and they barely survived and you know like it just like the thymus is completely different you just can'tByrne Hobart 1:10:55replicate that in America yeah yeah there's a there's this book called the reckoning about the US our industry and how it dealt with the rise of Japanese exports in the 70s and 80s and when it's talking about the post-war recovery in Japan there's this bit where I think I think the character they're following works for a bank and he in the bank's office in some city in Japan he likes to work in the room where there's a fire because there's like a fire with this big pot of stew and the stew is the food that the employees will eat at the bank as part of their benefits package and that's the only room in the bank that is you know warm enough that you can actually work and that's just like that is a level of material austerity that is inconceivable to me and I can't you know I don't know anyone who grew up in such poor circumstances I can't imagine it and then it did not take very long at all for the country to significantly recover from that and yeah you know there are countries that also had this massive catch-up growth where they went from very poor subsistence level or even below that in some cases to actually being middle income or even you know fairly rich countries.Dwarkesh Patel 1:12:10Yep yep I want to touch on the fact that Sanbeck Manfred was an effective altruist and that he was a strong proponent of first neutrality. We were having we're talking like many months ago and you made this really interesting comment that in many belief systems they have a way of segregating and limiting the impact of the most hardcore believers you know they and so if you're like a Christian the people who take it the most seriously you can just make them monks so they don't cause that much damage the rest of the world and EAs don't have that right so if you're like a hardcore risk neutral utilitarian you know you're out in the world you're like right making billion dollar crypto companies. As a side note by the way it's interesting a year ago I feel like the meme was oh look at these useless rationalists they're just reading blogs all day and they have all these you know mind palaces and whatever and what good are they you know and then now now everybody's like oh these neutral utilitarians are gonna wager our entire civilization in these 51 49 schemes right but anyways yeah I just want to get your commentary on on all this.Byrne Hobart 1:13:17Yeah yeah like I think I think it's a useful pattern to observe because I mean it goes back to that that point that human nature just doesn't change all that fast to the extent that it ever does and that we've had the problem with different civilizations have had this problem of okay we've got some rules and we've got these beliefs and they're they're generally going to guide people to behave the right way but they're going to guide people to be the right kind of normal person and not to be someone whose life is entirely defined by this incredibly strict rigid moral code and by whatever you get if you take the premises of that and just extrapolate them linearly as far as they can go and I think that gets especially dangerous with really smart people because you can give them a set of first principles and they can ask really really interesting questions and come up with edge cases and sometimes like I think for some people like the first philosophy class where they encounter these edge cases they they just reject it as stupid and say things like you know I you know if you if you shove the fat man in front of the trolley why do you think the trolley would stop the trolley would just kill him too like this is dumb and I think that is like it is useful to keep in mind that the thought experiments are designed to be implausible and they are supposed to be the intuition pumps but the more you get this complicated highly abstract economy where an increasing share of it is software interacting software well software doesn't have that common sense break on behavior and if you have this very composable economy you can find cases where first principles thinking actually is action guiding and can can guide you to extreme behaviors unfortunately those extreme behaviors are things like trading cryptocurrencies with lots and lots of leverage and you know we we have like it's it's maybe merciful that the the atoms to bits interface has not been fully completed while we still have time to deal with you know malevolent unfriendly ea so that's that's good but yeah it is like it's a problem that you come up with you see it a lot and you see a lot of different societies and they do tend to have some kind of safety valve but like if you you really think that praying all day is the thing you should do you should go do it somewhere else and you shouldn't really be part of what we're doing and I think that's healthy and I think in some cases it's like a temporary thing like you do that you get it out of your system and either you come back as this totally cynical person who doesn't believe in any of it or you come back as someone who is still deeply religious and is willing to integrate with society in in a productive way and I think even like even within the monastic system you you do have different levels of engagement with the outside world and just yeah different different levels of interaction so I I think that that's something that ea should take take seriously as an observation as like a design pattern for societies that you typically don't want the people in charge to be the most fanatical people and that because ea beliefs do tend to correlate with being you know a very effective shape rotator or a very effective manipulator like symbol symbol manipulator and those skills are very lucrative and money does have some exchange with power like you you basically have a system where very smart people can become very powerful and if very smart people can also become very crazy then you you tend to increase the correlation between power and craziness and doesn't take very long clicking through Wikipedia articles on various leaders in world history to say that you ideally do not want your powerful people to be all that crazy or your crazy people to be all that powerful as far as what to actually do about that like I think one you know one model is that smart people should be advisors but not in an executive capacity like they shouldn't be executives or like you you don't want the smartest person in the organization also being the person who makes the final decisions for various reasons and but you do want them around you want the person making final decisions to be like reasonably smart like smart enough they understand what the smart person is telling them and why why that might be wrong what the flaws might be so that might be one model is that you want the ea is dispersed throughout different organizations of the world as someone working with non-eas and kind of nudging them in an ea friendly direction giving them helpful advice but not actually being the executive one possibility is that every other society got it wrong and that the monastic tradition was stupid and it has been independently discovered by numerous stupid civilizations that have all been around for much longer than effective altruism so one possibility you can't discount it but I think if you if you run the probabilities it's probably not the case yeah yeah and IDwarkesh Patel 1:17:54mean in general it's always a little bit the leaders who take ideas seriously don't necessarily have a great track record right like Stalin apparently had a book of like 20,000 a library of like 20,000 books like if you listen to Putin's speech on Ukraine it's you know laden with all kinds of historical references um obviously you know there's like many ways you can disagree with it but it's like a man of ideas and do you want a man of ideas inByrne Hobart 1:18:20charge of important institutions it's not clear I mean the founding I mean well founding fathers I was gonna say you know a lot of them were wordsmiths and we basically had we have whole collections of unknowns flaming each other through pamphlets that was papers so yeah in one sense they it was a nation of nerves on the other hand Washington didn't as far as I know did not have huge contributions to that literary corpus so so maybe that is actually the model it's like you want the nerds you want them to debate things you want the debates to either reach interesting conclusions or at least tell you where the fault lines are like what are the things nobody can actually come to a good agreement on and then you want someone who is not quite that smart not really into playing wars to actually make the finalDwarkesh Patel 1:19:07call yeah yeah yeah no that's really good point and I mean like forget about Jefferson think of like if Thomas Paine was made president the United States that would be very bad newsByrne Hobart 1:19:17yeah yeah like it was good to have like it's and it's important to know that like it's it's good to have it's better to have some level of fanaticism than no fanaticism you know right there's like an optimal amount of the most and there's like an optimal place for it but I think yeah from a totally cynical perspective like your most demonic people maybe they are at the front lines doing things and taking risks but also not making the decisions about who goes to the front lines or I think the other thing is like making sure that some of the person deciding where the front lines are and saying you know the front line is like we we keep France safe from the invaders and not the front line is Moscow so get to Moscow and burn it down there's a the book the mind of new hole or there's a recent Napoleon biography that I'm also in the middle of it's been a good year for reading about power tripping people it does point out that technically France was actually declared Napoleon had more countries declare war on him than he declared war on so on average on average France was fighting defensive wars during the Napoleonic era it's just you know they kept defendingDwarkesh Patel 1:20:24farther and farther from France yeah yeah yeah defense requires some strange kinds of offense often yes okay so one of one like sort of meta question I've had is there in all other kinds of discourse there's this question about you know whether you're trying to figure out how to do which charities do the most good but they're trying to figure out which policies are best whether you're trying to figure out how you should promote leaders anything you're there's a question there's like two kinds of discourse there's one that's like we've got these few dozen RCTs and let's see how we can extrapolate the data from these in the least theory laden way and there's another where it's like I've just read a s**t ton of classics and I've you know I'm like a thinking person I think a lot about culture and philosophy and here's my sort of like big intricate worldview about how these things are going to shape out and investing is an interesting realm because there's both kinds of people and you can see the track records over long periods of time so having seen this track record is there any indication to you where there are this sort of first sort of microeconomic approach actually leads to better concrete results than somebody like teal or soros who are motivated by a sort of intricate worldview that's based on philosophy or something which one actually makes better concrete predictions that areByrne Hobart 1:21:41actionable so I think typically the greats have some synthesis of the two and it probably leans more towards big worldview than towards micro level observations I think like one way to divide things is to say that the quants are all these micro level observations like you could be a quant who does not actually know what the numbers mean you know doesn't know what the product is doesn't know the time scale it's just looking for patterns and finds them and I mean people have people have done it that way but it seems like quantitative strategies get more successful when you're doing that you find some anomaly and then you find an explanation the anomaly and the explanation might be some psychological factor you've identified and maybe you find studies indicating that loss aversion is real and this affects how fast stocks go down versus how fast they should often go down and that gives you a trading strategy maybe it's something more more mundane like maybe there is some large investor who has some policy like we rebalance between stocks and bonds on the first day of every quarter and if you know that these and like the investors who have that policy control X trillion dollars assets and you know how they'll rebalance then every at the end of every quarter you know money is sloshing between stocks and bonds and that's predictable so a lot of the quantitative strategies that have those theories behind them tend to blow up more rarely because they sort of know why the strategy works and then they know why it'll stop working and data mining is always a risk if you find an anomaly and there's no explanation to keep repeating itself one of the explanations is other people found the anomaly too and they are exacerbating it by trading it then I think on the other end like if you have these just totally theory driven views usually what kills these totally abstract theory driven views is time because a lot of the best abstract theories are you look at some part of the economy you say this is obviously unsustainable and then the problem is you can say that at any point during its arc and it can look sustainable to other people for a very long time so like one of the favorite examples of this is that there's this snappy one-liner that is something it's like looking at housing and it's like a subprime borrower who didn't put down a down payment is basically just a renter with you know with upside or something it's like some line about how the economics are the same and like you know these people are not actually safe borrowers but the paper that it came from came out in 2001 and so if you had read that had been like American housing market is broken the people are massively overpaying for houses they're all over leverage collapse you could have shorted housing stocks and then lost you know 400% of your money as home builders soared over the next four or five years so usually the way you one of the ways you get around that is like you have the high-level theory you say okay here's what's actually going on in the world like here's what people don't understand but you also have to have this lower level theory of here's what they think is going on here's why things keep moving in the like keep ratifying the theory that they have and then the next step is okay what actually breaks down that causes reality to collide like perception to collide with reality and and then the other question of like can perception actually undershoot in the same direction so you know a lot of money was made by people who looked at the tech bubble in the late 90s said this is gonna blow up and we're gonna figure out when to short it and then we'll short it we know it'll just keep going down for a while that it's not you know it wasn't the dot-coms were 20% too expensive it's that most of them are worth zero so those people made a lot of money by shorting after things started dividing knowing they would keep on dividing but a lot more money was made by people in 2003 2004 saying you know this didn't actually discredit the internet it's still a good technology and it's not like we fundamentally can't make money online it's that you can't make money online if you don't know what you're doing and you massively overspend and there just aren't that many people online and no one's spending money online yet so a lot more money was made by people who were able to take advantage of the overshooting in the opposite direction rather than the people who figured out from first principles that the bubble had bubble characteristics and was eventually gonna pop and that just it requires a lot more of this micro level analysis so you know a lot of a lot of macro people are looking at what individual companies are doing and what they're saying and how how consumer sentiment is changing month to month and all these other very low level indicators where the indicators are not a thesis but the indicators tell you something about when your thesis will become true.Dwarkesh Patel 1:26:17That's really interesting. I'm just gonna do some rapid fire questions for you now in the final few minutes. First, how can somebody be long AI but hedge for the possibility that Taiwan will be invaded? So you know you want to I don't know if I should put money into TSMC but I know that GPUs are going to be the next big thing or are we going to be very important in the future. How do you make that position concrete?Byrne Hobart 1:26:38Oh man, that's really hard. Like, I guess the next best thing would be looking at the Korean fabs because they are they're close but I guess they don't produce the same chips but I guess I guess the bet would be that Korea is the country most likely to catch up to Taiwan in the event that or most likely to catch up to where Taiwan is today if Taiwan is no longer an option. But I think like if you're betting if you're trying to make the AI bet conditional on Taiwan bet, I think a lot of what you want to do is actually think about how you underwrite the the Taiwan invasion bet because that's probably the thing with the bigger long term impact. Maybe, maybe not. It gets tricky. Like there's, you know, sometimes geopolitical changes can just lead to these these permanent inflections like we have the data on there's some kind of emissions that you can measure that is the result of copper mining and so we can see how much copper mining changes year to year throughout history and we do actually see like it was rising during the Roman Empire and then peaked and then went down and then didn't come back for like a millennium. So yeah, sometimes there is a really unfortunate geopolitical inflection in underlying technology. But if you think about what that means in the real world, what it probably means is like that is that is the end like your big concern is not your portfolio in in a world where we were an invasion causes AI is the reason AI does not happen. So yeah, I would separate the invasion bet from the AI bet. And then I guess next best thing would be I mean, the sad answer is Intel is maybe Intel and TSM are sort of America's last hopes on this. I think there's like you can you can tell a story where invasion becomes more and more likely and the US does a sort of operation paperclip with no connotation about the the political views of the engineers of old but you know, operation paperclips all the best TSM engineers out to Arizona and has them all work on building those chips in the US in which case TSM is still you know, still a play although it's certainly lost some valuable assets. But that's that's a very tricky question. And it may be one of those things where it's kind of kind of hard to hit like there are there are sufficiently bad things you know, there's there's not really a good meteor hedge like you know, in the in the minutes before the meteor hits us, maybe maybe treasuries do outperform equities, but you don't really care. Okay, yeah. AllDwarkesh Patel 1:29:10right. I'll definitely have to have you on again in a few weeks. Because we've gone through like I don't know, like a quarter of the question. So okay. But it was really interesting. I really this is like probably the most fun episode I've done so far. So awesome. Yeah. So just another plug. It's the diff.co that's with two F's and the Twitter handle. WhatByrne Hobart 1:29:31is your Twitter handle burn? It's my full name at Bern Hobart. Okay, cool. Yeah, andDwarkesh Patel 1:29:36highly recommend it for the most schizophrenic. Galaxy brain takes visit the diff.co. Awesome.Byrne Hobart 1:29:42Thanks, Byrne. You bet.Thanks for reading The Lunar Society! Subscribe for free to receive new posts and support my work. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Edward Glaeser is the chair of the Harvard department of economics, and the author of the best books and papers about cities (including Survival of the City and Triumph of the City).He explains why:* Cities are resilient to terrorism, remote work, & pandemics,* Silicon Valley may collapse but the Sunbelt will prosper, * Opioids show UBI is not a solution to AI* & much more!Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow me on Twitter for updates on future episodes.If you enjoy this episode, I would be super grateful if you shared it. Post it on Twitter, send it to your friends & group chats, and throw it up wherever else people might find it. Can’t exaggerate how much it helps a small podcast like mine.A huge thanks to Graham Bessellieu for editing this podcast and Mia Aiyana for producing its transcript.Timestamps(0:00:00) - Mars, Terrorism, & Capitals (0:06:32) - Decline, Population Collapse, & Young Men (0:14:44) - Urban Education (0:18:35) - Georgism, Robert Moses, & Too Much Democracy? (0:25:29) - Opioids, Automation, & UBI (0:29:57) - Remote Work, Taxation, & Metaverse (0:42:29) - Past & Future of Silicon Valley (0:48:56) - Housing Reform (0:52:32) - Europe’s Stagnation, Mumbai’s Safety, & Climate ChangeTranscriptMars, Terrorism, & CapitalsDwarkesh Patel 0:00:00Okay, today, I have the pleasure of speaking with Professor Edward Glaeser, who is the chair of the Harvard Department of Economics, and author of some of the best books and papers about cities. Professor Glazer, thanks for coming on The Lunar Society.Edward Glaeser 0:00:25Oh, thank you so much for having me on! Especially given that The Lunar Society pays homage to one of my favorite moments in urban innovation in Birmingham during the 18th century.Dwarkesh Patel 0:00:26Oh wow, I didn’t even catch that theme, but that’s a great title. My first question is, What advice would you give to Elon Musk about building the first cities on Mars?Edward Glaeser 0:00:35[laughs] That’s a great question. I think that demand for urbanism in Mars is going to be relatively limited. Cities are always shaped by the transportation costs that are dominant in the era in which they’re created. That both determines the micro-shape of the city and determines its macro future. So cities on Mars are, of course, going to be limited by the likely prohibitive cost of traveling back and forth to the mother planet. But we also have to understand what cars people are going to be using on Mars. I assume these are all going to be Teslas, and everyone is going to be driving around in some appropriate Tesla on Mars. So it’s going to be a very car-oriented living experience. I think the best strategy would be to create a fairly flexible plan, much like the 1811 grid plan in New York, that allows entrepreneurs to change land use over time and put a few bets on what’s necessary for infrastructure and then just let the city evolve organically. Usually, the best way is to put more trust in individual initiative than central planning–– at least in terms of micromanaging what goes where. Dwarkesh Patel 0:01:58Gotcha. Now, since 9/11, many terrorist groups have obviously intended to cause harm to cities. But by and large, at least in Western countries, they haven’t managed to kill off thousands of people like they were able to do during 9/11. What explains this? Do you think cities are just more resilient to these kinds of attacks than we would have otherwise thought? Or are the terrorists just not being creative enough?Edward Glaeser 0:02:20I don’t know. There’s also the question of what the objectives are. Even for the 9/11 terrorists, their end game was not to kill urbanites in America. It was to effect change in Saudi Arabia or in the Middle East more generally. We’ve also protected our cities better. If you think about it, two things go on simultaneously when you collect economic activity in one place in terms of defense: one of which is they become targets–– and of course, that’s what we saw on 9/11; it’s hard to think of a symbol that’s clearer than those twin towers. But at the same time, they’re also a defensible space. The origin of the urban agglomeration and use for cities and towns was the fact that they could be walled settlements. Those walls that brought together people collectively for defense are the ultimate reason why these towns came about. The walls provided protection.I think the same thing has been playing out with cities over the past 20 years. Just as New York was a target, it was also a place where post-2001, the city ramped up its anti-terrorism efforts. They put together a massive group as London had previously done. The cameras that implemented congestion pricing in London were the same cameras that used against the Irish terrorists. So both effects went on. I think we’ve been fortunate and that we’ve shown the strength of cities in terms of protecting themselves.Dwarkesh Patel 0:03:52If you look throughout ancient world history, there are so many examples of empires that are basically synonymous with their capital cities (ex. Rome or Athens, or Sparta). But today, you would never think of America as the ‘Washingtonian Empire.’ What is the explanation for why the capital city has become much less salient in terms of the overall nation? Is there a Coasian answer here?Edward Glaeser 0:04:20There are specific things that went on with English offshoot colonies where in many cases, because they recognized the tendency of the capital city to attract lots of excess goodies that had been taken from elsewhere in the country, they located the capital city in a remote place. It’s actually part of the story of the Hamilton musical in The Room Where it Happens. Part of the deal was about moving the capital of the US to a relatively remote Virginia location rather than having it be in Philadelphia, New York. That was partially to reflect the fact that the South needed to be protected against all of the extra assets going to New York and Philadelphia.So, whether or not this is Canberra or Ottawa, you see all of these English offshoot places without their capitals in the big metropoles. Whereas traditionally, what’s happened in these places that have been around for centuries, is that even if the capital didn’t start off as the largest city, it became the largest city because centuries of French leaders thought their business was to take wealth from elsewhere in France and make Paris great. I think the French Empire was as synonymous with Paris as most of those ancient empires were with their capital city. I guess the question I could throw back to you is, what are places where this is not true? Moscow, St. Peter’s, and Beijing are examples. Do we think that Beijing is less synonymous with China than the Roman Empire is with Rome? Maybe a little–– possibly just because China is so big and Beijing is a relatively small share of the overall population of China. But it’s more so certainly than Washington, D.C. is with the U.S. Decline, Population Collapse, & Young MenDwarkesh Patel 0:06:32That’s a really interesting answer. Once a city goes through a period of decline (maybe an important industry moved out, or maybe it’s had a sequence of bad governance), are you inclined to bet that there will be some sort of renewal, or do you think that things will continue to get worse? In other words, are you a momentum trader, or are you a reversion to the mean trader when it comes to cities?Edward Glaeser 0:06:54I can tell you different answers for different outcomes. For housing prices, I can tell you exactly what we know statistically about this, which is at higher frequencies, let’s say one year, housing prices show wickedly large levels of momentum. For five years or more, they show very significant levels of mean reversion. It’s a short-term cycle in housing prices followed by decline. Population just shows enormous persistence on the downside. So what happens is you typically will have an economic shock. Detroit used to be the most productive place on the planet in 1950, but a bunch of shocks occurred in transportation technology which made it no longer such a great place to make cars for the world. It takes a century for the city to respond in terms of its population because the housing is sticky. The housing remains there. So between the 50s and 60s, the population declines a little bit, and prices drop. They drop sufficiently far that you’re not going to build a lot of new housing, but people are going to still stay in the houses. They’re not going to become vacant. So, the people are still there because the houses are still there. During the 60s to 70s, the population drops a  little bit further and prices kind of stay constant, but still it’s not enough to build new housing. So the declines are incredibly persistent, and growth is less so. So on the boom side, you have a boom over a 10-year period that’s likely to mean revert and it’s not nearly as persistent because it doesn’t have this sticky housing element to it. In terms of GDP per capita, it’s much more of a random walk there in terms of the straight income stuff. It’s the population that’s really persistent, which is, in fact, the reality of a persistent economy.Dwarkesh Patel 0:08:44Interesting. Why don’t Americans move as much as they used to a century ago? So you have a paper from 2018 titled Jobs in the Heartland, where you talk about how there’s increasing divergence between the unemployment rates between different parts of America. Why don’t Americans just move to places where there are better economic circumstances? Edward Glaeser 0:09:04I want to highlight one point here, which is that you said “unemployment rate”, and I want to replace that with non-employment rate. That’s partially what we’re seeing now. It looks like America’s labor force couldn’t be better in terms of the low levels of unemployment, but what’s happened over the last 50 years is there has been a very large rise in the share of prime-age men who are not in the labor force. So they’ve stopped looking for work, and those guys are miserable. It’s not that those guys are somehow rather productive and happy,–– this is a very bad outcome for prime-age men. I’m separating men from women, not to say that the female labor markets aren’t just as important, just as fascinating, just as critical. But labor force participation means something different for many women than it does for men. There are many women who are not in the labor force who are doing things that are enormously productive socially, like caring for their children and caring for their families.I wish it were symmetric across the genders. It just isn’t true. I mean, there just are very few men not in the labor force who are doing anything much other than watching television. It’s just a very different thing. So yes, there are big differences in the non-employment rate. There are some parts of America where, for much of the past decade, one in four prime-age men have been jobless. It’s an enormous gap. The question is, why don’t they get out?I think the answer is really twofold: one of which is the nature of how housing markets have frozen up. Historically, the differences in housing costs in the US weren’t that huge across places. Most parts of America had some kind of affordable housing, and it was relatively easy to put up. At the dawn of the 20th century, these were kit helms sold by Sears and Roebuck that sprung up by the thousand. You bought the kit from Sears and Roebuck, and you just built it yourself. After World War II, it was mass-produced homes in places like Levittown.For most of the last 50 years, in places like coastal California or the East Coast, building has just become far more difficult. With the decline of mass-produced housing, it’s become far more expensive, and it becomes harder and harder for relatively low-income people to find opportunities in places that have high levels of income, and high levels of opportunity. That’s partially why there’s not just a general decline in mobility, there’s a decline in directed mobility for the poor. Historically, poor people moved from poor areas to rich areas. That’s pretty much stopped. In part, that’s because rich areas just have very, very expensive housing. The other thing is the rising importance of the informal safety net.So if you think about most particularly prime-aged men, they’re not receiving significant handouts from the government except if they’re on disability. But they will typically have some form of income, some form of housing that’s being provided for them by someone other than themselves. A third of them are living in their parent's homes. That informal safety net is usually very place dependent. Let’s say you’re living in Eastern Kentucky; it’s not like your parents were going to buy you a condo in San Francisco. You can still have your own bedroom, but you can’t go anywhere else and still get that level of support. And so that’s, I think, another reason why we’re increasingly stuck in place.The third you mentioned, is that a third of the non-employed population of young men or is that a third of all young men? Non-employed is a third of non-employed prime aged men. So that’s 25 to 54. There are a lot of 45 year olds who are living on their parents’ couches or in their old bedroom. It’s a fairly remarkable thing.Dwarkesh Patel 0:12:49Now, we’ll get to housing in just a second, but first, I want to ask you: If the fertility trends in East Asia and many other places continue, what will the impact on cities be if the average age gets much older and the possible eventuality of depopulation?Edward Glaeser 0:12:53That’s a really interesting question.The basic age fact on cities is that within the bracket of the sort of high-income or middle-income, for prime-aged parents, cities tend to be relatively bad for them. Once you’re in the sort of high end of the upper middle class, the distrust of our public school systems, merited or not, means that that group tends to leave. You have plenty of parents with kids who are lower income, and then you have groups who are part of a demographic barbell that like cities. So this is partially about people who don’t feel like they need the extra space and partially because if they’re young, they’re looking to find prospective mates of various forms.Cities are good for that. Urban proximity works well in the dating market. And they’ve got time on their hands to enjoy the tremendous amenities and consumption advantages that cities have. For older people, it’s less about finding a mate typically, but the urban consumption amenity still has value. The ability to go to museums, the ability to go to concerts, and those sorts of activities continue to draw people in.Going forward, I would have continued to expect the barbell dimension to persist until we actually get around to solving our urban schools and declining population levels. If anything, I would have thought that COVID skews you a bit younger because older people are more anxious and remember that cities can also bring pandemics. They remember that it can be a nice thing to have a suburban home if you have to shelter in place. So that might lead some people who would have otherwise relocated to a dense urban core to move out, to stay out.Urban EducationDwarkesh Patel 0:14:44You just mentioned urban schools, and I’m curious because you’ve written about how urban schools are one of the reasons people who have children might not want to stay in cities. I’m curious why it’s the case that American cities have some of the best colleges in the world, but for some reason, their K-to-12 is significantly worse, or it can be worse than the K-to-12 in other parts of the country. Why is it that the colleges are much better in cities, but K to 12 is worse? Edward Glaeser 0:15:19So it’s interesting. It’s not as if, I don’t think there’s ever been an Englishman who felt like they had to leave London to get better schools for the kids, or a Frenchman who thought they needed to leave Paris. It’s not like there’s something that’s intrinsic to cities, but I’ve always thought it’s a reflection of the fact that instead of allowing all of the competition and entrepreneurship that thrives in cities and that makes cities great, in the case of K to 12 public education, that’s vanished.And your example of colleges is exactly right. I’m in this industry; I’m a participant in this industry and let me tell you, this industry is pretty competitive. Whether or not we’re competing for the best students, at our level we go through an annual exercise of trying to make sure we get Ph.D. students to come to our program instead of our competitors, whether it’s by hiring faculty members or attracting undergraduates, we occupy a highly competitive industry where we are constantly aware of what we need to do to make ourselves better. It doesn’t mean that we’re great along every dimension, but at least we’re trying. K through 12 education has a local monopoly.So it’s like you take the great urban food, leisure and hospitality, and food industries, and instead of having in New York City by a hyper-competitive world where you constantly have entry, you say, “You know what? We’re going to have one publicly managed canteen and it’s going to provide all the food in New York City and we’re not going to allow any competitors or the competitors are going to have to pay a totally different thing.” That canteen is probably going to serve pretty crappy food. That’s in some sense what happens when you have a large-scale public monopoly that replaces private competition.Dwarkesh Patel 0:16:50But isn’t that also true of rural schools? Why are urban schools often worse? Edward Glaeser 0:17:46There’s much more competition in suburban schools. So in terms of the suburban schools, typically there are lots of suburbs, and people are competing amongst them. The other thing that’s actually important is (I don’t want to over exaggerate this, but I think it is something that we need to think a little bit about) the role of public sector unions and particularly teachers unions in these cases. In the case of a suburban school district, the teachers union is no more empowered on the management side than they would be in the private sector.Dwarkesh Patel 0:17:30So in a normal private sector, you’ve got a large company, you’ve got a union, and they’re arguing with each other. It’s a level playing field. It’s all kind of reasonable. I’m not saying management has done awful things, and that unions have done foolish things. I’m not saying that either are perfect, but it’s kind of well-matched. It’s matched that way in the suburbs as well. You’ve got highly empowered parents who are highly focused on their kids and they’re not dominated.It’s not like the teachers union dominates elections in Westchester County. Whereas if you go into a big city school district, you have two things going on. One of which is the teachers tend to be highly involved politically and quite capable of influencing management essentially, because they are an electoral force to be reckoned with, not just by the direct votes, but also with their campaign spending. On top of this, you’re talking about a larger group of disparate parents, many of whom have lots of challenges to face and it becomes much harder for them to organize effectively on the other side. So for those reasons, big urban schools can do great things and many individual teachers can be fantastic, but it’s an ongoing challenge. Georgism, Robert Moses, & Too Much Democracy?Dwarkesh Patel 0:18:35What is your opinion on Georgism? Do cities need a land value tax? Would it be better if all the other taxes are replaced by one?Edward Glaeser 0:18:41Okay. So Henry George, I don’t know any economist who doesn’t think that a land value tax is an attractive idea. The basic idea is we’re going to tax land rather than taxing real estate values. And you would probably implement this in practice by evaluating the real estate and then subtracting the cost of construction, (at least for anything that was built up, meaning you’d form some value of the structures and you just subtract it).The attractive thing from most of our perspectives is it doesn’t create the same disincentive to build that a real estate tax does. Real estate tax says, “Oh, you know what? I might want to keep this thing as a parking lot for a couple of years so I don’t have to pay taxes on it.”If it were a land value tax, you’re going to pay the same tax, whether or not it’s a parking lot or whether or not you’re going to put a high rise on it, so you might as well put the high rise on it and we could use the space. So I think by and large, that’s a perfectly sensible idea. I’d like to see more places using land value taxes or using land value taxes in exchange for property taxes.Where George got it wrong is the idea that a land value tax is going to solve all the problems of society or all the problems of cities. That is ludicrously not true.One could make an argument that in those places that just have a property tax, you could replace it with a land value tax with little loss, but at the national level, it’s not a particularly progressive tax in lots of ways. It would be hard to figure out how to fund all the things you want to fund, especially since there are lots of things that we do that are not very land intensive. I think George was imagining a world in which pretty much all value-creating enterprises had a lot of land engaged. So it’s a good idea, yes. A panacea, no. Dwarkesh Patel 0:20:20No, that’s a good point. I mean, Google’s offices in San Francisco are probably generating more value than you would surmise just from the quantity of land they have there. Do American cities need more great builders like Robert Moses?Edward Glaeser 0:20:36Robert Caro’s The Power Broker is one of the great biographies of the past 100 years, unquestionably. The only biography that I think is clearly better is Robert Caro’s biography of Lyndon Baines Johnson, right? I mean, it’s Caro is truly amazing. That being said, I would not exactly call it a fair and balanced view of Robert. I mean, it is true that Robert Moses was high handed, and it is true that there are things that he did that were terrible, that you never want to do again. But on the other hand, the man got stuff built. I mean, I think of myself as a child growing up in New York City, and whether or not it was the public pool that I swam in or the parks that I played in, or the roads that I traveled on, they were all delivered by Robert Moses. There’s got to be a middle ground, which is, no, we’re not going to run roughshod over the neighborhood as Robert Moses did, but we’re still going to build stuff. We’re still going to deliver new infrastructure and we’re not going to do it for 10 times more than every other country in the world does it.Dwarkesh Patel 0:21:37We’re actually going to have sensible procurement policies that bring in things at a reasonable cost, and I think we need to balance a little bit back towards Robert Moses in order to have slightly more empowered builders who actually are able to deliver American cities the infrastructure they need at an affordable cost. Dwarkesh Patel 0:21:57Do we have too much democracy at the local level? You wrote a paper in 2017 titled The Political Economy of Transportation Investments and one of the points you make there is that the local costs are much more salient to people for new construction than the public benefits, and the benefits to newcomers would be. Does that mean we have too much federalism? Should we just have far less power at the city level and not universally? There are lots of good things that local control does.Edward Glaeser 0:22:25I do think we have too much local ability to say no to new housing projects. So that’s a particular case that I’m focused on. I think it’s exactly right that the near neighbors to a project internalize all of the extra noise and perhaps extra traffic that they’re going to have due to this project. They probably overestimate it because they are engaging in a bit of status quo bias and they think the present is great and can’t imagine any change.By contrast, none of the people who would benefit from the new project are able to vote. All of the families that would love to move into this neighborhood are being zoned out by the insiders who get a say. I think the goal is to make sure that we have more ability to speak for outsiders. Cities at their best, are places where outsiders can find opportunities. That’s part of what’s so great about them. It’s a tragic thing that we make that so hard. Now I’m not sure exactly that I’m claiming that I want less democracy, but I do want more limitations on how much regulations localities can do. So I think there are certain limitations on local power that I think are fine.I would prefer to call this not a limitation on local democracy, but an increase in the protection of individual rights or the individual rights of landowners to do what they want with their land. Which in effect, is a limit on democracy. But the Bill of Rights is a limit on democracy! The Bill of Rights says that they don’t care if 51% of your voters want to take away your right to free assembly. They’re not allowed to do that. So in some sense, what I’m just arguing for is more property owners’ rights so that they can actually allow more housing in their building.In terms of transportation projects, it’s a little bit dicier because here the builder is the government itself. I think the question is you want everyone to have a voice. You don’t want every neighborhood to have a veto over every potential housing project or potential transportation project. So you need something that is done more at the state level with representation from the locality, but without the localities getting the ultimate sayDwarkesh Patel 0:24:33I wonder if that paper implies that I should be shorting highly educated areas, at least in terms of real estate. One of the things you mentioned in the paper was that highly educated areas that had much higher opposition were able to foment much more opposition. Edward Glaeser  0:24:49Okay. So here’s the real estate strategy, which I have heard that actually there are buyers who do this. You take an area that has historically been very pro-housing. So it’s got lots of housing, and it’s affordable right now because supply is good. But lots of educated people have moved in. Which means that going forward, they’re going to build much less, which means that going forward, they’re likely to become much more expensive. So you should, in fact, buy options on that stuff rather than shorting it. You should short if you have a security that is related to the population level in that community. You should short that because the population growth is going to go down, but the prices are likely to go up. Opioids, Automation, & UBIDwarkesh Patel 0:25:29So you wrote a paper last year on the opioid epidemic. One of the points that you made there was that the opioid epidemic could be explained just by the demand side stuff about social isolation and joblessness. I wonder how this analysis makes you think about mass-scale automation in the future. What impact do you think that would have? Assume it’s paired with universal basic income or something like that. Do you think it would cause a tremendous increase in opioid abuse?Edward Glaeser 0:26:03I would have phrased it slightly differently–– which is as opposed to the work of two amazing economists, Anne Case and Angus Deaton, who really emphasized the role of deaths of despair; we are much more focused on the supply side. WIth the demand side, meaning just the way that we handled the distribution of large-scale pain relieving medicines, we tell a story where every 30 to 50 years, someone comes up with the same sort of idea, which is we know that human beings love opioids in different forms. We also know they’re highly addicted and lead to a terrible cycle. So all of a sudden comes along this innovator says, you know what? I’ve got a new opioid and it’s safe. You don’t have to worry about getting addicted to this one. It’s magical.It won’t work. 100 years ago, that thing was called heroin. 200 years ago, that thing was called morphine. 300 years ago, that thing was called Meldonium. We have these new drugs which have come in, and they’ve never been safe. But in our case, it was OxyContin and the magic of the time relief was supposed to make it safe, and it wasn’t safe.Dwarkesh Patel 0:27:30There’s a lot of great work that just shows that the patterns of opioid use was related to the places that just had a lot of pain 30 years ago. Those places came with a lot of tendency to prescribe various things for pain. So when opioids came in, when OxyContin came in, those were the places that got addicted most. Now it’s also true that there are links between these economic issues. There are links with joblessness, and I basically do believe that things that create joblessness are pretty terrible and are actually much worse than income inequality. I push back against the universal basic income advocates who I think are basically engaging in a materialist fallacy of thinking that a human being’s life is shaped by their take home pay or their unearned pay. I think for most people, a job is much more than that. A job is a sense of purpose. A job is a sense of social connection. When you look at human misery and opioid use, you look at the difference between high-income earners, mid-income earners. There are differences, but they’re small. You then look at the difference between low-income earners and the jobless, then unhappiness spikes enormously, misery spikes enormously, family breakups spike enormously. So things like universal basic income, which the negative income tax experimented on in the 1970s, are the closest thing we have for its large-scale experiments in this area, which had very large effects on joblessness by just giving people money. They feel quite dangerous to me because they feel like they’re going to play into rising joblessness in America, which feels like a path for its misery. I want to just quickly deviate and some of the UBI advocates have brought together UBI in the US and UBI in the developing world. So UBI in the developing world, basically means that you give poor farmers in Sub-Saharan Africa fairly modest amounts of money. This is a totally sensible strategy.These people are not about to live life permanently not working. They’re darn poor. It’s very efficient relative to other ways of giving.  I am in no sense pushing back on UBI with modest amounts of money in the poorest parts of the world. By all means, it’s been deemed to be effective. It’s just a very different thing if you’re saying I’m going to give $100 to a poor Congolese farmer, or I’m going to give $10,000 to a long-term jobless person in Eastern Kentucky. You’re not buying a PS5 for $100 in Congo.Remote Work, Taxation, & MetaverseDwarkesh Patel 0:29:57I want to ask you about remote work. You write in The Survival of the City, that improvements in information technology can lead to more demand for face-to-face contact because FaceTime complements time spent communicating electronically. I’m curious, what distinguishes situations where FaceTime substitutes for in-person contact from situations where it complements FaceTime complements virtual contact?Edward Glaeser 0:30:25So there’s not a universal rule on this. I wrote a paper based on this in the 1990s about face-to-face contact complements or substitutes for electronic contacts. It was really based on a lot of anxiety in the 1970s that the information technology of their day, the fax machine, the personal computer was going to make face-to-face contact in the cities that enable that contact obsolete. That discussion has reappeared amazingly in the past two and a half years because of Zoom, and all of those questions still resonate. I think in the short run, typically these things are substitutes.Typically you don’t necessarily need to meet some person who’s your long-term contact. You can actually just telephone them, or you can connect with them electronically. In the long run, they seem to be much more likely to be complements, in part because these technologies change our world. The story that I tell over the last 40 years is that, yes, there were some face-to-face contacts that were made unnecessary because of electronic interactions. But it’s not just that cities did well over the past 40 years–– business travel went through the roof over the past 40 years. You’d think that that would have been made unnecessary by all these electronic interactions, but I think what just happened was that these new technologies and globalization created a more interconnected world, a world in which knowledge was more important, and we become smart by interacting with people face-to-face. This world became more knowledge and information intensive and more complicated, and as things get more complicated, it’s easier for ideas to get lost in translation. So we have these wonderful cues for communicating comprehension or confusion that are lost when we’re not in the same room with one another. So I think over the longer time, they tend to complements, and over the shorter term, they tend to be substitutes.One of the things I think was helpful in my earlier work on this was looking at the history of information technology innovations. I think probably the first one is the book. It’s hard to imagine an innovation that did more to flatten distance. Now you can read stuff that people are saying hundreds of miles away. Yet there’s not a shred of evidence that the book led to less urbanization in Europe or to less connection. It helped create a totally different world in which people were passionate about ideas and wanted to talk to each other. They wanted to talk to each other about their books.Flash forward 350 years when we have the telephone. Telephones started being used more in cities, and they were used mostly by people who were going to meet face-to-face. There’s no evidence that this has created a decline in the demand for face-to-face contact or a decline in the demand for cities. So I think if we look at Zoom, which unquestionably has allowed a certain amount of long-distance contact, that’s very, very useful. In the short run, it certainly poses a threat to urban office markets. My guess is in the long run; it’s probably going to be likely to be neutral at worst for face-to-face contact in the cities that enable that contact. Dwarkesh Patel 0:33:37I think that my podcast has been a great example for me about this. I mean, right now we’re talking virtually. So maybe, in a way it’s substituted, and perhaps I would have interviewed in person without the podcast. However, in another way, I’ve also met so many people that I’ve interviewed on the podcast or who have just connected with me because of the podcast in person. The amount of in-person interactions I’ve had because of a virtual podcast is a great anecdote to what you’re talking about, so that makes total sense.Edward Glaeser 0:34:05Absolutely.Dwarkesh Patel 0:34:06Why do even the best software engineers in India or in Europe make so much less when they’re working remotely from those locations than remote engineers working in America make? I mean, why don’t employers just pay them more until the price discrepancy goes away?Edward Glaeser 0:34:23That’s interesting. I don’t fully know the answer to that question. I would suspect some of it just has to do with the nature of supply and demand. There are some things that are just very hard to be done remotely. Either because you have very precise informational needs that you have that are easier to communicate to people who are nearby or the person who’s nearby has evolved in ways in terms of their mind that they actually know exactly what you want and they have exactly the product that you need. So even though the remote call center worker and the local one may be totally equivalent on raw programming talent, you may still end up in equilibrium and be willing to pay a lot more to the local one just because, right?So there’s a slightly differentiated skill the local one has, and look, there’s just a lot of competition for the remote ones, so the price is going to be pretty low. There’s not that much supply of the one guy who’s down the hall and knows exactly what you’re looking for. So that guy gets much higher wages, just because he can offer you something that no one else can exactly reproduce.Dwarkesh Patel 0:35:27Let me clarify my question. Even remote engineers in America will make more than remote engineers in Europe or in India. If somebody is working remotely but he just happens to live in the US, is that just because they can communicate in English in the same way? Edward Glaeser 0:35:54I would take the same stance. I would say that they’re likely to have just skills that are somewhat idiosyncratic and are valued in the US context.Dwarkesh Patel 0:35:56Are you optimistic about the ability of the metaverse and VR to be able to better puncture whatever makes in-person contact so valuable?Edward Glaeser 0:36:19No, I do not think the metaverse is going to change very much. I do think that there will be a lot of hours spent on various forms of gaming over the next 20 years, but I don’t think it ultimately poses much of a threat to real-world interactions. In some sense, we saw this with the teenage world over the last three years. We saw a lot of America spend an awful lot of time, 15, 16-year-olds, 17-year-olds, gaming and connecting entirely virtually during the whole time of the pandemic lockdowns.Every single person that I’ve seen in that cohort, when you allowed them to interact with real members of their group live, leaped at the opportunity. They leaped at the opportunity of meeting and actually hanging out with real people until three o’clock in the morning and arguing over whatever it is–– whether or not it’s football or Kant. I think particularly for the young, living life live just beats the alternative.Dwarkesh Patel 0:37:05That sounds like a very Harvard scenario, having to argue over football or Kant, those two topics. [laughs] Are you predicting lower taxes over the coming decades in places like California and New York, specifically because of how remote work sets a sort of maximum bar of how much you can tax highly productive people before they will just leave? Edward Glaeser 0:37:29This is a great question. It’s a central issue of our day. Here’s how I think about it. In part, it’s why I wrote my recent book, Survival of the City. It’s because I was worried about this. Two things happened simultaneously. One, as you correctly say, Zoom has made it easier to connect anywhere. I don’t think that Zoom is going to cause our tech startup currently in Silicon Valley to say, oh, you know what? We’re just going to go home to our Orange County suburban homes and never meet live again. I think that’s a low-probability event.But what seems to be a perfectly high probability event is saying, “Oh, we can Zoom with our VCs, we can Zoom with our lawyers. Why don’t we just relocate to Austin, Texas, not pay taxes, or relocate to Boulder, Colorado, so we can have beautiful scenery, or relocate to Honolulu so we can surf?” That seems like we’ve made the ability for smart people to relocate much easier, even if they’re going to keep on seeing each other in the office three or four days a week. That collides with this very fervent desire to deal with festering social inequities at the local level. Be this limited upward mobility for poorer people, be this high housing costs, be this the rise of mass incarceration and police brutality towards particularly minority groups. There’s this progressive urge which runs up against the fact that the rich guys can run away.If your model, which says, “Oh, the local governments are going to realize the rich guys can run away, so they will seamlessly lower tax rates in order to make sure that they attract those people,” that’s running up against the fact that there’s a whole lot of energy on the progressive side, which says, “No! Massachusetts just passed a millionaire’s tax. For the first time ever, we have the possibility to have a progressive tax, which feels extraordinarily dangerous given this time period.”I think we may need to see a bunch of errors in this area before we start getting things right. We went through a lot of pain in the 1970s as cities first tried to deal with their progressive goals and rich people and companies ran away, and it wasn’t until the 1980s that people started realizing this was the path to local bankruptcy and that we had real city limits on what the locality could do.Dwarkesh Patel 0:39:44You cited research on the survival of the city, which said that firms like Microsoft were much less willing to hire new people once they went online because of the pandemic. What do you make of the theory that this is similar to when industrialization first hit and we hadn’t figured out exactly how to make the most use of it to be most productive, but over the long run, somebody will do to remote work what Henry Ford did to the factory floor and in fact, just make it much more effective and efficient than in-person contact just because we’ll have better ways of interacting with people through remote work, since we’ll have better systems?Dwarkesh Patel 0:40:17It’s entirely possible. I never like betting against the ingenuity of humanity. On the other hand, you need a lot of technology to override 5 million years of evolution. We have evolved to be an in-person species, not just because we’re productive and learn a lot face-to-face, but also because we just like it. A world of hyper-efficient remote work where you basically are puttering around your apartment doing things very quickly and getting things done, doesn’t sound particularly joyful to me.Workplaces are not just places of productivity; they’re also places of pleasure, particularly at the high end. Remember in 2019 and earlier, Google, and Yahoo, the companies that should have had the biggest capacity to do remote stuff, weren’t sending their workers home; they were building these paradises for high-skilled workers, stuffed with foosball tables and free snacks and whatever else they had in these giant campuses in the Google lex. So they were certainly betting on the power of face-to-face and creativity rather than on the ability of remote work to make everything work. I think the most reasonable view, let’s say that of Nick Bloom of Stanford, is that for those types of workers, 20% of your week being hybrid, maybe 40%, seems quite possible.That seems like a thing, particularly for workers who have families who really value that degree of flexibility. But fully remote, I guess that’s a pretty niche thing. There’s some jobs like call center workers where you could imagine it being the norm, but in part, that’s just because it’s just hard to learn the same amount remotely that you do face-to-face. This came out both in the earlier Bloom study on remote call center workers in China and on more recent work by Natalia Emmanuel and Emma Harrington. Both studies found the same thing, which is in these call centers, are plenty productive when they’re remote, but the probability of being promoted drops by 50%.The entrepreneur may make it very efficient to do things in the short run remotely, but they’re going to turn off this tendency that we have to be able to learn things from people around us, which is just much harder to duplicate remotely.Past & Future of Silicon ValleyDwarkesh Patel 0:42:29Now, I’m curious why Silicon Valley became the hub of technology. You wrote a paper in 2018 about where pioneer and non-pioneer firms locate. So, I was hoping you had insight on this. Does it stand for it? Is it where Fairchild Semiconductor is located? What is the explanation?Edward Glaeser 0:42:48So, we take it as being earlier. It is Stanford. I traced through this, I think in Triumph. Yeah, it was a company called Federal Telegraph Company that was founded by a guy called Cyril Frank Elwell, who was a radio pioneer, and he was tapped by his teacher to head this radio company. The story was, as I remember it, there’d been this local genius in San Francisco who had attracted all these investors and was going to do this wireless telegraphy company. Then he died in a freak carriage accident.These investors wanted to find someone else, and they went to Stanford’s nearby factory and asked, who should we hire? It was this guy Elwell who founded Federal Telegraph. Federal Telegraph then licensed, I think Danish technology which was originally the Poulsen Telegraph Company. They then hired some fairly bright people like Lee DeForest and they did incredibly well in World War I off of federal Navy contracts, off of Navy contracts. They then did things like providing jobs for people like the young Fred Terman, whose father was a Stanford scientist. Now, Fred Terman then plays an outsized role in this story because he goes to MIT, studies engineering there, and then comes back to become Dean of Stanford’s engineering program.He really played an outsized role in setting up the Stanford Industrial Park which attracting Fairchild Semiconductor. Then there’s this sort of random thing about how the Fairchild Semiconductor attracts these people and then repels them because you have this brilliant guy Shockley, right? He’s both brilliant and sort of personally abhorrent and manages to attract brilliant people and then repel all of them. So they all end up dispersing themselves into different companies, and they create this incredibly creative ecosystem that is the heart of Silicon Valley.In its day, it had this combination of really smart people and really entrepreneurial ethos, which just made it very, very healthy. I think the thing that many of us worry about is that Silicon Valley more recently, feels much more like it’s a one-industry town, which is dangerous. It feels more like it’s a bunch of industrial behemoths rather than a bunch of smart and scrappy startups. That’s a recipe that feels much more like Detroit in the 1950s than it does like Silicon Valley in the 1960s.Dwarkesh Patel 0:45:52Speaking of startups, what does your study of cities imply about where tech startups should locate and what kind of organization in person or otherwise they should have? I think there’s a lot to like about in person, certainly. Relying too much on remote feels quite dangerous if you’re a scrappy startup. But I like a lot the Sunbelt smart cities.I sort of have a two-factor model of economic growth, which is it’s about education, and it’s about having governments that are pro-business. If you think about sort of the US, there’s a lot of heterogeneity in this. If you think about the US versus other countries, it’s heterogeneity. So the US has historically been better at being pro-business than, let’s say, the Northern European social democracies, but the Northern European social democracies are great on the education front.So places like Sweden and the Netherlands, and Germany are also very successful places because they have enough education to counter the fact that they may not necessarily be as pro-business as the US is. Within the US, you also have this balance, whereas places like Massachusetts, and California are certainly much less pro-business, but they’re pretty well-educated. Other parts of the country may be more pro-business, but they’re less so. The real secret sauce is finding those places that are both highly educated and pro-business.So those are places like Charlotte and Austin and even Atlanta, places in the Sun Belt that have attracted lots of skilled people. They’ve done very, very well during COVID. I mean, Austin, by most dimensions, is the superstar of the COVID era in terms of just attracting people. So I think you had to wait for the real estate prices to come down a bit in Austin, but those are the places that I would be looking at. Dwarkesh Patel 0:47:46I don’t know if you know, but I live in Austin, actually.Edward Glaeser 0:47:50I did not know that. [laughs]Dwarkesh Patel 0:47:54Well, actually, I’m surprised about what you said about education because you write in the paper, “general knowledge measured as average years of schooling is not a strong determinant of the survival of a pioneer firm, but relatedness of knowledge between past and present activities is.” So I’m surprised that you think education is a strong determinant for pioneer firms.Edward Glaeser 0:48:15No, I’m a big human capital determinist. So I tend to believe that individuals, cities, and nations rise and fall based on their skill levels. Certainly, if you look over the last 40 or 50 years, skills are very predictive of which cities (particularly colder cities) manage to do well versus poorly. If you ask yourself why Detroit and Seattle look different, more than 50% of Seattle’s adults have college degrees, and maybe 14, 15% of Detroit’s adults do.That’s just a huge, huge gap. Certainly, when we think about your punitive startup, you’re going to be looking for talent, right? You’re going to be looking to hire talent, and having lots of educated people around you is going to be helpful for that.Housing ReformDwarkesh Patel 0:48:56Let’s talk about housing. Houston has basically very little to no zoning. Why is it not more of interesting today? Nobody goes to Houston for tourism.Edward Glaeser 0:49:07I have. [laughs] I have, in fact, gone to Houston for tourism. Although part of it, I admit, was to look at the housing and to go to the woodlands and look at that. Interesting has a lot to do with age in this country. So the more that a city has… Boston is good for tourism just because it’s been around for a long time, and it hasn’t changed all that much. So it has this sort of historical thing. Houston’s a new place, not just in the sense that the chronological age is lower but also in the sense that it’s just grown so much, and it’s dominated by new stuff, right?That new stuff tends to be more homogenous. It tends to have less history on it. I think those are things that make new cities typically less interesting than older cities. As witnessed by the fact that Rome, Jerusalem, London, are great tourist capitals of the world because they’ve just accreted all this interesting stuff over the millennium. So I think that’s part of it. I’m not sure that if we look at more highly zoned new cities, we’re so confident that they’re all that more interesting.I don’t want to be particularly disparaging any one city. So I’m not going to choose that, but there’s actually a bunch that’s pretty interesting in Houston, and I’m not sure that I would say that it’s any less interesting than any comparably aged city in the country.Dwarkesh Patel 0:50:35Yeah. I’m visiting Houston later this month. I asked my friend there, should I stay here longer? I mean, is there anything interesting to do here? And then he responds, “Well, it’s the fourth biggest city in the country, so no.”Dwarkesh Patel 0:50:47Many people, including many economists, have said that we should drastically increase US population through immigration to a figure like 1 billion. Do you think that our cities could accommodate that? We have the infrastructure, and I mean, let’s say we reformed housing over a decade or so. Could we accommodate such a large influx of people? Edward Glaeser 0:51:24A billion people in a decade? I love the vision. Basically, in my heart, I’m an open borders person, right? I mean, it’s a moral thing. I don’t really like the idea that I get to enjoy the privileges of being an American and think that I’m going to deny that opportunity to anyone else. So I love this vision. A billion people over 10 years is an unimaginably large amount of people over a relatively short period of time. I’d love to give it a shot. I mean, it’s certainly not as if there’s any long-term reason why you couldn’t do it.I mean, goodness knows we’ve got more than enough space in this country. It would be exciting to do that. But it would require a lot of reform in the housing space and require a fair amount of reform in the infrastructure space as well to be able to do this at some kind of large scale affordability.Dwarkesh Patel 0:52:05What does the evidence show about public libraries? Do they matter?Dwarkesh Patel 0:52:09My friend Eric Kleinberg has written a great book about… I think it’s called Palaces for the People about all the different functions that libraries have played. I’ve never seen anything statistically or systematically about this, but you’re not going to get a scholar to speak against books. It’s not a possible thing.Europe’s Stagnation, Mumbai’s Safety, & Climate Change Dwarkesh Patel 0:52:32Why do European cities seem so much more similar to what they look like decades or even centuries ago than American cities, even American cities that are old, obviously not as old as European cities, but they seem to change much more over time. Edward Glaeser 0:52:46Lower population growth, much tougher zoning, much tougher historic preservation. All three of these things are going on. So it’s very difficult to build in European cities. There’s a lot of attention to caring about history. It’s often part of the nationalist narrative. You often have huge amounts of national dollars going to preserve local stuff and relatively lower levels of population growth.An extreme example of this is Warsaw, where central Warsaw is completely destroyed during World War II, and they built it up to look exactly like it looked before the bombing. So this is a national choice, which is unlikely that we would necessarily make here in the US. Dwarkesh Patel 0:53:27Yeah. I was in Mumbai earlier this year, and I visited Dharavi, which is the biggest slum in Asia. And it’s a pretty safe place for a slum. Why are slums in different countries? Why do they often have different levels of how safe they are? What is the reason?Edward Glaeser 0:53:45I, too, have been in Dharavi and felt perfectly safe. It’s like walking around Belgravia and London in terms of it. I think my model of Dharavi is the same model as Jane Jacobs's model of Greenwich Village in 1960, which is this is just a well-functioning community.People have eyes on the street. If you’re a stranger in these areas, they’re going to be looking at you, and it’s a community that just functions. There are lots of low-income communities throughout the world that have this. It requires a certain amount of permanence. So if the community is too much in flux, it becomes hard to enforce these norms and hard to enforce these sort of community rules. It’s really helpful if there aren’t either a massive number of guns floating around or an unbelievably lucrative narcotics trade, which is in the area. Those are both things that make things incredibly hard. Furthermore, US drug policy has partially been responsible for creating violence in some of the poor parts of Latin American cities.Dwarkesh Patel 0:54:43Maybe you don’t play video games enough to know the answer to this question. But I’m curious, is there any video game, any strategic video game like Civilization or Europa that you feel does a good job representing the economics of cities? Edward Glaeser 0:55:07No, I will say that when I was in graduate school, I spent a few hours playing something called Sim City. I did think that was very fun. But I’m not going to claim that I think that it got it right. That was probably my largest engagement with city-building video games.Dwarkesh Patel 0:55:12What would you say we understand least about how cities work? Edward Glaeser 0:55:18I’m going to say the largest unsolved problem in cities is what the heck we’re going to do about climate change and the cities of the developing world. This is the thing I do not feel like I have any answer for in terms of how it is that we’re going to stop Manila or Mumbai from being leveled by some water-related climate event that we haven’t yet foreseen.We think that we’re going to spend tens of billions of dollars to protect New York and Miami, and that’s going to happen; but the thing I don’t understand and something we really need to need to invest in terms of knowledge creation is what are we going to do with the low-lying cities of the developing world to make them safe. Dwarkesh Patel 0:55:54Okay. Your most recent book is Survival of the City. And before that Triumph of the City, both of which I highly recommend to readers. Professor Glaeser, thank you so much for coming on the podcast. This was very interesting.Edward Glaeser 0:56:05I enjoyed this a lot. Thank you so much for having me on. I had a great deal of fun. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

I had a fascinating discussion about Robert Moses and The Power Broker with Professor Kenneth T. Jackson.He's the pre-eminent historian on NYC and author of Robert Moses and The Modern City: The Transformation of New York.He answers:* Why are we so much worse at building things today?* Would NYC be like Detroit without the master builder?* Does it take a tyrant to stop NIMBY?Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow me on Twitter for updates on future episodes.If you end up enjoying this episode, I would be super grateful if you share it, post it on Twitter, send it to your friends & group chats, and throw it up wherever else people might find it. Can’t exaggerate how much it helps a small podcast like mine.A huge thanks to Graham Bessellieu for editing this podcast.Timestamps(0:00:00) Preview + Intro(0:11:13) How Moses Gained Power(0:18:22) Moses Saved NYC?(0:27:31) Moses the Startup Founder?(0:32:34) The Case Against Moses Highways(0:51:24) NIMBYism(1:03:44) Is Progress Cyclical(1:12:36) Friendship with Caro(1:20:41) Moses the Longtermist?.TranscriptThis transcript was produced by a program I wrote. If you consume my podcast via transcripts, let me know in the comments if this transcript was (or wasn’t) an adequate substitute for the human edited transcripts in previous episodes.0:00:00 Preview + IntroKenneth Jackson 0:00:00Robert Moses represented a past, you know, a time when we wanted to build bridges and super highways and things that pretty much has gone on. We're not building super highways now. We're not building vast bridges like Moses built all the time. Had Robert Moses not lived, not done what he did, New York would have followed the trail of maybe Detroit. Essentially all the big roads, all the bridges, all the parks, the United Nations, Lincoln Center, the World's Fairs of 1939 and 1964, and hundreds of other things he built. And I think it was the best book I ever read. In broad strokes, it's correct. Robert Moses had more power than any urban figure in American history. He built incredible monuments. He was ruthless and arrogant and honest. Okay.Dwarkesh Patel 0:00:54I am really, really excited about this one. Today I have the pleasure of speaking with Professor Kenneth T. Jackson about the life and legacy of Robert Moses. Professor Jackson is the preeminent historian on New York City. He was the director of the Herbert H. Lehman Center for American History and the Jock Barzun Professor Emeritus of History at Columbia University, where he has also shared the Department of History. And we were discussing Robert Moses. Professor Jackson is the author and editor of Robert Moses and the Modern City, the Transformation of New York. Professor Jackson, welcome to the podcast.Kenneth Jackson 0:01:37Well, thank you for having me. Okay.Dwarkesh Patel 0:01:40So many people will have heard of Robert Moses and be vaguely aware of him through the popular biography of him by Robert Caro, the power broker. But most people will not be aware of the extent of his influence on New York City. Can you give a kind of a summary of the things he was able to get built in New York City?Kenneth Jackson 0:02:03One of the best comparisons I can think of is that our Caro himself, when he compared him to Christopher Wren in London, he said, if you would see his monument, look around. It's almost more easier to talk about what Moses didn't do than what he did do. If you all the roads, essentially all the big roads, all the bridges, all the parks, the United Nations, Lincoln Center, the World's Fairs of 1939 and 1964, and hundreds of other things he built. I mean, he didn't actually do it with his own two hands, but he was in charge. He got it done. And Robert Caro wrote a really great book. I think the book was flawed because I think Caro only looked at Moses's own documents and Moses had a very narrow view of himself. I mean, he thought he was a great man, but I mean, he didn't pay any attention to what was going on in LA very much, for example. But clearly, by any standard, he's the greatest builder in American history. There's nobody really in second place. And not only did he build and spend this vast amount of money, he was in power for a long time, really a half century more or less. And he had a singular focus. He was married, but his personal life was not important to him. He did it without scandal, really, even Caro admits that he really died with less than he started with. So I mean, he wanted power, and boy, did he have power. He technically was subservient to governors and mayors, but since he built so much and since he had multiple jobs, that was part of his secret. He had as many as six, eight, ten different things at once. If the mayor fired him or got rid of him, he had all these different ways, which he was in charge of that the mayor couldn't. So you people were afraid of him, and they also respected him. He was very smart, and he worked for a dollar a year. So what are you going to get him for? As Caro says, nobody is ready to be compared with Robert Moses. In fact, compares him with an act of nature. In other words, the person you can compare him with is God. That's the person. He put the rivers in. He put the hills in. He put the island in. Compare that to Moses, what Moses did. No other person could compare to that. That's a little bit of exaggeration, but when you really think about Robert Moses and you read the Power Broker, you are stunned by the scope of his achievement. Just stunned. And even beyond New York, when we think of the interstate highway system, which really starts in 1954, 55, 56, and which is 40-something thousand miles of interstate highways, those were built by Moses' men, people who had in their young life had worked with the parkways and expressways in and around New York City. So they were ready to go. So Moses and Moses also worked outside New York City, mostly inside New York City, but he achieved so much. So probably you need to understand it's not easy to get things done in New York. It's very, very dense, much twice as dense as any place in the United States and full of neighborhoods that feel like little cities and are little cities and that don't want change even today. A place like Austin, for example, is heavy into development, not New York. You want to build a tall building in New York, you got to fight for it. And the fact that he did so much in the face of opposition speaks a lot to his methods and the way he… How did Moses do what he did? That is a huge question because it isn't happening anymore, certainly not in New YorkDwarkesh Patel 0:06:22City. Yeah. And that's really why I actually wanted to talk to you and talk about this book because the Power Broker was released in 1974 and at the time New York was not doing well, which is to put it mildly. But today the crisis we face is one where we haven't built significant public works in many American cities for decades. And so it's interesting to look back on a time when we could actually get a lot of public works built very quickly and very efficiently and see if maybe we got our characterization of the people at the time wrong. And that's where your 2007 book comes in. So I'm curious, how was the book received 50 years after, or I guess 40 years after the Power Broker was released? What was the reception like? How does the intellectual climate around these issues change in that time?Kenneth Jackson 0:07:18The Power Broker is a stunning achievement, but you're right. The Power Broker colon Robert Moses and the fall of New York. He's thinking that in the 1970s, which is the… In New York's 400-year history, we think of the 1970s as being the bottom. City was bankrupt, crime was going up, corruption was all around. Nothing was working very well. My argument in the subtitle of the 2007 book or that article is Robert Moses and the rise of New York. Arguing that had Robert Moses not lived, not done what he did, New York would have followed the trail of maybe Detroit and St. Louis and Cincinnati and Pittsburgh and most cities in the Northeast and Midwest, which really declined. New York City really hasn't declined. It's got more people now than it ever did. It's still a number one city in the world, really, by most of our standards. It's the global leader, maybe along with London. At one point in the 1980s, we thought it might be Tokyo, which is the largest city in the world, but it's no longer considered competitive with New York. I say London too because New York and London are kind of alone at the top. I think Robert Moses' public works, activities, I just don't know that you could have a New York City and not have expressways. I don't like the Cross Bronx expressway either and don't want to drive on it. How can you have a world in which you can't go from Boston to San Francisco? You had to have it. You have to have some highways and Carroll had it exactly wrong. He talked about Moses and the decline of public transit in New York. Actually what you need to explain in New York is why public transit survived in New York, wherein most other American cities, the only people who use public transit are the losers. Oh, the disabled, the poor and stuff like that. In New York City, rich people ride the subway. It's simply the most efficient way to get around and the quickest. That question needs, some of the things need to be turned on its head. How did he get it done? How did he do it without scandal? I mean, when you think about how the world is in our time, when everything has either a financial scandal or a sexual scandal attached to it, Moses didn't have scandals. He built the White Stone Bridge, for example, which is a gigantic bridge connecting the Bronx to Queens. It's beautiful. It was finished in the late 1930s on time and under budget. Actually a little earlier. There's no such thing as that now. You're going to do a big public works project and you're going to do it on time. And also he did it well. Jones Beach, for example, for generations has been considered one of the great public facilities on earth. It's gigantic. And he created it. You know, I know people will say it's just sand and water. No, no, it's a little more complicated than that. So everything he did was complicated. I mean, I think Robert Caro deserves a lot of credit for doing research on Moses, his childhood, his growing up, his assertion that he's the most important person ever to live in and around New York. And just think of Franklin Roosevelt and all the people who lived in and around New York. And Moses is in a category by himself, even though most Americans have never heard of Robert Moses. So his fame is still not, that book made him famous. And I think his legacy will continue to evolve and I think slightly improve as Americans realize that it's so hard, it's hard to build public works, especially in dense urban environments. And he did it.0:11:13 How Moses Gained PowerDwarkesh Patel 0:11:33Yeah. There's so much to talk about there. But like one of the interesting things from the Power Broker is Caro is trying to explain why governors and mayors who were hesitant about the power that Moses was gaining continued to give him more power. And there's a section where he's talking about how FDR would keep giving him more positions and responsibilities, even though FDR and Moses famously had a huge enmity. And he says no governor could look at the difficulty of getting things built in New York and not admire and respect Moses' ability to do things, as he said, efficiently, on time, under budget, and not need him, essentially. But speaking of scandal, you talked about how he didn't take salary for his 12 concurrent government roles that he was on. But there's a very arresting anecdote in the Power Broker where I think he's 71 and his daughter gets cancer. And for the first time, I think he had to accept, maybe I'm getting the details wrong, but he had to accept salary for working on the World's Fair because he didn't have enough. He was the most powerful person in New York, and he didn't have enough money to pay for his daughter's cancer. And even Caro himself says that a lot of the scandals that came later in his life, they were just kind of trivial stuff, like an acre of Central Park or the Shakespeare in the park. Yeah, it wasn't... The things that actually took him down were just trivial scandals.Kenneth Jackson 0:13:07Well, in fact, when he finally was taken down, it took the efforts of a person who was almost considered the second most powerful person in the United States, David Rockefeller, and the governor of New York, both of whom were brothers, and they still had a lot of Moses to make him kind of get out of power in 1968. But it was time. And he exercised power into his 70s and 80s, and most of it was good. I mean, the bridges are remarkable. The bridges are gorgeous, mostly. They're incredible. The Throgs Neck Bridge, the Verrazano Narrows Bridge, the Triborough Bridge, they're really works of art. And he liked to build things you could see. And I think the fact that he didn't take money was important to it. You know, he was not poor. I wouldn't say he's not wealthy in New York terms, but he was not a poor person. He went to Yale as a Jewish person, and let's say in the early 20th century, that's fairly unusual and he lived well. So we can't say he's poor, but I think that Carol was right in saying that what Moses was after in the end was not sex and not power, and not sex and not money. Power. He wanted power. And boy, did he get it.Dwarkesh Patel 0:14:37Well, there's a good review of the book from, I'm not sure if I remember the last name, but it was Philip Lopgate or something. Low paid, I think.Kenneth Jackson 0:14:45Okay.Dwarkesh Patel 0:14:46And he made a good point, which was that the connotation of the word power is very negative, but it's kind of a modern thing really to have this sort of attitude towards power that like somebody who's just seeking it must necessarily have suspicious motivations. If Moses believed, and in fact, he was probably right in believing that he was just much more effective at building public works for the people that live in New York, was it irrational of him or was it selfish of him to just desire to work 14 hour days for 40 years on end in order to accumulate the power by which he could build more public works? So there's a way of looking at it where this pursuit of power is not itself troubling.Kenneth Jackson 0:15:36Well, first of all, I just need to make a point that it's not just New York City. I mean, Jones Beach is on Long Island. A lot of those highways, the Northern State Parkway, the Southern State Parkway are built outside the city and also big projects, the Power Authority in upstate New York. He also was consultant around the world in cities and transportation. So his influence was really felt far beyond New York City. And of course, New York City is so big and so important. I think also that we might want to think about, at least I think so, what do I say, the counterfactual argument. Can you imagine? I can remember when I was in the Air Force, we lived next door to a couple from New York City. We didn't know New York City at the time. And I can't remember whether she or he was from the Bronx or Brooklyn, but they had they made us understand how incredibly much he must have loved her to go to Brooklyn or the Bronx to see her and pick her up for days and stuff like this. You couldn't get there. I mean, it would take you three hours to go from the Rockaways in Brooklyn to somewhere in the Northern Bronx. But the roads that Moses built, you know, I know at rush hour they're jammed, but you know, right this minute on a Sunday, you can whiz around New York City on these expressways that Moses built. It's hard to imagine New York without. The only thing Moses didn't do was the subway, and many people have criticized him because the subways were deteriorated between the time they were built in the early part of the 20th century in 1974 when Carol wrote to Power Broker. But so had public transit systems all over the United States. And the public transit system in New York is now better than it was 50 years ago. So that trajectory has changed. And all these other cities, you know, Pittsburgh used to have 600,000 people. Now it has 300,000. Cleveland used to have 900,000 and something. Now it's below five. Detroit used to have two million. Now it's 600 something thousand. St. Louis used to have 850,000. Now it's three hundreds. I mean, the steep drop in all these other cities in the Midwest and Northeast, even Washington and even Boston and Philadelphia, they all declined except New York City, which even though it was way bigger than any of them in 1950 is bigger now than it was then. More people crammed into this small space. And Moses had something to do with that.0:18:22 Would NYC Have Fallen Without Moses?Dwarkesh Patel 0:18:22Yeah, yeah, yeah. You write in the book and I apologize for quoting you back to yourself, but you write, had the city not undertaken a massive program of public works between 1924 and 1970, had it not built the arterial highway system and had it not relocated 200,000 people from old law tenements to new public housing projects, New York would not have been able to claim in the 1990s that it was a capital of the 20th century. I would like to make this connection more explicit. So what is the reason for thinking that if New York hadn't done urban renewal and hadn't built the more than 600 miles of highways that Moses built there, that New York would have declined like these other cities in the Northeast and the Midwest?Kenneth Jackson 0:19:05Well, I mean, you could argue, first of all, and friends of mine have argued this, that New York is not like other cities. It's a world city and has been and what happens to the rest of the United States is, I accept a little bit of that, but not all of it. You say, well, New York is just New York. And so whatever happens here is not necessarily because of Moses or different from Detroit, but I think it's important to realize its history has been different from other American cities. Most American cities, especially the older cities, have been in relative decline for 75 years. And in some ways New York has too. And it was its relative dominance of the United States is less now than because there's been a shift south and west in the United States. But the prosperity of New York, the desire of people to live in it, and after all, one of its problems is it's so expensive. Well, one reason it's expensive is people want to live there. If they didn't want to live there, it would be like Detroit. It'd be practically free. You know what I mean? So there are answers to these issues. But Moses' ways, I think, were interesting. First of all, he didn't worry about legalities. He would start an expressway through somebody's property and dare a judge to tell him to stop after the construction had already started. And most of the time, Moses, he was kind of like Hitler. It was just, I don't mean to say he was like Hitler. What I mean is, but you have such confidence. You just do things and dare other people to change it. You know what I mean? I'm going to do it. And most people don't have that. I think there's a little bit of that in Trump, but not as much. I mean, I don't think he has nearly the genius or brains of Moses. But there's something to self-confidence. There's something to having a broad vision. Moses liked cities, but he didn't like neighborhoods or people. In other words, I don't think he loved New York City. Here's the person who is more involved. He really thought everybody should live in suburbs and drive cars. And that was the world of the future. And he was going to make that possible. And he thought all those old law tenements in New York, which is really anything built before 1901, were slums. And they didn't have hot and cold water. They often didn't have bathrooms. He thought they should be destroyed. And his vision was public housing, high-rise public housing, was an improvement. Now I think around the United States, we don't think these high-rise public housing projects are so wonderful. But he thought he was doing the right thing. And he was so arrogant, he didn't listen to people like Jane Jacobs, who fought him and said, you're saying Greenwich Village is a slum? Are you kidding me? I mean, he thought it was a slum. Go to Greenwich Village today. Try to buy anything for under a million dollars. I mean, it doesn't exist. You know what I mean? I mean, Greenwich Village, and he saw old things, old neighborhoods, walking, is hopelessly out of date. And he was wrong. He was wrong about a lot of his vision. And now we understand that. And all around the country, we're trying to revitalize downtowns and reduce our dependence on fossil fuels and gasoline and cars. But Moses didn't see the world that way. It's interesting. He never himself drove a car. Can you believe that the man who had more influence on the American car culture, probably even than Henry Ford, himself was always driven. He was chauffeured. In fact, he was so busy that Carol talks about him as having two limousines behind each other. And he would have a secretary in one, and he would be dealing with business and writing letters and things like this. And then she would have all she could do. They would pull off to the side of the road. She would get out of his car. The car that was following would discharge the secretary in that car. They would switch places. And the fresh secretary would get in the backseat, Moses, and they would continue to work. And the first secretary would go to type up whatever she had to do. He worked all the time. He really didn't have much of a private life. There are not many people like Robert Moses. There are people like Robert Moses, but not so many, and he achieved his ideal. I think that there are so many ironies there. Not only did he not drive himself, he didn't appreciate so much the density of New York, which many people now love, and it's getting more dense. They're building tall buildings everywhere. And he didn't really appreciate the diversity, the toleration. He didn't care about that, but it worked. And I just think we have to appreciate the fact that he did what was impossible, really impossible, and nobody else could have done what he did. And if we hadn't done it then, he sure as heck wouldn't be able to do it in the 21st century, when people are even more litigious. You try to change the color of a door in New York City, and there'll be—you try to do something positive, like build a free swimming pool, fix up an old armory and turn it into a public—there'll be people who'll fight you. I'm not kidding this. And Moses didn't care. He says, I'm going to do this. When he built the Cross Bronx Expressway, which in some ways is—it was horrible what he did to these people, but again, Carol mischaracterizes what happened. But it's a dense working class—let's call it Jewish neighborhood—in the early 1950s. And Roses decides we need an interstate highway or a big highway going right through it. Well, he sent masses of people letters that said, get out in 90 days. He didn't mean 91 days. He meant—he didn't mean let's argue about it for four years. Let's go to legit—Moses meant the bulldozers will be bulldozing. And that kind of attitude, we just don't have anymore. And it's kind of funny now to think back on it, but it wasn't funny to the people who got evicted. But again, as I say, it's hard to imagine a New York City without the Cross Bronx Expressway. They tore down five blocks of dense buildings, tore them down, and built this road right through it. You live—and they didn't worry about where they were going to rehouse them. I mean, they did, but it didn't work. And now it's so busy, it's crowded all the time. So what does this prove? That we need more roads? But you can't have more roads in New York because if you build more roads, what are you going to do with the cars? Right now, the problem is there are so many cars in the city, there's nothing to do. It's easy to get around in New York, but what are you going to do with the car? You know, the car culture has the seeds of its own destruction. You know, cars just parking them or putting them in a garage is a problem. And Moses didn't foresee those. He foreseed you're all going to live in the Long Island suburbs or Westchester suburbs or New Jersey suburbs. Park your car in your house and come in the city to work. Now, the city is becoming a place to live more than a place to work. So what they're doing in New York as fast as they can is converting office buildings into residential units. He would never have seen that, that people would want to live in the city, had options that they would reject a single family house and choose high rise and choose the convenience of going outside and walking to a delicatessen over the road, driving to a grocery store. It's a world he never saw.0:27:31 Moses the Startup Founder?Dwarkesh Patel 0:27:31Yeah, yeah. Yeah. Like the thing you pointed out earlier about him having the two limousines and then the enormous work ethic and then the 90 day eviction. I mean, I'm a programmer and I can recognize this trope immediately. Right. Robert Moses was a startup founder, but in government, you know, that attitude is like, yeah, it's like Silicon Valley. That's like we all recognize that.Kenneth Jackson 0:27:54And I think we should we should we should go back to what you said earlier about why was it that governors or mayors couldn't tell him what to do? Because there are many scenes in the power broker where he will go to the mayor who wants to do something else. And Moses would, damn it. He'd say, damn it, throw his pages on the desk and say, sign this. This is my resignation. You know, OK. And I'm out of here because the mayors and governors love to open bridges and highways and and do it efficiently and beautifully. And Moses could do that. Moses could deliver. And the workers loved him because he paid union wages, good wages to his workers. And he got things done and and things like more than 700 playgrounds. And it wasn't just grand things. And even though people criticize the 1964 World's Fair as a failure and financially it was a failure, but still tens of millions of people went there and had a good time. You know, I mean, even some of the things were supposedly were failures. Failures going to home, according to the investment banker, maybe, but not to the people who went there.Dwarkesh Patel 0:29:20Right. Yeah. And I mean, the point about the governors and mayors needing him, it was especially important to have somebody who could like work that fast. If you're going to get reelected in four years or two years, you need somebody who can get public works done faster than they're done today. Right. If you want to be there for the opening. Yeah, exactly.Kenneth Jackson 0:29:36And it's important to realize, to say that Moses did try public office once.Dwarkesh Patel 0:29:41Yeah.Kenneth Jackson 0:29:42And I think it's true that he lost by more than anybody in the history of New York. He was not, you know, he was not an effective public speaker. He was not soft and friendly and warm and cuddly. That's not Robert Moses. The voters rejected him. But the people who had power and also Wall Street, because you had to issue bonds. And one of the ways that Moses had power was he created this thing called the Traverse Bridge and Tunnel Authority to build the Traverse Bridge. Well, now, if in Portland, Oregon, you want to build a bridge or a road, you issue a couple hundred million dollars worth of bonds to the public and assign a value to it. Interest rate is paid off by the revenue that comes in from the bridge or the road or whatever it is. Normally, before, normally you would build a public works and pay for it itself on a user fees. And when the user fees paid it off, it ended. But what Moses, who was called the best bill drafter in Albany, which was a Moses term, he said he was somewhere down in paragraph 13, Section G, say, and the chairman can only be removed for cause. What that meant was when you buy a bond for the Traverse Bridge or something else, you're in a contract, supported by the Supreme Court. This is a financial deal you're making with somebody. And part of the contract was the chairman gets to stay unless he does something wrong. Well, Moses was careful not to do anything wrong. And it also would continue. You would get the bond for the Traverse Bridge, but rather than pay off the Traverse Bridge, he would build another project. It would give him the right to continually build this chain of events. And so he had this massive pot of money from all these initially nickels and dimes. Brazil made up a lot of money, the 30s and 40s and 50s and 60s, to spend more money and build more bridges and build more roads. And that's where he had his power. And the Wall Street, the big business loved him because they're issuing the bonds. The unions loved him because they're paying the investors. Now what Carroll says is that Moses allowed the investors an extra quarter percent, I think a quarter percent or half percent on bonds, but they all sold out. So everybody was happy. And was that crooked? It wasn't really illegal. But it's the way people do that today. If you're issuing a bond, you got to figure out what interest am I going to pay on this that will attract investors now.0:32:34 The Case Against Moses HighwaysDwarkesh Patel 0:32:34And the crucial thing about these tales of graft is that it never was about Moses trying to get rich. It was always him trying to push through a project. And obviously that can be disturbing, but it is a completely different category of thing, especially when you remember that this was like a corrupt time in New York history. It was like after Tammany Hall and so on. So it's a completely different from somebody using their projects to get themselves rich. But I do want to actually talk in more detail about the impact of these roads. So obviously we can't, the current system we have today where we just kind of treat cities as living museums with NIMBYism and historical preservation, that's not optimal. But there are examples, at least of Carroll's, about Moses just throwing out thousands of people carelessly, famously in that chapter on the one mile, how Moses could have diverted the cross Bronx expressway one mile and prevented thousands of people from getting needlessly evicted. So I'm just going to list off a few criticisms of his highway building and then you can respond to them in any order you want. So one of the main criticisms that Carroll makes is that Moses refused to add mass transit to his highways, which would have helped deal with the traffic problem and the car problem and all these other problems at a time when getting the right of way and doing the construction would have been much cheaper. Because of his dislike for mass transit, he just refused to do that. And also the prolific building of highways contributed to urban sprawl, it contributed to congestion, it contributed to neighborhoods getting torn apart if a highway would crossKenneth Jackson 0:34:18them.Dwarkesh Patel 0:34:19So a whole list of criticisms of these highways. I'll let you take it in any order you want.Kenneth Jackson 0:34:27Well first of all, Moses response was, I wasn't in charge of subways. So if you think the subways deteriorated or didn't build enough, find out who was in charge of them and blame that person. I was in charge of highways and I built those. So that's the first thing.Dwarkesh Patel 0:34:41But before you answer that, can I just ask, so on that particular point, it is true that he wasn't in charge of mass transit, but also he wasn't in charge of roads until he made himself responsible for roads, right? So if he chose to, he could have made himself responsible for mass transit and taken careKenneth Jackson 0:34:56of it. Maybe, although I think the other thing about it is putting Moses in a broader historical concept. He was swimming with the tide of history. In other words, history when he was building, was building Ford Motor Company and General Motors and Chrysler Corporation and building cars by the millions. I mean, the automobile industry in the United States was huge. People thought any kind of rail transit was obsolete and on the way out anyway. So let's just build roads. I mean, that's what the public wanted. He built what the public wanted. It's not what I was looking historically. I don't think we did the right thing, but we needed to join the 20th century. New York could have stayed as a quaint, I don't know, quaint is not the right word, but it's a distinctly different kind of place where everybody walks. I just don't think it would have been the same kind of city because there are people who are attached to their cars in New York. And so the sprawl in New York, which is enormous, nobody's saying it wasn't, spreads over 31 counties, an area about as large as the state of Connecticut, about as large as the Netherlands is metropolitan New York. But it's still relatively, I don't want to say compact, but everybody knows where the center is. It's not that anybody grows up in New York at 16 and thinks that the world is in some mall, you know, three miles away. They all know there is a center and that's where it is. It's called Manhattan. And that's New York and Moses didn't change that for all of his roads. There's still in New York a definite center, skyscrapers and everything in the middle. And it's true, public transit did decline. But you know those, and I like Chicago, by the way, and they have a rail transit from O'Hare down to Dan Ryan, not to Dan Ryan, but the JFK Expressway, I think. And it works sort of, but you got to walk a ways to get on. You got to walk blocks to get in the middle of the expressway and catch the train there. It's not like in New York where you just go down some steps. I mean, New York subway is much bigger than Chicago and more widely used and more. And the key thing about New York, and so I think what Carol was trying to explain and your question suggests this, is was Moses responsible for the decline of public transit? Well, he was building cars and roads and bridges. So in that sense, a little bit, yes. But if you look at New York compared to the rest of the United States, it used to be that maybe 20 percent of all the transit riders in the United States were in the New York area. Now it's 40 percent. So if you're looking at the United States, what you have to explain is why is New York different from the rest of the United States? Why is it that when I was chairman or president of the New York Historical Society, we had rich trustees, and I would tell them, well, I got here on a subway or something. They would think, I would say, how do you think I got here? Do you know what I mean? I mean, these are people who are close to billionaires and they're saying they used the subway. If you're in lower Manhattan and you're trying to get to Midtown and it's raining, it's five o'clock, you've got to be a fool to try to get in your own limousine. It isn't going to get you there very quickly. A subway will. So there are reasons for it. And I think Moses didn't destroy public transit. He didn't help it. But his argument was he did. And that's an important distinction, I think. But he was swimming with history. He built what the public wanted. I think if he had built public transit, he would have found it tougher to build. Just for example, Cincinnati built a subway system, a tunnel all through the city. It never has opened. They built it. You can still see the holes in the ground where it's supposed to come out. By the time they built it, people weren't riding trains anymore. And so it's there now and they don't know what to do with it. And that's 80 years ago. So it's a very complicated—I don't mean to make these issues. They're much more complex than I'm speaking of. And I just think it's unfair to blame Moses for the problems of the city. I think he did as much as anybody to try to bring the city into the 21st century, which he didn't live to. But you've got to adopt. You've got to have a hybrid model in the world now. And I think the model that America needs to follow is a model where we reduce our dependence on the cars and somehow ride buses more or use the internet more or whatever it is, but stop using so much fossil fuels so that we destroy our environment. And New York, by far, is the most energy efficient place in the United States. Mainly because you live in tall buildings, you have hot floors. It doesn't really cost much to heat places because you're heating the floor below you and above you. And you don't have outside walls. And you walk. New Yorkers are thinner. Many more people take buses and subways in New York than anywhere else in the United States, not just in absolute terms, in relative terms. So they're helping. It's probably a healthier lifestyle to walk around. And I think we're rediscovering it. For example, if you come to New York between Thanksgiving and Christmas, there's so many tourists in the city. I'm not making this up. That there is gridlock on the sidewalks around. The police have to direct the traffic. And in part, it's because a Detroit grandmother wants to bring her granddaughter to New York to see what Hudson's, which is a great department store in Detroit or in any city. We could be rich as in Atlanta, Fox, G Fox and Hartford. Every city had these giant department and windows where the Santa Claus is and stuff like this. You can still go to New York and see that. You can say, Jane, this is the way it used to be in Detroit. People ringing the bells and looking at the store windows and things like that. A mall can't recapture that. It just can't. You try, but it's not the same thing. And so I think that in a way, Moses didn't not only did he not destroy New York. I think he gets a little bit of credit for saving it because it might have been on the way to Detroit. Again, I'm not saying that it would have been Detroit because Detroit's almost empty. But Baltimore wasn't just Baltimore, it's Cleveland. It's every place. There's nobody there anymore. And even in New York, the department stores have mostly closed, not all of them. And so it's not the same as it was 80 years ago, but it's closer to it than anywhere else.Dwarkesh Patel 0:42:16OK, so yes, I'm actually very curious to get your opinion on the following question. Given the fact that you are an expert on New York history and you know, you've written the encyclopedia, literally written the encyclopedia on New York City.Kenneth Jackson 0:42:30800 people wrote the encyclopedia. I just took all the credit for it.Dwarkesh Patel 0:42:34I was the editor in chief. So I'm actually curious, is Caro actually right that you talked about the importance just earlier about counterfactual history. So I'm curious if Caro is actually right about the claim that the neighborhoods through which Moses built his highways were destroyed in a way that neighborhoods which were in touch by the highways weren't. Sorry for the confusing phrasing there. But basically, was there like a looking back on all these neighborhoods? Is there a clear counterfactual negative impact on the neighborhoods in which Moses built his highways and bridges and so on?Kenneth Jackson 0:43:10Well, Moses, I mean, Caro makes that argument mostly about East Tremont and places like that in the Bronx where the Cross Bronx Expressway passed through. And he says this perfectly wonderful Jewish neighborhood that was not racially prejudiced and everybody was happy and not leaving was destroyed by Moses. Well, first of all, as a historian of New York City, or for that matter, any city, if a student comes to you and says, that's what I found out, you said, well, you know, that runs counter to the experience of every city. So let's do a little more work on that. Well, first of all, if you look at the census tracts or the residential security maps of S.H.A. You know, it's not true. First of all, the Jews were leaving and had nothing to do with the thing. They didn't love blacks. And also, if you look at other Jewish, and the Bronx was called the Jewish borough at the time, those neighborhoods that weren't on the Cross Bronx Expressway all emptied out mostly. So the Bronx itself was a part of New York City that followed the pattern of Detroit and Baltimore and Cleveland. Bronx is now coming back, but it's a different place. So I think it's, well, I've said this in public and I'll pay you for this. Carol wouldn't know those neighborhoods if he landed there by parachute. They're much better than he ever said they were. You know, he acted like if you went outside near the Bronx County Courthouse, you needed a wagon train to go. I mean, I've taken my students there dozens of times and shown them the people, the old ladies eating on the benches and stuff like this. Nobody's mugging them. You know, he just has an outsider's view. He didn't know the places he was writing about. But I think Carol was right about some things. Moses was personally a jerk. You can make it stronger than that, but I mean, he was not your friendly grandfather. He was arrogant. He was self-centered. He thought he knew the truth and you don't. He was vindictive, ruthless, but some of those were good. You know, now his strategies, his strategies in some were good. He made people building a beach or a building feel like you're building a cathedral. You're building something great and I'm going to pay you for it and let's make it good. Let's make it as best as we can. That itself is a real trick. How do you get people to think of their jobs as more than a job, as something else? Even a beach or a wall or something like that to say it's good. He also paid them, so that's important that he does that and he's making improvements. He said he was improving things for the people. I don't know if you want to talk about Jane Jacobs, who was his nemesis. I tend to vote with Jane Jacobs. Jane Jacobs and I agree on a lot of things or did before she died a few years ago. Jane Jacobs saw the city as intricate stores and people living and walking and knowing each other and eyes on the street and all these kinds of things. Moses didn't see that at all. He saw the city as a traffic problem. How do we tear this down and build something big and get people the hell out of here? That was a mistake. Moses made mistakes. What Moses was doing was what everybody in the United States was doing, just not as big and not as ruthless and not as quick. It was not like Moses built a different kind of world that exists in Kansas City. That's exactly what they did in Kansas City or every other city. Blow the damn roads to the black neighborhoods, build the expressway interchanges, my hometown of Memphis crisscrossed with big streets, those neighborhoods gone. They're even more extensive in places like Memphis and Kansas City and New Orleans than they are in New York because New York builds relatively fewer of them. Still huge what he built. You would not know from the power broker that Los Angeles exists. Actually Los Angeles was building freeways too. Or he says that New York had more federal money. Then he said, well, not true. I've had students work on Chicago and Chicago is getting more money per person than New York for some of these projects. Some of the claims, no doubt he got those from Moses' own records. If you're going to write a book like this, you got to know what's going on other places. Anyway, let's go back to your questions.Dwarkesh Patel 0:48:10No, no. That was one of the things I was actually going to ask you about, so I was glad to get your opinion on that. You know, actually, I've been preparing for this interview and trying to learn more about the impact of these different projects. I was trying to find the economic literature on the value of these highways. There was a National Bureau of Economic Research paper by Morgan Foy, or at least a digest by Morgan Foy, where he's talking about the economic gains from highways. He says, the gains tend to be largest in areas where roads connect large economic hubs where few alternative routes exist. He goes on to say, two segments near New York City have welfare benefits exceeding $500 million a year. Expanding the Long Island Expressway had an estimated economic value of $719 million, which I think was Moses. He says, of the top 10 segments with the highest rate of return, seven are in New York City area. It turns out that seven of the top 10 most valuable highway segments in America are in New York. Reading that, it makes me suspect that there must have been... The way Cairo paints Moses' planning process, it's just very impulsive and feelings-based and almost in some cases, out of malice towards poor people. Given that a century later, it seems that many of the most valuable tracks of highways were planned and built exactly how Moses envisioned, it makes you think that there was some sort of actual intelligent deliberation and thought that was put into where they were placed.Kenneth Jackson 0:50:32I think that's true. I'm not saying that the automobile didn't have an economic impact. That's what Moses was building for. He would probably endorse that idea. I think that what we're looking at now in the 21st century is the high value put on places that Moses literally thought were something. He was going to run an expressway from Brooklyn through lower Manhattan to New Jersey and knock down all these buildings in Greenwich Village that people love now. Love. Even movie stars, people crowd into those neighborhoods to live and that he saw it as a slum. Well, Moses was simply wrong and Cairo puts him to task for that. I think that's true.0:51:24 The Rise of NIMBYismDwarkesh Patel 0:51:24Okay. Professor Jackson, now I want to discuss how the process of city planning and building projects has changed since Moses' time. We spent some good amount of time actually discussing what it was like, what Moses actually did in his time. Last year, I believe, you wrote an op-ed in the Wall Street Journal talking about how the 27-story building in Manhattan was put in limbo because the parking lot, which we would replace, was part of a historic district. What is it like to actually build a skyscraper or a highway or a bridge or anything of that sort in today's New York City?Kenneth Jackson 0:52:06Well, I do think in the larger context, it's probably fair to say it's tougher to build in New York City than any other city. I mean, yeah, a little precious suburb, you may not deploy a skyscraper, but I mean, as far as the city is concerned, there'll be more opposition in New York than anywhere else.It's more dense, so just to unload and load stuff to build a building, how do you do that? You know, trucks have to park on the street. Everything is more complicated and thus more expensive. I think a major difference between Robert Moses' time and our own, in Robert Moses' time, historic preservation was as yet little known and little understood and little supported. And the view generally was building is good, roads are good, houses are good, and they're all on the way to a more modern and better world. We don't have the same kind of faith in the future that they did. We kind of like it like it is. Let's just sit on it. So I think we should say that Moses had an easier time of it than he would have had he lived today. It still wasn't an easy time, but easier than today. Yeah.Dwarkesh Patel 0:53:40Well, actually, can you talk more about what that change in, I guess, philosophy has been since then? I feel like that's been one of the themes of this podcast, to see how our cultural attitude towards progress and technology have changed.Kenneth Jackson 0:53:54Well, I think one reason why the power broker, Robert Carroll's famous book, received such popular acclaim is it fits in with book readers' opinions today, which is old is better. I mean, also, you got to think about New York City. If you say it's a pre-war apartment, you mean it's a better apartment. The walls are solid plaster, not fiber or board and stuff like that. So old has a reverence in New York that doesn't have in Japan. In Japan, they tear down houses every 15 years. So it's a whole different thing. We tend to, in this new country, new culture, we tend to value oldness in some places, especially in a place that's old like New York City. I mean, most Americans don't realize that New York is not only the most dense American city and the largest, but also really the oldest. I mean, I know there's St. Augustine, but that's taking the concept of what's a city to a pretty extreme things. And then there's Jamestown and Virginia, but there's nobody there, literally nobody there. And then where the pilgrims landed in Massachusetts, Plymouth plantation, that's totally rebuilt as a kind of a theme park. So for a place that's a city, it's Santa Fe a little bit in New Mexico, but it was a wide place on the road until after World War II. So the places that would be also, if you think cities, New York is really old and it's never valued history, but the historic preservation movement here is very strong.Dwarkesh Patel 0:55:33What is the reason for its resurgence? Is it just that, because I mean, it's had a big impact on many cities, right? Like I'm in San Francisco right now, and obviously like you can't tear down one of these Victorian houses to build the housing that like the city massively needs. Why have we like gained a reverence for anything that was built before like 80 years?Kenneth Jackson 0:55:56Because just think of the two most expensive places in the United States that could change a little bit from year to year, but usually San Francisco and New York. And really if you want to make it more affordable, if you want to drop the price of popsicles on your block, sell more popsicles. Have more people selling popsicles and the price will fall. But somehow they say they're going to build luxury housing when actually if you build any housing, it'll put downward pressure on prices, even at super luxury. But anyway, most Americans don't understand that. So they oppose change and especially so in New York and San Francisco on the basis that change means gentrification. And of course there has been a lot of gentrification. In World War II or right after, San Francisco was a working class city. It really was. And huge numbers of short and longshoremen live there. Now San Francisco has become the headquarters really in Silicon Valley, but a headquarters city is a tech revolution and it's become very expensive and very homeless. It's very complex. Not easy to understand even if you're in the middle of it.Dwarkesh Patel 0:57:08Yeah. Yeah. So if we could get a Robert Moses back again today, what major mega project do you think New York needs today that a Moses like figure could build?Kenneth Jackson 0:57:22Well if you think really broadly and you take climate change seriously, as I think most people do, probably to build some sort of infrastructure to prevent rising water from sinking the city, it's doable. You'd have to, like New Orleans, in order to save New Orleans you had to flood Mississippi and some other places. So usually there is a downside somewhere, but you could, that would be a huge project to maybe build a bridge, not a bridge, a land bridge from Brooklyn to Manhattan to prevent water coming in from the ocean because New York is on the ocean. And to think of something like that's really big. Some of the other big infrastructure projects, like they're talking about another tunnel under the river, Hudson River from New Jersey to New York, the problem with that is there are already too many cars in Manhattan. Anything that makes it easier to bring cars into Manhattan because if you've not been to New York you don't really understand this, but there's no place for anything. And if you bring more cars in, what are you going to do with them? If you build parking garages for all the cars that could come into the city, then you'd be building over the whole city. There'd be no reason to come here because it would all be parking garages or parking lots. So New York City simply won't work if you reduce the density or you get rid of underground transportation because it's all about people moving around underneath the streets and not taking up space as they do it. So it won't work. And of course, it's not the only city. Tokyo wouldn't work either or lots of cities in the world won't work increasingly without not just public transportation but underground public transportation where you can get it out of the way of traffic and stuff like that. Moses probably could have done that. He wouldn't have loved it as much as he loved bridges because he wanted you to see what he built. And there was an argument in the power broker, but he didn't really want the Brooklyn battle very tunnel built because he wanted to build a bridge that everybody could see. So he may not have done it with such enthusiasm. I actually believe that Moses was first and foremost a builder. He really wanted to build things, change things. If you said, we'll pay you to build tunnels, I think he would have built tunnels. Who knows? He never was offered that. That wasn't the time in which he lived. Yeah. Okay.Dwarkesh Patel 1:00:04And I'm curious if you think that today to get rid of, I guess the red tape and then the NIMBYism, would it just be enough for one man to accumulate as much influence as Moses had and then to push through some things or does that need to be some sort of systemic reform? Because when Moses took power, of course there was ours also that Tammany Hall machine that he had to run through, right? Is that just what's needed today to get through the bureaucracy or is something more needed?Kenneth Jackson 1:00:31Well, I don't think Robert Moses with all of his talents and personality, I don't think he could do in the 21st century what he did in the middle of the 20th century. I think he would have done a lot, maybe more than anybody else. But also I think his methods, his really bullying messages, really, really, he bullied people, including powerful people. I don't think that would work quite as easy today, but I do think we need it today. And I think even today, we found even now we have in New York, just the beginnings of leftists. I'm thinking of AOC, the woman who led the campaign against Amazon in New York saying, well, we need some development. If we want to make housing more affordable, somebody has got to build something. It's not that we've got more voter because you say you want affordable housing. You got to build affordable housing and especially you got to build more of it. So we have to allow people, we have to overturn the NIMBYism to say, well, even today for all of our concern about environmental change, we have to work together. I mean, in some ways we have to believe that we're in some ways in the same boat and it won't work if we put more people in the boat, but don't make the boat any bigger. Yeah.Dwarkesh Patel 1:01:59But when people discuss Moses and the power accumulated, they often talk about the fact that he took so much power away from democratically elected officials and the centralized so much power in himself. And obviously the power broker talks a great deal about the harms of that kind of centralization. But I'm curious having studied the history of New York, what are the benefits if there can be one coordinated cohesive plan for the entire city? So if there's one person who's designing all the bridges, all the highways, all the parks, is something more made possible that can be possible if like multiple different branches and people have their own unique visions? I don't know if that question makes sense.Kenneth Jackson 1:02:39That's a big question. And you've got to put a lot of trust into the grand planner, especially if a massive area of 20, 25 million people, bigger than the city, I'm not sure what you're really talking about. I think that in some ways we've gone too far in the ability to obstruct change, to stop it. And we need change. I mean, houses deteriorate and roads deteriorate and sewers deteriorate. We have to build into our system the ability to improve them. And now in New York we respond to emergencies. All of a sudden a water main breaks, the street collapses and then they stop everything, stop the water main break and repair the street and whatever it is. Meanwhile in a hundred other places it's leaking, it's just not leaking enough to make the road collapse. But the problem is there every day, every minute. Right. Yeah, yeah, yeah.1:03:44 Is Progress CyclicalDwarkesh Patel 1:03:44I'm curious, as a professor, I mean you've studied American history. Do you just see this as a cyclical thing where you have periods where maybe one person has too much power to periods where there's dispersed vitocracy and sclerosis and then you're just going to go through these cycles? Or how do you see that in the grand context of things, how do you see where we are, where we were during Moses and where we might be in the future?Kenneth Jackson 1:04:10Well you're right to say that much of life is cyclical. And there is a swing back and forth. But having said that, I think the person like Robert Moses is unusual, partly because he might have gone on to become a hedge fund person or didn't have hedge funds when he was around. But you know, new competitor to Goldman Sachs, I mean he could have done a lot of things, maybe been a general. He wanted to have power and control. And I think that's harder to accumulate now. We have too much power. You can demonstrate and you can stop anything. We love demonstrations in the United States. We respect them. We see it as a visible expression of our democracy, is your ability to get on the streets and block the streets. But you know, still you have to get to work. I mean at some point in the day you've got to do something. And yeah, Hitler could have done a lot of things if he wanted to. He could have made Berlin into a... But you know, if you have all the power, Hitler had a lot of it. If he turned Berlin into a colossal city, he was going to make it like Washington but half-sive. Well Washington has already got its own issues. The buildings are too big. Government buildings don't have life on the street and stuff like this. Like Hitler would destroy it forever because you build a monumental city that's not for people. And I think that was probably one of Moses' weak points is unlike Jane Jacobs who saw people. Moses didn't see people. He saw bridges. He saw highways. He saw tunnels. He saw rivers. He saw the city as a giant traffic problem. Jane Jacobs, who was a person without portfolio most of her life except of her own powers of judgment and persuasion, she thought, well what is the shoe repairman got to do with the grocery store, got to do with the school, got to do with something else? She saw what Moses didn't see. She saw the intricacies of the city. He saw a giant landscape. She saw the block, just the block.Dwarkesh Patel 1:06:45Yeah there's a common trope about socialist and communist which is that they love humanity in the abstract but they hate people as individuals. And it's like I guess one way to describe Robert Moses. It actually kind of reminds me of one of my relatives that's a doctor and he's not exactly a people person. And he says like, you know, I hate like actually having to talk to the patients about like, you know, like ask them questions. I just like the actual detective work of like what is going on, looking at the charts and figuring out doing the diagnosis. Are you optimistic about New York? Do you think that in the continuing towards the end of the 21st century and into the 22nd century, it will still be the capital of the world or what do you think is the future ofKenneth Jackson 1:07:30the city? Well, The Economist, which is a major publication that comes out of England, recently predicted that London and New York would be in 2100 what they are today, which is the capitals of the world. London is not really a major city in terms of population, probably under 10 million, much smaller than New York and way smaller than Tokyo. But London has a cosmopolitan, heterogeneous atmosphere within the rule of law. What London and New York both offer, which Shanghai doesn't or Hong Kong doesn't at the moment is a system so if you disagree, you're not going to disappear. You know what I mean? It's like there's some level of guarantee that personal safety is sacred and you can say what you want. I think that's valuable. It's very valuable. And I think the fact that it's open to newcomers, you can't find a minority, so minority that they don't have a presence in New York and a physical presence. I mean, if you're from Estonia, which has got fewer people than New York suburbs, I mean individual New York suburbs, but there's an Estonian house, there's Estonian restaurants, there's, you know, India, Pakistan, every place has got an ethnic presence. If you want it, you can have it. You want to merge with the larger community, merge with it. That's fine. But if you want to celebrate your special circumstances, it's been said that New York is everybody's second home because you know if you come to New York, you can find people just like yourself and speaking your language and eating your food and going to your religious institution. I think that's going to continue and I think it's not only what makes the United States unusual, there are a few other places like it. Switzerland is like it, but the thing about Switzerland that's different from the United States is there are parts of Switzerland that are most of it's Swiss German and parts of it's French, but they stay in their one places, you know what I mean? So they speak French here and they speak German there. You know, Arizona and Maine are not that different demographically in the United States. Everybody has shuffled the deck several times and so I think that's what makes New York unique. In London too. Paris a little bit. You go to the Paris underground, you don't even know what language you're listening to. I think to be a great city in the 21st century, and by the way, often the Texas cities are very diverse, San Francisco, LA, very diverse. It's not just New York. New York kind of stands out because it's bigger and because the neighborhoods are more distinct. Anybody can see them. I think that's, and that's what Robert Moses didn't spend any time thinking about. He wasn't concerned with who was eating at that restaurant. Wasn't important, or even if there was a restaurant, you know? Whereas now, the move, the slow drift back towards cities, and I'm predicting that the pandemic will not have a permanent influence. I mean, the pandemic is huge and it's affected the way people work and live and shop and have recreation. So I'm not trying to blow it off like something else, but I think in the long run, we are social animals. We want to be with each other. We need each other, especially if you're young, you want to be with potential romantic partners. But even other people are drawn. Just a few days ago, there was a horrible tragedy in Seoul, Korea. That's because 100,000 young people are drawn to each other. They could have had more room to swing their arms, but they wanted to crowd into this one alley because that's where other people were. They wanted to go where other people were. That's a lot about the appeal of cities today. We've been in cars and we've been on interstate highways. At the end of the day, we're almost like cats. We want to get together at night and sleep on each other or with each other. I think that's the ultimate. It's not for everybody. Most people would maybe rather live in a small town or on the top of a mountain, but there's a percentage of people. Let's call it 25% who really want to be part of the tumble in the tide and want to be things mixed up. They will always want to be in a place like New York. There are other places, San Francisco, Boston, Philadelphia a little bit. They're not mainly in the United States, but in Europe, Copenhagen. Copenhagen is not a big city, neither is Prague, but they have urbanity. New York has urbanity. I think we don't celebrate urbanity as much as we might. The pure joy of being with others.1:12:36 Friendship with CaroDwarkesh Patel 1:12:36Yeah. I'm curious if you ever got a chance to talk to Robert Caro himself about Moses at someKenneth Jackson 1:12:45point. Robert Caro and I were friends. In fact, when the power broker received an award, the Francis Parkman Prize from the Society of American Historians, it turned out we lived near each other in the Bronx. And I drove him home and we became friends and social friends. And I happened to be with him on the day that Robert Moses died. We were with our wives eating out in a neighborhood called Arthur Avenue. The real Little Italy of New York is in the Bronx. It's also called Belmont. But then on the 100th anniversary of Moses's birth, I think in 1989, I was asked to give the keynote speech at a conference at Hofstra University on Moses. And Caro was also invited to be a speaker, maybe another keynote speaker. And there I said, and I still stand by this, that the power broker, I learned more from it than any book I ever read because it's such an enormous topic. I learned more from it and I wish I had written it myself so that my name was on it rather than his. And I think it was the best book I ever read. That may be a slight exaggeration, but just like it's an incredible achievement. But having said that, I said it's got a thousand errors, just small errors. I mean, in broad strokes, it's correct. Robert Moses had more power than any urban figure in American history. He built incredible monuments that the city needs. He was ruthless and arrogant and honest. That's a big story right there. That's probably true. But in all the little stories about the temperature in the swimming pools, about the destruction of public transit, about the destruction of the Bronx with the Eid Cross Bronx Expressway, about the building the bridges too low so that buses couldn't get to the beaches. He's just wrong. I mean, it's just in that way. Wasn't that way, isn't that way. And all he had to do was look at some different sources, you know that in that they were doing some of the same things in LA or Chicago. They just weren't as famous as New York. I mean, that's more or less what it was. But I think I still feel that way. I still wish I had written the book, even with all those mistakes. I've taught for half a century or more New York City history at Columbia University. I've had dozens of students write term papers on one or another aspect of Carroll's book. I can never remember a single one coming back and saying, Oh, Carroll got it right. You know, they would go back to the same source and stuff like this. You know, this is not what this is not the way he said it was. Now they may be smaller, but it was generally that way. They didn't celebrate it. I think he'd made up his mind what he was going to argue before he started it. And Moses was a jerk. For example, he think of the issues now with President Biden and his son Hunter, you know, and all the grief he's catching about his son or people with, you know, having a hiring. My wife is telling me not to go down this road. But Moses is attacked in the book because he's not good enough to his brother. You know, he should have done more for his brother than he did. Well, you know, so he didn't give his brother a job. And so I'm just saying that all these little things that you can come to about different neighborhoods and things like that. But I think Carol was right that Moses, the biggest builder of cities in the 20th century, the builder of the greatest city in the world, didn't like it. That's incredible. He didn't actually like the place he was designing. He wanted everybody to get out. It's better in the suburbs, better if you have a house, better if you have a garage, better if you have a car in the front. It's better than the Bronx or Brooklyn or Queens, you know what I mean? Whereas again, his opponent, Jane Jacobs, are people now. And one of the greatest changes now than when Carol was writing Moses is people wanted to all have a car in New York. Everybody have a car. Teachers, when they were 16 years old, they wanted to have a driver's license more than they wanted to have sex. Get me the car. Now a big percentage of young Americans are skipping the driver's license. They don't care as much. We're moving into a different time. And where that's going to lead us, I'm not sure. But I think we're ready to walk more for health reasons, all sorts of reasons. But Moses did not see it. Moses never drove, but he created the world for drivers. Yeah.Dwarkesh Patel 1:17:57So, some people might object to this defense of Moses by saying, like, listen, whenever he does something well, we give him credit here. But then whenever he does something badly, we just say, oh, well, he was just swimming with the tide of history. There were other cities that were doing it worse. So we're doing, you know, we're like doing what aboutism on the negative side of Moses' legacy. But then we're like happy to let him take credit for the good things. It's kind of a double standard. How would you respond to that?Kenneth Jackson 1:18:27Well, I understand what you're saying and I can sympathize with it. But I think most of the things, let's take the cross Bronx expressway as an egregious example of something that Robert Caro or Moses' critics would say, God, all these people, tens of thousands of people paid a price. Their lives were uprooted. But I just can't imagine you would say we can't have a cross Bronx. I mean, you know, it could have been two blocks this way or two blocks that way. That's a different question. And we can talk about that too, but I think we have to have it. And I think the parks, I think the bridges, the Verrazano and D'Eros bridge transformed Staten Island. The history of Staten Island is before and after 1964. They had to take into account the curvature of the earth. That bridge was so long. At the time it was the longest suspension bridge in the world. It's been surpassed in Europe since then, but a big bridge. That would be a lifetime's achievement. If you built the Verrazano and D'Eros bridge, this gigantic, gorgeous entrance to New York Harbor, that's a lifetime achievement. For Moses, it's one of a list of about 50 things. You know, you don't even think about the Verrazano and D'Eros bridge and Robert Moses. It's just not, yeah, he did it. So what? There's lots of other big things too. I think it's the scale and the scale was not human. It was totally on a different scale. And with that comes a lot of criticism because as he would say himself, in order to make an omelet, you have to break eggs. No other way to do it. And he would say, I had to make, I had to do it. This is his answer, in order to build a great public event or thing, I have to hurt some people. That's just the way it is. And I think, and we don't want to, the way we live now, we don't want to hurt anybody. You can't run a city or a country that way. You can't. Nothing will change.1:20:41 Moses the Longtermist?Dwarkesh Patel 1:20:41Yeah, I've had recently a lot of guests who have been advocating for this philosophical view that's called long-termism, which is basically the idea that we should take the interest of future generations and consider them equally with the interest of people alive today as a way to emphasize, for example, that people who live thousands of years from now, we should take their interest seriously. And one of the, I guess if we take this kind of view that basically we just care about progeny more, it's interesting, there's a part in the Power Broker where they're talking about the cross and Bronx Expressway through East Tremont and Moses is getting opposition from an elected official. And Moses responds by saying, you make a habit out of pointing out that I'm not democratically elected while you are. But the advantage of me not being democratically elected is that I can build projects that might not be the favorite thing for the people alive now, but will benefit the city for generations and centuries to come. There's obviously a lot of arrogance there and it's like, well, if that's true, right? But to the extent that that is true, and it is in many cases, right? All these bridges you're talking about and all these highways, they're still standing today and in wide use. It kind of changes how you think about him. Given all the omelet breaking or the egg breaking that had to happen at the time, it's still the fact that for hundreds of years we'll get to use the things he built. I'm curious, how did Caro, so you mentioned you were with him when you found out that Moses had died. How did you react? Was he sad about it?Kenneth Jackson 1:22:25Well, he was being interviewed. I just remember being stunned at the restaurant. We were eating at a restaurant in the Bronx and they brought a telephone to him. I've never seen anybody have a telephone brought to them. That was way before cell phones and everything else. It was 1989 or something like that. I don't remember the exact year, but it was somewhere like that. But we were friends when he died. Maybe it was 1981. Anyway, whatever year it was. It was after I criticized him in public and the New York Times quoted me. They didn't quote that I thought was the best book I'd ever read. I wish I'd written it. They did quote that I said it was full of mistakes. That's what the New York Times, that's what he read. He didn't hear my speech. But I'm sorry. I don't have enemies with anyone, but I have regard for the book and have regard from his ability to do research. That's what's amazing about the power broker is his ability and interest in going back and interviewing his third grade teacher and stuff like that and finding that out. That's way more than most of us are willing to do.Dwarkesh Patel 1:23:35But what was his reaction when he found out that Moses died?Kenneth Jackson 1:23:41That was not unexpected. He was 90 years old at the time. Remember this is 30 years ago, more than that. That many people lived to be 90 and he was a swimmer. He was an athlete. He was a swimmer. Swam in the ocean in his 80s. He was quite a person.Dwarkesh Patel 1:24:01Yeah. Yeah. There was a part in the in Caro's memoir where he talks about learning from Moses' former aides who are now friends with Caro, how they would tell him that now that he had lost his power, he was just in his house all day just looking at all his plans and writing down more ideas for there should be another highway here and so on. Just impotently making new ideas and so on. Caro says that just hearing about that scene, this master builder just having nothing to do really, it made him want to cry. Despite the fact that he had documented all the harm that Moses had done. That was really interesting.Kenneth Jackson 1:24:50Really interesting. Well, Moses had a phenomenal amount of power and he loses it all in the short order. That's got to be tough. Really tough. Now, Moses did write a response to the Power Broker, which was published in the New Yorker about 1975, which is a long response saying, of course, that Caro had it all wrong and didn't know that your listeners might want to go to. It's available, I'm sure, in the New Yorker. Yeah.Dwarkesh Patel 1:25:24Yeah. Actually, I thought I don't know what your reaction to the response was. I read it and I thought that Moses kind of vindicated Caro's description of his personality because it was very ad hominem. It wasn't specific. I'm sure there were a lot of errors, as you say. But then Moses just says, I mean, he wrote 8,000 words, but he actually documents very few of the supposed errors that he claims Caro is making. The ones he does document are minor ones, not the major ones that were about his major public works, so just small little details. But yeah, I don't know what your reaction was to that response.Kenneth Jackson 1:26:04Well, I think you're very perceptive. I think his response was rambling, wordy, not particular. I think he probably could have taken Caro apart, but he didn't. He didn't say, Page, so-and-so, you said this. This is wrong. He didn't. And he also, Moses didn't have people around him, like maybe Hitler didn't or Trump or somebody else, to say, Boss, you're wrong here. You got to reword this. You don't mean it the way you said it.Dwarkesh Patel 1:26:37Yeah, exactly.Kenneth Jackson 1:26:38And also, the quality of her response was poor enough that he needed assistance. He needed a smart or three or four smart people to say, put it this way. You got to give this example or do something else. But still, it tells you something about Moses, the response. And also the way Moses kind of held grudges. So he blames the New Yorker and he blames Knopf, Alfred Knopf Publishers, because you're in cahoots with Caruso. You're all damned and going to hell rather than just talking about Caro. So maybe that's just the way he looked at the world at his time. You got to find out who's got the levers of power and then go after them. The rest of the people don't matter.Dwarkesh Patel 1:27:28Yeah. Yeah. Okay. So I want to be respectful of your time. You've given me so much already. But before we close out the interview, if you have any other things you want to say about the power broker or about Moses or about his legacy or about, I don't know, NIMBYism today or the state of construction and public works today.Kenneth Jackson 1:27:46Well, I think of Moses as the polar opposite of Jane Jacobs. Jane Jacobs was a woman. But think about what Jane Jacobs saw as important. She saw the block, the store, the people, the mixture of genders and races and everything else as being significant. Robert Moses really didn't see, as you said earlier, people. He saw massive things, things you put on an architectural board and he didn't see other things. So that's both his strength and his weakness. Had he seen people more, maybe he would never have built what he did and we wouldn't have had the bridges. But we do. And can you imagine New York without the Traverse Bridge? I mean, it's not imaginable. You got to have it. Because what, again, readers who have not been to New York may not understand, this is a city that has water all through it. You know, it's about water. It's not like Dallas, where there's essentially no water. You know what I mean? New York water is everywhere. You've got to cross these bridges. You've got to get over that. So it creates a problem of circulation that's vast, especially when you have tens of millions of people trying to move around. So that's something that Moses figured a way around. Yep.Dwarkesh Patel 1:29:14Yep. Actually, one more question that just occurs to me. It's just that I'm curious why you think that this biography of Moses by Caro achieved the cultural prominence it did. Of course, it's like an incredible book and I like I incredibly I enjoyed it a lot as well. But like there's countless biographies written every year, right? And many of them are also good. What was it about this book that catapulted it? I mean, there's a review of the new play about Robert Moses and the title of that review was just that New Yorkers love to hate Robert Moses. Why does he have this sort of cultural prominence in New York and actually across the world?Kenneth Jackson 1:29:57Well, because I think Robert Moses represented a past, you know, a time when we wanted to build bridges and super highways and things that pretty much is going on. We're not building super highways now. We're not building vast bridges like Moses built all the time. So he's not swimming with the tide of history anymore. And so I think that's part of it. Plus the fact that it's a biography that has an argument and the argument is understandable and it runs through the whole book. And he's a terrific writer and builds suspense and he can write a paragraph in two words and he repeats himself a little too much. Anyway, when I get negative, my wife is nearby getting on me. I think it's a terrific book. Look, Moses was a great man. Caro is a great writer and in many ways a great historian. And I think the other thing is Caro's book is so important. You know, Thomas Jefferson, Abraham Lincoln, I have lots of books written about. Caro not so much. I mean, Moses not so much. He's not that famous. So it's such a big and intimidating book. Everybody else is afraid to go there. There will be other books about Robert Moses. There may be underway as we speak and they will revise our reinterpretation. I think that's true. He will be reinterpreted in ways in which we talked about today, though I don't know that. But, you know, the basic thing that Moses did was there. You can look at it. And the things that Caro said about him are mostly true. I mean, where he lived, you know, he gives a little tiny bit about an affair that he once explained to me that sex was not important to Moses. You know, that you want to understand him, it wasn't about females. And I think that he cared about what Moses was committed, married to his job and to his vision of a city. And that's both his greatness and the fact that he didn't have friends or many friends and he didn't live the world the way most people live it, you know, with people. I think that's probably all I know.Dwarkesh Patel 1:32:21Well, this is a true pleasure. I highly recommend that people check out your book, Robert Moses and the Modern City, the Transformation of New York. And there they can find your essay on, you know, Robert Moses and the Rise of New York City, which I highly recommend. Professor Jackson, where else can people find you?Kenneth Jackson 1:32:42My email address is still at Columbia University. KTJ is my initials. One. Number one at Columbia.edu. I'm there. Okay. It's a pleasure. Hey, thanks for listening.Dwarkesh Patel 1:32:57If you enjoyed that episode, I would really, really, really appreciate it if you couldKenneth Jackson 1:33:03share it.Dwarkesh Patel 1:33:04This is still a pretty small podcast. So it is a huge help when any one of you shares an episode that you like, post it on Twitter, send it to friends who you think might like it, put it in your group chats, just let theKenneth Jackson 1:33:16word go forth. It helps out a ton.Dwarkesh Patel 1:33:19Many thanks to my amazing editor, Graham Bessalou for producing this podcast and to Mia Ayana for creating the amazing transcripts that accompany each episode, which have helpful links, and you can find them at the link in the description below. Remember to subscribe on YouTube and your favorite podcast platforms.Kenneth Jackson 1:33:41Cheers. See you next time. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

It was a pleasure to welcome Brian Potter on the podcast! Brian is the author of the excellent Construction Physics blog, where he discusses why the construction industry has been slow to industrialize and innovate.He explains why:* Construction isn’t getting cheaper and faster,* “Ugly” modern buildings are simply the result of better architecture,* China is so great at building things,* Saudi Arabia’s Line is a waste of resources,* Environmental review makes new construction expensive and delayed* and much much more!Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow me on Twitter for updates on future episodes.More really cool guests coming up; subscribe to find out about future episodes!You may also enjoy my interviews with Tyler Cowen (about talent, collapse, & pessimism of sex). Charles Mann (about the Americas before Columbus & scientific wizardry), and Austin Vernon about (Energy Superabundance, Starship Missiles, & Finding Alpha).If you end up enjoying this episode, I would be super grateful if you share it, post it on Twitter, send it to your friends & group chats, and throw it up wherever else people might find it. Can’t exaggerate how much it helps a small podcast like mine.A huge thanks to Graham Bessellieu for editing this podcast and Mia Aiyana for producing its transcript.Timestamps(0:00) - Why Saudi Arabia’s Line is Insane, Unrealistic, and Never going to Exist (06:54) - Designer Clothes & eBay Arbitrage Adventures (10:10) - Unique Woes of The Construction Industry  (19:28) - The Problems of Prefabrication (26:27) - If Building Regulations didn’t exist… (32:20) - China’s Real Estate Bubble, Unbound Technocrats, & Japan(44:45) - Automation and Revolutionary Future Technologies (1:00:51) - 3D Printer Pessimism & The Rising Cost of Labour(1:08:02) - AI’s Impact on Construction Productivity(1:17:53) - Brian Dreams of Building a Mile High Skyscraper(1:23:43) - Deep Dive into Environmentalism and NEPA(1:42:04) - Software is Stealing Talent from Physical Engineering(1:47:13) - Gaps in the Blog Marketplace of Ideas(1:50:56) - Why is Modern Architecture So Ugly?(2:19:58) - Advice for Aspiring Architects and Young Construction PhysicistsTranscriptWhy Saudi Arabia’s Line is Insane, Unrealistic, and Never going to Exist Dwarkesh Patel Today, I have the pleasure of speaking with Brian Potter, who is an engineer and the author of the excellent Construction Physics blog, where he writes about how the construction industry works and why it has been slow to industrialize and innovate. It's one of my favorite blogs on the internet, I highly, highly recommend that people check it out. Brian, my first question is about The Line project in Saudi Arabia. What are your opinions? Brian Potter It's interesting how Saudi Arabia and countries in the Middle East, in general, are willing to do these big, crazy, ambitious building projects and pour huge amounts of money into constructing this infrastructure in a way that you don't see a huge amount in the modern world. China obviously does this too in huge amounts, some other minor places do as well, but in general, you don't see a whole lot of countries building these big, massive, incredibly ambitious projects. So on that level, it's interesting, and it's like, “Yes, I’m glad to see that you're doing this,” but the actual project is clearly insane and makes no sense. Look at the physical arrangement layout–– there's a reason cities grow in two dimensions. A one-dimensional city is the worst possible arrangement for transportation. It’s the maximum amount of distance between any two points. So just from that perspective, it's clearly crazy, and there's no real benefit to it other than perhaps some weird hypothetical transportation situation where you had really fast point-to-point transportation. It would probably be some weird bullet train setup; maybe that would make sense. But in general, there's no reason to build a city like that. Even if you wanted to build an entirely enclosed thing (which again doesn't make a huge amount of sense), you would save so much material and effort if you just made it a cube. I would be more interested in the cube than the line. [laughs] But yeah, those are my initial thoughts on it. I will be surprised if it ever gets built. Dwarkesh Patel Are you talking about the cube from the meme about how you can put all the humans in the world in a cube the size of Manhattan? Brian Potter Something like that. If you're just going to build this big, giant megastructure, at least take advantage of what that gets you, which is minimum surface area to volume ratio, and stuff like that. Dwarkesh Patel Why is that important? Would it be important for temperature or perhaps other features? Brian Potter This is actually interesting because I'm actually not sure how sure it would work with a giant single city. In general, a lot of economies of scale come from geometric effects. When something gets bigger, your volume increases a lot faster than your surface area does. So for something enclosed, like a tank or a pipe, the cost goes down per thing of unit you're transporting because you can carry a larger amount or a smaller amount of material. It applies to some extent with buildings and construction because the exterior wall assembly is a really burdensome, complicated, and expensive assembly. A building with a really big floor plate, for instance, can get more area per unit, per amount of exterior wall. I'm not sure how that actually works with a single giant enclosed structure because, theoretically, on a small level, it would apply the same way. Your climate control is a function of your exterior surface, at some level, and you get more efficient climate control if you have a larger volume and less area that it can escape from. But for a giant city, I actually don't know if that works, and it may be worse because you're generating so much heat that it's now harder to pump out. For examples like the urban heat island effect, where these cities generate massive amounts of waste heat, I actually don't know if that would work if it didn't apply the same way. I'm trying to reach back to my physics classes in college, so I'm not sure about the actual mechanics of that. But in general, that's why you'd want to perhaps build something of this size and shape. Dwarkesh Patel What was the thought process behind designing this thing? Because Scott Alexander had a good blog post about The Line where he said, presumably, the line is designed to take up less space and to use less fuel because you can just use the same transportation across the line. But the only thing that Saudi Arabia has is space and fuel. So what is the thought process behind this construction project? Brian PotterI get the sense that a lot of committees have some amount of success in building big, impressive, physical construction projects that are an attraction just by virtue of their size and impressiveness. A huge amount of stuff in Dubai is something in this category. Then they have that giant clock tower in Jeddah that is similar to the biggest giant clock building and one of the biggest buildings in the world or something like that. I think, on some level, they're expecting that you would just see a return just from building something that's really impressive and the biggest thing on some particular axis or whatever. So to some extent, I think they're just optimizing for big and impressive and maybe not diving into it more than that. There's this theory that I think about every so often. It's called the garbage can theory of organizational decision-making, which is that, basically, the choices that organizations make are not the result of any particular recent process. They are the result of whenever a problem comes up, they reach into the garbage can of potential solutions. Then whatever they pull out of the garbage can, that's the decision that they end up going with, regardless of how much sense it makes. It was a theory that was invented by academics to describe decision-making in academia. I think about that a lot, especially with reference to big bureaucracies and governments.You can just imagine the draining process of how these decisions evolve. You can just imagine any random decision being made, especially when there's such a disconnect between the decision-makers and technical knowledge.Designer Clothes & eBay Arbitrage Adventures Dwarkesh PatelYeah. Tell me about your eBay arbitrage with designer clothes. Brian Potter Oh man, you really did dive deep. Yeah, so this was a small business that I ran seven or eight years ago at this point. A hobby of mine was high-end men's fashion for a while, which is a very strange hobby for an engineer to have, but there you go. Basically, that hobby centers around finding cheap designer stuff, because buying new can just be overwhelmingly expensive. However, a lot of times, you can get clothes for a very cheap price if you're even a little bit motivated. Either it shows up on eBay, or it shows up in thrift stores if you know what to look for, especially because a lot of these clothes can last because they're well-made. They last a super, super, super long time–– even if somebody wore it for 10 years or something, it could be fine. So a lot of this hobby centers around finding ways to get really nice clothes cheaply. A lot of it was based around eBay, but it was really tedious to find really nice stuff on eBay. You had to manually search for a bunch of different brands and then filter out the obvious bad ones, then search for typos in brands that were pretty reliably put in titles and stuff like that. I was in the process of doing this, and I thought, “Oh, this is really annoying. I should figure out a way to automate this process.” So I made a very simple web app where when you searched for shoes or something, it would automatically search the very nice brands of shoes and all the typos of the brand name. Then it would just filter out all the junk and let you search through the good stuff. I set up an affiliate system, basically. So anybody else that used it, I would get a kick of the sales. While I was interested in that hobby, I ran this website for a few years, and it was reasonably successful. It was one of the first things I did that got any real traction on the internet, but it was never successful in proportion to how much effort it took to maintain and update it. So as I moved away from the hobby, I eventually stopped putting time and effort into maintaining the website. I'm curious as to how you even dug that up. Dwarkesh Patel I have a friend who was with you at the Oxford Refugees Conference, Connor Tabarrok. I don't know if you remember him. Brian Potter Nice. Dwarkesh Patel Yeah. Finding other information about you on the internet was quite difficult actually. You somehow managed to maintain your anonymity. If you're willing to reveal, what was the P&L of this project? Brian Potter Oh, it made maybe a few hundred dollars a month for a few years, but I only ever ran it as a side hobby business, basically. So in terms of time per my effort or whatever, I'm sure it was very low. Pennies to an hour or something like that. Unique Woes of The Construction Industry   Dwarkesh Patel A broad theme that I've gotten from your post is that the construction industry is plagued with these lossy feedback loops, a lack of strong economies of scale, regulation, and mistakes being very costly. Do you think that this is a general characteristic of many industries in our world today, or is there something unique about construction? Brian Potter Interesting question. One thing you think of is there are a lot of individual factors that are not unique at all. Construction is highly regulated, but it's not necessarily more regulated than medical devices or jet travel, or even probably cars, to some extent, which have a whole vat of performance criteria that they need to hit. With a couple of things like land use, for example, people say, “Oh, the land requirements, could you build it on-site,” and those kind of things make it difficult. But there are a lot of things that fall into this category that don't really share the same structure of how the construction industry works.I think it's the interaction of all those effects. One thing that I think is perhaps underappreciated is that the systems of a building are really highly coupled in a way that a lot of other things are. If you're manufacturing a computer, the hard drive is somewhat independent from the display and somewhat independent from the power supply. These things are coupled, but they can be built by independent people who don't really necessarily even talk to each other and then assembled into one structured thing. A building is not really like that at all. Every single part affects every single other part. In some ways, it's like biology. So it's very hard to change something that doesn't end up disrupting something else. Part of that is because the job a building does is to create a controlled interior environment, so basically, every single system has to run through and around the surfaces that are creating that controlled interior. Everything is touching each other. Again, that's not unique. Anything really highly engineered, like a plane or an iPhone, share that to some extent. In terms of the size of it and the relatively small amount you're paying in terms of unit size or unit mass, however, it's quite low. Dwarkesh Patel Is transportation cost the fundamental reason you can't have as much specialization and modularity?Brian Potter Yeah, I think it's really more about just the way a building is. An example of this would be how for the electrical system of your house, you can't have a separate box where if you needed to replace the electrical system, you could take the whole box out and put the new box in. The electrical system runs through the entire house. Same with plumbing. Same with the insulation. Same with the interior finishes and stuff like that. There's not a lot of modularity in a physical sense. Dwarkesh Patel Gotcha. Ben Kuhn  had this interesting comment on your article where he pointed out that many of the reasons you give for why it's hard to innovate in construction, like sequential dependencies and the highly variable delivery timelines are also common in software where Ben Koon works. So why do you think that the same sort of stagnation has not hit other industries that have superficially similar characteristics, like software? Brian Potter How I think about that is that you kind of see a similar structure in anything that's project-based or anything where there's an element of figuring out what you're doing while you're doing it. Compared to a large-scale manufacturing option where you spend a lot of time figuring out what exactly it is that you're building. You spend a lot of time designing it to be built and do your first number of runs through it, then you tweak your process to make it more efficient. There's always an element of tweaking it to make it better, but to some extent, the process of figuring out what you're doing is largely separate from the actual doing of it yourself. For a project-based industry, it's not quite like that. You have to build your process on the fly. Of course, there are best practices that shape it, right? For somebody writing a new software project or anything project-based, like making a movie, they have a rough idea for how it's going to go together. But there's going to be a lot of unforeseen things that kind of come up like that. The biggest difference is that either those things can often scale in a way that you can't with a building. Once you're done with the software project, you can deploy it to 1,000 or 100,000, or 1 million people, right? Once you finish making a movie, 100 million people can watch it or whatever. It doesn't quite look the same with a building. You don't really have the ability to spend a lot of time upfront figuring out how this thing needs to go. You kind of need to figure out a way to get this thing together without spending a huge amount of time that would be justified by the sheer size of it. I was able to dig up a few references for software projects and how often they just have these big, long tails. Sometimes they just go massively, massively over budget. A lot of times, they just don't get completed at all, which is shocking, but because of how many people it can then be deployed to after it's done, the economics of it are slightly different. Dwarkesh Patel I see, yeah. There's a famous law in software that says that a project will take longer than you expect even after you recount for the fact that it will take longer than you expect. Brian Potter Yeah. Hofstadter's law or something like that is what I think it is. Dwarkesh Patel Yeah. I'm curious about what the lack of skill in construction implies for startups. Famously, in software, the fact that there's zero marginal cost to scaling to the next customer is a huge boon to a startup, right? The entire point of which is scaling exponentially. Does that fundamentally constrain the size and quantity of startups you can have in construction if the same scaling is not available?Brian Potter Yeah, that's a really good question. The obvious first part of the answer is that for software, obviously, if you have a construction software company, you can scale it just like any other software business. For physical things, it is a lot more difficult. This lack of zero marginal cost has tended to fight a lot of startups, not just construction ones. But yeah, it's definitely a thing. Construction is particularly brutal because the margins are so low. The empirical fact is that trying what would be a more efficient method of building doesn't actually allow you to do it cheaper and get better margins. The startup that I used to work at, Katerra, their whole business model was basically predicated on that. “Oh, we'll just build all our buildings in these big factories and get huge economies of scale and reduce our costs and then recoup the billions of dollars that we're pumping into this industry or this business.” The math just does not work out. You can't build. In general, you can't build cheap enough to kind of recoup those giant upfront costs. A lot of businesses have been burned that way. The most success you see in prefabrication type of stuff is on the higher end of things where you can get higher margins. A lot of these prefab companies and stuff like that tend to target the higher end of the market, and you see a few different premiums for that. Obviously, if you're targeting the higher end, you’re more likely to have higher margins. If you're building to a higher level of quality, that's easier to do in a factory environment. So the delta is a lot different, less enormous than it would be. Building a high level of quality is easier to do in a factory than it is in the field, so a lot of buildings or houses that are built to a really high level of energy performance, for instance, need a really, really high level of air sealing to minimize how much energy this house uses. You tend to see a lot more houses like that built  out of prefab construction and other factory-built methods because it's just physically more difficult to achieve that on-site. The Problems of Prefabrication Dwarkesh Patel Can you say more about why you can't use prefabrication in a factory to get economies of scale? Is it just that the transportation costs will eat away any gains you get? What is going on? Brian PotterThere's a combination of effects. I haven't worked through all this, we’ll have to save this for the next time. I'll figure it out more by then. At a high level, it’s that basically the savings that you get from like using less labor or whatever are not quite enough to offset your increased transportation costs. One thing about construction, especially single-family home construction, is that a huge percentage of your costs are just the materials that you're using, right? A single family home is roughly 50% labor, and 50% materials for the construction costs. Then you have development costs, land costs, and things like that. So a big chunk of that, you just can't move to the factory at all, right?  You can't really build a foundation in a factory. You could prefab the foundation, but it doesn't gain you anything. Your excavation still has to be done on site, obviously. So a big chunk can't move to the factory at all. For ones that can, you still basically have to pay the same amount for materials. Theoretically, if you're building truly huge volume, you could get material volume discounts, but even then, it's probably not looking at things like asset savings. So you can cut out a big chunk of your labor costs, and you do see that in factory-built construction, right? These prefab companies are like mobile home companies. They have a small fraction of labor as their costs, which is typical of a factory in general, but then they take out all that labor cost while they still have their high material costs, and then they have overhead costs of whatever the factory has cost them. Then you have your additional overhead cost of just transporting it to site, which is pretty limited. The math does not really work out in favor of prefab, in terms of being able to make the cost of building dramatically cheaper. You can obviously build a building in a prefab using prefab-free methods and build a successful construction business, right? Many people do. But in terms of dramatically lowering your costs, you don't really see that. Dwarkesh Patel Yeah, yeah. Austin Vernon has an interesting blog post about why there's not more prefabricated homes. The two things he points out were transportation costs, and the other one was that people prefer to have homes that have unique designs or unique features. When I was reading it, it actually occurred to me that maybe they're actually both the result of the same phenomenon. I don't know if I'm pronouncing it correctly, but have you heard of the Alchian-Allen theorem in economics? Brian Potter Maybe, but I don't think so. Dwarkesh Patel Basically, it's the idea that if you increase the cost of some category of goods in a fixed way––let's say you tax oranges and added a $1 tax to all oranges, or transportation for oranges gets $1 more expensive for all oranges––people will shift consumption towards the higher grade variety because now, the ratio of the cost between the higher, the more expensive orange and the less expensive orange has decreased because of the increase in fixed costs. It seems like you could use that argument to also explain why people have strong preferences for uniqueness and all kinds of design in manufactured houses. Since transportation costs are so high, that's basically a fixed cost, and that fixed cost has the effect of making people shift consumption towards higher-grade options. I definitely think that's true. Brian PotterI would maybe phrase this as, “The construction industry makes it relatively comparatively cheap to deliver a highly customized option compared to a really repetitive option.” So yeah, the ratio between a highly customized one and just a commodity one is relatively small. So you see a kind of industry built around delivering somewhat more customized options. I do think that this is a pretty broad intuition that people just desire too much customization from their homes. That really prevents you from having a mass-produced offering. I do think that is true to some extent. One example is the Levittown houses, which were originally built in huge numbers–– exactly the same model over and over again. Eventually, they had to change their business model to be able to deliver more customized options because the market shipped it. I do think that the effect of that is basically pretty overstated. Empirically, you see that in practice, home builders and developers will deliver fairly repetitive housing. They don't seem to have a really hard time doing that. As an example, I'm living in a new housing development that is just like three or four different houses copy-pasted over and over again in a group of 50. The developer is building a whole bunch of other developments that are very similar in this area. My in-laws live in a very similar development in a whole different state. If you just look like multi-family or apartment housing, it's identical apartments, you know, copy-pasted over and over again in the same building or a bunch of different buildings in the same development. You're not seeing huge amounts of uniqueness in these things. People are clearly willing to just live in these basically copy-pasted apartments. It's also quite possible to get a pretty high amount of product variety using a relatively small number of factors that you vary, right? I mean, the car industry is like this, where there are enough customization options. I was reading this book a while ago that was basically pushing back against the idea that the car industry pre-fifties and sixties we just offering a very uniform product. They basically did the math, and the number of customization options on their car was more than the atoms in the universe. Basically just, there are so many different options. All the permutations, you know, leather seats and this type of stereo and this type of engine, if you add it all up, there's just a huge, massive number of different combinations. Yeah, you can obviously customize the house a huge amount, just by the appliances that you have and the finishes that are in there and the paint colors that you choose and the fixtures and stuff like that. It would not really theoretically change the underlying way the building comes together. So regarding the idea that the fundamental demand for variety is a major obstruction, I don’t think there's a whole lot of evidence for that in the construction industry. If Construction Regulation Vanished… Dwarkesh Patel I asked Twitter about what I should ask you, and usually, I don't get interesting responses but the quality of the people and the audience that knows who you are was so high that actually, all the questions I got were fascinating. So I'm going to ask you some questions from Twitter. Brian Potter Okay. Dwarkesh Patel 0:26:45Connor Tabarrok asks, “What is the most unique thing that would or should get built in the absence of construction regulation?”Brian Potter Unique is an interesting qualifier. There are a lot of things that just like should get built, right? Massive amounts of additional housing and creating more lands in these really dense urban environments where we need it, in places like San Francisco–– just fill in a big chunk of that bay. It's basically just mud flat and we should put more housing on it. “Unique thing” is more tricky. One idea that I really like (I read this in the book, The Book Where's My Flying Car),  is that it's basically crazy that our cities are designed with roads that all intersect with each other. That's an insane way to structure a material flow problem. Any sane city would be built with multiple layers of like transportation where each one went in a different direction so your flows would just be massively, massively improved. That just seems like a very obvious one.If you're building your cities from scratch and had your druthers, you would clearly want to build them and know how big they were gonna get, right? So you could plan very long-term in a way that so these transportation systems didn’t intersect with each other, which, again, almost no cities did. You’d have the space to scale them or run as much throughput through them as you need without bringing the whole system to a halt. There's a lot of evidence saying that cities tend to scale based on how much you can move from point A to point B through them. I do wonder whether if you changed the way they went together, you could unlock massively different cities. Even if you didn't unlock massive ones, you could perhaps change the agglomeration effects that you see in cities if people could move from point A to point B much quicker than they currently can. Dwarkesh Patel Yeah, I did an episode about the book, where's my flying car with Rohit Krishnan. I don't know if we discussed this, but an interesting part of the book is where he talks about transistor design. If you design transistors this way, can you imagine how slow they would be? [laughs] Okay, so Simon Grimm asks, “What countries are the best at building things?”Brian Potter This is a good question. Yeah, again, I'm going to sort of cheat a little bit and do it in terms of space and time, because I think most countries that are doing a good job at building massive amounts of stuff are not ones that are basically doing it currently.The current answer is like China, where they just keep building–– more concrete was used in the last 20 years or so than the entire world used in the time before that, right? They’ve accomplished massive amounts of urbanization, and built a lot of really interesting buildings and construction. In terms of like raw output, I would also put Japan in the late 20th century on there. At the peak of the concern and wonder of “Is Japan gonna take over the world?”, they were really interested in building stuff quite quickly. They spent a lot of time and effort trying to use their robotics expertise to try to figure out how to build buildings a lot more quickly. They had these like really interesting factories that were designed to basically extrude an entire skyscraper just going up vertically.All these big giant companies and many different factories were trying to develop and trying to do this with robotics. It was a really interesting system that did not end up ever making economic sense, but it is very cool. I think big industrial policy organs of the government basically encouraged a lot of these industrial companies to basically develop prefabricated housing systems. So you see a lot of really interesting systems developed from these sort of industrial companies in a way that you don't see in a lot of other places. From 1850 to maybe 1970 (like a hundred years or something), the US was building huge massive amounts of stuff in a way that lifted up huge parts of the economy, right? I don't know how many thousands of miles of railroad track the US built between like 1850 and 1900, but it was many, many, many thousands of miles of it. Ofcourse, needing to lay all this track and build all these locomotives really sort of forced the development of the machine tool industry, which then led to the development of like better manufacturing methods and interchangeable parts, which of course then led to the development of the automotive industry. Then ofcourse, that explosion just led to even more big giant construction projects. So you really see that this ability to build just big massive amounts of stuff in this virtuous cycle with the US really advanced a lot of technology to raise the standard of development for a super long period of time. Yeah, so those are my three answers. China’s Real Estate Bubble, Unbound Technocrats, and JapanDwarkesh Patel Yeah, those three bring up three additional questions, one for each of them! That's really interesting. Have you read The Power Broker, the book about Robert Moses? Brian Potter I think I got a 10th of the way through it. Dwarkesh Patel That's basically a whole book in itself, a 10th of the way. [laughs] Yeah I'm a half of the way through, and so far it's basically about the story of how this one guy built a startup within the New York state government that was just so much more effective at building things, didn't have the same corruption and clientelism incompetence. Maybe it turns into tragedy in the second half, but so far it's it seems like we need this guy. Where do we get a second Robert Moses? Do you think that if you had more people like that in government or in construction industries, public works would be more effectively built or is the stagnation there just a result of like other bigger factors? Brian Potter That's an interesting question. Yeah, I remember reading this article a while ago that was complaining about how horrible Penn Station is in New York. They're basically saying, “Yeah, it would be nice to return to the era of like the sort of unbound technocrat” when these technical experts in high positions of power in government could essentially do whatever they wanted to some extent. If they thought something should be built somewhere, they basically had the power to do it. It's a facet of this problem of how it's really, really hard to get stuff built in the US currently. I'm sure that a part of it is that you don't see these really talented technocrats occupy high positions of government where they can get stuff done. But it's not super obvious to me whether that's the limiting factor. I kind of get the sense that they would end up being bottlenecked by some other part of the process. The whole sort of interlocking set of institutions has just become so risk averse that they would end up just being blocked in a way that they wouldn't when they were operating in the 1950s or 1960s.Dwarkesh Patel Yeah, yeah, that's interesting. All right, so speaking of Japan, I just recently learned about the construction there and how they just keep tearing stuff down every 30 to 40 years and rebuilding it. So you have an interesting series of posts on how you would go about building a house or a building that lasts for a thousand years. But I'm curious, how would you build a house or a building that only lasts for 30 or 40 years? If you're building in Japan and you know they're gonna tear it down soon, what changes about the construction process? Brian Potter Yeah, that's interesting. I mean, I'm not an expert on Japanese construction, but I think like a lot of their interior walls are basically just paper and stuff like that. I actually think it's kind of surprising that last time I looked, for a lot of their homes, they use a surprising post and beam construction method, which is actually somewhat labor-intensive to do. The US in the early 1800s used a pretty similar method. Then once we started mass producing conventional lumber, we stopped doing that because it was much cheaper to build out of two-by-fours than it was to build big heavy posts. I think the boring answer to that question is that we’d build like how we build mobile homes–– essentially just using pretty thin walls, pretty low-end materials that are put together in a minimal way. This ends up not being that different from the actual construction method that single-family homes use. It just even further economizes and tightens the use of materials–– where a single-family home might use a half inch plywood, they might try to use three-sixteenths or even an eighth inch plywood or something like that. So we’d probably build a pretty similar way to the way most single-family homes and multi-family homes are built currently, but just with even tighter use of materials. Yeah, which perhaps is something that's not super nice about the way that you guys build your homes. But... [laughs]Dwarkesh Patel Okay, so China is the third one here. There's been a lot of talk about a potential real estate bubble in China because they're building housing in places where people don't really need it. Of course, maybe the demographics aren't there to support the demand. What do you think of all this talk? I don't know if you're familiar with it, but is there a real estate bubble that's created by all this competence in building? Brian PotterOh, gosh, yeah, I have no idea. Like you, I've definitely heard talk of it and I've seen the little YouTube clips of them knocking down all these towers that it turns out they didn't need or the developer couldn't, finish or whatever. I don't know a huge amount about that. In general, I wish I knew a lot more about how things are built in China, but the information is in general, so opaque. I generally kind of assume that any particular piece of data that comes out of China has giant error bars on it as to whether it's true or not or what the context surrounding it is. So in general, I do not have a hard opinion about that. Dwarkesh Patel This is the second part of Simon's question, does greater competence and being able to build stuff translate into other good outcomes for these countries like higher GDP or lower rents or other kinds of foreign outcomes? Brian Potter That's a good question. Japan is an interesting place where basically people point to it as an example of, “Here's a country that builds huge amounts of housing and they don't have housing cost increases.” In general, we should expect that dynamic to be true. Right? There's no reason to not think that housing costs are essentially a supply-demand problem where if you built as much as people wanted, the cost would drop. I have no reason to not think that's true. There is a little bit of evidence that sort of suggests that it’s impossible to build housing enough to overcome this sort of mechanical obstacle where the cost of it tends to match and rise to whatever people's income level are. The peak and the sort of flattening of housing costs in Japan also parallel when people basically stopped getting raises and income stopped rising in Japan. So I don't have a good sense of, if it ends up being just more driven by some sort of other factors. Generally though I expect the very basic answer of “If you build a lot more houses, the housing will become cheaper.”Dwarkesh PatelRight. Speaking of how the land keeps gaining value as people's income go up, what is your opinion on Georgism? Does that kind of try and make you think that housing is a special asset that needs to be more heavily taxed because you're not inherently doing something productive just by owning land the way you would be if you like built a company or something similar?Brian Potter Yeah, I don't have any special deep knowledge of Georgism. It's on my list of topics to read more deeply about. I do think in general, taxing encourages to produce less of something for something that you can't produce less of. It's a good avenue for something to tax more heavily. And yeah, obviously if you had a really high land value tax in these places that have a lot of single family homes in dense urban areas, like Seattle or San Francisco, that would probably encourage people to use the land a lot more efficiently. So yeah, it makes sense to me, but I don't have a ton of special knowledge about it. Dwarkesh Patel All right, Ben Kuhn asked on Twitter, “What construction-related advice would you give to somebody building a new charter city?”Brian Potter That is interesting. I mean, just off the top of my head, I would be interested in whether you could really figure out a way to build using a method that had really high upfront costs. I think it could otherwise be justified, but if you're gonna build 10,000 buildings or whatever all at once, you could really take advantage of that. One kind of thing that you see in the sort of post-World War II era is that we're building huge massive amounts of housing, and a lot of times we’re building them all in one place, right? A lot of town builders were building thousands and thousands of houses in one big development all at once. In California, it’s the same thing, you just built like 6 or 10 or 15,000 houses in one big massive development. You end up seeing something like that where they basically build this like little factory on their construction site, and then use that to like fabricate all these things. Then you have something that’s almost like a reverse assembly line where a crew will go to one house and install the walls or whatever, and then go to the next house and do the same thing. Following right behind them would be the guys doing the electrical system, plumbing, and stuff like that. So this reverse assembly line system would allow you to sort of get these things up really, really fast, in 30 days or something like that. Then you could have a whole house or just thousands and thousands of houses at once. You would want to be able to do something similar where you could just not do the instruction the way that the normal construction is done, but that's hard, right? Centrally planned cities or top-down planned cities never seem to do particularly well, right? For example, the city of Brasilia, the one that was supposed to be a planned city— the age it goes back to the unfettered technocrat who can sort of build whatever he wants. A lot of times, what you want is something that will respond at a low level and organically sort out the factories as they develop. You don't want something that's totally planned from the top-down, that's disconnected from all the sorts of cases on the ground. A lot of the opposition to Robert Moses ended up being that in a certain form, right? He's bulldozing through these cities that are these buildings and neighborhoods that he's not paying attention to at all. So I think, just to go back to the question, trying to plan your city from the top down doesn't have a super, super great track record. In general, you want your city to develop a little bit more organically. I guess I would think to have a good sort of land-use rules that are really thought through well and encourage the things that you want to encourage and not discourage the things that you don't want to discourage. Don't have equity in zoning and allow a lot of mixed-use construction and stuff like that. I guess that's a somewhat boring answer, but I’d probably do something along those lines. Dwarkesh Patel Interesting, interesting. I guess that implies that there would be high upfront costs to building a city because if you need to build 10,000 homes at once to achieve these economies of scale, then you would need to raise like tens of billions of dollars before you could build a charter city. Brian Potter Yeah, if you were trying to lower your costs of construction, but again, if you have the setup to do that, you wouldn't necessarily need to raise it. These other big developments were built by developers that essentially saw an opportunity. They didn't require public funding to do it. They did in the form of loan guarantees for veterans and things like that, but they didn't have the government go and buy the land. Automation and Revolutionary Future Technologies Dwarkesh Patel Right, okay, so the next question is from Austin Vernon. To be honest, I don't understand the question, you two are too smart for me, but hopefully, you'll be able to explain the question and then also answer it. What are your power rankings for technologies that can tighten construction tolerances? Then he gives examples like ARVR, CNC cutting, and synthetic wood products. Brian Potter Yeah, so this is a very interesting question. Basically, because buildings are built manually on site by hand, there's just a lot of variation in what ends up being built, right? There's only so accurately that a person can put something in place if they don't have any sort of age or stuff like that. Just the placement itself of materials tends to have a lot of variation in it and the materials themselves also have a lot of variation in them. The obvious example is wood, right? Where one two by four is not gonna be exactly the same as another two by four. It may be warped, it may have knots in it, it may be split or something like that. Then also because these materials are sitting just outside in the elements, they sort of end up getting a lot of distortion, they either absorb moisture and sort of expand and contract, or they grow and shrink because of the heat. So there's just a lot of variation that goes into putting a building up.To some extent, it probably constrains what you are able to build and how effectively you're able to build it. I kind of gave an example before of really energy efficient buildings and they're really hard to build on-site using conventional methods because the air ceiling is quite difficult to do. You have to build it in a much more precise way than what is typically done and is really easily achieved on-site. So I guess in terms of examples of things that would make that easier, he gives some good ones like engineered lumber, which is where you take lumber and then grind it up into strands or chips or whatever and basically glue them back together–– which does a couple of things. It spreads all the knots and the defects out so they are concentrated and everything tends to be a lot more uniform when it's made like that. So that's a very obvious one that's already in widespread use. I don't really see that making a substantial change.I guess the one exception to that would be this engineered lumber product called mass timber elements, CLT, which is like a super plywood. Plywood is made from tiny little sheet thin strips of wood, right? But CLT is made from two-by-four-dimensional lumber glued across laminated layers. So instead of a 4 by 9 sheet of plywood, you have a 12 by 40 sheet of dimensional lumber glued together. You end up with a lot of the properties of engineered material where it's really dimensionally stable. It can be produced very, very accurately. It's actually funny that a lot of times, the CLT is the most accurate part of the building. So if you're building a building with it, you tend to run into problems where the rest of the building is not accurate enough for it. So even with something like steel, if you're building a steel building, the steel is not gonna be like dead-on accurate, it's gonna be an inch or so off in terms of where any given component is. The CLT, which is built much more accurately, actually tends to show all these errors that have to be corrected. So in some sense, accuracy or precision is a little bit of like a tricky thing because you can't just make one part of the process more precise. In some ways that actually makes things more difficult because if one part is really precise, then a lot of the time, it means that you can't make adjustments to it easily. So if you have this one really precise thing, it usually means you have to go and compensate for something else that is not built quite as precisely. It actually makes advancing precision quite a bit more complicated. AR VR, is something I'm very bullish on. A big caveat of that is assuming that they can just get the basic technology working. The basic intuition there is that right now the way that pieces are, when a building is put together on site, somebody is looking at a set of paper plans, or an iPad or something that tells them where everything needs to go. So they figure that out and then they take a tape measure or use some other method and go figure out where that’s marked on the ground. There's all this set-up time that is really quite time consuming and error prone. Again, there's only so much accuracy that a guy dragging a tape 40 feet across site being held by another guy can attain, there's a limit to how accurate that process can be. It's very easy for me to imagine that AR would just project exactly where the components of your building need to go. That would A, allow you a much higher level of accuracy that you can easily get using manual methods. And then B, just reduce all that time it takes to manually measure things. I can imagine it being much, much, much faster as well, so I'm quite bullish on that. At a high level and a slightly lower level, it's not obvious to me if they will be able to get to the level where it just projects it with perfect accuracy right in front of you. It may be the case that a person moving their head around and constantly changing their point of view wont ever be able to project these things with millimeter precision––it's always gonna be a little bit jumpy or you're gonna end up with some sort of hard limit in terms of like how precisely you can project it. My sense is that locator technology will get good enough, but I don't have any principle reason believing that. The other thing is that being able to take advantage of that technology would require you to have a really, really accurate model of your building that locates where every single element is precisely and exactly what its tolerances are. Right now, buildings aren't designed like that, they are built using a comparatively sparse set of drawings that leaves a lot to sort of be interpreted by the people on site doing the work and efforts that have tried to make these models really, really, really precise, have not really paid off a lot of times. You can get returns on it if you're building something really, really complex where there's a much higher premium to being able to make sure you don't make any error, but for like a simple building like a house, the returns just aren't there. So you see really comparatively sparse drawings. Whether it's gonna be able to work worth this upfront cost of developing this really complex, very precise model of where exactly every component is still has to be determined. There's some interesting companies that are trying to move in this direction where they're making it a lot easier to draw these things really, really precisely and whave every single component exactly where it is. So I'm optimistic about that as well, but it's a little bit TBD. Dwarkesh Patel This raises a question that I actually wanted to ask you, which is in your post about why there aren't automatic brick layers. It was a really interesting post. Somebody left in an interesting comment saying that bricks were designed to be handled and assembled by humans. Then you left a response to that, which I thought was really interesting. You said, “The example I always reach for is with steam power and electricity, where replacing a steam engine with an electric motor in your factory didn't do much for productivity. Improving factory output required totally redesigning the factory around the capabilities of electric motors.” So I was kind of curious about if you apply that analogy to construction, then what does that look like for construction? What is a house building process or building building process that takes automation and these other kinds of tools into account? How would that change how buildings are built and how they end up looking in the end? Brian Potter I think that's a good question. One big component of the lack of construction productivity is everything was designed and has evolved over 100 years or 200 years to be easy for a guy or person on the site to manipulate by hand. Bricks are roughly the size and shape and weight that a person can move it easily around. Dimensional lumber is the same. It's the size and shape and weight that a person can move around easily. And all construction materials are like this and the way that they attach together and stuff is the same. It's all designed so that a person on site can sort of put it all together with as comparatively little effort as possible. But what is easy for a person to do is usually not what is easy for a machine or a robot to do, right? You typically need to redesign and think about what your end goal is and then redesign the mechanism for accomplishing that in terms of what is easy to get to make a machine to do. The obvious example here is how it's way easier to build a wagon or a cart that pulls than it is to build a mechanical set of legs that mimics a human's movement. That's just way, way, way easier. So yeah, I do think that a big part of advancing construction productivity is to basically figure out how to redesign these building elements in a way that is really easy for a machine to produce and a machine to put together. One reason that we haven't seen it is that a lot of the mechanization you see is people trying to mechanize exactly what a person does. You’d need a really expensive industrial robot that can move exactly the way that a human moves more or less. What that might look like is basically something that can be really easily extruded by a machine in a continuous process that wouldn't require a lot of finicky mechanical movements. A good example of this technology is technology that's called insulated metal panels, which is perhaps one of the cheapest and easiest ways to build an exterior wall. What it is, is it’s just like a thin layer of steel. Then on top of that is a layer of insulation. Then on top of that is another layer of steel. Then at the end, the steel is extruded in such a way that it can like these inner panels can like lock together as they go. It's basically the simplest possible method of constructing a wall that you can imagine. But that has the structural system and the water barrier, air barrier, and insulation all in this one really simple assembly. Then when you put it together on site, it just locks together. Of course there are a lot of limitations to this. Like if you want to do anything on top of like add windows, all of a sudden it starts to look quite a bit less good. I think things that are really easy for a machine to do can be put together without a lot of persistent measurement or stuff like that in-field. They can just kind of snap together and actually want to fit together. I think that's kind of what it looks like. 3D Printer Pessimism & The Rising Cost of LabourDwarkesh Patel What would the houses or the buildings that are built using this physically look like? Maybe in 50 to 100 years, we'll look back on the houses we have today and say, “Oh, look at that artisanal creation made by humans.” What is a machine that is like designed for robots first or for automation first? In more interesting ways, would it differ from today's buildings? Brian Potter Yeah, that's a good question. I'm not especially bullish on 3D building printing in general, but this is another example of a building using an extrusion process that is relatively easy to mechanize. What's interesting there is that when you start doing that, a lot of these other bottlenecks become unlocked a little bit. It's very difficult to build a building using a lot of curved exterior surfaces using conventional methods. You can do it, it's quite expensive to do, but there's a relatively straightforward way for a 3D printed building to do that. They can build that as easily as if it was a straight wall. So you see a lot of interesting curved architecture on these creations and in a few other areas. There's a company that can build this cool undulating facade that people kind of like. So yeah, it unlocks a lot of options. Machines are more constrained in some things that they can do, but they don't have a lot of the other constraints that you would otherwise see. So I think you'll kind of see a larger variety of aesthetic things like that. That said, at the end of the day, I think a lot of the ways a house goes together is pretty well shaped to just the way that a person living inside it would like to use. I think Stewart Brand makes this point in––Dwarkesh Patel Oh, How Buildings Learn. Brian Potter There we go. He basically makes the point that a lot of people try to use dome shaped houses or octagon shaped houses, which are good because again, going back to surface area volume, they include lots of space using the least amount of material possible. So in some theoretical sense they’re quite efficient, but it's actually quite inconvenient to live inside of building like really curved wall, right? Furniture doesn't fit up against it nicely and pictures are hard to hang on a really curved wall. So I think you would see less variation than maybe you might expect. Dwarkesh Patel Interesting. So why are you pessimistic about 3D printers? For construction, I mean. Brian Potter Yeah, for construction. Oh God, so many reasons. Not pessimistic, but just there's a lot of other interesting questions. I mean, so the big obvious one is like right now a 3D printer can basically print the walls of a building. That is a pretty small amount of the value in a building, right? It's maybe 7% or 8%, something like that. Probably not more than 10% of the value in a building. Because you're not printing the foundation, you're not printing like the overhead vertical, or the overhead spanning structure of the building. You're basically just printing the walls. You're not even really printing the second story walls that you have in multiple stories. I don't think they've quite figured that out yet. So it's a pretty small amount of value added to the building. It's frankly a task that is relatively easy to do by manual labor. It's really pretty easy for a crew to basically put up the structure of a house. This is kind of a recurring theme in mechanization or it goes back to what I was talking about to our previous lead. Where it takes a lot of mechanization and a lot of expensive equipment to replace what basically like two or three guys can do in a day or something like that. The economics of it are pretty brutal. So right now it produces a pretty small value. I think that the value of 3D printing is basically entirely predicated on how successful they are at figuring out how to like deliver more components of the building using their system.There are companies that are trying to do this. There's one that got funded not too long ago called Black Diamond, where they have this crazy system which is like a series of 3D printers that would act simultaneously, like each one building a separate house. Then as you progress, you switch out the print head for like a robot arm. Cause a 3D printer is basically like a robot arm with just a particular manipulator at the end, right?So they switch out their print head for like a robot arm and the robot arm goes and installs different other systems like the windows or the mechanical systems. So you can figure out how to do that reliably where your print head or your printing system is installing a large fraction of the value of the building. It's not clear to me that it's gonna be economic, but it obviously needs to reach that point. It's not obvious to me that they have gotten there yet. It's really quite hard to get a robot to do a lot of these tasks. For a lot of these players, it seems like they're actually moving away from that. I think in ICON is the biggest construction 3D printer company in the US, as far as I know. And as far as I know, they've moved away from trying to install lots of systems in their walls as they get printed. They've kind of moved on to having that installed separately, which I think has made their job a little bit easier, but again, not quite, it's hard to see how the 3D printer can fulfill its promises if it can't do anything just beyond the vertical elements, whichare really, for most construction, quite cheap and simple to build. Dwarkesh Patel Now, if you take a step back and talk how expensive construction is overall, how much of it can just be explained by the Baumol cost effect? As in labor costs are increasing because labor is more productive than other industries and therefore construction is getting more expensive. Brian Potter I think that's a huge, huge chunk of it. The labor fraction hasn’t changed appreciably enough. I haven't actually verified that and I need to, but I remember somebody that said that they used to be much different. You sent me some literature related to it. So let’s add a slight asterisk on that. But in general the labor cost has remained a huge fraction of the overall cost of the building. Reliably seeing their costs continue to rise, I think there's no reason to believe that that's not a big part of it. Dwarkesh Patel Now, I know this sounds like a question with an obvious answer, but in your post comparing the prices of construction in different countries, you mentioned how the cost of labor and the cost of materials is not as big a determiner of how expensive it is to construct in different places. But what does matter? Is it the amount of government involvement and administrative overhead? I'm curious why those things (government involvement and administrative overhead) have such a high consequence on the cost of construction. Brian Potter Yeah, that's a good question. I don't actually know if I have a unified theory for that. I mean, basically with any heavily regulated thing, any particular task that you're doing takes longer and is less reliable than it would be if it was not done right. You can't just do it as fast as on your own schedule, right? You end up being bottlenecked by government processes and it reduces and narrows your options. So yeah, in general, I would expect that to kind of be the case, but I actually don't know if I have a unified theory of how that works beyond just, it's a bunch of additional steps at any given part of the process, each of which adds cost. Dwarkesh Patel Yeah. Now, one interesting trend we have in the United States with construction is that a lot of it is done by Latino workers and especially by undocumented Latino workers. What is the effect of this on the price and the quality of construction? If you have a bunch of hardworking undocumented workers who are working for below-market rates in the US, will this dampen the cost of construction over time? What do you think is going to happen? Brian Potter I suspect that's probably one of the reasons why the US has comparatively low construction costs compared to other parts of the world. Well, I'll caveat that. Residential construction, which is single-family homes and multi-family apartment buildings all built in the US and have light framed wood and are put together, like you said, by a lot of like immigrant workers. Because of that, it would not surprise me if those wages are a lot lower than the equivalent wage for like a carpenter in Germany or something like that. I suspect that's a factor in why our cost of residential construction are quite low. AI’s Impact on Construction ProductivityDwarkesh Patel Overall, it seems from your blog post that you're kind of pessimistic, or you don't think that different improvements in industrialization have transferred over to construction yet. But what do you think is a prospect of future advances in AI having a big impact on construction? With computer vision and with advances in robotics, do you think we'll finally see some carry-over into construction productivity or is it gonna be more of the same? Brian Potter Yeah I think there's definitely gonna be progress on that axis. If you can wire up your computer vision systems, robotic systems and your AI in such a way that your capabilities for a robot system are more expanded, then I kind of foresee robotics being able to take a larger and larger fraction of the tasks done on a typical construction site. I kind of see it being kind of done in narrow avenues that gradually expand outward. You're starting to see a lot of companies that have some robotic system that can do one particular task, but do that task quite well. There's a couple of different robot companies that have these little robots for like drawing wall layouts on like concrete slabs or whatever. So you know exactly where to build your walls, which you would think would not be like a difficult problem in construction, but it turns out that a lot of times people put the walls in the wrong spot and then you have to go back and move them later or just basically deal with it. So yeah, it's basically a little Roomba type device that just draws the wall layout to the concrete slab and all the other systems as well–– for example, where the lines need to run through the slab and things like that. I suspect that you're just gonna start to see robotics and systems like that take a larger and larger share of the tasks on the construction site over time. Dwarkesh Patel Yeah, it's still very far away. It's still very far away. What do you think of Flow? That's Adam Neumann's newest startup and backed with $350 million from Andreeseen Horowitz.Brian Potter I do not have any strong opinions about that other than, “Wow, they've really given him another 350M”. I do not have any particularly strong opinions about this. They made a lot they make a lot of investments that don't make sense to me, but I'm out of venture capital. So there's no reason that my judgment would be any good in this situation–– so I'm just presuming they know something I do not. Dwarkesh Patel I'm going t o be interviewing Andreeseen later this month and I'm hoping I can ask him about that.Brian Potter You know, it may be as simple as he “sees all” about really high variance bets. There's nobody higher variance in the engine than Adam Neumann so, maybe just on those terms, it makes sense. Dwarkesh Patel You had an interesting post about like how a bunch of a lot of the knowledge in the construction industry is like informal and contained within best practices or between between relationships and expectations that are not articulated all the time. It seems to me that this is also true of software in many cases but software seems much more legible and open source than these other physical disciplines like construction despite having a lot of the knowledge contained within people's minds and within the culture rather than excessly codified somewhere. So why do you think that construction is seems more closed or stem software? It's interesting.Brian Potter To go back slightly to our products versus projects industry, a slightly different way of thinking about that is craft-based industries versus industrial processes where this isn't a dichotomy, but a spectrum. In general, there's an expertise and judgment aspect of it that is pretty well embedded in the craft-based process so you can't really remove it. Any sort of decision at any given point requires an expert or an artisan or somebody who understands the relevant context and knows how to proceed based on the specific variables in this specific situation. Industrial processes on the other hand have been sort of figured out. This is how it works every single time and construction is just very very much on the craft end of the production spectrum where the decision of how to put these things together and how to wire this building or whatever is all left up to the expertise and judgments of the people.Doing the installation and what that gets you is it lets you put things together without having to do a very large amount of specifying things exactly as how you need. The drawings specifying a house going together are way fewer than the drawings needed to produce a Toyota Corolla. The design Cost required to do it in terms in proportion to how expensive the thing is is also much lower as well. Again, I’m not an expert on software development but it's somewhat more legible by the response and the end-product is very clear. You can clearly see every single part of it and how every single part of it touches every single other part. I'm sure someone in software could say “Well It's actually really not super obvious how these things work and why they're done this way” or whatever, but you can clearly inspect every single part of it and see exactly how it does what it does and how it connects together. The other part of it is you can't really do that with a building. I guess I would also maybe say that if you're a developer, with a building, it's not necessarily obvious how it got to the point that it did when it was put together. A lot of times with physical things, even if you have the object, it is unclear what the process was to create it. So a lot of times what you see is that even with like this comes industrial espionage. Or somebody who's trying to steal some particular thing or whatever a lot of times that doesn't help them as much as they would think to try to like recreate it. A lot of times they have to basically go through the entire process of figuring out how to make it and it takes them just as long to do it as it did the original people doing the development. You saw this with like the development of the atomic bomb for instance. We're like the people who stole this stole the plans for how to make it or who had information on exactly how their system would react if the bomb worked basically took as long to figure out how to make it as the US did.So with a physical object, just the process used to make it is not necessarily super legible and it tends to be a little bit hidden. I was gonna say that perhaps that is not as true for software, but I actually realized that I don't actually know and it's very plausible to me that you could have some piece of software that was written, and then it'd just be utterly inscrutable as to how it came together and how you could maybe duplicate a similar piece of software. Is that like a category error? Dwarkesh Patel Yeah, that's a really good question. I think there are a lot of examples where if you don't have the context on why they were built a certain way, you wouldn't understand what was going on. If you've heard of the fast inverse square root, that's exactly what I was thinking of. Brian Potter Yeah, yeah.Dwarkesh Patel For the people who are interested, there's a great YouTube video on this that goes through it but basically, the guy who created it–– John Carmack is a super genius. If you look at the algorithm, it's a few lines, but you would never understand like why this gives you an inverse square root unless you went through the mind of John Carmack where he goes through Newton's method and all these other things like particular float operations, etc. I guess the advantage software has is the ability to fork. You can't just take a building, make an exact replica of it and then just change the part you want to better understand and see what the effect is. Whereas with a software project, you can just fork it or you can just make an API call or something. I guess it goes back to the modularity thing you were explaining–– try to understand a specific sub-component is easier with software.Brian Potter Yeah, that's interesting. You can run experiments on your piece of software to understand how it works easily and at a lower cost than you can with any physical object (especially a giant building).Brian Dreams of Building a Mile-High SkyscraperDwarkesh Patel Okay. So let's say the CEO of some mega-corporation is like “Brian, we want to build some really interesting skyscraper or building, I've talked to the mayor and the governor and they're willing to get rid of all the building codes.” So there's no building codes. There's no regulation. You just want to build a really cool skyscraper. What is it that you would do? What would be some innovation or some change that you would make? What would you do if you were given this latitude to just build a really cool building? Brian Potter I would like to see us fulfill the dream of the Early to mid 20th century and build a mile-high skyscraper. This was where people saw the development of skyscrapers going during the 30s, 40s and perhaps 50s. Frank Lloyd Wright designed this mile-high skyscraper called the Illinois presumably back when Chicago was a Metro rising in importance. The technology for it exists but you haven't really seen anyone do it. Even people who are clearly willing to build these giant, elephant projects–––– nobody's tried to go the distance and build something of this scale. I would like to see us do it.Dwarkesh Patel Interesting. I know you have a really interesting essay about skyscraper height and one of the things you talked about is the superlinear increase in lateral forces and other kinds of impediments to building tall. How would you get over that kind of stuff? Brian Potter Basically by throwing a giant amount of money in. So the basic gist of that is the physical constraints do not allow you to build a front that’s a mile in height. It's the economic and legal constraints that sort of stop this extreme construction. Even the economic constraints are significant enough that even in places where there are no legal constraints like China or Dubai, the economics of it are just so brutal. But yeah in this fantasy scenario, a giant stack of money would get devoted to doing this.Dwarkesh Patel[laughs] A stack of money a mile high. So speaking of which, in that post, you brought up that argument from the economist Glaeser that says that we were leaving billions of dollars basically on the table by having building height codes because we're just giving up on all this vertical space. I'm curious about why you think it's a case that these developers don't have any sort of lobbying or political influence to be able to like collect the billions of dollars of deadweight loss that are created by these codes? Why aren't they able to like organize politically in a way that like gets rid of these regulations that are helping no one? Brian Potter That's a really interesting question. In general, the strongest construction lobbying group I'm aware of is probably the National Association of Home Builders which exerts quite a bit of influence to try to keep the cost of building single-family homes low, I'm not aware of any anything that exists for large commercial buildings or something like that. Maybe the Association of General Contractors or something. I guess my my initial guess would be that something to the effect of the natural constituencies for opposing a big project like this are always going to be quite a bit great and at least as big (if not bigger) than the constituencies that would able would be able to act for it. So like any big giant construction project, even if it had like a lot of developers mobilized to try to support that kind of thing also would have a have a large constituency that would exist to oppose basically basically anyone who lives in the area. They don’t want this giant shadow of a building or they’re worried about the congestion that it would cause, etc. A paradox with this situation is that the places that need it the most because their rents are so high the people that are living there are gonna be financially well equipped to oppose it and in a certain sense they're losing the most out of it, right? If you if you're making $50,000 a year you might value the view out of your apartment at like $500 but if you're making five million dollars a year, you might value that view proportionately more and be willing to expend a lot more to prevent it from from being obstructed. So I feel like this sort of mechanism by where places get wealthier and need more housing kind of also creates its own opposition to some extent.Dwarkesh Patel I think a co-sign solution to this kind of thing would be optimal where if the view is worth more to you than the apartment is worth to somebody else, then you can just pay them to not build there. The view is not worth more than an apartment is probably worth to somebody right? So then you have an optimal allocation of resources based on who has political influence.Brian PotterYeah, it's interesting. I'm not super confident and I should look into it. Why developers don’t have better lobbying efforts does seem like an unanswered question. Deep Dive into Environmentalism and NEPADwarkesh Patel Speaking of being able to put projects into a tailspin, you just recently published a very interesting and thorough examination of how NEPA works. Do you want to explain what this law is and what its consequences are? Then I could ask you some more specific questions about it. Brian Potter Yeah. So NEPA is the national environmental policy act. This is the law that basically requires any major federal government action that might have significant environmental impacts to do a very long and thorough and expensive environmental impact study before anything is done on a project. It gets a large amount of attention because of how long these environmental impacts take to prepare. The average time currently is around four and a half years, and in some cases half of them take longer than that. The highway administration for instance, needed eight and a half years to do an environmental impact statement before they could build a new highway. So people are perpetually trying to figure out a way to reform this law so that we don’t have to wait years and years and years before building big important infrastructure projects. So that's the gist of what NEPA is and how it works.Dwarkesh PatelYou had a really interesting point in the article where you said that by adding this cost, you can basically think of it as like a tax on all major government actions and the effect of a tax is to reduce what you're taxing. I thought at the end you had a really interesting argument about how like NEPA is anti-law. Can you explain this argument for the podcast listeners? Brian Potter It's my spicy take at the end that I always have to throw in right at the end but yeah, the basic argument is that the purpose of a law is roughly twofold: to encourage something that you would want more of or discourage something that you would you would want less of. We have laws against drunk driving because we think drug driving is harmful and we want less drug driving in our society. The second purpose of a law is to basically reduce coordination problems and enable exchanges that might not otherwise be able to take place.The government enforces which side of the road you're allowed to drive on not because one side is inherently better than the other, but because it's good if everybody agrees on which side of the road to drive on. Contract law is in some ways like this. It's good if you know that people will be punished for breaking contracts because that allows people to enter into them, which allows exchanges that might not otherwise take place. I forget exactly what the example of this is, but the ability of the English government in the 1600s to 1700s to pay back its debts was a really important development because it allowed it to raise money that it otherwise wouldn't be able to because people could trust they would be able to get paid back. Anyway, those are the two rough purposes of a law and NEPA does not do either of those things. NEPA is basically a procedural statement or requirement it does not require the government to weigh environmental concerns especially heavily. It doesn't prevent a big oil and gas drilling project from taking place–– essentially what it does require is that for any major environmental effects, you just have to document them very thoroughly so all of it is a documentation requirement, and notifying the public of what you're doing but bit doesn't prevent major environmental negative ramifications. As long as you've documented it quite thoroughly, you can kind of do whatever you want and the evidence is very unclear as to whether it has had net beneficial environmental effects to the extent that it has made it harder to do anything at all. The other side is about solving coordination problems and I think that NEPA actually is very very bad at this. It creates a lot of uncertainty because the requirements for doing the analysis are so unclear and the definition what an environmental effect keeps shifting over time. In the 1970s, it was maybe not obvious that greenhouse gas emissions were in major environmental effect, but now in 2020, it obviously is and so what you've had to do for a NEPA analysis changes over time which is of course fine in that sense, right? But it does mean that it's very unclear how long it's gonna take and what is going to be involved and whether anybody is going to sort of litigate your decision. This is the other sort of big part of NEPA–– people are basically able to sue people for not completing the analysis thoroughly enough. They can't permanently stop the project because all you need to do is basically show that you've documented your things thoroughly enough. So once you have documented it thoroughly enough, they don't have grounds for stopping it anymore, but they can't slow it down. If they slow it down enough, sometimes the project becomes unattractive and it gets canceled. That's kind of what a lot of these groups hope for and so basically instead of great uncertainty and solid coordination problems, it creates all this new uncertainty where people will like very deliberately try to avoid the NEPA process because they do not know how long it will take and how much it will cost to get their project approved and in some cases going through the process will take a very very very very long time. So making a business decision as to whether to do a new offshore wind development or develop a new forest resource or something like that is very hard to do. You don't know when your project is going to start because you don’t know how long the process will take. Dwarkesh Patel Yeah, that's so fascinating. All right, so I've got a lot more questions about this because your breakdown was really interesting. I don't know if you're familiar with the longtermist movement, maybe you’ve come across this before, but one thing they've proposed is not like a doctrine or anything, but on the periphery, some idea I saw was that just as we have environmental review we should have a posterity review so that you're analyzing the impacts of your actions on generations way down the line. What are the future impacts of actions just as we analyze what the environmental impacts reactions? What do you think of an idea like that given the various dysfunctions of the environmental review process? Brian Potter Yeah, a couple thoughts. One is just my gut response is that any additional review is just gonna add additional time and complexity to your process. It's a process that takes some amount of time and has some particular chance of success, right? So adding basically another filter to this process means that it's only going to make the process slower and less likely to succeed rather than more. The other thing is how accurately are you gonna be able to predict what your long-term impacts are/ it's not obvious to me that anybody making predictions over the past 20 years would have been able to do so with any degree of precision. It's not obvious that we would even be able to get like the sign right. Whether it would be net positive or net negative, that's off the top of my head, I could definitely be persuaded otherwise by somebody who is who has thought a lot more about it. So that is not a strongly held opinion, but that's fine. Dwarkesh PatelYeah, that is not my immediate impression. That would be my critique as well. In the 70s, correct me if I'm wrong, but the technical consensus of the time was that we would hit peak oil by the 90s, and of course, that's because they couldn't predict their ability to find new reservoirs and develop new technologies that made more oil available to us. So it was just very hard to predict future trends. I don't know how much that kind of law would help. I vaguely hear that the political deliberation is that they're discussing reform to NEPA. What would your ideal reform of Napa look like? How would you reform the implementation? Brian PotterOn a very simple level, I would like to even the playing field so a lot of these newer energy technologies have a lot of the same benefits that like the oil and gas industries have been able to acrew. For instance, oil and gas have a lot of categorical exclusions for certain drilling operations and for drilling in the Gulf of Mexico. They actually have a lot of new exclusions, which was perhaps one of the reasons you can obviously connect that to like the giant Deepwater Horizon spill. Giving technologies like wind and solar and large-scale transmission projects the same benefits that oil and gas drilling and like you're like natural gas pipelines have what I think to be like a massive massive boom. So just off the top of my head. That's one thing that I would like to see.Dwarkesh Patel Yeah, I wonder what you think about this–– one idea I had while reading the post that didn’t make sense to me was why this was enforced through the courts where anybody can just bring a lawsuit. Shouldn't there be a single coherent bureaucracy whose goal is to figure out who's messing up? It seems like a mistake to have this done through the courts. Brian Potter I mean there I was reading a paper earlier basically saying that NEPA is a horribly drafted law because it contains no provisions for funding it or the bureaucracy enforcing it or anything like this. Essentially through random chance at the courts (it was passed during a very activist period in the court); they decided to enforce this this provision for the impact statement which was kind of added late in the process without a lot of fanfare or consideration and then that one little part of it ended up becoming the most important part because that's what the court decided to enforce really really strongly. This is not this is not how you would draft a environmental protection law if you were doing it from scratch. It's this weird thing that we've ended up with due to path dependency. An idea that I've seen floated around a few times is that you would want something that looked more like the OMB which basically is charged with figuring out how much additional a given law is going to cost. You would want something like a bureaucracy attached to it that was designed to figure out the environmental effects and that was decoupled from this specific agency. The downside of that, especially for an environmental protection statute, is whether it would be captured by political interests or not and either not enforced at all if it was very conservative of staffing or enforced extremely extremely vigorously if it was on the other end of the spectrum. That's kind of the risk of that, but yes, it's clearly not ideal that the court system is responsible for basically determining this.Dwarkesh Patel Even if there was a bias in how the law was enforced, if there's a bureaucracy, the benefit is that you can just fire the guy who's running it if you think he's not enforcing it correctly and replace him with somebody who you think will enforce it more appropriately. Whereas with the judiciary, if it's just dozens of different judges having independent opinions of how this should be enforced… There's nobody who's responsible to whom you can say to enforce it differently.Brian Potter The court actually makes it a little bit hard to change because you don't actually know what the effect of any given change in the provision until somebody files a lawsuit referring to it and it works its way through the courts. Some people think that During the Trump administration, there were some changes to how people worked because one thing about it is that a lot of these laws are just our federal level laws which are comparatively simpler to change. They change some of these laws and they’re designed to accelerate the process, but because it's unsure how the courts are going to interpret them, it's actually going to  increase the risk for these projects in the short term until some of these lawsuits make their way through the courts and we know exactly what is required or not.The court tells us that it's a very legitimate system of implementing environmental requirements. I don't think I'm an expert on this, but I don't think it's really how other countries do it. Almost every other country has something requiring environmental impact statements, but it doesn't necessarily mean that the courts are enforcing it via citizen lawsuits. A lot of times it's just done via a normal government bureaucracy or something like that. Dwarkesh PatelOkay, I was actually just about to ask you that. Do countries that have different or no systems of environmental review have speedier and more cost-effective public works? Brian Potter I don’t actually know, it would be very hard to separate that.Dwarkesh Patel That's all right. You had a comment in that post that I found interesting where you said that this uncertainty also makes changing NEPA somewhat risky. Experts have noted for instance that rules to accelerate NEPA processes or impose maximum timelines might result in more of them being challenged in court by failing to take the proper “hard look” Do you want to explain this? Because this is counterintuitive to me. Brian Potter Meeting the deeper requirement means you have to take what the courts call “a hard look” where you have to consider these impacts quite thoroughly. So the risk is that if you put a timeline cap on some of these processes, it has to be done in a year and if it's not done in a year, it's automatically approved. It's just an idea you see floated from time to time. The risk is that people will just say, “Okay well, we’ll go and litigate this project immediately, and then when we do, we will say that they did not look hard enough at these impacts and if they can't marshal the resources we needed to study some particular flowering species and it only has a flowering period of two weeks in the spring and the time period was up before that happens,” then the court is good, which is a thing that happens in NEPA apparently. It’s one of the reasons why these take multiple years because if you're observing some species or whatever, you might need an entire year to actually observe. But if you fail to look at this plant during the flowering season, you don't know if it's actually there and so you haven't considered the impacts on the potentially endangered species and the court would say “Yeah, you did not look hard enough at this, go back and do it again.” You see that mentioned quite a few times that timeline caps could either easily backfire by increasing the amount of increasing susceptible litigation which just makes these things take longer than they already do already. You see a lot of extra analysis due to risk aversion from these federal agencies. The laws around NEPA actually say that your environmental impact statements should really not be longer than 150 pages except in extreme circumstances, but the average environmental impact statement is now 660 pages or something like that. So people are already going more than what the law says they should do just out of risk aversion. So if you don't fix the incentives that are causing this risk aversion, your solution will not work Software is Stealing Talent from Physical EngineeringDwarkesh Patel I'm curious if you think that there's been a talent drain from physical engineering tasks (ex. construction) into software. Has that happened and has that had an impact on the world of atoms or is that just something people discuss on the internet and it's not real?Brian Potter I do think that's almost definitely happening. I mean this was my constant opinion when I was working as an engineer–– especially when I was managing younger engineers who were getting paid comparatively little. I was always on the verge of telling them, “Why don't you just go learn how to code and go earn 3-4x as much at a FAANG company instead of doing this fairly thankless work?” Frankly yeah, I think it's very likely to be an issue. In some sense, it's theoretically self-correcting to the extent where if the labor moves out of the field, then it gets more expensive and the incentives are changed a little bit and you're forced to find ways of building things with less labor requirements where you can spread your labor development over a larger volume.So arguably, if the engineers are leaving and engineers are getting more expensive, you're going to basically find a way that's gonna push you towards figuring out how to spread your engineering efforts over like a larger construction volume–– which would be using more prefab or using kits of parts, assemblies and things like that. So theoretically, to some extent, it is self-corrected. I guess the risk for that is if you screen off the top 20% of most talented people, does that fundamentally handicap what your industry is capable of doing? Or do your incentives kind of push the other way, and you try to lower your quality? I feel like I've heard some people make complaints to this effect with semiconductor research and how semiconductor engineering is actually not especially well paid. It’s relatively easy for semiconductor engineers to go get jobs working in software development so you see sort of a brain drain from that. Yeah, I think I think it actually may be correcting to some extent with engineers. I'm a little bit out of the engineering game, but the salaries for engineers have actually kind of risen quite a bit. A similar risk (and people are in construction complaining about this constantly) is just the innovative unavailability of skilled labor. We talked about how being able to do a lot of these tasks requires skilled expertise, and you saw a lot of these people leave the labor force during the greater session. People aren't just entering it at the rates that they need to. I think the average age of a construction worker is somewhere around the 40s or perhaps 50s. It's like very very high so people are constantly complaining about how they can't get enough laborers, not enough workers, or whatever like that. But of course, this also is just gonna incentivize finding ways to basically get these buildings built using less labor. I'm a little bit less worried about potential negative affection. There are a lot of historical examples of labor constraints developing into labor-saving inventions–– the history of the US is like that, right? We developed a lot of labor-saving machinery in the American system of manufacturing. Yeah, I'm a little bit less worried about that, but I could see it definitely having effects on the other sides of the industry. Dwarkesh Patel There was this author of this global economic history book who made the point that the Industrial Revolution happened in Britain because the cost of labor was highest in Britain since there was a plague that killed up a bunch of people so labor was really expensive.Brian Potter Yeah, I've heard that as well. I'm not an expert in economic history and sometimes try to avoid things I know very very little about. One other factor is just that now, as venture capital expands its tentacles into other industries, you're seeing a lot more effort in developing solutions for the built environment. So to some, you're seeing venture capital money flow into the space. So perhaps that will counteract to some extent. I don’t know.Gaps in the Blog Marketplace of IdeasDwarkesh PatelTyler Cowen was interviewed by Patrick Collison and one of the things Tyler Cowen said was that there should be more blogs focused on one particular area or issue and just kind of raise the salience of it and help drive insight and understanding of it. I feel like you've done that really well with Construction of Productivity and I'm curious as to what other areas would you like to see the blogs that do for their area what you have done for construction productivity–– which is taking a broader view of what's happening, what the trends are, and trying to add more insight to professional problems.Brian Potter Oh, good question. Yeah, I feel like there's so much about this I was complaining about. I think a very underrated problem is this giant Civilizational machine that takes in raw materials and spits out finished goods and services and high quality of life. Nobody really knows how it works and mostly how it works is completely undocumented. It does not exist in written information anywhere, and the information that is written down is maybe in one particular company’s shared drive or something like that. There are no instructions for building a Toyota, and it might be very hard to kind of recreate that if you needed to, but just in general, I would like to see somebody do something similar for manufacturing, especially since so much manufacturing knowledge has been lost to this move to China and other places where labor is cheaper. There's just so much information about how things get built and manufactured that just isn't written down anywhere or isn't written down anywhere accessible. You see kind of people share the same small number of resources for how these things work over and over again. I asked a few people who I thought would know about it, “Is there any book written that actually explains what it’s like to get something built in china or what building things in china are actually like, and they're all like, “No, I don't know any source that exists.” There are a few blogs that describe their particular experiences, which end up being overly valuable resources, but there's no general source of available information for how any of that works.So yeah, I just think that documentation of how the civilization machine functions are just wildly under-invested in which I guess is true for documentation in general right? Nobody wants to do that because the payoffs are far in the future and uncertain, and the costs are upfront. So it's not surprising to me that it doesn't exist, but I do think that you know in general terms, people are really very interested in understanding how things work and if you can explain how something works, even if it seems like a fairly niche topic, you can get quite a bit of attention. So for anybody who works in manufacturing, I think you would find quite a bit of success if you started writing things about how it functions.Dwarkesh PateInteresting. Okay, excellent. To listeners who know about manufacturing, do spin up your substacks.Why is Modern Architecture So Ugly?Dwarkesh PatelOkay, so this is part two of my conversation with Brian Potter. The first conversation was really interesting, and then afterwards, I realized that I’d forgotten to ask Brian about this really interesting theory that Scott Alexander and others have written about. Brian is the perfect person to talk to about this. So, I took the convenience of asking him to come on again. The question is basically, “Why does modern architecture just look so much uglier than things that were built 100 years ago or 200 years ago?”You would have thought that due to increases in technology and the build-up in new ideas and designs that things would become prettier. But if you look at a building that was built in the last 100 years, it just looks like a cylinder or a rectangle of glass and concrete. But if you look at things that were built before, you’d see things like Sagrada Familia or intricate cathedrals or even these skyscrapers that have all these flourishes, ornaments, and all these decorations. So Brian, what is going on? Why are things so much uglier now? Brian Potter I have a few thoughts on this, and I don't know if I have an answer to the actual question, but I can add some context. I don’t necessarily think that I’m the best person to ask about this–– a better person to ask would be an architect who can talk about how design and taste have evolved over the course of the 20th and 19th centuries. Generally, I don't have a huge amount of opinion on aesthetics; to the extent that I do tend to favor simple minimalist, clean lines. One of my favorite pieces of construction is this bridge called Saglinatobel, which is built in Switzerland. It’s the banner on my Twitter account, and it's this really simple minimalist tiny curve of concrete that's exactly in the shape it needs to be to resist the forces acting on it. So to some extent, to me, it's like you're asking, “Why did aesthetics change from like worst aesthetics to better aesthetics?” That's obviously not what I actually think, but I just want to shed some light on where I'm coming from.Do you want to separate out the question a little bit because I think it's more of a question about why modern buildings have less ornamentation. Not necessarily that they're ugly per se, but I think there's a really lot of really beautiful modern architecture. Again, an architect would be a better person to ask about this, but I will sort of muddle my way through using light and space and form to like create these big interesting open big impressive open spaces that create a lot of interesting shapes. A big expansive space is what they're really going for to be a good example of this. So you look at the new Terminal for the Portland airport, which has this big giant mass timber roof, which isn’t a usual way of building these big large-spanning structures, but it's really neat, it’s interesting, and that's a lot of what you see these days. A lot of architecture is focused on this, and that's been pretty common throughout history, right? If you like cathedrals, it's like they're trying to create these big impressive spaces using light and stuff to create this impressive space that feels like the Pantheon. It's the same thing. I think it's really about how you want to separate out the question of “Why it’s ugly” (which I do not necessarily agree with) and “Why does it not have so much?” Why is there so much less ornamentation is a little bit more defensible. Dwarkesh Patel Okay, actually, let me ask about the second one because I'm not sure I totally follow. So the ornamentation has been replaced by the openness…Brian PotterWell, yes. I guess my point is that traditionally, we were focused on creating these big impressive indoor spaces and playing with the light and stuff to do that. That's been common in buildings that people think are impressive. Our architects still do that a lot and use big open areas with a lot of glass everywhere as a kind of tool in their tool belt to some extent.Dwarkesh PatelGotcha. Okay, so they were replacing the old stoneworks and stone masonry stuff and the gargoyles with these kinds of things. Okay, I see.So yeah, let's talk about one because the idea that the older designs were less efficient in some way to steer man to the opposite position. Someone might say that a lot of the value of construction and building is just the aesthetic presence that it has in a city or a neighborhood and to an extent, we've lost that. Maybe we got to use less material on a bridge or a skyscraper, but then it just acts as this ugly thing in the middle of the city. Or if not ugly, at least not as aesthetically pleasing as it could have otherwise been. How would you react to something like that?Brian PotterYeah, so I guess to clarify what I was talking about before, I don't think that new buildings necessarily use less material in a sense. I just think they have an aesthetic that's more minimalist and streamlined without a lot of extra decoration. The complaint is that “Oh all buildings have to be a cylinder of glass or a rectangle of glass or whatever,” but I think one reason that is true is that, while it may not be super interesting from the outside, when you're on the inside of a building, you actually kind of want a whole lot of glass. It’s really nice to have a large open space to walk through and to have a lot of natural light.That was very hard to do prior to the mid-20th century for a couple of reasons. One is because buildings weren't really air-conditioned before that. Another one is it was like really expensive to have big expansive glass. It's still expensive, but back then, it was even more expensive. As you go farther back, there was a glass-making process invented in the 1950s 1960s called the float glass process, which made it a lot easier for you to basically make really high-quality glass for way way way cheaper than it was possible to previously. So for air conditioning and stuff like that, it basically advances in like structural design and increases the use of steel. It basically became a lot more possible to just have your building be a big giant slab of glass with a lot of natural light and a lot of openness on the inside, and that creates kind of a nice experience if you're actually in the building.To some extent, I think that applies a little bit more generally if you look at an HGTV remodel or something like that. Everybody wants to create a big giant open concept floor plan or whatever with all the walls blown out and lots of natural light coming in everywhere. So to some extent, it's just the technology. It seems like it's maybe a case of the technology evolving so you can create this nicer interior space. To some extent, that perhaps came at the expense of having a lot of really ornate decoration on the outside (not on the top, but the outside). If you're building a building, it makes sense to optimize the inside at the expense of the outside because that's what you're actually using.Dwarkesh PatelOkay. Yeah, that's an interesting way to put it. One comment that I've heard is the progress of YIMBYism has been hurt by the fact that new buildings, because of this rational self-interest, are ugly on the outside and very pleasant on the inside. The result is that the people who are community organizers will oppose these new buildings because what they get to see is the outside, and all these historical preservation boards will notice that these older buildings are not as pleasant on the inside and have obviously less occupancy and everything. They look more pleasant in their neighborhood than the new buildings that people want to tear down and build. So if we want to convince the Nimbys to go along with the new construction, you kind of have to make it look beautiful. What do you think about that? Brian Potter Yeah, it seems like it's true. That's like the fundamental tension in real estate, right? Any property you have will have a lot of externalities and influence with the value of everything around it, so it's this big game of negotiation between you and everything in the immediate area. That's why things like zoning and stuff like that exist in the first place. Even if it's not necessarily implemented in a special way that people think is good, I think it's probably a little bit easy to over-index on that. It would not surprise me if when you say, “We'll build this since it’s like a really beautiful old building”, people would still oppose it because it's still gonna be a giant building. It's still gonna mess up their traffic It's still gonna have a bunch of renters that are gonna come in and reduce property values. You see a lot of these historical preservation issues where people want to preserve things like old gas stations and laundry mats and things that are not beautiful at all. Parking lots and stuff like that. So I think that's probably true on some margin. I would be surprised if there was just “one thing” that we’d need to fix to untangle this problem.Dwarkesh Patel Gotcha. By the way, you mentioned how indoor air conditioning and heating has changed this dynamic. Is it just because we have enough insulation now that even if you lose heat through the glass, it’s fine?Brian Potter Basically if you have a big glass wall as your exterior building and you don't have air conditioning, then that thing is just going to cook whenever it gets hot out. It's going to basically be like a greenhouse So you basically need air conditioning to make that habitable and you see this with single-family homes too where when air conditioning started to become popular, all of a sudden they started building these houses with these big giant picturesque windows Which they didn't have before. Again, this makes a nice inside space, and if you're going to be inside, that's the part you want to focus on. But it basically is predicated on having air conditioning to control the climate.Dwarkesh Patel That's a nice little detail that I want to be able to talk about. That explains why the outsides of buildings aren't as pretty as it used to be, but there's still the question of why the insides are so minimalistic. I don't know if you saw this, by the way, but about a year or two ago, Microsoft announced that they were building this new office for developers in India and they were looking at this very interesting architectural details and craftsmanship that made it look like you know for everything from the furniture to the floor layout to the arches of the entrances. It was supposed to be like like Taj Mahal, and it actually looks really cool. So why don't more developers do something like that on the interiors of these buildings? Brian Potter I mean again, good question. I think, for the most part, broadly speaking, and again, I'm not a developer so I'm gonna model my group as best I can. They're basically building the space to rent out, right? Or to sell to somebody else. So they're creating what a lot of times is called the development's shell and core, which I think I'm using correctly. They basically don't even finish the inside, it's all just raw and open studs and everything like that. So then the tenant comes in and does whatever they want to the space. But they're basically in the business of creating usable space for some given class of market that they're trying to attack, right? They're not in the business of making fancy architecture. Same if you're buying a single-family home. You come in with blank walls and you put up all your different pictures and decorations and paint it however you want, then add your funky wallpaper or whatever. When you move, you can take all that stuff out, and the next person can come in and put in everything that they want. So I think to some extent, you see a decoupling of the aesthetic design from the building itself. Dwarkesh PatelSo then this is really a revealed preference about the people who are actually renting or buying these properties. People who are living there actually don't want this kind of material design maybe? Brian Potter Yeah, I think that again, it comes back to a little bit about a question of aesthetic style and whether people want a lot of ornamentation and fundamental attractiveness. Cause again, people do focus a lot on making these spaces attractive. A lot of times, they do that by having a nice open space, a lot of natural light, and a cool glass staircase that goes from here to there. The new Google headquarters (I don't know how new it is, but on the newer side), is basically this big, big giant, dome-type thing with a lot of structural detail visible and a lot of just light coming in this big, giant open space. There are a lot of interesting staircases and stuff like that. So to some extent, it's just a style with less ornamentation necessarily than aesthetics per se. Dwarkesh Patel Okay, gotcha. The other theories that out there emphasize more of the cultural and aesthetic changes rather than the actual practical necessities of these kinds of changes you've talked about. So one theory is that if you look at the change in men's clothing over the last two centuries, it's also become much more minimalistic and much less colorful and ornamental, right? If you look at King Louie or something, he's wearing a suit with all of these studded colors, dyes, and even gems. But if you look at like a picture of Joe Biden, he's just wearing a suit, and not even a tie anymore, right? It's just a black suit and a white shirt. So there’s this continuation of this sort of aesthetic trend towards being very minimalistic. What's your reaction to that, Cik? Brian PotterYeah, I mean, I think that's true to some extent. This is one of the difficulties of having a conversation like that–– there are so many degrees of freedom. It's hard to pin down what specifically you're talking about, and what class of things you're specifically talking about. If you look at an example from fashion, if you look at streetwear or something like that, and you just Google streetwear, you will find a ton of pictures of really quite ornate, interesting clothing. There will be some stuff that's minimalist, but there will be a lot that's not necessarily minimalist at all. I guess in some way I disagree with the premise. If you're talking about like some like elite counter-signaling thing, it's so easy and cheap to make ornate colors for clothing that it's not a signal of status anymore. So you have to countersignal by wearing very simple clothing or maybe there's something to that, but that's a different thing than why are things ugly in general.Dwarkesh PatelOne thing that people also talk about is the increasing cost of labor, so that now you can hire talented stonemasons to spend hours on every square foot of the outside of a building. I was in India like six months ago and we went to New Delhi to visit this new temple that was built, the Swaminarayan Akshardham. I'm sure I mispronounced it, but anyway, it has this really intricate and cool design on the outside. It is just covered in these hand-carved stones with like intricate idols and different images. It's really cool, but I think it took tens of thousands of hours and probably way more thousands of workers and stonemasons to actually construct. Which is obviously not going to be very feasible economically in a Western country. So one theory is just that it’s too expensive to do that kind of stuff anymore. You need to do something that doesn't require as much manpower. Brian Potter Yeah, I mean, that's definitely got to be part of the story, right? I mean, construction, as we know it, has not really gotten any cheaper, but it also hasn't gotten more expensive. A lot of other services that are pure labor, like medical care, education, etc, have gotten more expensive. Part of that is probably because we've found ways to pull labor out of the process. So construction only rises at the rate of inflation instead of faster than the rate of inflation. So super labor and things like masonry just doesn’t get done anymore. There's probably like a vicious cycle there where, you know, you hire less of it, so there's fewer masons available. So they get more expensive and the skill gets more scarce. Now it's difficult to hire someone to do really ornate masonry work in the US and it’s probably really difficult to like even find them. I'm sure they exist, but it's probably not trivial. If you have your schedule and you're trying to meet someone, it's not super straightforward. An interesting example of this is, I can't remember if we talked about this in part one or not, the Ise Jingu temple in Japan, which is this temple complex that gets torn down and rebuilt every 20 years. They've been doing this for 1300 years or something like that, so it's using like 1300-year-old construction techniques, thatched roofs, and particular woodworking methods or whatever. Now, it’s quite difficult for them to find a lot of these skills. There are just not that many roof thatchers around anymore. So, you know, again, I can imagine that it's some sort of a similar cycle with masonry. I don't think that's the whole story because a lot of these things are built in a way that makes building in this minimalist style actually quite expensive to do. A glass curtain wall is actually really expensive to build on a building because glass is just expensive by itself and because it lets in so much light and it gets so hot so you need a much more stronger mechanical system to keep it cool. I've talked to architects and why the owners love these, glass curtain walls because it seems like, especially for now, everyone is really concerned about like climate change and greenhouse emissions of whatever it is you're building. People are like, “Yeah, the owners just really love this all-glass look, and they're willing to pay extra to get it.” If you look very early, this is the sort of style of construction where you have a big glass facade. For a skyscraper, it’s called the international style. Early international-style skyscrapers were actually quite expensive, more expensive than the traditional way of building. But again, the people really liked the aesthetic. It gave you some other options in terms of light on the inside or whatever. So they decided that it was worth it. I think, yeah, that's definitely probably part of the story, but again, I think it definitely doesn't seem like it can be all of it. Dwarkesh Patel Gotcha. Okay. To the extent that it is part of the story, somebody left an interesting comment on one of Scott Alexander's posts about how modern construction looks different than older construction. This is a comment from fluffy Buffalo. He or she writes, “I think new technology should help a lot with 3D printers, CNC machines, robots, CAD, and AI. It shouldn't be too hard to come up with a way to produce pleasing ornaments, murals, and building shapes at a reasonable price.” Then they go on, that no one is doing it because the current crop of architects can apparently only think in steel, concrete, and glass. So how plausible do you think this is? Brian Potter I think I read some of the comments on that post. I think one of the people mentioned that the Victorian style of house basically came about because of mass production methods, which made really ornate wood decorations really, really cheaply. They were just cranked out on some milling machine in a factory somewhere, then you could just buy them and place them in your house or whatever. So that style is basically a function of technology making that cheaper. That was in style for a while, but it’s not in style anymore because of the shifting sands of aesthetics. I think part of this is more broadly applicable. It's actually kind of a hassle to have all this ornamentation all over your house. On the inside, it's just lots and lots of stuff to dust and keep clean, which again comes back to cost disease. If you have servants to do that for you, it's fine. But if you don't have servants, it's you, and it creates a lot of extra work for you. Same on the exterior. But then also there is the issue that in general, you want your building to shed water and direct it away from the house as possible. If you have a lot of little nooks and crannies and ornamentation stuff for water to collect, that's pretty bad from a durability perspective. I would be careful not to over-index on that because obviously, people did build extremely durable, beautiful masonry brick buildings. It's not like that makes it impossible. But it is something to consider because on the margin, it probably does make your maintenance costs go up. Dwarkesh PatelOkay. Are you optimistic overall? Maybe not with these specific technologies, and maybe not with having ornamentation or something, but do you think that in a hundred years, the technology would enable the construction of buildings that look prettier than modern buildings, but are also more maintainable or at least as maintainable? Or is it basically going to be steel and glass towers for the time for the upcoming future? Brian Potter Yeah, that's a good question. There's a lot of enthusiasm. Some of it is architecture. So we'll see how well it actually gets adopted. But for timber and large tall buildings made out of heavy timber elements, I don't know if that’s partially it's an aesthetic thing. If you look at it from a carbon perspective, it's using a lot of timber versus steel or concrete which is way better on that calculus. And it does kind of look nice. A lot of these tech companies are building these ornate timber offices. So that's one trend. Then yeah, there's not an obvious technology that could usurp the sort of standard we have unless it's like a dramatic development in material science or whatever, where somebody finds some way of building something that's way cheaper and gives you way more options than you had before. That’s what steel and then concrete gave you, right? All of a sudden, you could build things in ways that you couldn't do before steel, and you could use so much less structure to build fine concrete, because it was like liquid. All of a sudden, you could make any shape that you want. That's when you get all these really cool interesting shells and really ornate concrete domes, which of course, we also don't build anymore. So I don't see an obvious technology that could replace that. I guess, you know, the other thing is like, when all of a sudden you had technology that could like easily duplicate or make any sort of art possible, did that usher in a new era of way better art or 2D aesthetics? I don't necessarily think that it did, right? So I think if you could all of a sudden build any sort of shape that you want cheaply and easily, it's not obvious to me that we would get really cool things. I'm sure you would see a lot of interesting experiments on the margin or whatever, but it's not obvious to me that the standard way of building in some ways might become even less interesting. Dwarkesh Patel Right. So there is the question of why we haven't seen better aesthetics in these other fields. So given how much you can do with the traditional art today, why do these paintings that are selling for millions of dollars have the common perception and stereotype that they're very simple and ugly? So to apply that to architecture and engineering, there's this idea that Scott Alexander kind of talked about this a lot in his post about a cabal of modernist architects in these guilds who are just very obsessed with building these buildings that the public doesn't like to look at. Do you think it’s true that the architects just have a completely different sense of aesthetics than the average public? Brian Potter I think there's probably something to that where you go to architecture school and architecture school is adjacent to art school in the way that you learn how to design buildings, but you also learn a specific way of looking and thinking about them. That filters down into how you design your building, but I think architects are competing in a marketplace, and the vast majority of them who are not star architects are basically trying to deliver buildings that owners are happy with. If they don't do that, they're going to go out of business. I think most architects you will talk to will basically say, “Yeah, if I don't give the owner a building that he's happy with, I am not doing my job correctly.” They're definitely being hired for other things adjacent to a sense of taste. But perhaps that's, part of the story, and it's like a fragment or whatever, but I think it would be very easy to over-index. I think there's a lot of ways that's just not true. Advice for Aspiring Architects and Young Construction PhysicistsDwarkesh Patel So I'm really glad we got a chance to cover this topic and I appreciate all those explanations, but actually, there’s another question that I forgot to ask you the last time that I'm curious about. Let's say somebody listens to the conversation or they've been a follower of your blog and this has got them interested in engineering. Somebody may be in high school or maybe early in college. For them to be able to do cool things in these fields in the future, what kind of training and career advice would you give them so they could pursue and be able to get involved and innovate in these fields? Brian Potter Yeah, that's a good question. I don't have a super good answer to that. I fell into it very much, very much by accident. I spent a very large chunk of my career just doing pretty standard engineering-type of stuff. Then I sort of fell ass-backwards into a job at a construction startup which then led me to other places. I guess if you're an engineer (I feel sort of gross giving this answer) because in general, if you go to a good engineering school, it's like you're perpetuating the college industrial complex. But people do really care about that, especially in the fields of building engineering that I'm more familiar with. They do care about that quite a bit. I went to a reasonably good engineering school and that probably opened doors for me that I would not have otherwise. So yeah, go to a good engineering school, go get a lot of the status indicators that are very obvious, like an engineering school and a top-tier firm, whatever. That does kind of matter. People do pay attention to those things. It matters in the sense that people pay attention to those things in the building development world. If you went to MIT or Caltech, and then you had an internship and it's Skidmore or Merrill, that's gonna open quite a few doors for you. I'm not amazingly happy with that answer, but I do think that it is true. Dwarkesh Patel Yeah. Brian Potter Another way would just be to try to come in from a more oblique angle. Focus on software and then work at one of the many more new startups that are now tackling the construction space. They're increasingly in need of software developers and that would probably be a lower-risk way to do it because you don't need to necessarily go to a fancy school to become a software developer. Then if it doesn't work out, just go get a job at a FAANG company and make $600,000 a year. Look and see how the startups in the space are changing and growing. I think by the time some folks got out, the building space might look pretty different in technology, and software stuff is kind of slowly forcing its way in there a lot more. Dwarkesh Patel But if they want to transition from just being an engineer to working on the forefront stuff that you write and talk about, is working at a startup the ideal way to do that? Brian PotterOh, that's a good question. A lot of startups are doing really interesting stuff, not just in software, but a lot interesting building technology stuff. There's a lot of like green building that has worked, there's work out there that is being developed by folks working on low-carbon concrete and low-carbon steels. There's a lot construction robotics, a lot of prefab stuff, the startup world is really kind of trying to start to eat the construction world. There are a lot of opportunities there. Very broadly, I would say that I see a lot of innovation happening. So I think that's a good place to sort of look and see what's going on. Dwarkesh Patel Awesome. Okay. Well, Brian, thank you so much for coming back a second time. I really appreciate it. I'm glad we got a chance to talk about these questions. It is very interesting and it's good to get an actual engineer’s perspective on it so that we're not just doing like cultural theory and we actually understand the practicalities of what's involved in all these kinds of things.  I highly recommend people check out your blog and they can also follow you on Twitter. We'll leave the handle in the description. Anything else you'd like to plug or say at the end? Brian Potter I’m doing some work for the institute for progress, which is a think tank designed to advance industrial progress and progress studies ideas more generally so you should check them out as well. Dwarkesh Patel Okay, excellent. Thanks Brian, I appreciate it. Brian Potter Cool.  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

It was a fantastic pleasure to welcome Bryan Caplan back for a third time on the podcast! His most recent book is Don't Be a Feminist: Essays on Genuine Justice.He explains why he thinks:* Feminists are mostly wrong,* We shouldn’t overtax our centi-billionaires,* Decolonization should have emphasized human rights over democracy,* Eastern Europe shows that we could accept millions of refugees.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow me on Twitter for updates on future episodes.More really cool guests coming up; subscribe to find out about future episodes!You may also enjoy my interviews with Tyler Cowen (about talent, collapse, & pessimism of sex), Charles Mann (about the Americas before Columbus & scientific wizardry), and Steve Hsu (about intelligence and embryo selection).If you end up enjoying this episode, I would be super grateful if you share it, post it on Twitter, send it to your friends & group chats, and throw it up wherever else people might find it. Can’t exaggerate how much it helps a small podcast like mine.A huge thanks to Graham Bessellieu for editing this podcast and Mia Aiyana for producing its transcript.Timestamps(00:12) - Don’t Be a Feminist (16:53) - Western Feminism Ignores Infanticide(19:59) - Why The Universe Hates Women(32:02) - Women's Tears Have Too Much Power(46:37) - Bryan Performs Standup Comedy!(51:09) - Affirmative Action is Philanthropic Propaganda(54:12) - Peer-effects as the Only Real Education(58:46) - The Idiocy of Student Loan Forgiveness(1:08:49) - Why Society is Becoming Mentally Ill(1:11:49) - Open Borders & the Ultra-long Term(1:15:37) - Why Cowen’s Talent Scouting Strategy is Ludicrous(1:22:11) - Surprising Immigration Victories(1:37:26) - The Most Successful Revolutions(1:55:34) - Anarcho-Capitalism is the Ultimate Government(1:57:00) - Billionaires Deserve their WealthTranscriptDwarkesh PatelToday, I have the great honor of interviewing Bryan Caplan again for the third time. Bryan, thanks so much for coming on the podcast. Bryan CaplanI've got the great honor of being interviewed by you, Dwarkesh. You're one of my favorite people in the world!Don’t Be a FeministDwarkesh PatelIt's a greater pleasure every time (for me at least). So let's talk about your book, Don't Be a Feminist. Is there any margin of representation of women in leadership roles at which you think there should be introduced bias to make sure more women get in, even if the original ratio is not because of bias?Bryan CaplanNo, I believe in meritocracy. I think it is a good system. It is one that almost everyone sees the intuitive appeal of, and it works. Just looking at a group and saying, “We need to get more members of Group X,” is the wrong way to approach it. Rather, you need to be focusing on, “Let's try to figure out the best way of getting the top quality people here.”Dwarkesh PatelIf there's an astounding ratio of men in certain positions, could that potentially have an impact on the company's ability to do business well? Perhaps the company could just care about increasing the ratio for that reason alone. Bryan CaplanRight. I mean, one can imagine that! I think in our culture, it really goes the other way. People are more likely to be trying to get rid of men, despite the fact that the men are delivering value. If you really pushed me into starting to think, “Suppose you're running a bar, would you have ladies’ night?” well yeah, I would have ladies’ night in a bar because that actually works, and it's good business! However, if what you're doing is trying to actually get correct answers to things, if you're trying to go and make something run effectively, and if you're just trying to make progress and you're trying to learn new things, the thing to focus on is what actually leads to knowledge and not focusing on just trying to get demographic representation. I think what we've seen is once you go down that route, it is a slippery slope. So besides defending meritocracy on its merits, I would actually also say that the slippery slope argument is not one that should be dismissed lightly. There's a lot of evidence that it does actually fit the facts. When you make an exception of that kind, it really does lead you to bad places. Dwarkesh PatelOkay. But changing topics a bit, I wonder if this gives you greater sympathy for immigration restrictionists because their argument is similar, that there's no natural shelling point for your keyhole solutions where you let tens of millions of people in, but you don't give them welfare or voting rights. There's a slippery slope when you let them in because, eventually, the civil rights argument is going to extend to them. There'll be adverse consequences that these keyhole solutions can't solve for.Bryan CaplanFirst of all, I would say maybe. That is one of the best arguments against keyhole solutions. I'm also guessing that a lot of your listeners have no idea what keyhole solutions are, Dwarkesh, so maybe we want to back up and explain that. Dwarkesh PatelGo for it. Sure.Bryan CaplanSo I have a totally unrelated book called Open Borders, the Science and Ethics of Immigration. One of the chapters goes over ways of dealing with complaints about immigration that fall short of stopping people from actually excluding or kicking out people that are already there. So just to back up a little bit further, most of the book talks about complaints about immigration–– saying that they're either totally wrong or overstated. But then I have another chapter saying, “Alright, fine, maybe you don't agree with that, but isn't there another way that we could deal with this?” So, for example, if you're worried about immigrants voting poorly, you could say, “Fine, we won't extend voting rights to immigrants or make them wait for a longer time period.” That's one where I would just say that the focal point of citizen versus noncitizen is one of the strongest ones. So I think that it actually is one that has a lot of stability. This line of, “Well, you're not a citizen, therefore…” really does have a lot of intuitive appeal. Although, yes, I do think that keyhole solutions would probably not work multi-generationally, so to go and say this is a keyhole solution where you're not a citizen, your kids are not citizens, and their kids after them are not citizens, that's one that I think would be hard to maintain. However, again, at the same time, the problems people are worried about, if they ever were severe, are also getting diluted over time. So I wouldn't worry about it so much. That is one of the very best objections to keyhole solutions that I know of.Dwarkesh PatelOkay, so going back to feminism. Over time, doesn’t feminism naturally become true? One of the things you can say is that the way that society is unfair to men includes how they fight in wars or do difficult and dangerous jobs, but society, over time, becomes more peaceful (or at least has in our timeline), and the difficult jobs get automated. At the same time, the gains for people who are at the very peak of any discipline keep going up fairly, but the implication still is that if men are overrepresented there, even for biological reasons, then the relative gains that they get go up, right? So over time, feminism just becomes more true, not because society necessarily discriminated against women, but just because of the trends in technology. Bryan CaplanOnce again, I feel like we should just back up a little bit. What is feminism anyway, because if we don't know what that is, then it's very hard to talk about whether it's becoming more true over time. In my book, I begin with some popular dictionary definitions that just say feminism is the theory that women should be political, social, economic, and cultural equals of men. I say that this is a terrible definition, which violates normal usage. Why? Well, we actually have public opinion data on, first of all, whether people are or are not feminists, and second of all, what they believe about the political, social, economic, and cultural equality of women. And guess what? An overwhelming majority of people that say they are not feminists still agree with the equality of women in all those mentions, which really makes you realize that really can't be the definition of feminism. That would be like saying feminism is the theory that the sky is blue.Well, feminists do believe the sky is blue, but that isn't what distinguishes feminists from other people. So what distinguishes them? What I say is that the really distinguishing view of feminism is that society treats women less fairly than men. The view is that society treats women less fairly than men or treats men more fairly than women. This definition fits actual usage. It would be very strange for someone to say, “I'm a feminist, but I think that men get terrible treatment in our society, and women are treated like goddesses.” Then you say, “Well, then you're not really a feminist, are you?” That doesn't make sense. On the other hand, for someone to say, “I am not a feminist, but God, we treat women so terribly, we're awful.” That, again, just would not fit. So I'm not saying this is the one true definition, but rather that it is much closer to what people actually mean by feminism than what dictionaries say. So to be fair, every now and then, there'll be a better definition. I think the Wikipedia definition in the second sentence adds that it also has the view that women are treated very unfairly. Dwarkesh PatelIs another way of defining feminism just that we should raise the status of women? That's slightly different from the fairness issue because if you think of a feminist historian, maybe their contention is not that women were treated unfairly in the past. Maybe they just want to raise the status of women in the past who are underrepresented. If you think of somebody today who wants to, let's say, raise the status of Asians in our society, and they want to acknowledge the great things that Asians are doing in our society, then maybe their contention is not even that Asians are treated unfairly. They just want to raise their status. So what would you think of that definition?Bryan CaplanSo first of all, it could be, but I don't think so. Here's what I think. There could be a few people like that, but that's not what the word means in normal use. If someone were to say, “Women are treated absolutely fantastically, way better than men, and I want it to get even higher.” You say, hmm. Well, that's not what I think. Somebody might say, “Well, I can still be a feminist and think that,” okay, but that's not what the word actually means. It's not the typical view of people who call themselves feminists. The typical view is precisely that women are treated very unfairly. They want to raise that and alleviate that in a way that's almost by definition. If you think that someone's being treated unfairly, then to say, “I think they're being really unfair, but I think it’s great that it's unfair.” It's almost self-contradictory. Dwarkesh PatelI guess I was making a slightly different point, which is not even that these people don’t want to raise the status (the actual living standards of women) in some way. It's just that they want to raise the rhetorical status.Bryan CaplanYes, but again, if someone were to say, “I think that women are treated absolutely fantastically in society, way better than men, who we treat like dogs. But I also want women's status to be even higher than it already is.” That would be something where you could argue that “Well, that person may still be a feminist, but that is not what the word means.” Because hardly anyone who calls themselves a feminist believes that weird thing that you're talking about. Dwarkesh PatelLet me make an analogy. Let's say you or I are libertarians, right? And then we think we should raise the status of billionaires. Now, it's not like we think society mistreats billionaires. They're pretty fine, but we think their status should be even higher.Bryan CaplanYeah, I mean, this just goes to the definition. In order to find out whether a definition is correct, you just have to think, “Well, how is the word commonly used?” Logically speaking, it's possible to have a different view or two things that are compatible. The whole idea of a definition is that, ideally, you're trying to find necessary and sufficient conditions such that everybody who satisfies the conditions falls under the category and that everybody who doesn't satisfy the conditions doesn't. In ordinary language, of course, it's notoriously hard to really do that. Defining a table is actually quite difficult in a necessary and sufficient-condition sense, but we can still say, “Well, a table is not by definition something that people sit on, right?” Someone could say, “Well, I suppose you could sit on a table, but that's not the definition in ordinary use in any language of which I'm aware.”But why don't we actually go back to your real question. Which was..Dwarkesh PatelOverall, the left tail of society is being compressed, and the right tail is being expanded. Does feminism become more true over time?Bryan CaplanThe answer is that we really need to look at all of the main measures to get an idea of this. With some of the ones that you're talking about, it does make more sense. As jobs become less physically dangerous, then at least you might say that things are less unfair to men. Although in the book, what I say is that even that is a bit more superficially complicated, at least on the surface. The immediate reaction is that society's less fair to men because they do the most dangerous jobs. Although I also say, “Yeah, but they get monetary compensation for that.” So, all things considered, you probably shouldn't think of it as unfair. It's something where it's reasonable to say, “Hey, wait a second, how come men are the ones that are enduring 90 percent of the workplace deaths” and say, “Well, because they're getting 90 percent of the combat pay.” Broadly construed it’s not mostly actual for combat. So anyway, that's one area where you should be careful. But I can see the possibility there. I do have a section in the book where I go over what's happening over time. What I'll say is, well, one big thing that's happened over time is that people have become very hyper-concerned with the mistreatment of women, which means that feminism is becoming less true as a result because when people are really hyper-concerned that they might be unfair to someone, they are even less likely to be unfair to them. So I think that's one thing where society where feminisms become less true over time. Another area that I talk about and which I think really does tip the scales, although again, you really need to go through the book because I do try to work through a lot of different margins…I think the one that really does settle it against feminism in today's age is precisely the level of false feminist accusations about unfairness. When we go over all the objective measures, then you say, well, it's close to a wash in terms of which gender is treated more or less fairly overall. But then you realize, “Yes, but there's one gender that has to endure a whole lot of grossly exaggerated hyperbolic accusations and unfairness and another gender that gets to make those accusations.” The gender that has to endure the unfair accusations is men, and the gender that gets to make them is women. Obviously, not all women make them, and not all men receive them. But still, if we're talking about the average fairness of the treatment of men and women or society, I say that this climate of false accusation and intimidation is what really tips it. It didn't have to be this way, Dwarkesh! [laughs] We could have just had conditions change without a whole lot of flinging of wildly inaccurate accusations, but that's not the world we're in. Dwarkesh PatelWhen would you say was the flipping point? Was there a particular decade that you thought “unbalanced things are equal now?”Bryan CaplanYeah. So one of the things I say in the book is that there are a bunch of ways where you can say that women were treated less fairly in earlier decades, but there are aspects that are probably more important overall where women are treated worse now. The main one is paternal support for children. In 1940, the odds that you could count on the biological father of your children to help you to raise them was maybe 90%. Now it's probably more like 60%, 70%. So that's one of the main ways that I say that women probably are treated less fairly than men. And the unfairness has gotten worse over time. Again, just understand this is not the kind of book that most people are used to where someone argues like a lawyer and they just say, look, I've got 20 arguments for why I'm right. And everyone who disagrees with me is stupid and doesn't have a leg to stand on. This is the kind of book that I liked to write where I really say, let's just calm down and just go through every issue separately, weigh each one on its merits. There are a bunch of points where someone could say, “Why do you concede that? That makes your argument weaker.” Well, I concede it because it's true! Then in the end, I have my overall judgment. I will just say that there are a number of books that are written in this terrible modern style of lawyerly reasoning, where you basically have a thesis that you just try to defend in every possible way. I don't write books like that. I try to write books that are honest and self-reflective, and where if there's some weakness in what I'm saying, I don't just acknowledge it if someone points it out; I try to be the first person to reveal it so that people feel like they can trust me. It's my own conscience. I don't feel right when I say something not really quite right. I feel like I should’ve always said the other thing. So I try to just write with candor. Dwarkesh PatelNow, would you say that feminism in the United States is overcorrected but that it's still true in the global sense? In the way that, on average, across the world, women are treated more unfairly than men. Because if that's the case, then if the US is at the center of global feminism, then, of course, they're going to overcorrect here, but overall they're making the world a better place. Bryan CaplanSo that is a much better argument. I would say that if we think about most areas of Europe, then I think that it's very similar to what's going on in the US. In the book, I do go over this especially. I start with Saudi Arabia, where it's really obvious what's going on and how poorly women are treated. But then I go over to India and China and just think about plausible rates of female infanticide. I think it is very likely that overall the treatment of women in India and China is more unfair than that of men. In Saudi Arabia, I'm almost sure that it is. In terms of “Is the US providing a useful corrective for the world while messing up things in the US?” It's possible. I think the problem is that it does discredit a lot of the reasonable points because the US just doesn’t focus on the really big issues. The amount of time that American feminists spend on female infanticide in China and India… I don’t think it would even be 1% of the rhetoric. It's just not something that they care about.So I would say that there's more harm being done by the sheer distraction of putting so much emphasis upon small, exaggerated, or reverse problems that bother feminists in the first world while ignoring and indirectly causing people to forget or neglect actual serious problems in some other countries. Positively shifting the Overton WindowWestern Feminism Ignores InfanticideDwarkesh PatelBut let me apply the argument you make in Open Borders that you can effect change by shifting the Overton window. So advocating for open borders just shifts immigration policy slightly towards the open end. Can American feminists make the same point that through making the crazy arguments they make in America, they're making Saudi Arabia more liberal for women? Bryan CaplanI would say that when the arguments are crazy, then it's not clear that shifting the Overton window actually happens. That may be where you discredit the other view. In particular, I think what I say in that part of the book is that people generally confuse being radical with being unfriendly. And most of the harm that is done to radical causes is due to the unfriendliness rather than the radicalism. So in that case, I would say that feminism has a definite friendliness problem. It is not a movement that goes out of its way to go and make other people feel like they are respected, where even if you disagree with me, I want to be your friend and listen to what you have to say, and maybe we could go and come to some understanding. I think it is a movement where the main emotional tenure of the elites is, “We are totally right, and anyone who disagrees had better watch out.” So I think that there is a discrediting of it. The other thing is just that I think there's too much cultural separation between the feminist movement as we know it and places like China and India, where I just don't see the attitude of being really angry about exaggerated or false complaints about unfair treatment of women in the United States is going to do anything for infanticide in India. Correct me if I'm wrong, Dwarkesh. Do you see much influence of Western feminism on infanticide in India?Dwarkesh PatelI don’t know, but maybe yes. More generally, one of the common arguments that libertarians make about India and its elites is, “Oh, all of India's elites go study in Oxford or something, and they learn about the regulations the West is adopting that make no sense for a country with $2,000 GDP per capita.” I feel like some of the things could be true of feminism where all these Indian elites go to American universities and UK universities where they learn about radical feminism, and they go back, and they adopt some of these things.Bryan CaplanYes, although you might remember what Alex Tabarrok says about these very things. You can go to India and have people pushing paper straws on you, and yet the streets are still totally covered in trash. In fact, the pushing of the paper straws probably actually distracts people from the much more serious problem of the horrible trash, right? Again, I don't know enough about India to speak with any confidence here, but if you go and learn radical feminism in Western universities, come back to India and start complaining about how we need to have more female CEOs in a country where you have millions of female infanticides per year, I think it probably is like the paper straws problem where you are so focused on a trivial problem that maybe is not only a problem, is not even a problem at all. At the same time, that anger really blinds you to an actual, really serious problem that's going on. But you know India better than me, I could be wrong. Why The Universe Hates WomenDwarkesh PatelI believe rape within a marriage is still legal in India and is still not recognized. Maybe it was just recently changed. Let's say this is an interview, and a feminist says, “Oh my gosh, okay Bryan, maybe you're right that society as a whole doesn't mistreat women, but maybe the cosmos mistreats women.” So women are forced to have children. All of these things combined make women's lives worse on average than men's lives. It's not because society mistreats them, but in some sense, there's still unfairness geared toward women. What do you make of this argument?Bryan CaplanSo unfairness, where there's no human being that does it, seems like a very strange idea to me. Just from the get-go, well, so who was unfair to you? “The universe is unfair.” Then I mean, the correct term there is unfortunate, not unfair. So that aside, I would say it's a really interesting question. Who actually has better lives just as a matter of biological endowments, men or women? I mean, in terms of demonstrated preference, I think the overwhelming result is that most people just want to remain in whatever gender they're born in. So this is not actually transgenderism. This is like a genie wish. If you could change your gender just with a wish, costlessly, perfectly, I think a very large majority of people would still want to stay with whatever gender they have because it's part of their identity. It's some kind of endowment effect, status quo bias, or whatever. But then if you say, “Okay, yeah, right, fine. Like you, like you just want to stay whatever you were because that's your identity, but if you could put that aside, what would you want to be?” It's a tough question. You can say, “Well, women have a harder personality to deal with because of higher neuroticism, and they've also got higher agreeableness.” But that gives them some other advantages in terms of getting along with other people. For example, men's disagreeableness makes it hard for men to just bite their tongues and shut up when someone's saying something they don't like. I think that is easier for women to do. You may have noticed that having to shut up and bite your tongue while someone around you says something stupid you don't like is actually a big part of life. That is one thing. Now, in terms of things that I feel that I would get out of being a woman, just being able to have as many kids as I wanted would matter a lot to me. So I only have four kids right now. If it were totally up to me, I would have had more kids. I think, as a woman, it would have been easy to do. [laughs] So again, you know, there is the issue. How are you going to find a guy that wants to have a lot of kids? This is one where I've looked at the data on family size and what determines it. While both men and women seem to have a say on family size, it just looks like women's traits have a much larger effect. Men are more likely to say, “OK, fine, whatever. We'll do what you want to do on family size.” Whereas women seem to have much more pronounced preferences, which they then tend to get. I think that if I were a woman, I could have had more kids, and it would have been easier for me to do it. That would be something that matters to me. It's not something that matters to everybody, but that's something there. Again, there is just the nice fact of people caring about your suffering. In the book, I do talk about the ethos of women and children first, which is very pronounced. It’s a modern society where we can simultaneously have something like “women and children first”, but then also have a lot of rhetoric about how people don't care about women. It's like, “Hmm, that’s not right.”Dwarkesh PatelWhat do you think of this theory that maybe society cares a lot more about women suffering, but it sympathizes a lot more with men's success? If you think of a default character in a movie or a novel, at least for me, then the default is a man. Then maybe there's some victim that defaults as a woman. But I'd rather be the sympathy of some sort of success than get it for suffering.Bryan CaplanI mean, do you need sympathy for success? Or do you want admiration? I mean, I guess what I would say is that everybody's got suffering, and only a small share of people have any notable success. If all that you knew was you're going to be a man or woman, I would say, “Well, gee, if I'm a woman, then people will sympathize with my suffering, which is almost definitely coming because that's the human condition.” Whereas to have admiration for your success is something where it just affects a much smaller number of people. I know that hanging out in Austin among hyper-successful people may be biasing your sample a bit, but I do think it's believable that men get more unmitigated admiration for their success. Of course, there are also differences in the mating opportunities that you get for being a successful man versus a successful woman. So that is there too, but again, this is something that really is only relevant for a very small share of the population.But then the argument is, “Well, that small share of the population matters so much in terms of the story we tell ourselves about our civilization or just in terms of who controls more resources overall.” So if being a woman billionaire is harder, maybe for biological reasons, maybe for the reasons of our society, you can say, “Well, that only affects a small percentage of women in society.” But on the other hand, billionaires matter a lot.In terms of what life is like for most people, the main way they matter is that billionaires just provide awesome stuff. In terms of the stories that people tell, it's true that if you go and look at most classic movies or novels, the main characters are male. Even in cartoons, actually, the main characters traditionally have been male. But on the other hand, that’s just fiction. In terms of daily life. I'd rather have people be really concerned about me in real life but have my perspective underrepresented stories than the other way around. Dwarkesh PatelSo what do you make of the argument that employers hold defects in women's personalities much more against them than they hold defects in men's personalities? I think Tyler cited some of this research in his new book on talent that being too agreeable or being too aggressive harms women more than it harms men. Bryan CaplanI would say that it's complicated in terms of willingness to fire. I think employers are much more willing to fire men. For defects and for insubordination. Another thing on the list is a small one, but I think that it is indicative of a broader trend. For people working at workplaces with dress codes, men are much more likely to be dinged on dress code violations than women because for men, there's a definite thing men are supposed to do. If you're not doing it, you are in violation. For women, on the other hand, it's like, “Well, gee, I mean, it seems kind of like that's not what you should be wearing, but I don't want to be the person that says anything about it. And who knows? Who am I to judge what a woman ought to be wearing on the job?”  But a man, on the other hand, needs to be wearing a suit in 110-degree weather. What was the high this summer over in Austin? [laughter] Dwarkesh PatelWhy do you think that women have gotten less happy since the sixties in America?Bryan CaplanRight. So the main thing I know about this is Stevenson and Wolfer's research on this. The main thing to remember is the magnitude. If I remember correctly, they find that in the sixties, women had about a two percentage point advantage relative to men in terms of their odds of saying they're very happy. 25% of men said they were very happy, then 27% of women in the sixties said that they were very happy. Whereas now, it seems like women have a two percentage point deficit relative to men. So now, if 25% of men say they're very happy, then 23% of women say they're very happy. It's always important in these papers to look at those magnitudes because the media coverage is going to say, “Oh, women are miserable now.” It's not that women are miserable now! We're talking about a two-percentage point difference. It's a data set large enough for this to actually be meaningful, but we do want to keep it in perspective in terms of what's really going on. The paper probably actually goes over a bunch of stories and says the obvious ones are all wrong. That would be what Justin Wolfersustin especially would normally do. I think he's usually right that simple stories about something like this are wrong. In terms of what I would pursue if I read through the paper and reminded myself of what they found and then said, “Okay, well, what will work?” I think I would, on one end, focus on single moms because they’ll become much more common, and their lives really are hard. A rise in single motherhood is coming. I would guess that’s one important part of it. Then, I would also be wondering how much of it is actual feminism telling women that they should be unhappy because the world is unfair and that causes unhappiness. Again, I'm not saying that these are right. It's plausible to me. The main thing I would say about feminism causing unhappiness in the adherents is that it probably doesn't matter most for most self-identified feminists because most people just are not that intellectual and they don't think about their ideas very often. So it's one thing to say, look, if you believe you're going to hell, you'll be unhappy. It's like, well, if you believe it once a year, does it make you unhappy? If you remember, “Oh yeah, once a year, I think I'm going to hell.” The rest of the time, you don't think it.On the other hand, the person who is always thinking, “I'm going to hell, I'm going to hell,” probably will be unhappy. So I think feminism is very likely to reduce the happiness of people who are feminist elites and take it really seriously, where they're talking about it all the time. That is likely to cause unhappiness. I'd be amazed if it didn't. But on the other hand, for the vast majority of people who say, “Yeah, I am a feminist. Moving on…” I don't think it's too likely to be messing up their lives. Dwarkesh PatelThat raises an interesting possibility. This is not my theory, but let's run with this. So feminism has actually gotten more true over time, but it's precisely because of feminism.  Maybe it's made elite women more unhappy. As you said earlier, the amount of single mothers has gone up. Maybe part of that is the reason, and part of that is because of feminist trends in terms of family formation. Maybe women prefer to be at home caring for children on average more, but then feminism encourages them to have careers, which makes them less happy. So if you add all these things up, plus mentorship, which men are less likely to give because of #metoo. So add all these things up, maybe they're the result of feminism, but they still make feminism more right. Would you agree with that?Bryan CaplanYeah. If we go back to this definition of feminism and this theory that our society treats women less fairly than men, then if the story is that women have made a lot of false accusations against men and then men have responded by changing their behavior, that would seem to be a strange example of saying the society is treating women less fairly than men. It would seem to be a case that society is treating men unfairly, and this is having some negative side effects for women as well. But it's one where if you really were trying to draw the line… Well actually, here's actually one of the weaknesses of the definition that I proposed. So foot binding in China. From my understanding, the main drivers of foot binding in China were women. So women are binding feet, and they're also telling their daughters they have to have their feet bound. Men seemed to care less, actually, it was more of an intra-female abuse. This is one where you could say that in China, women are treated less fairly than men, even though the perpetrators are women. I think that does actually make sense. I would just say that the definition that we use in our society isn't really calibrated to deal with that kind of thing. When it comes to what the right way to describe it would be, it just gets a bit confusing. It's useful just to say, all right, well, if women are mistreating women and that's what's making women's lives hard, how do we count that? I think I would just say that we don't have any really good way of counting it, and might be useful to just come up with a new word to describe this kind of thing. Women's Tears Have Too Much PowerDwarkesh PatelWhat do you make of Hanania’s argument that women's tears win in the marketplace of ideas? Bryan CaplanYeah. So we might want to back up a little bit and explain what the argument is. So Richard Hanania on his substack has a very famous essay where he points out that in fiction, when there is a mob of angry college students, it's very demographically diverse. But when you look at actual footage, it seems like women are highly overrepresented. He generalizes this by saying that a lot of what's going on in terms of cancel culture and related problems is that women are the main ones that get angry about these things, and people don't know what to do about it. So he, if I remember correctly, says that a man can, in a way, actually enjoy an argument with another man. Even if you lose or even if it's a physical fight, he says, you can sort of feel invigorated by it. We got through this. We resolved something. Whereas no guy feels this way about an argument with his wife. “What do I need to do in order for this argument to end as soon as possible” would be a more normal reaction. This sort of generalizes to the majority of social arguments, specifically ones that involve someone being offended or angry, or hurt. He says a lot of what's going on is that it is mainly women that are presenting these complaints and that it's hard to deal with it because men don't want to argue with angry women. It just makes them feel bad. It's sort of a no-win situation. So anyway, that is Hanania's argument. Overall, it seemed pretty plausible to me. I haven't thought about it that much more, but it's one that does seem to make a fair bit of sense in terms of just what I'm writing about feminism. You know, one really striking thing is just how one-sided this conversation is. It is a conversation where women have complaints, and men mostly just listen in silence. Ofcourse, men will sometimes complain amongst each other when women aren't around. It's not a real dialogue where women have complaints about men, and then men are very eager to say, “Oh, but I have something I would like to say in rebuttal to that.” A lot of it is what he calls “women's tears.” It's sadness, but mingled with or supported by intimidation: “If you don't give me what I want, if you don't pretend that you agree with me, I will be very angry, and I will be fairly sad.” So you should be afraid. I think a lot of what's probably going on with the rhetorical dominance of feminism, is that people are just afraid to argue against it because, in a way, it does sort of violate the women and children first ethos. If women complain about something, you aren't supposed to go and say, “I disagree. Your complaints are unjustified.” You're supposed to say, “Look, what can I do to make it better?” Dwarkesh PatelBut that seems like a good description of race issues and class issues as well. Bryan CaplanI mean, the main difference there is that there are a lot of people who have a lot more firsthand experience of intergender relations, and they spend a lot more time in intergender relations than they spend in all of the other ones. So I mean, the dynamic is probably pretty similar, but in terms of the really negative firsthand experience that men have, Hanania probably is right about that. Then that generalizes to bigger issues. Dwarkesh PatelYou have an essay about endogenous sexism. Could this just not be the cause of society being unfair to a woman? We start off with men being in power, they get sexist just because they're around other men and they like them more. So then, the starting position matters a lot, even if men aren't trying to be sexist. Bryan CaplanSo let me just back up and explain the argument. The argument says to imagine that in reality, men and women are equally good in absolutely every way, but people are more likely to have close friends with their own gender, (which is totally true). So if I remember the essay, I think that for close male friends, the male-to-female ratio was 6:1, and for women, it was 4:1. So most people's close friends are of the same gender. When you meet these people, and they're your close friends, you know them really well. Furthermore, because you have handpicked them, you're going to think well of them. So then the question is, “What about people of the opposite gender? What will your interaction with them be like?” What I point out is that a lot of the opposite gender you hang out with will be the spouses and partners of your friends. On average, you're going to think worse of them because you didn't pick them. Basically, there are two filters there: I like you because you're my friend, and I put up with your partner because that person is your partner. So this means that the women that men are around are going to be the partners of their friends. They're not going to like them less and think less of them than they think of their friends. On the other hand, the partners of women's friends will be men, and women will get to know them and say, “Wow, they're not that great. They're at least kind of disappointing relative to my same-gender friends.” So anyway, this is an argument about how the illusion of your own gender being superior could arise. Now, as to whether this is actually the right story, I leave that open. This was just more of a thought experiment to understand what could happen here. Could this actually explain the unfair treatment of women in society? Especially if we start off with men being the gatekeepers for most of the business world? It's totally plausible that it could. That's why we really want to go to the data and see what we actually find. In the data I know of, the evidence of women earning less money than men while doing the same job is quite low. So there's very little gender disparity in earnings once you make the obvious statistical adjustments for being in the same occupation. Again, the main area that probably actually has gotten worse for women is mentoring. Mentoring is partly based on friendship. I like this person. I like working with them. So I will go and help them to go and acquire more human capital on the job. This is one that feminism has visibly messed up, and many feminists will, in a strange way, admit that they have done it while not taking responsibility for the harm. I've got an essay on that in the book as well.Looking at the evidence, it is totally standard now for male managers to admit that they are reluctant to mentor female employees because they're so worried. When I go and track down a bunch of feminist reactions to this, they basically just say, “I can't believe how horrible these guys are.” But it’s like, look, you're asking them for a favor to get mentorship. They're scared. If someone's scared, do you really want to yell at them more and offer more mostly empty threats? It's really hard to scare someone into doing something this informal, so you really do need to win them over. Dwarkesh PatelTactically, that might be correct, but it seems to just be a matter of “Is their argument justified?” I can see why they'd be frustrated. Obviously, you want to point out when there's a sexual harassment allegation, and that may have the effect of less mentorship. Bryan CaplanWell, is it obvious that you want to point that out? Part of what I’m saying is that there are different perceptions here. There are differences of opinion. If you want to get along with people, a lot of it is saying, “How does it seem from the other person's point of view?” Obviously, do not assume that the most hypersensitive person is correct. So much of the problem with mentorship comes down to hypersensitivity. I've got another piece in the book where I talk about misunderstandings and how we have so much lost sight of this very possibility. When there's a conflict between two people, who's right and who's wrong? Ofcourse, it could be that one person is the conscious malefactor and the other person is an obvious victim that no one could deny. That does happen sometimes. But much more often in the real world, there's a misunderstanding where each person, because of the imperfection of the human mind, has the inability to go and get inside another person's head. To each person, it seems like they're in the right and the other person is in the wrong, and one of the most helpful ways for people to get along with each other is to realize that this is the norm. Most conflicts are caused by misunderstandings, not by deliberate wrongdoing. This is the way the people who keep their friends keep their friends. If any time there's a conflict with a friend, you assume that you're right and your friend is in the wrong, and you demand an immediate abject apology, you're going to be losing friends left and right. It is a foolish person who does that. Friendship is more important than any particular issue. This is not only my personal view, it is the advice that I give to everyone listening. Keep your friends, bend over backward in order to keep your friends, and realize that most conflicts are caused by misunderstandings. It's not the other person is going out of their way to hurt you. They probably don't see it that way. If you just insist, “I'm right, I demand a full apology and admission of your wrongdoing,” you're probably going to be losing friends, and that’s a bad idea. The same thing I think is going on in workplaces where there is an ideology saying that we should take the side of the most hypersensitive person. This is not a good approach for human beings to get along with each other.Dwarkesh PatelYeah. That's very wise. What do you make the argument that a lot of these professions that are dominated by men are not intrinsically things that must appeal to men, but the way that they are taught or advertised is very conducive to what males find interesting? So take computer science, for example; there are claims that you could teach that or economics in a way that focuses on the implications on people from those practices rather than just focusing on the abstractions or the “thing-focused stuff.” So the argument is these things shouldn't be inherently interesting to men. It's just in the way they are taught. Bryan CaplanThe word inherently is so overused. It's one where you say, "Well, are you saying that inherently X?” Then someone says, “Well, not inherently X, just you'd have to bend over backward and move heaven and earth for it not to be. So I guess it's not really inherent.” That is a lot of what is worth pointing out. So if you're going to put the standard to that level, then it's going to be hard to find differences. You could say, “There's absolutely no way under the sun to go and teach math in a less male way.” On the other hand, maybe we should ask, “Is it reasonable to expect the whole world to revolve around making every subject equally appealing to men and women?” That's an unreasonable demand. If there's a subject like math that is male-dominated, the reasonable thing is to say, “Well, if you want to get in on that, you're going to need to go and become simpatico with the mindset of the people that are already there and then push the margin.” You can say that it’s “so unfair that male ways of doing math are dominant.” Or maybe you could say that it's unfair for someone who's just shown up to demand that an entire discipline change its way of doing things to make you feel better about it. Obviously, there are large areas that are very female-dominated, and there's no pressure on women to go and change the way that flower arranging is done, or cooking in order to make it more welcoming to men.So this is one where if you had a really high bar for how things are fair, then unless the rigorous conditions are met, you're going to see a lot of unfairness in the world. Although even then, as long as you have an equally high bar for both men and women, I don't think it's going to make feminism any more true by my definition. I also just say, I think these really high bars are unreasonable. If a friend had these bars of standards saying, “Look, why is it that when we meet for food, we have to go and meet at standard hours of breakfast, lunch, and dinner? I actually like meeting in the middle of the night. Why can’t we have half of the time be my way?” You respond, “Well yeah, but you're only one person, so why should I change?” It depends upon what subfield you're in as well. There are actually groups of people really like hanging out in the middle of the night, so if you ask, “Why is it we always have to meet in the middle of the night? Why can't we do it my way?” You are entering into a subculture that works this way. You could demand that we totally change our way of being to accommodate you, but it just seems like an unreasonable imposition on the people who are already here. Now, when you sort of go through the list of different things that people think of as making something a male or a not-male field, sometimes people will treat things like acting like there's an objectively correct answer as a male trait. If that's a male trait, then we need to keep that trait because that is vital to really any field where there are right and wrong answers. I mean, that's an area where I am very tempted rhetorically to say, “It's just so sexist to say that it's male to think that things are right and wrong. I think that is a trait of both genders”. In a way, I end the essay stating, “Yes, these are not male; not only do they not make a male monopoly, but they are also not uniquely male virtues. They are virtues that can and should be enjoyed by all human beings.” At the same time, you could ask whether virtues are equally represented by both genders and well, that's an empirical question. We have to look at that. Bryan Performs Standup Comedy!Dwarkesh PatelWe're shifting subjects. You recently performed at the Comedy Cellar. How was that experience? Bryan CaplanYeah, that was super fun and a big challenge! I am a professional public speaker. Standup comedy is professional public speaking. I was curious about how much transfer of learning there would be. How many of the things that I know as a regular public speaker can I take with me to do standup comedy? I'm also just a big fan of standup comedy– if you know me personally, I just find life constantly funny. Dwarkesh PatelYes, I can confirm that. You're a very pleasant person to be around. Bryan CaplanLife is funny to me. I like pointing out funny things. I like using my imagination. A lot of comedy is just imagination and saying, look, “Imagine that was the opposite way. What would that be like?” Well, actually, just to back up again: during COVID, I did just create a wiki of comedy ideas just on the idea that maybe one day I'll go and do standup comedy. Comedy Cellar actually has a podcast, kind of like Joe Rogan, where comedians go and talk about serious issues. I was invited to that, and as a result, I was able to talk my way into getting to perform on the actual live stage of the biggest comedy club in New York. The main thing I could say about my performance is that it was me and nine professional comedians, and I don't think I was obviously the worst person. So that felt pretty good.Dwarkesh PatelIt was a pretty good performance.Bryan CaplanI felt good about it! There were some main differences that I realized between the kind of public speaking I was used to doing and what I actually did there. One is the importance of memorizing the script. It just looks a lot worse if you're reading off a note. Normally I have some basic notes, and then I ad-lib. I don't memorize. The only time I have a script is if I have a very time-constrained debate, then I’d normally write an opening statement, but otherwise, I don't. The thing with comedy is it depends so heavily upon exact word choice. You could go and put the same sentence into Google Translate and then back-translate it and get another sentence that is synonymous but isn't funny at all. That was something that I was very mindful of. Then obviously, there are things like timing and being able to read an audience (which I'm more used to). That was what was so hard during COVID–– not being able to look at the faces of a live audience. I can see their eyes, but I can't tell their emotions or reactions to their eyes. I don't know whether I should talk more or less about something. I don't know whether they're angry or annoyed or curious or bored. So these are all things that I would normally be adjusting my talk for in normal public speaking. But with comedy, it's a bit hard to do. What successful comedians actually do is they try it in a bunch of different ways, and then they remember which ways work and which ones don't. Then they just keep tweaking it, so finally, when they do the Netflix special, they have basically done A/B testing on a hundred different audiences, and then it sounds great–– but the first time? Not that funny. Dwarkesh PatelIt didn't occur to me until you mentioned it, but it makes a lot of sense that there are transfers of learning there in both disciplines. There are a lot of hypotheticals, non-extra events, and putting things in strange situations to see what the result is…Bryan CaplanA lot of it is just not having stage fright. So I probably had just a tiny bit of stage fright at the Comedy Cellar, which normally I would have basically zero, but there it was a little bit different because it's like, “Am I going to forget something?” I actually have a joke in the set about how nothing is scarier than staying silent while thousands of people stare at you. So that was a self-referential joke that I worked in there.Dwarkesh PatelI can't remember if it was Robin Hanson who said this, but didn't he have a theory about how the reason we have stage fright is because somehow, you're showing dominance or status, and you don't want to do that if you're not actually the most confident. Bryan CaplanYou're making a bid for status. In the ancestral environment, we're in small groups of 20-40 people. If you go and want to speak, you're saying, “I'm one of the most important people in this band here.” If you're not, or if there are a lot of people voicing that that guy is not important, then who knows? They might shove you off the cliff the next time they get a chance. So yeah, watch out. Affirmative Action is Philanthropic PropagandaDwarkesh PatelI wonder if this explains the cringe emotion. When somebody makes a bid for status, and it's not deserved. Okay, I want to talk about discrimination. So as you know, there's a Supreme court case about Harvard and affirmative action. You might also know that a lot of companies have filed a brief in favor of Harvard, saying that affirmative action is necessary for them to hire diverse work for ourselves, including Apple, Lyft, General Motors. So what is the explanation for corporations wanting to extend affirmative action? Or are they just saying this, but they don't want it? Bryan CaplanIf those individual corporations could press a button that would immunize them from all employment lawsuits, I think they would press it. When you look at their behavior, they don't just give in whenever they get sued. They have a normal team of lawyers that try to minimize the damage to the company and pay as little as possible to make the problem go away. So I think really what's going on is public relations. They are trying to be on that team. As to whether it's public relations vis a vis their consumers or public relations vis a vis other people in the executive boardroom is an interesting question. I think these days, it probably is more of the latter. Although even under Reagan, there were a bunch of major corporations that did make a similar statement saying that they wanted affirmative action to continue. I think that the real story is that they want to get the status of saying, “we are really in favor of this. We love this stuff.” But at the same time, if it just went away, they wouldn't voluntarily adopt a policy where they give you a right to go and sue them for mistreatment.I think there would still be a lot of propaganda. I mean, here's the general thing. You think about this as a species of corporate philanthropy sticking your neck out in favor of a broad social cause. Some people disagree and say that it's self-interest. They say, “Look, the odds that even Apple is going to change the Supreme Court's mind is super low.” So I don't think it's that. Basically, what they're doing is a kind of philanthropy. What's the deal with corporate philanthropy? The deal with corporate philanthropy is you are trying to go and, first of all, make the public like you, but also, you're trying to look good and jockey for influence within your own company. One really striking thing about corporate philanthropy is when you look closer, normally, they spend way more resources marketing the philanthropy and letting everyone know, “Oh, we did all this philanthropy!” Then they actually spend on philanthropy. So I had a friend who was a marketing person in charge of publicizing her company's philanthropy. They gave away about a thousand dollars a year to the Girl Scouts, and she had a hundred thousand dollars salary telling everyone about how great they were for giving this money to the Girl Scouts. So I think that's the real story. Get maximally cynical. I think without denying the fact that there are true believers now in corporate boardrooms who are pushing it past the point of profitability. The cost of philanthropy is just the production budget of the TV commercial. A rounding error. The donations are a rounding error, and then they go, “Hey, everyone, look at us. We're so freaking philanthropic!” Peer effects as the Only Real EducationDwarkesh PatelOkay. So this question is one that Tyler actually suggested I ask you. So in The Myth of the Rational Voter, you say that education makes you more pro-free market. Now, this may have changed in the meantime, but let's just say that's still true. If you're not really learning anything, why is education making you more free market? Bryan CaplanIt's particularly striking that even people who don't seem to take any economics classes are involved. I think that the best story is about peer effects. When you go to college, you're around other peers who though not pro-market, are less anti-market than the general population. The thing about peer effects is that they really are a double-edged sword from a social point of view. Think about this. Right now, if you are one of the 1% of non-Mormons that goes to Brigham Young University, what do you think the odds are that you'll convert to Mormonism? Dwarkesh PatelHigher than normal. Bryan CaplanYeah. I don't know the numbers, but I think it's pretty high. But suppose that Brigham Young let in all the non-Mormons. What would Brigham Young do for conversion to Mormonism? Probably very little. Furthermore, you realize, “Huh, well, what if those Mormons at Brigham Young were dispersed among a bunch of other schools where they were that were a minority?” Seems quite plausible. They'd be making a lot more converts over there. So if you achieve your peer effects by segregation (which is literally what college does, it takes one part of society and segregates it from another part of society physically when you're in school, and then there's social segregation caused by the fact that people want to hang out with other people in their own social circles, your own education levels, etc.), in that case, in terms of whether or not education actually makes society overall pro-free market, I think it's totally unclear because, basically, when people go to college, they make each other more pro-free market. At the same time, they remove the possibility of influencing people of other social classes who don't go to college, who probably then influence each other and make each other less free market. I think that's the most plausible story.Dwarkesh PatelWhat about the argument that the people who go to elite universities are people who are going to control things? If you can engineer a situation in which the peer effects in some particular direction are very strong at Harvard (maybe because the upper class is very liberal or woke), they make the underclass even more woke, and then it’s a reinforcing cycle after every generation of people who come into college. Then that still matters a lot, even though presumably somebody becomes more right-wing once they don’t go to Harvard because there are no peers there. But it doesn't matter. They're not going to be an elite, or it doesn't matter as much. Bryan CaplanIt could be, although what we've seen is that we now just have very big gaps between elite opinion and mass opinion. Of course, it is a democracy. If you want to run for office, that is a reason to go and say, “Yeah, what is the actual common view here? Not just the view that is common among elites.” However, I will say that this is a topic that deserves a lot more study. Now the other thing to question is, “Wouldn't there be peer effects even without college?” If elites didn't go to college and instead they went and did elite apprenticeships at top corporations instead, I think you'd still wind up getting a very similar elite subculture. I think that this kind of social segregation is very natural in every human society. Of course, you can see it under communism very strongly where it's like, “I don't want my kid going and playing with a kid whose parents aren't in the communist party.” So every society has this kind of thing. Now, if you push the dynamics enough…. let's put it this way. If you were the prophet of the Mormon religion, what would be the very best thing for you to do to maximize the spread of Mormonism? It is not at all clear to me that trying to get all Mormons to go bring them young is a good strategy.Dwarkesh PatelI wonder if there are nonlinear dynamics to this. Bryan CaplanYeah. Well, there's gotta be, right? But as soon as you're talking about nonlinear dynamics, those are truly hard to understand. So I would just say to keep a much more open mind about this, and if anyone is listening and wants to do research on this, that sounds cool, I'll read it. Dwarkesh PatelRight. I remember you saying that one of the things you're trying to do with your books is influence the common view of elite opinion. So in that sense, there are elite subcultures in every society, but they're not the same elite subcultures, and therefore you might care very much about which particular subculture it is. Bryan CaplanNotice that that's one where I'm taking it as a given that we have the current segregation, and I'm going to try to go and take advantage of it. But if it were a question of if I could change the dial of what kind of segregation we have, then it's much less clear. The Idiocy of Student Loan Forgiveness Dwarkesh PatelStudent loan forgiveness. What is your reaction? Bryan CaplanOh, give me a freaking break. This is one subject where I think it's very hard to find almost any economist, no matter how left-wing and progressive, who really wants to stick their necks out and defend this garbage. Look, it's a regressive transfer. Why then? Why is it that someone who is left-wing or progressive would go and favor it? Maybe it’s because people who have a lot of education and colleges are on our team, and we just want to go and help our team. Obviously, the forgiveness really means, “We're going to go and transfer the cost of this debt from the elites that actually ran up the bill to the general population.” Which includes, of course, a whole lot of people who did not go to college and did not get whatever premium that you got out of it. So there's that. In terms of efficiency, since the people have already gotten the education, you're not even “increasing the amount of education” if you really think that's good. The only margin that is really increasing education is how it's making people think, “Well, maybe there'll be another round of debt forgiveness later on, so I'll rack up more debt. The actual true price of education is less than it seems to be.” Although even there, you have to say, “Huh, well, but could people knowing this and the great willingness to borrow actually wind up increasing the ban for college and raising tuition further?” There's good evidence for that. Not 100%, but still a substantial degree.Again, just to back up–– that can be my catchphrase [laughter]. So I have a book called The Case Against Education, and my view is much more extreme than that of almost any normal economist who opposes student loan debt forgiveness. I think that the real problem with education is that we have way too much of it. Most of it is very socially wasteful. What we're doing with student loan forgiveness is we're basically going and transferring money to people who wasted a lot of social resources. The story that you are on the slippery slope to free college for all is, in a way, the best argument in favor of it. If you thought that free college for all was a good idea, then this puts us on that slippery slope. It’s terrible because the real problem with education is that we just spend way too many years in school. It is generally not socially useful. The main reason why it's going on is that it’s a way of stamping people's foreheads, saying that they are better than their competitors, and to not throw their application in the trash. The more education we get, the more you need to not have your application thrown in the trash. Credential inflation. Since we're talking a lot about inflation these days, the central organizing idea of what's so wasteful about education in my book is credential inflation. When everyone has a college degree, nobody does, right? This analogy is very good. Can you make a country rich just by giving everybody a trillion dollars? You cannot. All that happens is you wind up raising prices, and you cause a lot of harm in the process. I say the same thing is going on with the multiplication of credentials.Dwarkesh PatelLet me ask you about that. Because I think for the last 10 years, the proportion of Americans who are getting college degrees hasn’t gone up, right? Doesn't the signaling theory imply that it should be going up as a credential gets diluted?Bryan CaplanSo actually, if it doesn't go up, then it's not getting diluted. But here's the actual story and what's been going on during the last 10 years… I have a bunch of bets on this, actually, and I just won the first one. When you see that the share that's going to college is going down, that's counting community college, right? It's community college that has fallen a bit, which makes sense because the signal sent by community college is barely better than nothing, right? Except in a few disciplines like nursing, and a few occupations similar to that. But for four-year college attendance, it's actually continuing to rise. The bets that I have are all along the lines of “Attendance in traditional four-year brick and mortar colleges will fall no more than 10%.” I have a whole series of these bets, each with 10-year maturities. So I just won the first one, and I think I'm just going to win a whole bunch of other ones. Dwarkesh PatelDoes your undefeated bet record make you more hesitant to take bets? Because getting the first loss and seeing 52-1 will just be a huge [Bryan interrupts]Bryan CaplanYeah, I would be lying if I said it didn't change my emotions. I do have a record of 23 wins for 23 bets that have resolved. It is fun to be able to go and say that. To say I've got 29 out of 30 bets won wouldn't sound as good. At the same time, I still am totally willing to make bets. The thing about bets is that it's not like they just come fall into your lap. You really have to aggressively seek them out because hardly anyone wants to bet. At this point, you might think that some people would want to bet me just basically saying, “Well, if I beat him, I'll be the guy that beat him. And if I lose, then who's ever heard of me anyway? Who cares?” But even that doesn't really do very much. The bet that I'm likely to lose is a global warming bet with the standup economist, Yoram Bauman. So that's one where he gave me three to one odds initially. So I was expecting to lose. He very much enjoys running annual victory laps on Twitter without ever mentioning, “Yeah, well, you did give me odds because I wasn't saying that I was convinced. I was saying that I thought that other people were overconfident”. But that's his right to go and run his victory laps. Dwarkesh PatelYou're like a UFC fighter who hasn't lost. I don't know if you know Khabib Nurmagomedov? He retired before he lost a single fight, I believe. I think he said his reason was, “Oh, my mother doesn't want me to fight anymore.” [laughs] But one wonders. Are you hopeful that right-wing governments are seeing education polarization and loan forgiveness as a transfer of wealth toward left-wing elites? Are you hopeful that they’ll implement education austerity?Bryan CaplanBarely. Just to back up, the big policy reform that I push in The Case Against Education is education austerity, which means spending less on education and making education less accessible. Making it less accessible, if I am correct, will be socially desirable, because it will basically mean that credential inflation will be reversed, and people will be able to get the jobs they were going to get anyway while spending fewer years of their lives in school learning stuff that is not very useful. The main reason that I'm skeptical about this is that even in states where the state government is very right-wing, it seems that the prestige of state university systems is sufficiently high that politicians generally don't want to challenge it. In Texas, we both were hanging out around the University of Texas campus, and the state capitol is just a 20-minute walk away. It seems like the governor of Texas does not want to have a throwdown with the president of the University of Texas and say, “Hey, we're sick of this stuff.” Why not? Probably because the governor of Texas thinks that UT, with its great football team, is really popular and that he can't beat them. It’d be hard for him to say, “We're going to pass a bill saying that all the athletics of UT are fully funded, but we are going to go and get rid of the following departments.” It's hard to go and make that happen. The president of UT could probably get the football coach to say, “We stand arm in arm, shoulder to shoulder with our fat studies department,” or whatever. So that is the concern.Florida is a little bit different. It does seem like DeSantis is trying to go and at least make some symbolic efforts against overwhelming left-wing bias at the University of Florida. But as far as I know, he isn’t doing anything about their budgets, which I think they really care about. You can pass all the laws you want, but if you don't actually mess with their money, then I don't think they're going to care that much. The main change that I could plausibly see is defunding the least popular departments while saying we're going to keep the total budget of the school the same. So say, “In the state budget, we are slashing the budgets of the English department, women's studies department, ethnic studies department, sociology,” basically any subject that a normal voter would laugh at when you set when you pronounce the name of the department, maybe they could get away with that. In a way, it just seems too strategic and requires just too much attention from politicians to make them realize this. But, that's the easiest thing to see. Dwarkesh PatelThis could include making them cosign the loan for student loans that they had to pay out of their endowments, right?Bryan CaplanRight. Again, that's one that's just so easy to admit to, demagogue, and say, “Oh, so what about this poor student who couldn't do it? Now no school wants to accept him because they don't want to be responsible for it.” If you go and read Lyndon Johnson's original speech in favor of student loans, it just takes the social desirability bias dial and turns it up to the absolute deafening maximum. I can't remember Lyndon Johnson's accent, but let's give him this accent. “I believe that in America, no student should ever be denied full access to the maximum opportunities of education merely because they were born in a family that was too poor to afford it. There is no price too high, no sacrifice too great.” Oh, God. That's the kind of weaponized nuclear rhetoric that politicians will deploy to defend this stuff. Yeah, it's really what I'm up against. That stuff that is good doesn't sound good. I was turning Lyndon Johnson into Bill Clinton. I just realized they're the same Texan––Why Society is Becoming Mentally IllDwarkesh PatelYeah, I might be giving that speech from the bathroom every day, I don't even know if you’ve heard the story [laughs]. Why do you think young people are getting more anxious and have a higher incidence of neuroticism overall?Bryan CaplanMy first pass on this is always that it's an artifact of measurement to the medicalization of society. It's basically just measurement. By modern measures, there was no neuroticism, and there were no psychiatric problems 200 years ago because there were no psychiatrists. If you went back 200 years ago and measured it, you say, “Well, the number of people in psychiatry offices is zero, so it doesn't exist here.” Then we go and expand it. We really went out of our way to make access super easy, to have a big center on every campus, to de-stigmatize, and at the same time to stigmatize the traditional subsidies for psychiatry like religion. Traditionally, when you have a problem, you go and talk to your priest. If you stigmatize that, that results in something like, “Well, I can't talk to a priest. They're scumbags now, I can't talk to them. So who can I talk to? I can go to the counseling center. I can do that.” However, there are some measures where the level of neuroticism is not just measuring people going to a psychiatrist's office. We actually see this in suicide rates. Although there… I have a piece where I go over the last 60 or 70 years of suicide rates. It's really complicated, Dwarkesh. Dwarkesh PatelOh, really? Bryan CaplanYeah. So basically, suicide rates were falling from 1970-2000 and then have had a big rebound since then. If I remember, I think suicide rates now are pretty similar to what they were in the fifties. I'd have to go back and double-check those numbers, but that's what I remember. You’d have to have a really complicated theory, or you could just have a bunch of ad hoc theories. Maybe it was World War II and the trauma of that while also being married to a veteran with trauma that could mess women up and make them kill themselves. Then that changed, and then something else happened. So the Jonathan Haidt case of keeping kids from playing outside by infantilizing them or making them really anxious doesn't fit with anything from the fifties. You could argue, “Well, in the fifties, they were really good in terms of unsupervised play, but they were really bad in terms of something else.” I mean, when people talk about this stuff, what really strikes me is that I felt like I learned more from just going and looking at the time series as far back as it goes than from every person that pontificated about what's really going on. Just to realize the numbers are complicated; no obvious story fits. It would be really ideologically convenient for me to say feminism is leading women to kill themselves. But the numbers don't work. So that's wrong. Immigration & the Ultra-long TermDwarkesh PatelHow persistent are the harms of immigration restriction? If the world is getting wealthier by itself anyways, does it really matter if it'll take a few more decades than it would have? You could transfer them here now, or you could just wait for economic growth to do its thing there.Bryan CaplanDoes it really matter if we miss a hundred trillion dollars during the time that people are poorer than they're probably ever going to be again? Yeah, I think it really does matter, I’ll go with that. Just to back up, in Open Borders, I go over what I consider to be the most powerful argument in favor of immigration. It all just comes down to this. We know for a fact, undeniably, that if you go and take a very poor worker from a poor country and move them to a rich country, almost overnight, their pay multiplies many times. This is something that you cannot deny while looking at the facts. So the question is, why can we make a Haitian suddenly earn 20 times as much money just by moving into Miami? He hasn't even learned English yet, but he's still making 20 times as much money as he was back in Haiti. The textbook economic explanation is we pay immigrants more in rich countries because their productivity is so much more than it was back home. Productivity is much higher in rich countries for everyone. Most of the reason why Haitians are poor is not that there's anything wrong with individual Haitians. Most of the reason is that there's something really wrong with Haiti. If we were to go and get deposited in Port de Prince, Dwarkesh, we'd be struggling to get out in existence as well. What's messed up is Haiti, not Haitians primarily. Now, this is basically undeniable. The part that is debatable is: is this scalable? We can make one Haitian vastly better off just by going and moving them to the U.S., and it pays for itself because he's more productive. Could we go and move a million Haitians? Yeah. Ten million? This is where people might start saying that maybe it's not really scalable. In the book, a lot of the argument is that, really, it's totally scalable, and this is just a massive missed opportunity where we really could go and rescue hundreds of millions of people, billions of people, from poverty in a short amount of time. We can essentially just fast forward from right now to this future that you're talking about. How valuable is this? Well, if you're someone who thinks on million-year timescales, then not so valuable. If you're someone who thinks on the timescale of dramatically improving the lives of billions of people over the next hundred years, then yeah, it's fantastic. On top of this, it’s worth pointing out that it’s almost certain that right now, we are missing some of the greatest human talents. They’re trapped in some poor village in India or China, and we'll never find out what their accomplishment is. If you think that we are one day going to beat death, it is quite likely that the guy that could have beaten death 5 or 10 years earlier is in some poor village in India or China. So by not allowing immigration, that person is not going to get to beat death. If we're going to beat death, we'll beat it eventually. But just to shave 5 or 10 years off of that, this matters a lot to me. Those 5 or 10 years really make a difference. If the technology just freezes people at the age they're at, I want to get frozen really quick because I'm going downhill. Dwarkesh, even for you, 5 or 10 years, it's a big difference. If you are an ultra-long-termist, then I guess that you could say Open Borders is not that big of a deal. But in terms of doable policy changes that will lead to the increase of human wealth of hundreds of trillions of dollars in this century, then it's the best I know of.Why Cowen’s Talent Scouting Strategy is LudicrousDwarkesh PatelSpeaking of talent, Tyler Cowen and Daniel Gross have a new book about it. One of the implications the book makes is that if talent spotting is something that you can do pretty reliably with a 1500-word essay and a Zoom call, then doesn't that imply that college is not necessarily that much about signaling because you don't need four years of cognitively demanding pointless work? There's clearly a more convenient way to just get that signal for identifying talent. Bryan CaplanThis goes back to a very long-running argument from Tyler. Tyler has a lot of objections to my book, The Case against Education, but his central one comes down to this: “Look, Bryan, I hire people; you don't.” It’s basically, “I hire people, you don't, and I will just tell you as a fact that I know after a couple of months whether a worker is good or not, and therefore signaling really cannot be very important. End of story.”  Pulling rank. This is the argument that Tyler has right now. There are a few different responses to this. The one that is most pleasant and most flattering is to say, “All right, well look, Tyler, you are one employer in a million. You're fantastic. You have incredible capabilities. You can do this, but you're just one person. You're not involved in hiring most people, and most employers are nowhere near as good at you as spotting talent, so you're still wrong.” That is sthe easiest thing to say. In terms of more fundamental arguments, I would say that the idea that you can spot talent with a Zoom call and a 1500-word essay is ludicrous. The essay can be forged, obviously. You could put them in a testing center, and even then, if a dream job hangs in the balance, people will figure out a way to cheat on that. Then in terms of the Zoom call…. Yeah, no. I have been hiring artists who are admittedly nefarious and unreliable. What I found is that even work product is not that good of a predictor because someone who really wants to get a job can do five great pages in a timely manner, but then they keep you waiting for years for what you really want out of them. So it's just not that easy. Not even close. I think the better argument is not saying that we can find talent with the Zoom call and the essay, but rather we can find talent by hiring people and watching them for a couple of months. That makes more sense. The problem with that is that it is incredibly expensive to go and hire people and watch them for a couple of months. You get a stack of applications, hundreds of people think, and what you are doing there is trying to figure out ways to say no as quickly as possible and narrow it down. You might do this knowing full well that there are three awesome people you've just thrown away. Because “Yeah, well, I threw 3 awesome people away, and I also threw away 294 terrible people, and I don't have any way of finding those other people.” So I call this the diamonds in the rough problem, and I say that this is a lot of the reason why signaling matters so much; it's a way of getting out of the undifferentiated mass of people who may be good (who knows?), and into this better pool. Now, I do also say that another big error in Tyler's “I just watched him for a couple of months story” is that there is very strong evidence that, for multiple reasons, hardly any employer does the strategy of hire, watch, and then fire if you're disappointing. The simplest reason is maybe you're at the 45th percentile of expectations, so then it's like, “Well, he's kind of disappointing, but it's not worth going back to the drawing board again.” There are also a lot of social and emotional problems with firing people. People do not like firing, and then on top of it, of course, there are legal problems, which should not be discounted. Dwarkesh PatelIsn't this just what an internship is, though?Bryan CaplanWell, remember, when you apply for an internship, does everybody get the internship? Dwarkesh PatelTrue, but you can have a lower bar for the internship, so then it's like a call option on being able to hire them. Bryan CaplanYes. A lot of what people are signaling is not just intelligence, it's not even work ethic; it's just sheer conformity. Here's the issue: you might ask, why can't I just take my Harvard acceptance letter and get hired by Goldman Sachs and say, “Hey, look, Harvard said I was good enough. Harvard has a 98% five-year graduation rate. Come on, let's just start right now.” That is so weird in our society for someone who gets into Harvard to say, “I don't want to go to college at all, and show up with this odd offer.” Goldman very reasonably could react with, “Yeah, well, he got into Harvard, but this guy's a freak. We're worried about it.” So I think it's basically the same problem that you're talking about. Dwarkesh PatelCouldn't Goldman say, “Okay, well, maybe you don't want to hire him full-time out, but, let's see if we can give him an internship?” In fact, internships are very common. Bryan CaplanYes. Although again, you want to give the internships to people that are checking all the boxes. The person who is doing the weird thing, you're nervous about him. Now, by the way, I've multiple times been on panels where there's some business leader, and he'll say, “In the business world today, we don't care about credentials. We only care about hard demonstrable skills.” Then I always ask the same question: how many uncredentialed people have you personally hired for high-skilled jobs? “Well, we haven't done any, but I read in the Wall Street Journal,” Aha, you're acting as if you've got some firsthand experience. You're just repeating what you read in the freaking newspaper, which writes stories about stuff that is atypical. Of course, you don't write a story about something everybody knows about because that's familiar to people. You go and dredge up some weird platypus and then show everybody and say, huh, platypuses are taking over the ecosystem. Dwarkesh PatelDidn’t this happen to your podcast with Andreessen, by the way? Bryan CaplanThat would be plausible that it would happen. He said, “We only hire on demonstrable skills,” and I asked him who he’s hired without credentials. Then what did he say? Dwarkesh PatelI don't remember. I don't know if you asked him directly, but that was his claim. I don't know if you followed up that way.Bryan CaplanHere's a good way of thinking about it in Computer Science. I have heard that top firms like Google sometimes hire contest winners. But when I ask people there, how many standardly credentialed employees do you have in your programming and how many contest winners without credentials? The results are, yeah, you have three contest winners and thousands of regular credential workers. So basically, you have to walk on water to get hired by these firms without having the regular credentials. Surprising Immigration VictoriesDwarkesh PatelYou recently traveled to Eastern Europe in the aftermath of the Ukraine war. Bryan CaplanI took my 12-year-old son there too. A lot of people were saying, “You're crazy. What are you doing? Why would you go there?” I was super glad that I did; it was an incredibly exciting trip. What happened actually was that my book was translated into three Eastern European languages, Polish, Hungarian, and Czech, and then I also spoke in Slovakia, where I had gotten a few different versions but Slovakians said, “Yeah, we can read Czech. Totally no problem. It's basically the same language.” I got to give talks in all four of those countries. Poland was especially exciting because you could see the pro-Ukrainian anti-Russian enthusiasm in the streets. I was by the train station in Krakow, and there was just a Polish guy just screaming, “F**k Putin, glory to Ukraine!” And I was saying, is that guy drunk? He's not drunk. He's just a Polish person speaking his mind here. When you went to the train stations, they were packed with refugees. What I did not realize was that the refugees were in fantastic spirits because of the warm welcome of the Polish people; it was so strong that the people there were actually feeling good about the situation. Look at their faces– just imagine the stress of fleeing a war zone with your kids. That's what was going on. I also got to learn some amazing things when I was there. Since I am the author of Open Borders, you can definitely predict that I would say, “Oh, well, letting in a lot of refugees won't be a big deal,” but Poland increased its population by 10% in a month, and the country looked fine. No one there was complaining, and I could see why. Look, this is not ideology. This is me walking around and looking at stuff. Poland was able to go and do this. Why? Because where there's a will, there's a way. There can be a thousand refugees from a country you don't like. You put it on the news, and people say, oh, we just couldn't possibly absorb them. We're at our absolute breaking point. This is terrible. On the other hand, you can have millions of refugees come into your country, and if you like them and sympathize with them, then it's all hunky dory, and it's fine. Polish policy was also excellent. Ukrainians are allowed to work the day they show up. Normally what you do to refugees is say, “Well, you can come here because you'll be dead if you stay in your own country, but we don't want you getting a job,” because producing and contributing to society, as we all know, is a bad thing for human beings to do. Much better than we just keep you as a semi-prisoner on welfare for a few years. That sounds like a much better thing to do and is normal. Poland was doing the best thing where the day you show up, you can get a job there. You're totally legal to work. So this is a path toward having them become productive members of society. I mean, just to emphasize how amazing what they're doing in Poland is, this would be like the US took 30 million refugees in a month, 33 million refugees in a month. Americans freak out over 10,000. So you just realize how phony and bogus the complaints are. It really is just a matter of believing and seeing. If you think that refugees are bad and immigrants are bad, you will see bad things happening. On the other hand, if you're supportive and have a can-do attitude, then you'll say, “Hey, this is completely doable.”Dwarkesh PatelI guess you're skeptical that Americans will have a can-do attitude about it. Bryan CaplanThe can-do attitude mostly just comes down to: Are you going to get out of the way and let them do their thing? That's the real problem, right? It's not an argument against accepting them and letting them work. It's an argument that we're not going to do it and we'll do the wrong thing. Dwarkesh PatelIn the Myth of the Rational Voter, you point out that a lot of times, what liberal economists do is they'll defend some policy based on the optimal implementation of it. But then, in effect, it’d be like arcane environmental regulations. I wonder if it's similar here.Bryan CaplanWell, that's why in Open Borders, I defend immigration as it really is. I don't go and say that we have to do a bunch of other things first. I say that it's fantastic right here, right now, in the real world. Of course, I do have that chapter on keyhole solutions where I try to meet people who disagree halfway. But really, what I learned in Poland is that my view of what's doable has expanded quite a bit. Previously, I think I would have said that maybe you can take in two or three percent repopulation a month without looking really bad. I'm also the kind of person who will say the train station is going to be full of human misery but still way better than trapping people in a war zone. I'm that kind of person. I'm someone who always asks, “Compared to what?”.If someone’s here crying with their children in a train station, it's probably because back home, they would have been crying over a dead body instead. This is still a big improvement, and this is still actually what we should be doing. But in Poland, I didn't have to make any hard arguments. I could just walk through the train stations full of refugees, and they're happy, the kids are playing, and they’ve got their puppies, and there are dog feeding stations. It's like, “Wow, I don't have to go and convince myself through logic that this is the best thing that could happen or the least bad thing that can happen. I can just walk around and see people are happy and are adjusting to a new life.”Dwarkesh PatelHow should decolonization have been done to increase the odds of a competent and free-market government? Bryan CaplanYou’re also avoiding a total bloodbath. Let's not forget that. Dwarkesh PatelSo what do you think? Are you of the opinion that it had to be done, or was it inevitable at some point? How could it have been done so that it had the optimal outcome?Bryan CaplanFirst of all, with really high credibility, this is where you say, “Look, here's the timetable. We are going to be partitioning India over the course of 20 years. We are staying there.” Even tying your hand saying, “Look, we are issuing a pile of government securities where you have to pay us money unless we go and just give up in the middle of the game.” Basically, you've got to pre-commit stating your goal: Our goal is going to be a peaceful, free rich India. We have a plan for how we're going to do this, and we're going to stick to it, and we are ready to lose a whole lot of our soldiers in order to do this, and then we are going to go and find people that we are going to very gradually transition power to. They have to be reasonable people. If these are people that are inciting pogroms, we are going to get rid of them. We are not going to tolerate that kind of thing here. This is going to be an orderly transition where all of her majesty's subjects can anticipate survival and a future where they are in peace. Now, again, probably a lot of people don't realize how badly the partition of India was botched in decolonization. The chaos makes it hard to get accurate numbers, but there are a lot of people saying that millions of people died in pogroms in the end. So as some of you say, “Oh, maybe it was only 500 or 1000.” That was a complete disaster. It came down to the British saying they were never going to leave until they did (really quickly). That's not what you do. Dwarkesh PatelWhat made the denazification and the US occupation of Japan successful?Bryan CaplanBecause they started off by completely crushing their enemies. [laughs] The key thing is that in those occupations, there were two things that they were pushing: democracy and human rights. They pushed for human rights a lot more than democracy.  So basically, they said, “Yes, we're going to have elections.” As long as you are completely committed to the denazification of Germany, you can be elected, and you can have a little bit of power. Then we're going to very slowly devolve power on you while it remains completely clear that you have no Nazi sympathies, and none of this stuff is going to come back. So that is basically what happened: there was a complete crushing of what existed before, and then a rebuilding where democracy is a low priority. Is democracy yielding good results? Then we can turn the democracy dial up a little bit. The same thing happened in Japan. Really bad war criminals wind up getting sentences that are quite light overall. If I remember correctly, under a thousand German war criminals got executed by the US. Just think about how many probably Otto have gotten executed. A hundred thousand, maybe. So people who really had blood on their hands, people who ordered the deaths of innocent people when they could have just not done it without. There's a famous book called Hitler's Willing Executioners, saying that this was not primarily people murdering innocent people under duress where there's a gun at your head saying you shoot another person. What the author looked at was what happened to Germans who refused to participate, and hardly any of them did. It's called Hitler's willing executioners. Hardly any ethnic Germans refused to cooperate, even soldiers were punished. People who didn’t cooperate in the genocide were punished. Rather than saying, “Oh, well, you know, we're going to have to transfer you then if you won't go and murder innocent people, what a jerk you're being.” That's the kind of thing that should have been done. Here is the way that I think about it. You want to do it from a position of strength. You don't wait before the fanatics have the upper hand and there's blood in the streets and then say, Oh gee, what do we do now? You want to jump the gun when things are peaceful. This is where you say we have now, in this time of complete peace and harmony, worked out a plan for decolonization, and here's how it's going to work. You never want to let it make it look like your hand is being forced. You never want to let fanatics and bloodthirsty people have their status raised by standing up to you successfully. You want it to all be happening over their heads so that they just look like losers and crazy people, and then you find some people that want to work for a decent, peaceful society. Of course, there are people who are not complete mushheads like Gandhi. Just to stick my neck out, Gandhi was an apostle of nonviolence. Good for him, but he was also someone who was so dominated by wishful thinking and just trying to pretend like a pogrom shouldn’t be expected after the transition (the pogroms were reasonably expected). It was a lot of pie-in-the-sky nonsense that he preached. He himself is not a mass murderer. He's just a very, touchy-feely person who should be nowhere near any important decision. He might have been a good therapist, something like that. He was someone who had a lot of sympathy for other people, but he was not a reasonable person.Dwarkesh PatelThat's really interesting because in your book on political demagoguery, you make the point that if we were to judge political leaders by normal moral standards, we would think they're monsters. The interesting thing with the Gandhi example is that maybe the people who are moral heroes in an ordinary context would make the worst politicians. Do you think there's any correlation between how moral somebody is as a human and how moral the government they lead is?Bryan CaplanThey’re definitely not the worst people. The very worst people are people who come to power self-consciously and want to commit mass murder. Those are the worst. Now, if you have a very conventional moral view where the only thing that you judge people by is how caring they are, then yeah, I think those people make bad leaders. If you have an effective altruism point of view, however, where it's not just feeling a lot of caring emotions, but being very committed to thinking clearly about the best way to get good results, then I'll say those people are more heroic people in my view. Those people, I think actually, if any of them ever got power, would generally be good leaders. Again, EAs need some experience too, but basically, that is the right profile for a good leader: someone who is very caring, but at the same time very logical. Dwarkesh PatelIs there a correlation between conventional virtues like honesty and being kind towards strangers and being good in an effective altruist sense? Or are those just completely unrelated? Bryan CaplanLet's see. If it’s the sort of kindness towards strangers you meet firsthand, like being willing to feed a homeless guy, then yeah, sure. My guess is that most effective altruists are people who would like to give to homeless people, but just realize that it's not a good use of money. They sort of have to suppress their desire to give to the homeless. Now about the honesty one: this is one where a lot of politicians say that you have to be dishonest to get things done. I would say that there's this whole literature on credibility saying, “No, what you really want is to be honest and in a very credible way such that when you say I'm going to do something in 20 years, people believe you.” Again, I think that's a lot of what you would have needed for effective decolonization. It would be to have people there of ironclad honesty. When they say, “Look, I am not leaving just because you look like there are terrorist attacks, I'm willing to give up 100,000 British soldiers to be able to carry our attacks before we walk out.” When I say it, I mean it, and I think that is actually an important trait for leadership.Here's the interesting thing. I don't think Tyler will in any way see this as a negative. On one hand, he does like to impishly say, “Oh, well, you have to be dishonest to get things done,” and so on, yet his leadership style is ultra-honest, and it's based upon everyone believing that something was going to be good for them. Afterward, they come away saying, “Wow, that was real leadership.” People leave the deal years later feeling like things worked out. Traits like integrity and honesty; while we can easily come up with hypotheticals where they're bad in a leader, I think the real thing is in the old saying “underpromise and overdeliver,” right? Don't promise more than you're really willing to do and then try to exceed expectations. That, I would say, is a trait of a leader, but I'd say that's not dishonesty. If someone promises something and that they’ll do more for you, people say liar! So you can say “No, it's not a lie. I wasn't a liar. I did what I said, and I also did more.”The Most Successful RevolutionDwarkesh PatelNow, I know, in general, you're not a fan of revolution, but if you had to choose: What is the best revolution, the most justified, or the one that had the best effects?Bryan CaplanSo this is one where there's the cheesy thing of picking something that I don't really consider revolution and then saying other people do. So the collapse of communism in Eastern Europe, you could call it a revolution. I don't think it really was because it was just way too peaceful to count. If you'll count that, then that is very likely the best example of a revolution. But again, what you really want is a bloodbath. In terms of wars, the Korean Wars had the best record; it basically saved two-thirds of a country and turned out great. We sort of have a reasonable counterfactual for how awful it would have been in North Korea. But again, North Korean propaganda might claim it was a revolution, but that’s a civil war, not a revolution in terms of what would be the best example. Of course, a lot of people want to do the American Revolution, but I'm not a fan of that. You could argue that Britain abolished the slave trade earlier, but one interesting argument I've heard recently, not about this particular, but generally, is that the argument that the end of slavery was a lot more contingent; there really wasn't a strong reason for thinking that slavery had to end then. As you told me, it was pretty profitable at the time. So if you think it was just the combination of a bunch of random things at the time, one of which was the American Revolution, which led to the end of slavery, then that's not a strong argument. Bryan CaplanMy view is that it was this British-based anti-slavery movement that was really key, which then spread to the colonies. It probably would have spread stronger and furthermore. The British have a much better record of getting rid of slavery peacefully. It would have cost so much more to do it in the US because there were so many slaves. So it's complicated. I'm still trying to come back to the question about the best revolutions. The other things you have are more coups than revolutions. The coup against the mother Muslim Brotherhood was not great, but still, it’s better than letting those fanatics take over. So let's see… There's the glorious revolution! My understanding is that it really was a real revolution and that people at the time tried to portray it as totally peaceful, but it actually really was not. The first Russian revolution against the Tsar in February, the one that replaced the Tsar with the first democratic government of Russia probably have worked out okay, if it hadn't been for Lenin. It didn't work out, but it had potential. Dwarkesh PatelHow contingent do you think history is overall? Let's say that Lenin wasn't shipped back to Russia in World War One. Does the communist takeover not happen? Or was that kind of baked into the cake?Bryan CaplanI know the details really well for this question. I’ll bet that there’s a 99% chance that without Lenin, even with all the other Bolsheviks, it wouldn't have happened. Because I actually know the facts. So if you read Richard Pipes’ book about the Russian Revolution, the rest of the Bolshevik Party was planning on taking part of the provisional government. Then Lenin shows up and reads the riot act, and he has so much intellectual status.  I don't know what he had, but the whole group was against him. He was reading the riot act, and they all said, Yes sir, ‘’Lenin, we're ready for ready for revolution.’ Without Lenin, that would just not have happened. You could say, “Well, maybe some years later, something similar would have happened.” If you know the facts, the whole revolution was based upon a tiny number of fanatics seizing power because they had 2000 guys following orders in a country where no one else was following orders. If you just waited a little while, whatever other forces would have rebuilt, and there would have been no hope for this tiny minority of lunatics to take over. So overall, I am a big believer in contingency.Of course, it does vary. Were things like economic growth going to happen one way or another starting in 1800? That, I think, was not so contingent if it didn't happen in Britain, because there were just too many things going on. There were a bunch of different scientific breakthroughs with obvious economic applications. There are a bunch of countries where they have a business class that's interested in making more money and trying these ideas out. I think that was something that you can say was quite inevitable. On the other hand, for almost anything involving major wars, I’d say almost all major wars could be avoided by one side giving in.Dwarkesh PatelThe worry, then, is that this inadvertently creates a greater list of grievances for the next war. Bryan CaplanYeah, well, that's what the hawks on both sides are always saying. Sometimes they're right. Sometimes they're wrong. They're wrong about half the time. That's basically an argument that is true sometimes but is not at all reliable. Again, often what happens when you give in is people say, “Oh, well, I thought these people were completely unreasonable and that we could never make a deal with them, but it turns out they're not so bad. So we can now de-escalate and get back to peace.” That happens, too. Then people say, “You couldn't do that with Hitler.” Yeah, I know you couldn't do that with Hitler! Hitler was terrible. Just to say the most controversial thing on this podcast. Hitler was not a person that you could negotiate with any long-term success. But hardly any world leaders are Hitler; almost all of them actually can be negotiated with. Often what they want is so trivial because politics is so based upon demagoguery, which means that small symbolic concessions are often all they need to go and thump their chests and say, “Oh, I am a great leader.” I think about how Indonesia, for 30 years, refused to give up East Timor. It's one insignificant half of one insignificant island. But for all these decades, they're thumping their chests and saying, “We couldn't possibly do that. No, that will lead to total collapse.” It's endless nonsense. “All right, fine. We'll give it away. We'll give it away.” Now it wasn't good for East Timor, the whole thing was a disaster, but it still probably is pretty bad. But there really is the case, as everybody knows in real life, that many conflicts can be avoided by giving another person what they want. If you say that “They'll just escalate their demands infinitely,” there are a few people like that. However, most people do not infinitely escalate their demands. Instead, most people will either say, “Oh, you gave me what I wanted, good! End of story.” Or maybe they'll go and periodically tax you with another demand, which is annoying but is still much better than losing a friend or a contact.Dwarkesh PatelGiven the irrationality and demagoguery in the political system. Why is it the case that the society we live in is relatively free, peaceful, and prosperous? I mean, if the average person is a National Socialist (aka. Nazi)? Bryan CaplanI said moderate National Socialist Dwarkesh. That's what I said. So there are a few things going on. The first thing is just to remember, “Usually, we don't have this.” The norm is not peaceful and prosperous societies throughout human history. The norm is impoverished and war-prone societies. Always keep that in mind if you're saying, “Well, gee, but things are okay now.” I often think of this as the ‘Look out the window test’ as in, “Hey, Dwarkesh, is it on fire out there?” We're not going to turn the camera, but I think that listeners will believe that it is not on fire.Dwarkesh PatelHow else do you think we're getting this nice lighting? [laughs] Yeah, it's not on fire. So there's that, but still, there is the interesting question: what's going on with the exceptions? Bryan CaplanSo one is I think that rich, prosperous people and societies generally have less crazy electorates. The political ideology of the society is just not as terrible as in other places. Well, it seems pretty bad, but there are still not many people saying that we want to go and murder half the population. When you go to other societies, there are actually people like that.  A friend of mine was in India, and he actually saw a pro ‘Nuke Pakistan’ rally. I assume this is not normal in India. Have you ever seen a pro ‘Nuke Pakistan’ rally?Dwarkesh PatelNo, but the nationalists can get pretty crazy over there with the celebrating.Bryan CaplanYes, but NUKE Pakistan. Preemptively nuke a nuclear power. What do you think is going to happen? We don’t have that kind of just true fanatical sociopathic bloodthirsty, horrible stuff. It's common in many societies, but it seems to be quite reduced in better-functioning societies. So that's one thing. In these better-functioning societies, people's political views are not terrible; if you propose something awful, even normal people will say, “No, I don't think it’s such a good idea to go and murder all the billionaires. Maybe we can tax them at 90%, but murder them? That's too far.” Whereas in most societies, you say that stuff, and they cackle with glee. “Let's strangle the last billionaire in the intestines of the last right-wing talk show radio host. Hahaha.” That is more of the human attitude… just think about how kids are. The way that the kids are shows us what adults are feeling, but hiding. Kids get angry, and they want blood. So more effective societies are ones where people are suppressing these atavistic desires to really just turn society into a total blood bath. So there's that. I do think public opinion obviously matters a lot in democracies. Even in most dictatorships, public opinion matters a lot. Dictators demagogue, right? They try to go and win people over normally. It's easier because the people that would have been their rivals are dead or imprisoned or terrified. So that sort of lets you weaponize the demagoguery by saying, “I'm the only one that gets to say I'm anointed by God.” So there's that kind of thing, but even dictators generally want to be liked by their population. It makes ruling easier. Then you only have to terrify 10% of the population into obedience instead of 90%. Having a better leadership class probably matters too. There's probably a high correlation between the quality of leaders and the quality of the public, but not in every case. So that's another thing to look for. Something else is also just having constructive interest groups.For example, I have a pet theory. I'm working on a book on housing regulation. My pet theory is that if we're not from lobbying from developers, basically zero things would be built in America because building things has almost no demagogic appeal. There's almost no one who emotionally gets a tear in their eye when they see a skyscraper go up or a new housing development. It’s very rare to be enthused about building stuff. Yet we need places to live. We need places to work. We need places to shop. On the other hand, there's a bunch of angry people whenever we try to build something, we call them nimbies who have an endless series of complaints. Traffic, parking, quality, the character of the neighborhood, pollution, and on and on, they make every possible complaint. So I think the main reason anything gets built is that there are developers who probably do not really sincerely believe that they're heroes, but just come and say, “Hey, well, we can make our money building stuff. We provide jobs and income through the community; let us build stuff. Please, please, please, please, please, please, please.” That is, I think, the main reason why. So all of you have constructive interest groups (economists mostly talk about interest groups as being bad), but lobbying has very positive effects overall for housing and for immigration. I think a lot of the main reason why we have as much immigration as we do is that there are a bunch of corporations pushing for it. Dwarkesh PatelAs far as developers go, why is it the case that they're not more powerful than they are? Bryan CaplanI mean, they're typically like Mancur Olson’s concentrated interest, right? Because Mancer was mostly wrong.Dwarkesh PatelOh, really? Say more. Bryan CaplanPublic opinion is much more important for policy than interest groups. Contrary to what Mancer Olson said, if you really look at what interest groups do normally, they're trying to work in the fine print. Interest groups do not go and try to pass some overall changes in US tax law. They say, “Look, that's going to be determined by public opinion. That's not the kind of thing I can affect. Maybe I can go and get a sentence change somewhere on page 1037 of the tax code. Perhaps I could get that.” So I say that most of the policies we have are ones that are supported by the general public, and you really have to look at details to see cases where interest groups are getting something that is actually unpopular with the public. So even with things as seemingly straightforward as farm subsidies, economists say, “Oh well, obviously most people don't want to go and pay those, but farmers get it.” Yeah, think again. We look at public opinion, and farm subsidies are actually very popular. If you ask people that are not in farm states, why do you want farm subsidies? Usually, they just give very pro-social reasons like, I want to make sure there's enough food. So you say, “Well, that's stupid. We only subsidize a handful of agricultural products, but they're all available” But that's already one step deeper than most voters ever have done or ever will do. Dwarkesh PatelYou know, Charles Mann, the author of The Wizard and the Prophet? Bryan CaplanYeah.Dwarkesh PatelI had him on recently, and we actually talked about this because he's concerned about water and food shortages. Especially when they're used in inefficient ways where they give it to cattle instead of consuming it directly. So I pointed out, “Isn't there an obvious free market solution? The prices will rise if you're using it in an inefficient way, and then it'll just go to people who need it the most.” His claim was that, ideally, this would be the case, but the reality is that if there's something that is physically necessary for people to survive, there's just not going to be a political will to put in actual pricing regulations for water usage, for example, which would solve a lot of water shortage problems. Bryan CaplanYeah. It seems like a silly argument because we don't have to go and raise the price of water up to the level where a few people die of thirst. You could go and multiply the price by a factor of 10 or 100, and people will still be drinking all the water that they want. They'll just be taking quicker showers, or farming will be happening in different parts of the country… that kind of thing.Dwarkesh PatelYeah. But some of the problems include how in some regions in China where they have done this, the cost of water is––Bryan CaplanOkay, I was thinking about the US. Dwarkesh Patel––a significant fraction of their income. Bryan CaplanEven there though, can it really be that there's somewhere in China so poor that the main use of water is for drinking? Or are these farmers?Dwarkesh PatelNo, no. These are actual urban residents and a quarter or a tenth of their monthly income just goes towards paying for the water.Bryan CaplanBut that's different from drinking water, right? No matter how poor you are, normally, only a very tiny fraction of the water that you use is drunk. Most of it would be for bathing or for washing clothes, a little bit for cooking, and probably even more for cooking than for actual drinking. I'm from California. I remember being a kid and being told, “Only three minutes in the shower. Come on, chop-chop!”Dwarkesh PatelEven in India, yeah. That's also a thing. Hanania had an essay recently where the titled was, Why I care more about pronouns than genocide.Bryan CaplanHe writes good titles, I’ll give him that. [laughs]Dwarkesh PatelHe talks about the irrational system of one part of his mind that cares about things that are objectively less important if you actually thought about them rationally. One of those things is pronouns in comparison to genocide. What is your irrational system’s equivalent of one thing that you recognize is not that important in the grand scheme of things, but just bothers you to no end?Bryan CaplanPeople often say, “Well, you shouldn't be talking to that guy. He's a terrible person. He said certain things,” and I'll say, “Yeah, but he was really nice to me.” [laughs] So, on the positive level, someone having good manners and being friendly with me goes a really long way. I mean, honestly, this isn't something that I'm trying to overcome. The thing I'm trying to overcome is being really friendly to people who are not friendly to me. So yeah, the main thing is when people are just very personally rude and unpleasant. I still think intellectually that the best thing to do is to turn the other cheek and try to, if not win them over, to at least win observers over with how much more reasonable and fair I am. But my instinctive reaction is just to yell back at them. I will say that that instinctive reaction just gets weaker and weaker over time because I am someone who is so uncomfortable with anger. Part of it is, it's not really my personality, but a lot of it is just the feeling of if I ever got angry, I just don't know where I would draw the line. I'm worried I would completely flip out. So I'm too concerned. If I started yelling at this person, I probably wouldn't just give him one or two cutting insults. I'd probably be screaming at him like a lunatic. So probably I better just keep on the sunny side of life and not even try to get angry because I'm just not good at it. Dwarkesh PatelYou know that line from the Avengers where Captain America asks the Hulk... Bryan CaplanOh yeah, yeah. Actually, I do. Yes. “I'm always angry.”Dwarkesh PatelRight.Bryan CaplanI'm not always angry, not even close. But I mean, honestly, I'll say there's almost only one thing that really makes me angry, and that's people being angry. So I do have secondary anger, but I have very little primary anger. Anarcho-Capitalism is the Ultimate Government Dwarkesh PatelWhat kind of government would you implement if you had a zero discount rate? So if you're a strong longtermist?Bryan CaplanSo since this is The Lunar Society, I'll stick my neck out for anarcho-capitalism and say that this is really the best system if we can figure out a way of doing it. There's no government like no government. I realize I may be completely blowing up all of my credibility, but you can just go and Google what I have to say about it. People sometimes ask, “Bryan, are you an anarchist?” And I'll say, “Well, not the crazy kind.” What I mean by this is I'm not someone who thinks that if you just pressed a button and got rid of the government, things will be good. I think it'd be a total disaster. Rather, what I think is that there is another equilibrium that is totally doable if people realize that it's totally doable. This equilibrium is one where we actually have competing police, competing legal systems, and competing court systems. It's one where if I had an hour, I could not convince anyone that disagrees. But I believe if you gave me an hour, I can convince you that it's not crazy. Which is what I actually do whenever I talk about this stuff. I say, “Look, I have a really radical idea. I couldn't possibly convince a reasonable person of it in an hour, so I'm not going to try. What I'm going to try to do is convince you in an hour that this view, though you still will think it's wrong, is not crazy.”We don't have an hour to talk about it, but I think that this is the best alternative, especially for the long term. If we could get to this equilibrium, it's the best equilibrium to be in. It's one where it basically once and for all solves a whole lot of problems with international war. It diffuses nationalism. It's something that does a lot to take care of a lot of root causes of human problems. It is one where basically it dethrones demagogues, right? But there's always a place for people like that. They'll be running cults. They'll be involved in religion. They'll be pundits. But this will be a world where there's no longer any government you can get your hands on to go and cause horrible problems for the world. So it's one where the demagogues will sort of have lost their main line of employment and will have to get, if not exactly a real job, then at least a job that doesn't involve mass murder. Billionaires Deserve their WealthDwarkesh PatelScott Alexander had a post last night making the point that he's in favor of more taxes on billionaires because even though Jeff Bezos has created a lot of consumer surplus and he certainly hasn't absorbed all of it, it's not the case that the rewards have to be that high to get Amazon built. Somebody would have ended up building Amazon anyways, even if the rewards were slightly lower. So Jeff Bezos himself is not that counterfactually responsible for Amazon. What do you make of that argument?Bryan CaplanSo two things. One is in economics, we have something called tournament theory, and this says that it can be extremely socially valuable to go and have seemingly unreasonably large rewards for people that do something useful because it doesn't just incentivize the winner, it incentivizes all the potential winners. So billionaires are not just an inspiration to each other. It's not just, “Oh, I can get to be a billionaire, I'll do this thing and make the money.” It is something that actually fosters a whole culture of entrepreneurship. I mean, again, we've been hanging out in Austin all over there. There's a whole bunch of people who are never going to be billionaires, Dwarkesh. I've told people, “Will Dwarkesh ever be a billionaire? Probably not, but like 2%. Dwarkesh is just a mover and a shaker!” Where in India was your family from? Dwarkesh PatelGujarat.Bryan CaplanIs that a big city? Is it a small town, or what even was it? Dwarkesh PatelYeah, it was a big city. Bryan CaplanOkay. So you probably would have gone to IIT or something like that. But imagine if…Dwarkesh PatelI don't know if I could have made it to IIT.Bryan CaplanImagine if your family was out in some rural village, and it's the Indira Gandhi era, right? You don't hear about dot com billionaires or anything. In terms of inspiring a generation, I think the billionaires are inspiring a generation of movers and shakers. If they are, and if their earnings were greatly taxed, I think this would really put a dent in it. I think anytime people speak ill of them, that's putting a dent in it. If you want billionaires to make less money, praise them to the skies so that more people enter, and it drives down the rewards for doing what they do. So this tournament theory does make a lot of sense. This is a story about, “Why do you pay the CEO so much more than all the next level down? Is he really that much better than the second-best guy?” Look, this isn't just incentivizing the CEO; it's incentivizing everyone who's there. Who could plausibly tell themselves, “Maybe one day me.” So there's that. The other thing is actually going back to the historical contingency. I think business history is less historically contingent, but we actually do have a lot of evidence that the quality of entrepreneurship and management varies a lot from country to country, which I think does actually mean that for the really big businesses. It's not totally clear that it would have happened anyway.Now, if you broaden it and just ask, “Well, would eCommerce have happened?” Yes, eCommerce would have happened. Would there be one store that was bigger than the others? Yeah, but is it possible that the second-best thing to Amazon would have been 1/10th as good? That actually is not crazy. I don't know. But to go and just say, “We know that that's not true,” seems pretty dogmatic to me. Again, what’s also striking is what is the second best thing to Amazon. You can say it's a natural monopoly, not true in any other retail that I know of.So people talk about Alibaba, and I tried looking at that one. Isn’t this Chinese? Shouldn't they be catering to their market? It's the English language version of the site. Shouldn't they be trying to make me happy? So that is a case where it doesn't seem like it makes any economic sense; it's a natural monopoly based upon past experience. Think about cars. We got the big three (Germany, Japan, US). Why aren't there three things like Amazon? Maybe it really is the case that no one but Jeff Bezos knew how to do it, especially when you realize part of knowing how to do something is knowing how to assemble a team. It's so easy to say, “You didn't do it, and it was your team that did it.” I made my team. That's what a leader does! They take people that are good in themselves, and they fuse them together, and they make them great, and maybe it’s self-serving, but it's plausible. Dwarkesh PatelThat makes a lot of sense. Well, Bryan, I want to thank you for giving me so much of your time. I especially want to thank you for being the first guest on my podcast. We've gone full circle with the third episode, but it would not have been possible at all without you. Bryan Caplan Totally awesome. And yes, so the books that we've been talking about are both available on Amazon. So there is How Evil Are Politicians?: Essays on Demagoguery. Then there is Don't Be a Feminist, Essays on Genuine Justice. By the time you get the podcast, both books will be available. They're really cheap, only 12 bucks, and I have not raised the price despite inflation! I've been thinking about why not and the economic theory behind that. The eBook is just $9.99. These books are both collections of my very best essays from 2005 to 2022, but Don't Be a Feminist has a totally all-new lead essay, one that, for years, I was too nervous to write. Then as I watched my daughter growing up, I felt something along the lines of “No, I've got to write this essay. I'm going to do it for her.” The actual first essay is called Don't Be a Feminist, A Letter to My Daughter. That is how I frame it. This is not an angry essay. As I said, I'm not an angry person. I'm not mad at feminists. Rather, I want to especially help my daughter, but anyone who's in the same boat as her, I would be thrilled to go and help them as well.Bryan CaplanSo like I said, this is not a typical lawyerly book where all I do is try to come up with as many arguments in my favor as I can and ignore everything that goes against me. This is one where I'm really trying to grapple with the truth. I can honestly say this: my dream is not to upset any reader. In my dream world, everyone on earth would read my stuff, and everyone would be happy after reading it. Everyone would be smiling. Everyone would be feeling grateful. Look, I haven't really won until I have turned every enemy into a friend. That may seem quixotic, but that is what I am trying to do. That's what's on my mind. Of course, you've got to first admit that there's disagreement before you can begin trying to change someone's mind and make them feel good about it, but that really is my dream. Dwarkesh PatelAnybody who has read Bryan’s books or met him can confirm that the books and the arguments in them are very good, and they also obviously come from a place of kindness and understanding about the other person's position. Bryan CaplanYeah. We all have problems, Dwarkesh. We are, we are all imperfect, flawed human beings, but we must rise above it. Dwarkesh PatelI highly recommend the books. Bryan, thanks so much for being on the Lunar Society. Bryan CaplanThanks for coming out here. Now, this is the first time that I've actually had you right in my office during an interview. So as great as Dwarkesh is over zoom, he's even better in real life. All people must try to meet Dwarkesh, he’s a cool guy, a really positive person. Thank you, buddy. Dwarkesh PatelThank you, Bryan.  Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

It was my great pleasure to speak once again to Tyler Cowen. His most recent book is Talent, How to Find Energizers, Creatives, and Winners Across the World.We discuss:* how sex is more pessimistic than he is,* why he expects society to collapse permanently,* why humility, stimulants, & intelligence are overrated,* how he identifies talent, deceit, & ambition,* & much much much more!Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Follow me on Twitter for updates on future episodes.More really cool guests coming up, subscribe to find out about future episodes!You may also enjoy my interviews of Bryan Caplan (about mental illness, discrimination, and poverty), David Deutsch (about AI and the problems with America’s constitution), and Steve Hsu (about intelligence and embryo selection).If you end up enjoying this episode, I would be super grateful if you shared it. Post it on Twitter, send it to your friends & group-chats, and throw it up on any relevant subreddits & forums you follow. Can’t exaggerate how much it helps a small podcast like mine.A huge thanks to Graham Bessellieu for editing this podcast and Mia Aiyana for producing its transcript.Timestamps(0:00) -Did Caplan Change On Education?(1:17) - Travel vs. History(3:10) - Do Institutions Become Left Wing Over Time?(6:02) - What Does Talent Correlate With?(13:00) - Humility, Mental Illness, Caffeine, and Suits(19:20) - How does Education affect Talent?(24:34) - Scouting Talent(33:39) - Money, Deceit, and Emergent Ventures(37:16) - Building Writing Stamina(39:41) - When Does Intelligence Start to Matter?(43:51) - Spotting Talent (Counter)signals(53:57) - Will Reading Cowen’s Book Help You Win Emergent Ventures?(1:04:18) - Existential risks and the Longterm(1:12:45) - Cultivating Young Talent(1:16:05) - The Lifespans of Public Intellectuals(1:19:42) - Risk Aversion in Academia(1:26:20) - Is Stagnation Inevitable?(1:31:33) - What are Podcasts for?TranscriptDid Caplan Change On Education?Tyler Cowen   Ask Bryan about early and late Caplan. In which ways are they not consistent? That's a kind of friendly jab.Dwarkesh Patel   Okay, interesting. Tyler Cowen   Garrett Jones has tweeted about this in the past. In The Myth of the Rational Voter, education is so wonderful. It no longer seems to be true, but it was true from the data Bryan took from. Bryan doesn't think education really teaches you much. Dwarkesh Patel So then why is it making you want a free market?Tyler Cowen  It once did, even though it doesn't now, and if it doesn't now, it may teach them bad things. But it's teaching them something.Dwarkesh Patel   I have asked him this. He thinks that education doesn't teach them anything; therefore, that woke-ism can’t be a result of colleges. I asked him, “okay, at some point, these were ideas in colleges, but now they’re in the broader world. What do you think happened? Why did it transition together?” I don't think he had a good answer to that.Tyler Cowen   Yeah, you can put this in the podcast if you want. I like the free podcast talk often better than the podcast. [laughs]Dwarkesh Patel   Okay. Well yeah, we can just start rolling. Today, it is my great pleasure to speak to Tyler Cowen about his new book, “Talent, How to Find Energizers, Creatives, and Winners Across the World.” Tyler, welcome (once again) to The Lunar Society. Tyler Cowen   Happy to be here, thank you!Travel vs. HistoryDwarkesh Patel 1:51  Okay, excellent. I'll get into talent in just a second, but I've got a few questions for you first. So in terms of novelty and wonder, do you think travelling to the past would be a fundamentally different experience from travelling to different countries today? Or is it kind of in the same category?Tyler Cowen   You need to be protected against disease and have some access to the languages, and obviously, your smartphone is not going to work, right? So if you adjust for those differences, I think it would be a lot like travelling today except there'd be bigger surprises because no one else has gone to the past. Older people were there in a sense, but if you go back to ancient Athens, or the peak of the Roman Empire, you’d be the first traveller. Dwarkesh Patel   So do you think the experience of reading a history book is somewhat substitutable for actually travelling to a place? Tyler Cowen   Not at all! I think we understand the past very very poorly. If you’ve travelled appropriately in contemporary times, it should make you more skeptical about history because you'll realize how little you can learn about the current places just by reading about them. So it's like Travel versus History, and the historians lose.Dwarkesh Patel   Oh, interesting. So I'm curious, how does travelling a lot change your perspective when you read a work of history? In what ways does it do so? Are you skeptical of it to an extent that you weren't before, and what do you think historians are probably getting wrong? Tyler Cowen   It may not be a concrete way, but first you ask: was the person there? If it's a biography, did the author personally know the subject of the biography? That becomes an extremely important question. I was just in India for the sixth time, I hardly pretend to understand India, whatever that possibly might mean, but before I went at all, I'd read a few hundred books about India, and it’s not like I got nothing out of them, but in some sense, I knew nothing about India. Now that I’ve visited, the other things I read make more sense, including the history.Do Institutions Become Left Wing Over Time?Dwarkesh Patel   Okay, interesting. So you've asked this question to many of your guests, and I don't think any of them have had a good answer. So let me just ask you: what do you think is the explanation behind Conquest’s Second Law? Why does any institution that is not explicitly right-wing become left-wing over time?Tyler Cowen   Well, first of all, I'm not sure that Conquest’s Second Law is true. So you have something like the World Bank which was sort of centrist state-ist in the 1960s, and by the 1990s became fairly neoliberal. Now, about what's left-wing/right-wing, it's global, it's complicated, but it's not a simple case of Conquest’s Second Law holding. I do think that for a big part of the latter post-war era, some version of Conquest’s Law does mostly hold for the United States. But once you see that it’s not universal, you're just asking: well, why have parts? Why has the American intelligentsia shifted to the left? So that there's political science literature on educational polarization? [laughs] I wouldn't say it's a settled question, but it's not a huge mystery like “how Republicans act wackier than Democrats are” for example. The issues realign in particular ways. I believe that’s why Conquest’s Law locally is mostly holding.Dwarkesh Patel   Oh, interesting. So you don't think there's anything special about the intellectual life that tends to make people left-wing, and this issue is particular to our current moment?Tyler Cowen    I think by choosing the words “left-wing” you're begging the question. There's a lot of historical areas where what is left-wing is not even well defined, so in that sense, Conquests Law can't even hold there. I once had a debate with Marc Andreessen about this–– I think Mark tends to see things that are left-wing/right-wing as somewhat universal historical categories, and I very much do not. In medieval times, what's left wing and what's right wing? Even in 17th century England, there were particular groups who on particular issues were very left-wing or right-wing. It seems to me to be very unsatisfying, and there's a lot of fluidity in how these axes play out over real issues.Dwarkesh Patel   Interesting. So maybe then it’s what is considered “left” at the time that tends to be the thing that ends up winning. At least, that’s how it looks like looking back on it. That's how we categorize things. Something insightful I heard is that “if the left keeps winning, then just redefine what the left is.” So if you think of prohibition at the time, it was a left-wing cause, but now, the opposite of prohibition is left-wing because we just changed what the left is.Tyler Cowen    Exactly. Take the French Revolution: they're the historical equivalent of nonprofits versus 1830s restoration. Was everything moving to the left, between Robespierre and 1830? I don't pretend to know, but it just sure doesn't seem that way. So again, there seem to be a lot of cases where Conquest’s Law is not so economical.Dwarkesh Patel   Napoleon is a great example of this where we’re not sure whether he’s the most left-wing figure in history or the most right-wing figure in history.Tyler Cowen 6:00Maybe he’s both somehow.What Does Talent Correlate With?Dwarkesh Patel How much of talent or the lack thereof is a moral judgment for you? Just to give some context, when I think that somebody is not that intelligent, for me, that doesn't seem like a moral judgment. That just seems like a lottery. When I say that somebody's not hard working, that seems like more of a moral judgment. So on that spectrum, where would you say talent lies?Tyler Cowen   I don't know. My default is that most people aren't that ambitious. I'm fine with that. It actually creates some opportunities for the ambitious–– there might be an optimal degree of ambition. Well, short of everyone being sort of maximally ambitious. So I don't go around pissed off at unambitious people, judging them in some moralizing way. I think a lot of me is on autopilot when it comes to morally judging people from a distance. I don't wake up in the morning and get pissed off at someone in the Middle East doing whatever, even though I might think it was wrong.Dwarkesh Patel   So when you read the biographies of great people, often you see there's a bit of an emotional neglect and abuse when they're kids. Why do you think this is such a common trope?Tyler Cowen   I would love to see the data, but I'm not convinced that it's more common than with other people. Famous people, especially those who have biographies, on average are from earlier times, and in earlier times, children were treated worse. So it could be correlated without being causal. Now, maybe there's this notion that you need to have something to prove. Maybe you only feel you need to prove something if you’re Napoleon and you're short, and you weren't always treated well. That's possible and I don't rule it out. But you look at Bill Gates and Mark Zuckerberg without pretending to know what their childhoods were like.  It sure sounds like they were upper middle class kids treated very well, at least from a distance. For example, the Collison's had great parents and they did well.Dwarkesh Patel   It could just be that the examples involving emotional neglect stuck out in my mind in particular.  Tyler Cowen   Yeah. So I'd really like to see the data. I think it's an important and very good question. It seems to me, maybe one could investigate it, but I've never seen an actual result.Dwarkesh Patel   Is there something you've learned about talent spotting through writing the book that you wish wasn't so? Maybe you found it disturbing, or you found it disappointing in some way. Is there something that is a correlate for talent that you wish wasn't? Tyler Cowen   I don't know. Again, I think I'm relatively accepting of a lot of these realities, but the thing that disappoints me a bit is how geographically clustered talent is. I don't mean where it was born, and I don't mean ethnically. I just mean where it ends up. So if you get an application, say from rural Italy where maybe living standards are perfectly fine–– there's good weather, there's olive oil, there's pasta. But the application just probably not that good. Certainly, Italians have had enough amazing achievements over the millennia, but right now, the people there who are actually up to something are going to move to London or New York or somewhere. So I find that a bit depressing. It's not really about the people. Dwarkesh Patel   When you do find a cluster of talent, to what extent can that be explained by a cyclical view of what's happening in the region? In the sense of the “hard times create strong men” theory? I mean at some point, Italy had a Renaissance, so maybe things got complacent over time.Tyler Cowen   Again, maybe that's true for Italy, but most of the talent clusters have been such for a long time, like London and New York. It's not cyclical. They've just had a ton of talent for a very long time. They still do, and later on, they still will. Maybe not literally forever, but it seems like an enduring effect.Dwarkesh Patel   But what if they leave? For example, the Central European Jews couldn’t stay where they were anymore and had to leave.Tyler Cowen   Obviously, I think war can destroy almost anything. So German scientific talent took a big whack, German cultural talent too. I mean, Hungarian Jews and mathematics-–I don't know big of a trend it still is, but it's certainly nothing close to what it once was.Dwarkesh Patel   Okay. I was worried that if you realize that some particular region has a lot of talent right now, then that might be a one-time gain. You realize that India, Toronto or Nigeria or something have a lot of talent, but the culture doesn't persist in some sort of extended way. Tyler Cowen   That might be true for where talent comes from, but where it goes just seems to show more persistence. People will almost certainly be going to London for centuries. Is London producing a lot of talent? That's less clear. That may be much more cyclical. In the 17th century, London was amazing, right? London today? I would say I don't know. But it's not obvious that it’s coming close to its previous glories. So the current status of India I think, will be temporary, but temporary for a long time. It's just a very big place. It has a lot of centres and there are things it has going for it like not taking prosperity for granted. But it will have all of these for quite a while–– India's still pretty poor.Dwarkesh Patel   What do you think is the difference between actual places where clusters of talent congregate and places where that are just a source of that talent? What makes a place a sink rather than a source of talent?Tyler Cowen   I think finding a place where people end up going is more or less obvious. You need money, you need a big city, you need some kind of common trade or linguistic connection. So New York and London are what they are for obvious reasons, right? Path dependence history, the story of making it in the Big Apple and so on. But origins and where people come from are areas that I think theory is very bad at understanding. Why did the Renaissance blossom in Florence and Venice, and not in Milan? If you're going back earlier, it wasn't obvious that it would be those places. I've done a lot of reading to try to figure this out, but I find that I've gotten remarkably not far on the question.Dwarkesh Patel   The particular examples you mentioned today–– like New York, San Francisco, London, these places today are kind of high stakes, because if you want to move there, it's expensive. Do you think that this is because they've been so talented despite this fact, or because you need some sort of exclusion in order to be a haven of talent?Tyler Cowen   Well, I think this is a problem for San Francisco. It may be a more temporary cluster than it ought to have been. Since it's a pretty recent cluster, it can’t count on the same kind of historical path dependence that New York and Manhattan have. But a lot of New York still is not that expensive. Look at the people who work and live there! They're not all rich, to say the least. And that is an important part of why New York is still New York. With London, it's much harder, but it seems to me that London is a sink for somewhat established talent––which is fine, right? However, in that regard, it’s much inferior to New York.Humility, Mental Illness, Caffeine, and Suits Dwarkesh Patel   Okay, I want to play a game of overrated and underrated with you, but we're going to do it with certain traits or certain kinds of personalities that might come in when you're interviewing people.Tyler Cowen   Okay, it's probably all going to be indeterminate, but go on.Dwarkesh Patel   Right. So somebody comes in, and they're very humble.Tyler Cowen   Immediately I'm suspicious. I figure most people who are going to make something of themselves are arrogant. If they're willing to show it, there's a certain bravery or openness in that. I don't rule out the humble person doing great. A lot of people who do great are humble, but I just get a wee bit like, “what's up with you? You're not really humble, are you?”Dwarkesh Patel   Maybe humility is a way of avoiding confrontation–– if you don't have the competence to actually show that you can be great. Tyler Cowen   It might be efficient for them to avoid confrontation, but I just start thinking that I don't know the real story. When I see a bit of arrogance, I'm less likely to think that it may, in a way, be feigned. But the feigning of arrogance in itself is a kind of arrogance. So in that sense, I'm still getting the genuine thing. Dwarkesh Patel   So what is the difference? Let's say a 15-year-old who is kind of arrogant versus a 50-year-old who is kind of arrogant, and the latter has accomplishments already while the first one doesn't. Is there a difference in how you perceive humility or the lack thereof?Tyler Cowen   Oh, sure. With the 50-year-old, you want to see what they have done, and you're much more likely to think the 50 year old should feign humility than the 15-year-old. Because that's the high-status thing to do–– it’s to feign humility. If they can't do that, you figure, “Here's one thing they're bad at. What else are they bad at?” Whereas with the 15-year-old, maybe they have a chip on their shoulder and they can't quite hold it all in. Oh, that's great and fine. Let's see what you're gonna do.Dwarkesh Patel   How arrogant can you be? There are many 15 year olds who are really good at math, and they have ambitions like “I want to solve P ≠ NP” or “I want to build an AGI” or something. Is there some level where you just clearly don't understand what's going on since you think you can do something like that? Or is arrogance always a plus?Tyler Cowen   I haven't seen that level of arrogance yet. If a 15-year-old said to me, “in three years, I'm going to invent a perpetual motion machine,”  I would think “No, now you're just crazy.” But no one's ever said that to me. There’s this famous Mark Zuckerberg story where he went into the VC meeting at Sequoia wearing his pajamas and he told Sequoia not to give him money. He was 18 at a minimum, that's pretty arrogant behavior and we should be fine with that. We know how the story ends. So it's really hard to be too arrogant. But once you say this, because of the second order effect, you start thinking: “Well, are they just being arrogant as an act?” And then in the “act sense”, yes, they can be too arrogant.Dwarkesh Patel   Isn't the backstory there that Mark was friends with Sean Parker and then Sean Parker had beef with Sequoia…Tyler Cowen   There's something like that. I wouldn't want to say off the top of my head exactly what, but there is a backstory.Dwarkesh Patel   Okay. Somebody comes in professionally dressed when they don't need to. They've got a crisp clean shirt. They've got a nice wash. Tyler Cowen How old are they?Dwarkesh Patel 20.Tyler Cowen They’re too conformist. Again, with some jobs, conformity is great, but I get a little suspicious, at least for what I'm looking for. Though I wouldn't rule them out for a lot of things–– it’s a plus, right?Dwarkesh Patel   Is there a point though, where you're in some way being conformist by dressing up in a polo shirt? Like if you're in San Francisco right now, it seems like the conformist thing is not to wear a suit to an interview if you're trying to be a software engineer.Tyler Cowen   Yeah, there might be situations where it's so weird, so over the top, so conformist, that it's actually totally non-conformist. Like “I don't know anyone who's a conformist like you are!” Maybe it's not being a conformist, or just being some kind of nut, that makes you interested again.Dwarkesh Patel   An overall sense that you get from the person that they're really content, almost like Buddha came in for an interview. A sense of wellbeing.Tyler Cowen   It's gonna depend on context, I don't think I'd hold it against someone, but I wouldn't take it at face value. You figure they're antsy in some way, you hope. You'll see it with more time, I would just think.Dwarkesh Patel   Somebody who uses a lot of nootropics. They're constantly using caffeine, but maybe on the side (multiple times a week), they're also using Adderall, Modafinil, and other kinds of nootropics.Tyler Cowen   I don't personally like it, but I've never seen evidence that it's negatively correlated with success, so I would try to put it out of my mind. I sort of personally get a queasy feeling like “Do you really know what you're doing. Is all this stuff good for you? Why do you need this?” That's my actual reaction, but again, at the intellectual level, it does seem to work for some people, or at least not screw them up too much.Dwarkesh Patel   You don't drink caffeine, correct? Tyler Cowen  Zero.Dwarkesh Patel Why?Tyler Cowen I don't like it. It might be bad for you. Dwarkesh Patel Oh really, you think so? Tyler Cowen People get addicted to it.Dwarkesh Patel    You're not worried it might make you less productive over the long term? It's more about you just don't want to be addicted to something?Tyler Cowen   Well, since I don't know it well, I'm not sure what my worries are. But the status quo regime seems to work. I observe a lot of people who end up addicted to coffee, coke, soda, stuff we know is bad for you. So I think: “What's the problem I need to solve? Why do it?”Dwarkesh Patel   What if they have a history of mental illness like depression or anxiety? Not that mental illnesses are good, but at the current margins, do you think that maybe they're punished too heavily? Or maybe that people don't take them seriously enough that they actually have a bigger signal than the people are considering?Tyler Cowen   I don't know. I mean, both could be true, right? So there's definitely positive correlations between that stuff and artistic creativity. Whether or not it’s causal is harder to say, but it correlates. So you certainly should take the person seriously. But would they be the best Starbucks cashier? I don't know.How does Education Affect Talent?Dwarkesh Patel   Yeah. In another podcast, you've pointed out that some of the most talented people you see who are neglected are 15 to 17 year olds. How does this impact how you think? Let's say you were in charge of a high school, you're the principal of a high school, and you know that there's 2000 students there. A few of them have to be geniuses, right? How is the high school run by Tyler Cowen? Especially for the very smartest people there? Tyler Cowen   Less homework! I would work harder to hire better teachers, pay them more, and fire the bad ones if I'm allowed to do that. Those are no-brainers, but mainly less homework and I’d have more people come in who are potential role models. Someone like me! I was invited once to Flint Hill High School in Oakton, it's right nearby. I went in, I wasn't paid. I just figured “I'll do this.” It seems to me a lot of high schools don't even try. They could get a bunch of people to come in for free to just say “I'm an economist, here's what being an economist is like” for 45 minutes. Is that so much worse than the BS the teacher has to spew? Of course not. So I would just do more things like that.Dwarkesh Patel   I want to understand the difference between these three options. The first is: somebody like you actually gives an in-person lecture saying “this is what life is like”. The second is zoom, you could use zoom to do that. The third is that it's not live in any way whatsoever. You're just kind of like maybe showing a video of the person. Tyler Cowen   I'm a big believer in vividness. So Zoom is better than nothing. A lot of people are at a distance, but I think you'll get more and better responses by inviting local people to do it live. And there's plenty of local people, where most of the good schools are.Dwarkesh Patel   Are you tempted to just give these really smart 15-year-olds a hall pass to the library all day and some WiFi access, and then just leave them alone? Or do you think that they need some sort of structure?Tyler Cowen   I think they need some structure, but you have to let them rebel against it and do their own thing. Zero structure strikes me as great for a few of them, but even for the super talented ones, it's not perfect. They need exposure to things, and they need some teachers as role models. So you want them to have some structure.Dwarkesh Patel   If you read old books about education, there's a strong emphasis on moral instruction. Do you think that needs to be an important part of education? Tyler Cowen   I'd like to see more data. But I suspect the best moral instruction is the teachers actually being good people. I think that works. But again, I'd like to see the data. But somehow getting up and lecturing them about the seven virtues or something. That seems to me to be a waste of time, and maybe even counterproductive.Dwarkesh Patel   Now, the way I read your book about talent, it also seems like a critique of Bryan’s book, The Case Against Education.Tyler Cowen   Ofcourse it is. Bryan describes me as the guy who's always torturing him, and in a sense, he's right.Dwarkesh Patel   Well, I guess more specifically, it seems that Bryan's book relies on the argument that you need a costly signal to show that you have talent, or you have intelligence, conscientiousness, and other traits. But if you can just learn that from a 1500 word essay and a zoom call, then maybe college is not about the signal.Tyler Cowen   In that sense, I'm not sure it's a good critique of Bryan. So for most people in the middle of the distribution, I don't think you can learn what I learned from Top 5 Emergent Ventures winners through an application and a half-hour zoom call. But that said, I think the talent book shows you my old saying: context is that which is scarce. And you're always testing people for their understanding of context. Most people need a fair amount of higher education to acquire that context, even if they don't remember the detailed content of their classes. So I think Bryan overlooks how much people actually learn when they go to school.Dwarkesh Patel   How would you go about measuring the amount of context of somebody who went to college? Is there something you can point to that says, “Oh, clearly they're getting some context, otherwise, they wouldn’t be able to do this”?Tyler Cowen   I think if you meet enough people who didn't go to college, you'll see the difference, on average. Stressing the word average. Now there are papers measuring positive returns to higher education. I don't think they all show it’s due to context, but I am persuaded by most of Brian's arguments that you don't remember the details of what you learned in class. Oh, you learn this about astronomy and Kepler's laws and opportunity costs, etc. but people can't reproduce that two or three years later. It seems pretty clear we know that. However, they do learn a lot of context and how to deal with different personality types.Dwarkesh Patel   Would you falsify this claim, though, that you are getting a lot of context? Is it just something that you had to qualitatively evaluate? What would have to be true in the world for you to conclude that the opposite is true? Tyler Cowen   Well, if you could show people remembered a lot of the facts they learned, and those facts were important for their jobs, neither of which I think is true. But in principle, they're demonstrable, then you would be much more skeptical about the context being the thing that mattered. But as it stands now, that's the residual. And it's probably what matters.Dwarkesh Patel   Right. So I thought that Bryan shared in the book that actually people don't even remember many of the basic facts that they learned in school.Tyler Cowen   Ofcourse they don't. But that's not the main thing they learn. They learn some vision of how the world works, how they fit into it, that they ought to have higher aspirations, that they can join the upper middle class, that they're supposed to have a particular kind of job. Here are the kinds of jerks you're going to meet along the way! Here's some sense of how dating markets work! Maybe you're in a fraternity, maybe you do a sport and so on. That's what you learned. Dwarkesh Patel   How did you spot Bryan?Tyler Cowen   He was in high school when I met him, and it was some kind of HS event. I think he made a point of seeking me out. And I immediately thought, “Well this guy is going to be something like, gotta keep track of this guy. Right away.”Dwarkesh Patel   Can you say more - what happened?Tyler Cowen   His level of enthusiasm, his ability to speak with respect to detail. He was just kind of bursting with everything. It was immediately evident, as it still is. Bryan has changed less than almost anyone else I know over what is now.. he could tell you how many years but it’s been a whole bunch of decades.Dwarkesh Patel   Interesting. So if that's the case, then it would have been interesting to meet somebody who is like Bryan, but a 19 year old.Tyler Cowen   Yeah, and I did. I was right. Talent ScoutingDwarkesh Patel   To what extent do the best talent scouts inevitably suffer from Goodhart’s Law? Has something like this happened to you where your approval gets turned into a credential? So a whole bunch of non-earnest people start applying, you get a whole bunch of adverse selection, and then it becomes hard for you to run your program.Tyler Cowen   It is not yet hard to run the program. If I needed to, I would just shut down applications. I've seen a modest uptick in bad applications, but it takes so little time to decide they're no good, or just not a good fit for us that it's not a problem. So the endorsement does get credentialized. Mostly, that's a good thing, right? Like you help the people you pick. And then you see what happens next and you keep on innovating as you need to.Dwarkesh Patel   You say in the book that the super talented are best at spotting other super talented individuals. And there aren't many of the super talented talent spotters to go around. So this sounds like you’re saying that if you're not super talented, much of the book will maybe not do you a bunch of good. Results be weary should be maybe on the title. How much of talent spotting can be done by people who aren't themselves super talented?Tyler Cowen   Well, I'd want to see the context of what I wrote. But I'm well aware of the fact that in basketball, most of the greatest general managers were not great players. Someone like Jerry West, right? I'd say Pat Riley was not. So again, that's something you could study. But I don't generally think that the best talent scouts are themselves super talented.Dwarkesh Patel   Then what is the skill in particular that they have that if it's not the particular thing that they're working on?Tyler Cowen   Some intangible kind of intuition, where they feel the right thing in the people they meet. We try to teach people that intuition, the same way you might teach art or music appreciation. But it's not a science. It's not paint-by-numbers.Dwarkesh Patel   Even with all the advice in the book, and even with the stuff that isn't in the book that is just your inarticulable knowledge about how to spot talent, all your intuitions… How much of the variance in somebody's “True Potential” is just fundamentally unpredictable? If it's just like too chaotic of a thing to actually get your grips on. To what extent are we going to truly be able to spot talent?Tyler Cowen   I think it will always be an art. If you look at the success rates of VCs, it depends on what you count as the pool they're drawing from, but their overall rate of picking winners is not that impressive. And they're super high stakes. They're super smart. So I think it will mostly remain an art and not a science. People say, “Oh, genomics this, genomics that”. We'll see, but somehow I don't think that will change this.Dwarkesh Patel   You don't think getting a polygenic risk score of drive, for example, is going to be a thing that happens?Tyler Cowen   Maybe future genomics will be incredibly different from what we have now. Maybe. But it's not around the corner.Dwarkesh Patel   Yeah. Maybe the sample size is just so low and somebody is like “How are you even gonna collect that data? How are you gonna get the correlates of who the super talented people are?”Tyler Cowen   That, plus how genomic data interact with each other. You can apply machine learning and so on, but it just seems quite murky.Dwarkesh Patel   If the best people get spotted earlier, and you can tell who is a 10x engineer in a company and who is only a 1x engineer, or a 0.5x engineer, doesn't that mean that, in a way that inequality will get worse? Because now the 10x engineer knows that they're 10x, and everybody else knows that they're 10x, they're not going to be willing to cross subsidize and your other employees are going to be wanting to get paid proportionate to their skill.Tyler Cowen   Well, they might be paid more, but they'll also innovate more, right? So they'll create more benefits for people who are doing nothing. My intuition is that overall, inequality of wellbeing will go down. But you can't say that's true apriori. Inequality of income might also go up.Dwarkesh Patel   And then will the slack in the system go away for people who are not top performers? Like you can tell now, if we're getting better.Tyler Cowen   This has happened already in contemporary America. As I wrote, “Average is over.” Not due to super sophisticated talent spotting. Sometimes, it’s simply the fact that in a lot of service sectors, you can measure output reasonably directly––like did you finish the computer program? Did it work? That has made it harder for people to get paid things they don't deserve.Dwarkesh Patel   I wonder if this leads to adverse selection in the areas where you can't measure how well somebody is doing. So the people who are kind of lazy and bums, they'll just go into places where output can't be measured. So these industries will just be overflowing with the people who don't want to work.Tyler Cowen   Absolutely. And then the people who are talented in the sectors, maybe they'll leave and start their own companies and earn through equity, and no one is really ever measuring their labor power. Still, what they're doing is working and they're making more from it.Dwarkesh Patel   If talent is partly heritable, then the better you get at spotting talent, over time, will the social mobility in society go down?Tyler Cowen   Depends how you measure social mobility. Is it relative to the previous generation? Most talent spotters don't know a lot about parents, like I don't know anything about your parents at all! The other aspect of spotting talent is hoping the talent you mobilize does great things for people not doing anything at all. That's the kind of automatic social mobility they get. But if you're measuring quintiles across generations, the intuition could go either way.Dwarkesh Patel   But this goes back to wondering whether this is a one time gain or not. Maybe initially they can help the people who are around them. Somebody in Brazil, they help people around them. But once you’ve found them, they're gonna go to those clusters you talked about, and they're gonna be helping the people with San Francisco who don't need help. So is this a one time game then?Tyler Cowen   Many people from India seem to give back to India in a very consistent way. People from Russia don't seem to do that. That may relate to the fact that Russia is in terrible shape, and India has a brighter future. So it will depend. But I certainly think there are ways of arranging things where people give back a lot.Dwarkesh Patel   Let's talk about Emergent Ventures. Sure. So I wonder: if the goal of Emergent Ventures is to raise aspirations, does that still work given the fact that you have to accept some people but reject other people? In Bayesian terms, the updates up have to equal the updates down? In some sense, you're almost transferring a vision edge from the excellent to the truly great. You see what I'm saying?Tyler Cowen   Well, you might discourage the people you turn away. But if they're really going to do something, they should take that as a challenge. And many do! Like “Oh, I was rejected by Harvard, I had to go to UChicago, but I decided, I'm going to show those b******s.” I think we talked about that a few minutes ago. So if I just crushed the spirits of those who are rejected, I don't feel too bad about that. They should probably be in some role anyway where they're just working for someone.Dwarkesh Patel   But let me ask you the converse of that which is, if you do accept somebody, are you worried that if one of the things that drives people is getting rejected, and then wanting to prove that you will reject them wrong, are you worried that by accepting somebody when they're 15, you're killing that thing? The part of them that wants to get some kind of approval?Tyler Cowen   Plenty of other people will still reject them right? Not everyone accepts them every step of the way. Maybe they're just awesome. LeBron James is basketball history and past a certain point, it just seems everyone wanted him for a bunch of decades now. I think deliberately with a lot of candidates, you shouldn't encourage them too much. I make a point of chewing out a lot of people just to light a fire under them, like “what you're doing. It's not gonna work.” So I'm all for that selectively.Dwarkesh Patel   Why do you think that so many of the people who have led Emergent Ventures are interested in Effective Altruism?Tyler Cowen   There is a moment right now for Effective Altruism, where it is the thing. Some of it is political polarization, the main parties are so stupid and offensive, those energies will go somewhere. Some of that in 1970 maybe went to libertarianism. Libertarianism has been out there for too long. It doesn't seem to address a lot of current problems, like climate change or pandemics very well. So where should the energy go? The Rationality community gets some of it and that's related to EA, as I'm sure you know. The tech startup community gets some of it. That's great! It seems to be working pretty well to me. Like I'm not an EA person. But maybe they deserve a lot of it.Dwarkesh Patel   But you don't think it's persistent. You think it comes and goes?Tyler Cowen   I think it will come and go. But I think EA will not vanish. Like libertarianism, it will continue for quite a long time.Dwarkesh Patel   Is there any movement that has attracted young people? That has been persistent over time? Or did they all fade? Tyler Cowen   Christianity. Judaism. Islam. They're pretty persistent. [laughs]Dwarkesh Patel   So to the extent that being more religious makes you more persistent, can we view the criticism of EA saying that it's kind of like a religion as a plus?Tyler Cowen   Ofcourse, yeah! I think it's somewhat like a religion. To me, that's a plus, we need more religions. I wish more of the religions we needed were just flat-out religions. But in the meantime, EA will do,Money, Deceit, and Emergent VenturesDwarkesh Patel   Are there times when somebody asks you for a grant and you view that as a negative signal? Let's say they're especially when well off: they’re a former Google engineer, they wanna start a new project, and they're asking you for a grant. Do you worry that maybe they're too risk averse? Do you want them to put their own capital into it? Or do you think that maybe they were too conformist because they needed your approval before they went ahead?Tyler Cowen   Things like this have happened. And I asked people flat out, “Why do you want this grant from me?” And it is a forcing question in the sense that if their answer isn't good, I won't give it to them. Even though they might have a good level of talent, good ideas, whatever, they have to be able to answer that question in a credible way. Some can, some can't.Dwarkesh Patel   I remember that the President of the University of Chicago many years back said that if you rejected the entire class of freshmen that are coming in and accepted the next 1500 that they had to reject that year, then there'll be no difference in the quality of the admits.Tyler Cowen   I would think UChicago is the one school where that's not true. I agree that it's true for most schools.Dwarkesh Patel   Do you think that's also true of Emergent Ventures?Tyler Cowen   No. Not at all.Dwarkesh Patel   How good is a marginal reject?Tyler Cowen   Not good. It’s a remarkably bimodal distribution as I perceive it, and maybe I'm wrong. But there aren't that many cases where I'm agonizing and if I'm agonizing I figure it probably should be a no.Dwarkesh Patel   I guess that makes it even tougher if you do get rejected. Because it wasn't like, “oh, you weren't a right fit for the job,” or “you almost made the cut.” It's like, “No, we're actually just assessing your potential and not some sort of fit for the job.” Not only were you just not on the edge of potential, but you were also way on the other edge of the curve.Tyler Cowen   But a lot of these rejected people and projects, I don't think they're spilling tears over it. Like you get an application. Someone's in Akron, Ohio, and they want to start a nonprofit dog shelter. They saw EV on the list of things you can apply to. They apply to a lot of things and maybe never get funding. It's like people who enter contests or something, they apply to EV. Nothing against non-profit dog shelters, but that's kind of a no, right? I genuinely don't know their response, but I don't think they walk away from the experience with some deeper model of what they should infer from the EV decision.Dwarkesh Patel   How much does the money part of Emergent Ventures matter? If you just didn't give them the money?Tyler Cowen   There's a whole bunch of proposals that really need the money for capital costs, and then it matters a lot. For a lot of them, the money per se doesn't matter.Dwarkesh Patel   Right, then. So what is the function of return for that? Do you like 10x the money, or do you add .1x the money for some of these things? Do you think they add up to seemingly different results? Tyler Cowen   I think a lot of foundations give out too many large grants and not enough small grants. I hope I'm at an optimum. But again, I don't have data to tell you. I do think about this a lot, and I think small grants are underrated.Dwarkesh Patel   Why are women often better at detecting deceit?Tyler Cowen   I would assume for biological and evolutionary reasons that there are all these men trying to deceive them, right? The cost of a pregnancy is higher for a woman than for a man on average, by quite a bit. So women will develop defense mechanisms that men maybe don't have as much.Dwarkesh Patel   One thing I heard from somebody I was brainstorming these questions with–– she just said that maybe it's because women just discuss personal matters more. And so therefore, they have a greater library.Tyler Cowen   Well, that's certainly true. But that's subordinate to my explanation, I’d say. There are definitely a lot of intermediate steps. Things women do more of that help them be insightful.Building Writing StaminaDwarkesh Patel   Why is writing skill so important to you?Tyler Cowen   Well, one thing is that I'm good at judging it. Across scales, I'm very bad at judging, so there's nothing on the EV application testing for your lacrosse skill. But look, writing is a form of thinking. And public intellectuals are one of the things I want to support. Some of the companies I admire are ones with writing cultures like Amazon or Stripe. So writing it is! I'm a good reader. So you're going to be asked to write.Dwarkesh Patel   Do you think it's a general fact that writing correlates with just general competence? Tyler Cowen   I do, but especially the areas that I'm funding. It’s strongly related. Whether it's true for everything is harder to say.Dwarkesh Patel   Can stamina be increased?Tyler Cowen   Of course. It's one of the easier things to increase. I don't think you can become superhuman in your energy and stamina if you're not born that way. But I think almost everyone could increase by 30% to 50%, some notable amount. Dwarkesh Patel   Okay, that's interesting.Tyler Cowen   Put aside maybe people with disabilities or something but definitely when it comes to people in regular circumstances.Dwarkesh Patel   Okay. I think it's interesting because in the blog post from Robin Hanson about stamina, I think his point of view was that this is just something that's inherent to people.Tyler Cowen   Well, I don't think that's totally false. The people who have superhuman stamina are born that way. But there are plenty of origins. I mean, take physical stamina. You don't think people can train more and run for longer? Of course they can. It's totally proven. So it would be weird if this rule held for all these organs but not your brain. That seems quite implausible. Especially for someone like Robin, where your brain is just this other organ that you're gonna download or upload or goodness knows what with it. He’s a physicalist if there ever was one.Dwarkesh Patel   Have you read Haruki Murakami's book on running?Tyler Cowen   No, I've been meaning to. I'm not sure how interesting I'll find it. I will someday. I like his stuff a lot.Dwarkesh Patel   But what I found really interesting about it was just how linked building physical stamina is for him to building up the stamina to write a lot.Tyler Cowen   Magnus Carlsen would say the same with chess. Being in reasonable physical shape is important for your mental stamina, which is another kind of simple proof that you can boost your mental stamina.When Does Intelligence Start to Matter?Dwarkesh Patel   After reading the book, I was inclined to think that intelligence matters more than I previously thought. Not less. You say in the book that intelligence has convex returns and that it matters especially for areas like inventors. Then you also say that if you look at some of the most important things in society, something like what Larry and Sergey did, they're basically inventors, right? So in many of the most important things in society, intelligence matters more because of the increasing returns. It seems like with Emergent Ventures, you're trying to pick the people who are at the tail. You're not looking for a barista at Starbucks. So it seems like you should care about intelligence more, given the evidence there. Tyler Cowen   More than who does? I feel what the book presents is, in fact, my view. So kind of by definition, I agree with that view. But yes, there's a way of reading it where intelligence really matters a lot. But it's only for a relatively small number of jobs.Dwarkesh Patel   Maybe you just started off with a really high priori on intelligence, and that's why you downgraded?Tyler Cowen   There are a lot of jobs that I actually hire for in actual life, where smarts are not the main thing I look for.Dwarkesh Patel   Does the convexity of returns on intelligence suggest that maybe the multiplicative model is wrong? Because if the multiplicative model is right, you would expect to see decreasing returns and putting your stats on one skill. You'd want to diversify more, right?Tyler Cowen   I think the convexity of returns to intelligence is embedded in a multiplicative model, where the IQ returns only cash out for people good at all these other things. For a lot of geniuses, they just can't get out of bed in the morning, and you're stuck, and you should write them off.Dwarkesh Patel   So you cite the data that Sweden collects from everybody that enters the military there. The CEOs are apparently not especially smart. But one thing I found interesting in that same data was that Swedish soccer players are pretty smart. The better a soccer player is, the smarter they are. You've interviewed professional basketball players turned public intellectuals on your podcast. They sound extremely smart to me. What is going on there? Why, anecdotally, and with some limited amounts of evidence, does it seem that professional athletes are smarter than you would expect?Tyler Cowen   I'm a big fan of the view that top-level athletic performance is super cognitively intense and that most top athletes are really extraordinarily smart. I don't just mean smart on the court (though, obviously that), but smart more broadly. This is underrated. I think Michelle Dawson was the one who talked me into this, but absolutely, I'm with you all the way.Dwarkesh Patel   Do you think this is just mutational load or––Tyler Cowen   You actually have to be really smart to figure out things like how to lead a team, how to improve yourself, how to practice, how to outsmart the opposition, all these other things. Maybe it’s not the only way to get there, but it is very G loaded. You certainly see some super talented athletes who just go bust. Or they may destroy themselves with drugs: there are plenty of tales like that, and you don't have to look hard. Dwarkesh Patel   Are there other areas where you wouldn't expect it to be G loaded but it actually is?Tyler Cowen   Probably, but there's so many! I just don't know, but sports is something in my life I followed. So I definitely have opinions about it. They seem incredibly smart to me when they're interviewed. They're not always articulate, and they’re sort of talking themselves into biased exposure. But I heard Michael Jordan in the 90s, and I thought, “That guy's really smart.” So I think he is! Look at Charles Barkley. He's amazing, right? There's hardly anyone I'd rather listen to, even about talent, than Charles Barkley. It's really interesting. He's not that tall, you can't say, “oh, he succeeded. Because he's seven foot two,” he was maybe six foot four tops. And they called him the Round Mound of Rebound. And how did he do that? He was smart. He figured out where the ball was going. The weaknesses of his opponents, he had to nudge them the right way, and so on. Brilliant guy.Dwarkesh Patel   What I find really remarkable is that (not just with athletes, but in many other professions), if you interview somebody who is at the top of that field, they come off really really smart! For example, YouTubers and even sex workers.Tyler Cowen   So whoever is like the top gardener, I expect I would be super impressed by them.Spotting Talent (Counter)signalsDwarkesh Patel   Right. Now all your books are in some way about talent, right? Let me read you the following passage from An Economist Gets Lunch, and I want you to tell me how we can apply this insight to talent. “At a fancy fancy restaurant, the menu is well thought out. The time and attention of the kitchen are scarce. An item won't be on the menu unless there's a good reason for its presence. If it sounds bad, it probably tastes especially good?”Tyler Cowen   That's counter-signaling, right? So anything that is very weird, they will keep on the menu because it has a devoted set of people who keep on ordering it and appreciate it. That's part of the talent of being a chef, you can come up with such things. Dwarkesh Patel   How do we apply this to talent? Tyler Cowen   Well, with restaurants, you have selection pressure where you're only going to ones that have cleared certain hurdles. So this is true for talent only for talents who are established. If you see a persistent NBA player who's a very poor free throw shooter like Shaquille O'Neal was, you can more or less assume they're really good at something else. But for people who are not established, there's not the same selection pressure so there's not an analogous inference you can draw.Dwarkesh Patel   So if I show up to an Emergent Ventures conference, and I meet somebody, and they don't seem especially impressive with the first impression, then I should believe their work is especially impressive. Tyler Cowen Yes, absolutely, yes. Dwarkesh Patel   Okay, so my understanding of your book Creative Destruction is that maybe on average, cultural diversity will go down. But in special niches, the diversity and ingenuity will go up. Can I apply the same insight to talent? Maybe two random college grads will have similar skill sets over time, but if you look at people on the tails, will their skills and knowledge become even more specialized and even more diverse?Tyler Cowen   There are a lot of different presuppositions in your question. So first, is cultural diversity going up or down? That I think is multi-dimensional. Say different cities in different countries will be more like each other over time.. that said, the genres they produce don't have to become more similar. They're more similar in the sense that you can get sushi in each one. But novel cuisine in Dhaka and Senegal might be taking a very different path from novel cuisine in Tokyo, Japan. So what happens with cultural diversity.. I think the most reliable generalization is that it tends to come out of larger units. Small groups and tribes and linguistic groups get absorbed. Those people don't stop being creative and other venues, but there are fewer unique isolated cultures, and much more thickly diverse urban creativity. That would be the main generalization I would put forward. So if you wanted to apply that generalization to talent, I think in a funny way, we come back to my earlier point: talent just tends to be geographically extremely well clustered. That's not the question you asked, but it's how I would reconfigure the pieces of it.Dwarkesh Patel   Interesting. What do you suggest about finding talent in a globalized world? In particular, if it's cheaper to find talent because of the internet, does that mean that you should be selecting more mediocre candidates?Tyler Cowen   I think it means you should be more bullish on immigrants from Africa. It's relatively hard to get out of Africa to the United States in most cases. That's a sign the person put in a lot of effort and ability. Maybe an easy country to come here from would be Canada, all other things equal. Again, I'd want this to be measured. The people who come from countries that are hard to come from like India, actually, the numbers are fairly high, but the roots are mostly pretty gated.Dwarkesh Patel   Is part of the reason that talent is hard to spot and find today that we have an aging population?  So then we would have more capital, more jobs, more mentorship available for young people coming up, than there are young people.Tyler Cowen   I don't think we're really into demographic decline yet. Not in the United States. Maybe in Japan, that would be true. But it seems to me, especially with the internet, there’s more 15-year-old talent today than ever before, by a lot, not just by little. You see this in chess, right? Where we can measure performance very well. There’s a lot more young talent from many different places, including the US. So, aging hasn't mattered yet. Maybe for a few places, but not here.Dwarkesh Patel   What do you think will change in talent spotting as society becomes older?Tyler Cowen   It depends on what you mean by society. I think the US, unless it totally screws up on immigration, will always have a very seriously good flow of young people that we don't ever have to enter the aging equilibrium the way Japan probably already has. So I don't know what will change. Then there's work from a distance, there's hiring from a distance, funding from a distance. As you know, there's EV India, and we do that at a distance. So I don't think we're ever going to enter that world..Dwarkesh Patel   But then what does it look like for Japan? Is part of the reason that Japanese cultures and companies are arranged the way they are and do the recruitment the way they do linked to their demographics? Tyler Cowen   That strikes me as a plausible reason. I don't think I know enough to say, but it wouldn't surprise me if that turned out to be the case.Dwarkesh Patel   To what extent do you need a sort of “great man ethos” in your culture in order to empower the top talent? Like if you have too much political and moral egalitarianism, you're not going to give great people the real incentive and drive to strive to be great.Tyler Cowen   You’ve got to say “great man or great woman ethos”, or some other all-purpose word we wish to use. I worry much less about woke ideology than a lot of people I know. It's not my thing, but it's something young people can rebel against. If that keeps you down, I'm not so impressed by you. I think it's fine. Let the woke reign, people can work around them.Dwarkesh Patel   But overall, if you have a culture or like Europe, do you think that has any impact on––Tyler Cowen   Europe has not woken up in a lot of ways, right? Europe is very chauvinist and conservative in the literal sense, and often quite old fashioned depending on what you're talking about. But Europe, I would say, is much less woke than the United States. I wouldn't say that's their main problem, but you can't say, “oh, they don't innovate because they're too woke”, like hang out with some 63 year old Danish guys and see how woke you think they are once everyone's had a few drinks.Dwarkesh Patel   My question wasn't about wokeism. I just meant in general, if you have an egalitarian society.Tyler Cowen   I think of Europe as less egalitarian. I think they have bad cultural norms for innovation. They're culturally so non-egalitarian. Again, it depends where but Paris would be the extreme. There, everyone is classified right? By status, and how you need to wear your sweater the right way, and this and that. Now, how innovative is Paris? Actually, maybe more than people think. But I still think they have too few dimensions of status competition. That's a general problem in most of Europe–– too few dimensions of status competition, not enough room for the proverbial village idiot.Dwarkesh Patel   Interesting. You say in the book, that questions tend to degrade over time if you don't replace them. I find it interesting that Y Combinator has kept the same questions since they were started in 2005. And of course, your co-author was a partner at Y Combinator. Do you think that works for Y Combinator or do you think they're probably making a mistake?Tyler Cowen   I genuinely don't know. There are people who will tell you that Y Combinator, while still successful, has become more like a scalable business school and less like attracting all the top weirdos who do amazing things. Again, I'd want to see data before asserting that myself, but you certainly hear it a lot. So it could be that Y Combinator is a bit stale. But still in a good sense. Like Harvard is stale, right? It dates from the 17th century. But it's still amazing. MIT is stale. Maybe Y Combinator has become more like those groups.Dwarkesh Patel   Do you think that will happen to Emergent Ventures eventually?Tyler Cowen   I don't think so because it has a number of unique features built in from the front. So a very small number of evaluators too. It might grow a little bit, but it's not going to grow that much. I'm not paid to do it, so that really limits how much it's going to scale. There's not a staff that has to be carried where you're captured by the staff, there is no staff. There's a bit of free riding on staff who do other things, but there's no sense of if the program goes away, all my buddies on staff get laid off. No. So it's kind of pop up, and low cost of exit. Whenever that time comes.Dwarkesh Patel   Do you personally have questions that you haven't put in the book or elsewhere because you want them to be fresh? For asking somebody who's applying to her for the grant? Tyler Cowen   Well, I didn't when we wrote the book. So we put everything in there that we were thinking of, but over time, we've developed more. I don't generally give them out during interviews, because you have to keep some stock. So yeah, there's been more since then, but we weren't holding back at the time.Dwarkesh Patel It’s like a comedy routine. You gotta write a new one each year.Tyler Cowen That's right. But when your shows are on the air, you do give your best jokes, right?Will Reading Cowen’s Book Help You Win Emergent Ventures?Dwarkesh Patel Let’s say someone applying to emergent ventures reads your book. Are they any better off? Or are they perhaps worse off because maybe they become misleading or have a partial view into what's required of them?Tyler Cowen   I hope they're not better off in a way, but probably they are. I hope they use it to understand their own talent better and present it in a better way. Not just to try to manipulate the system. But most people aren't actually that good at manipulating that kind of system so I'm not too worried.Dwarkesh Patel   In a sense, if they can manipulate the system, that's a positive signal of some kind.Tyler Cowen   Like, if you could fool me –– hey, what else have you got to say, you know? [laughs]Dwarkesh Patel   Are you worried that when young people will encounter you now, they're going to think of you as sort of a talent judge and a good one at that so they're maybe going to be more self aware than whether––Tyler Cowen   Yes. I worry about the effect of this on me. Maybe a lot of my interactions become less genuine, or people are too self conscious, or too stilted or something.Dwarkesh Patel   Is there something you can do about that? Or is that just baked in the gig?Tyler Cowen   I don't know, if you do your best to try to act genuine, whatever that means, maybe you can avoid it a bit or delay it at least a bit. But a lot of it I don't think you can avoid. In part, you're just cashing in. I'm 60 and I don't think I'll still be doing this when I'm 80. So if I have like 18 years of cashing in, maybe it's what I should be doing.Identifying talent earlyDwarkesh Patel   To what extent are the principles of finding talent timeless? If you're looking for let's say, a general for the French Revolution, how much of this does the advice change? Are the basic principles the same over time?Tyler Cowen   Well, one of the key principles is context. You need to focus on how the sector is different. But if you're doing that, then I think at the meta level the principles broadly stay the same.Dwarkesh Patel   You have a really interesting book about autism and systematizers. You think Napoleon was autistic?Tyler Cowen   I've read several biographies of him and haven’t come away with that impression, but you can't rule it out. Who are the biographers? Now it gets back to our question of: How valuable is history? Did the biographers ever meet Napoleon? Well, some of them did, but those people had such weak.. other intellectual categories. The modern biography is written by Andrew Roberts, or whoever you think is good, I don't know. So how can I know?Dwarkesh Patel   Right? Again, the issue is that the details that stick in my mind from reading the biography are the ones that make him seem autistic, right?Tyler Cowen   Yes. There's a tendency in biographies to storify things, and that's dangerous too. Dwarkesh Patel   How general across a pool is talent or just competence of any kind? If you look at somebody like Peter Thiel–– investor, great executive, great thinker even, certainly Napoleon, and I think it was some mathematician either Lagrangian or Laplace, who said that he (Napoleon) could have been a mathematician if he wanted to. I don't know if that's true, but it does seem that the top achievers in one field seem to be able to move across fields and be top achievers in other fields. Is that a pattern that you see as well? Tyler Cowen   Maybe somewhat, but I don't think you can be top at anything–– or even most things. A lot of these are very successful people in other areas might just be near millionaires. Maybe they ran a car dealership and earned $3 million in 1966. Which was a pretty good life back then. But it's not like what they have ended up being.Dwarkesh Patel   You quote Sam Altman in the book, and I thought it was really interesting. He says, “The successful founders I funded believe that they are eventually certain to be successful.” To what extent is this self-belief the result or the cause of being talented?Tyler Cowen   Maybe it's both, but keep in mind the context for Sam. He’s talking about companies and startups, and startups succeed at such a low rate that the success is really on selecting for people with quite a bit of overconfidence. In other sectors, you won't in general find that same level of overconfidence. So you have to be careful. I agree with Sam, but he's talking about one set of things, not everything.Dwarkesh Patel   Is that not true of other fields? If you're looking for a public intellectual, you're partially hoping for the outcome that they become remembered or their ideas have a lot of influence. That's also a rare thing to be able to do.Tyler Cowen   I think more people stumble into it, for instance. There's more people who know early on that they can do it, but not for Sam-like reasons of overconfidence. They kind of know it because they can, and there are enough early tests. So I still think it's different. And there's more stumbling into it by accident.Dwarkesh Patel   Which better describes your intellectual journey? Like were you in some sense a little overconfident in your 20s?Tyler Cowen   There's an interesting break in my life that relates to stumbling into things. I grew up with no internet so I thought I would do quite well. In that sense, I was overconfident, but I had no notion that I would have large numbers of people listening to me. I just didn't think about the internet! So in that sense, I totally stumbled into the particular way in which I ended up doing well. But I was still, at a younger age, overconfident. Dwarkesh Patel   That’s interesting. I wanted to backtest some of your methods of finding talent, but for certain people. So we just talked about Haruki Murakami; let's use him as an example. In his 30s, I believe he was running a bar. The novelist Haruki Murakami is just running a bar, right? It doesn't have to be him in particular, but just generally think of like a 30-year-old–– you go to Japan, you go to a bar, you start talking to the bartender who also happens to be in the place. What would the conversation look like? How would you identify that this person could be a great novelist or anything?Tyler Cowen   I think my chance of identifying great novelists is very low. And it's one reason why it's not something I try to do.Dwarkesh Patel   Interesting. Well, why is that?Tyler Cowen   You see, when I look at biographies, there seem to be so many instances of people who don't show obvious signs of promise early on. Maybe if I knew more about such people, I could develop markers. It's possible, right? Like my chance of being good at that is probably way above average, but I definitely don't think I'd be good at it now.Dwarkesh Patel   Interesting. And what do you think makes novelists so hard to predict?Tyler Cowen   They can blossom much later, and very often, they do. A very high percentage of them are women whose earlier lives are interrupted–– often by children, but not only that, this gets back to the late bloomers thing. There's also something quite discreet about a novel–– until a person has done it, it's hard to tell how good they are. Or say a great nonfiction book: with Taleb or Pinke or whoever, you could read their earlier blog posts and just flat out see, “oh, they're really smart, maybe they could write a great book.” I wouldn't say anyone could do that, but most people we know could do that. I can spot them earlier. But with a novel, I can't.Dwarkesh Patel   Do you think that's also true? It sounds very similar to a startup founder. Even with regards to the time horizon, you haven't really done anything that's like it before. The time horizon would be maybe like 5 to 10 years? Maybe it'll take shorter, but––Tyler Cowen   There are more intermediate benchmarks with startups. Just how good a job do they do trying to raise their first round? There's a lot you can watch. It's not indicative of product-fit to the market and a bunch of other things. But you see a lot early on. How good is the pitch deck? Again, there are some great things that had terrible pitches, but I think you see way more early signs. Maybe novelists show early signs that I don't know about. So again, I'm suggesting that maybe I could learn, but right now, I'm totally at peace with that one. Joseph Conrad, was I going to get that? Herman Melville? I don't think so.Dwarkesh Patel   Interesting. Okay, well, let's backtest with another––Tyler Cowen   Like, “Hey Joe, you're from Poland, and you're gonna write in English?” Come on you know, get real.Dwarkesh Patel   Scott Aaronson, as you know, is a famous complexity theorist, computer scientist, and he was actually my former professor. He wrote in a blog post about standardized tests “I was a 15 year old with perfect SATs and a published research paper, but not only was I young and immature with spotty grades and weird academic trajectory, I had no sports, no music, no diverse leadership experiences. I was a narrow linear A to B thinker who lacked depth and emotional intelligence. The exact opposite of what Harvard and Princeton were looking for in every way.” Now, what would happen to Scott Aaronson if he at that time had applied to Emergent Ventures? Tyler Cowen   I’ve never met Scott, but odds are very strong that we’d fund him. From the sound of it. Again, I don't know him at all.Dwarkesh Patel   But the narrow linear thinker––Tyler Cowen   I don't know what that means. A lot of people misdescribe themselves. They say things like, “Oh, if you ask me those questions, I would suck.” And they're wrong. They wouldn't suck. I know they don't. And I suspect Scott's self-description is a bit off. But I think he would do very well at Emergent Ventures..Existential Risks and the LongtermDwarkesh Patel   Yeah, I agree. Let's talk about Effective Altruism. You have expressed skepticism to the idea that you can use longtermism to say that existential risks matter more than everything else because we should be optimizing for the branch of the decision tree where we survive for millions of years. Can you say more of why you're skeptical of that kind of reasoning?Tyler Cowen   Well, I'd like to express my skepticism a little more clearly. I think existential risk matters much more than almost anyone thinks. In this sense I'm with the EA people, but I do think they overvalue it a bit. I would just say I don't think there are many good things we can do to limit existential risks that are very different from looking for mortality and growing GDP, supporting science, trotting down a pretty familiar list of things that don't all have to be that long-term. In that sense, I think they flip out about it a bit too much and have all these super-specific hypotheses. But we should invest in good things now. I do favor an Asteroid Protection Program, by the way.Dwarkesh Patel   To the extent that there was a trade off, in that hypothetical, would you put the same weight on extra work that they do? Or do you just differ with them on how you actually go about solving essential risks?Tyler Cowen   Probably more the latter. I think they're not epistemically modest enough when it comes to existential risk. They think they have all these petite very particular hypotheses about AGI and we've got to prevent this. That's where I really differ from them. I think their ability to limit that risk, however great or small, might basically be zero. That if AGI is a risk, it's the worst set of procedures that will do you in and you can't regulate those very well at all. Putting everyone at your favorite tech company through this training about alignment… I'm not against doing that. But like, come on! You know, if it's gonna happen, it's like handling pandemic materials. It's the sloppiest people you've got to worry about, and they are not sitting in on your class on AGI in alignment.Dwarkesh Patel   Yes. Although it isn't surprising to the extent that companies in the US that (maybe) care more than other other entities about alignment are actually the first currently. Like Open AI for instance.Tyler Cowen   Yes but it won't matter. Because if that view is the correct one, and I don't think it is, the more screwed up successors will just come 10 years later. And you know, Skynet goes live.. but 10 years later.Dwarkesh Patel   I'm curious, why is the possibility of humanity surviving for a very long time, not something that is a strong part of your worldview–– given that you’re a long termist.Tyler Cowen   I think the chance of there being a major war with nuclear weapons or whatever comes next. While very low in any given year, you just have the clock tick, and that chance adds up. We're not going to be here for another 100,000 years. It’s a simple argument, but I'm not a pessimist about any given year at all.Dwarkesh Patel   Right, but if the odds are like sufficiently above zero, then do you just not buy the argument that anything above zero is just huge? And that we should be optimizing for that?Tyler Cowen   I'm all for efforts to make nuclear weapons safer. But it's hard to know exactly what to do. Like what do we do in Ukraine now? Should we be more tough, less tough? There's different arguments, but they're not that different from just the normal foreign policy arguments. There's not some special branch of EA longtermism that tells you what to do in Ukraine. Those people, if anything, tend to be kind of underinvested in historical and cultural forms of knowledge. So I just don't think you buy that much extra stuff by calling yourself worried about existential risk. It's plenty of people in the US foreign policy establishment who think about all this stuff. Until recently, most of them had never heard of EA. Maybe even still. It doesn't change the debate much.Dwarkesh Patel   I'm sure you've heard these arguments, but it seems with nuclear war, it's hard to imagine how it could kill every single person on the planet. Tyler Cowen   It probably won’t. But we’ll be permanently set back kind of forever. And in the meantime, we can't build asteroid protection or whatever else. It’ll just be like medieval living standards: super small population, feudal governance, lots of violence, rape. There's no reason to think like, oh, read a copy of the Constitution in and 400 years, we're back on track. That's crazy wrong.Dwarkesh Patel   We did emerge from feudalism, right? So if it happened once, isn't that example enough? Tyler Cowen   We don’t know! There’s like–– hundreds of thousands of years of human history where we seem to make diddly squat progress. We don't know why. But don't assume that just because it happened once that means you always rebuild. I don't think it does.Dwarkesh Patel   Right. If it's not just the idea of everything being laid in space, what would it take for our descendants to be able to recover industrial civilization? Tyler Cowen   I don't think we have good theories of that at all. I would just say we had a lot of semi-independent operating parts of the world, circa 1500. And not that many of them made much progress.Dwarkesh Patel   Right. I mean, I think of you as an optimist––at least by temperament. But this seems like one of the more pessimistic things I've heard overall, anywhere, because of the idea that not only will human civilization be decimated almost surely, but that they will never be able to recover. Tyler Cowen   I wouldn't say never, you know, never say never. But there's no reason to assume you just bounce back–– I would say we don't know. Other problems will come upon us: nuclear winter or crop failures, climate change. It just seems very daunting to me. And like the overall history of mammalian species is not that optimistic. The fact that sex exists is biologically very pessimistic. I mean, I don't think of myself as a pessimist, but you can call it that.Dwarkesh Patel   Can you explain that quote? “The fact that sex exists is biologically very pessimistic.”Tyler Cowen   Anything that stands still gets destroyed by parasites or destroyed by something. So you've got to randomize and change what you are through sex. That's like the clearly winning model for at least larger things. That's a sign nothing survives for that long. So the existence of sex is the most pessimistic thing there is, I find that ironic. So I'm not the pessimist, sex is.Dwarkesh Patel   Let's say I take your argument that economic growth is very important. Does that imply anything in particular about what somebody should do with their life? Or is it basically just an argument about policy?Tyler Cowen   It can guide your life a bit. So to think just more carefully: How do you fit in? Maybe you could do something important. Maybe you could have higher aspirations. For most people, that won't matter. But again, certainly some people could do much more. I do my best to try to help that along.Dwarkesh Patel   Right. It doesn't have to do with the fact that we don't know much about what causes economic growth? Or is it just that you could never offer concrete advice about what you could do to increase economic growth?Tyler Cowen   I give concrete advice to people all the time with a grain of salt. I'll tell people, “I think you should go to this school, not that school.” That's concrete advice. I don't think we know so little about growth. We certainly know a lot about how to wreck growth, right? So we know enough.Dwarkesh Patel   Right, but not enough to create something like 80,000 hours for progress. What do you think? Tyler Cowen   You mean an institution? I mean there's an Institute for progress..Dwarkesh Patel   No. 80,000 hours has a list, “here's the things you should consider doing with your career,” Tyler Cowen   That’s not the right way to think about it. You want to sit down with the person, understand the entire context, see what they could do, see if there's a way you could or should bend up the curve. But a list now… that's a little to EA static maximization for me. If you focus more on learning about cultures, history, you're not going to come up with some list as the way to approach that.Dwarkesh Patel   What are culture and history going to show you?Tyler Cowen   They show how complex things are, and the people who made very significant contributions show how complex the inputs were into that. Or even people who did very terrible things like Napoleon–– understanding Napoleon, where he came from, the ideas he had, it’s super complicated. I don't really get the list version. Here's the list for baby Napoleon: like don't invade Russia or whatever. It just seems to miss the point.Cultivating Young TalentDwarkesh Patel   If a young person were to read a bunch of biographies, not as early career advice, but just generally as trying to better understand how they can be more effective, do you think that would teach them that things are more complex than they thought? Would that give them any practical benefit?Tyler Cowen   I think both! Napoleon is a good person to read biographies of. When I was young, sports and chess players were my grist. And I feel I learned a lot from that. I don't know that it was any big lesson, but it’s just how you saw all these histories of people persevering and self-improving. That's worth a lot. So I don't think it's a waste of time at all. I think it's probably essential. I don't know if you have to read biographies, like if you just follow sports careers, that might be enough. But that's kind of like reading a biography, right? YouTube can also do it! I don't like to fixate on the biography, they seem in a way, inefficiently long.Dwarkesh Patel   Is it like somebody having a blog and you following along with their blog on a weekly or daily basis?Tyler Cowen   Absolutely. That’s reading a biography. I've been blogging for almost 20 years, and I hope there's some lesson in the constancy of that for people.Dwarkesh Patel   I was struck while reading your book that some of the advice you offer for how to ask good questions in hiring is actually great advice for also how to ask good questions in a podcast. Like you keep the conversation flow going to get them interested in talking about something that they're very interested in.Tyler Cowen   Don't worry about changing the subject, Just get them on something where they're involved and excited. Dwarkesh Patel   So to what extent was just informed by having a podcast?Tyler Cowen   Oh, quite a bit. You can think of podcasts in the sense like interviews. They're kind of very judgmental, like, “How worthy are you?” Right? People are afraid more and more.Dwarkesh Patel   You have a quite mellow personality, and I'm similar in that way. Do you think that has any sort of intellectual consequence in the sense that if you could experience like this, the exuberant highs or the incapacitating lows, you would be maybe less modest or moderate about your views about longtermism and economic growth? Like you’d be the type to want to get everyone into the galaxy?Tyler Cowen   I might be more creative, but I think I would be more wrong.Dwarkesh Patel   Interesting. On that trade off, where should one be if they're trying to reason about important topics? Should you just try to increase the variance so you can get to the important things?Tyler Cowen   Again, I think it’s context specific. You want to understand where a person is, understand they were probably born that way and that you can only budge them so much, regardless of wherever you might think they should be. Just try to marginally improve how they're dealing with the flow coming their way. I prefer to work with people's strengths and boost their strengths, rather than have a list set out of how to reform them. I think it's a way more productive way to do things. It's lower conflict, and as a coach or mentor or co-worker, it's way less stressful for you. Because you're being very positive with them, and it's sincere, so you'll just do more of it. If you're hitting them over the head, “Why don't wake up at 7am in the morning,” and maybe they should, but it's like come on, you have something better to do than that. They can figure that out for themselves. Tell them something else that they can actually find useful.The Lifespans of Public IntellectualsDwarkesh Patel   When you interviewed Andrew Sullivan, one of the things he said was that the reason he decided to write about gay rights was that he got HIV, and he realized he might not have that long to live. Yeah. Ofcourse, we see the consequence of that in society today. If you find out you only have five years to live, what is the book you would write and what is the argument you would make?Tyler Cowen   Five years from now? I think I would do more Emergent Ventures. I would finish the book I'm working on, and I might consider a sequel to Talent depending on Daniel's plans. But my marginal thing is I don't feel like writing more books. Though, I will write more books.Dwarkesh Patel   So like, it's like in your late career that you think the most important thing is institution building and talent spotting.Tyler Cowen   Yes, at this point. I've written like 16-17 books. So it's not like I haven't had my say.Dwarkesh Patel    One thing about top performers in many fields is that they have intricate philosophies and worldviews. Like, you know, Peter Thiel obviously with the religion stuff, but even like somebody like George Soros, with the theory of reflexivity, to what extent do you think that these are very important in their success? Maybe if you just have somebody who has plus four-standard-deviations in verbal intelligence, one of the things they'll do other than be very successful is to just create intricate worldviews?Tyler Cowen   With all the people I know who are like that, such as Peter, I feel that it was important for their success. Soros? I don't know. But since all the people I do know, it seems to matter. My intuition is that it matters a lot more broadly. Like, you need a unique way of looking at the world.Dwarkesh Patel   Is that a correlate in the sense that it jolts you out of complacency? Tyler Cowen   And it protects you from other people's idiocy. Your mimetic desires get channelled away from a lot of other things that might even be good overall, but they would distract you.Dwarkesh Patel   Right. But maybe the actual theory itself is not the edge.Tyler Cowen   Correct. Now sometimes it is the edge. There’s the famous story of how Peter knew Rene Girard and saw Facebook would be a big thing, right? It's probably true. But it doesn't have to be the edge, I would say.Dwarkesh Patel   Yeah. So one thing I found really interesting in your book, What Price Fame was you had this interesting discussion where you cite your former adviser, Thomas Schelling, about how certain celebrities can make themselves focal points in the culture. I'm curious about how we can apply this to public intellectuals. In recent years, we've seen a lot of public intellectuals become a focal point in the cultural war or in just general discussions. So in some sense, this has happened to you as well, right? Where we've seen this with many of your podcast guests: Jordan Peterson, Christopher Hitchens, Sam Harris––how do public intellectuals make themselves focal points? Tyler Cowen   Well, by doing something noteworthy, right? It can be an idea, but it can also be a form of performance art, and maybe performance art has become more important. I think my own vocality has more to do with performance art than with any specific idea I have. I think very carefully about how to stay somewhat focal for a long period of time. So it's quite unusual that I've mostly increased my vocality for over 20 years now. It's much more common that people come and go and decline. I work quite hard not to do that. A lot of the IDW people: very clear peaks, which now lie in the past, and I suspect will have fairly rapid declines. Well I don't want that to happen to me. I want to be in the thick of things, just for selfish reasons.Dwarkesh Patel   What do you think is the explanation for why they peak so early?Tyler Cowen   I don't know if early is the word. Jordan Peterson was at it for a long time. But they made extreme bets on very particular ideas, and maybe different people will disagree about those ideas. But I think a lot of them are losing ideas, even if they might be correct in some ways. I've done much less to bet on a single idea. You can say it’s kind of market-based economics. But it's not so radical. Like we're still in a capitalistic society. I have enough to say about new issues that come along all the time. I’ll be taking a mostly pro-capitalist point of view. Like it's just not that obsolete; maybe it's not peak fashion now, but it's fine to be doing that.Dwarkesh Patel   They were overleveraged in the GOP margin cult.Tyler Cowen   I'm not making a big bet on Ivermectin is one way to put it.Risk Aversion in AcademiaDwarkesh Patel   Why doesn't tenure make academics less risk averse?Tyler Cowen   I've thought about this quite a bit. I think the selection filters are very strong. They're very pro-conformity. People care a lot about their peers and think of them. You're selecting conformists to begin with, and so you're just literally not trained in how to take risks. It's not always that easy, right? So let's say you're like F*** this tenure. They get up and take a risk. What do you say that the demand curve slope upwards? [laughs] It's just not that easy.Dwarkesh Patel   Is there something that would be analogous to a course on risk that makes more people more risk-taking? Tyler Cowen   I would say at Mercatus, we have a lot of students come through here, and we do try to teach them all in different ways about how to take more career risk. I think we've been remarkably successful at that. Dwarkesh Patel What is being taught that makes it more risky?Tyler Cowen   Well, first of all, they observe what we all do. And they just learn by example. If they want advice, like how to run a podcast, how to write a blog, how to try to work for someone on the Senate Banking Committee, we have people who've done that, and we'll put them in touch. So we don't have “a class.” But there's a very serious, focused effort that anyone with any interest in learning how to do things and take more risk can get that here, for free.Dwarkesh Patel   How malleable is risk aversion?Tyler Cowen   I think a lot of the students we produce have done unusual things. Certainly relative to other programs. It could be better, of course, but us leading by example is the number one way we teach them.Dwarkesh Patel   You had an interesting post in 2011 where you're talking about which public intellectuals have been the most influential. One thing I noticed from the list was that the people you said who were most influential were people who were advocating for one very specific narrow policy chain their entire careers.Tyler Cowen   A lot of those people fade. Now the two I cited: Andrew Sullivan and Peter Singer have not faded. It's a risky strategy. I would get bored too quickly doing that.Dwarkesh Patel   Okay, I was just about to ask: is there a reason why you haven't adopted a strategy yourself? Tyler Cowen   That's the way in which I am risk averse. I don't have a single issue. Like for Andrew it was gay marriage, and great, he won. That's amazing. I'm all for it. But in part one, because it is the thing he cared about most. And I don't have a comparable thing like that. The closest thing that I have is like, “here's my way of thinking I'm going to show it to you.” And I have done that pretty monomaniacally. And I think I've been somewhat successful.Dwarkesh Patel   Does this imply that the most interesting intellectuals will never be the most influential? Because to be influential, you have to focus on just one thing? Tyler Cowen   On average, that’s true. So John Stuart Mill was super interesting, and he wrote about many, many things and he had some influence. But was there a single thing where he saw it through and made it happen? I don't know. Or Richard Cobden, not too interesting as a deep economic thinker, but free trade against the Corn Laws–– he and John Bright made that happen. I would say they were correct, but it's not that interesting to read them.Dwarkesh Patel   Do you think some people just change people's worldviews in general? They might not have impacted any one person all that much, no one’s going to become evangelists because they read this person, but they could be impactful towards the broader cultural change in a way that's hard to measure? Do you think these people are especially influential over the long term? Tyler Cowen   I don't know, I hope there's some influence there, but it's very hard to say. Hard to measure.Dwarkesh Patel   Much of the blogosphere or the legendary parts of it were started in 2000s to 2010s–– people like you, Paul Graham, and Scott Alexander. Do you think that people starting blogs today are just LARPing the new moment you had at the time, or do you think that this is actually a format that can survive the test of time?Tyler Cowen   I think it will survive. So we have early bloggers, Samuel Pepys, James Boswell, they've survived, right? It's good material. That's the 17th and 18th centuries. So why can’t it survive today when technology makes it easier and more readily preserved? Just the notion that you write and someone reads seems to be extremely robust.Dwarkesh Patel   Right. So you write on the internet on a regular basis? Tyler Cowen   Why not? So many writers like writing on a regular basis, and it has some practical advantages so I'd be very surprised if that went away. Now, at this moment, you could say substack is bigger than blogs, it's a bit different. But it's broadly a similar thing.Dwarkesh Patel   Well, what do you see as the differences between a substack and a blog?Tyler Cowen   Substack posts tend to be longer. With a lot of blogs, you're very much the editor and not just content-creator. You're sometimes an editor in substack, but much less. So something like what instapundit has done. I don't think there's really a substack version of that, for better or worse. You don't need one; it's done on blogs. He's mostly been an editor. A lot of Marginal Revolution is just me as editor, or sometimes Alex as editor.Dwarkesh Patel   Are you worried that the same format and look of substack will make people also intellectually less creative?Tyler Cowen   I think substack encourages posts that are too long, too whiny, and too self reflective, and too obsessed with a relatively small number of recurring topics. So do I worry? Yes but are there enough mechanisms in the whole thing for self-correction? Obviously, there's competition, readers get sick of stuff that's not great, it cycles through whatever, it'll be fine.Is Stagnation Inevitable?Dwarkesh Patel   Is the reason that we've been seeing a decline in research productivity explained by the buildup of scientific bureaucracy? If it's been consistent over decades, we just have slowly deteriorating research productivity that the only explanation can be that we just pick the low-hanging fruits.Tyler Cowen   I think that's a reason. But I don't think it's the most fundamental reason. In this sense, maybe like Patrick Collison would see it as more important than I do. I think exhausting the literal low hanging fruits at the technological level is the main reason. With those, you can replenish them with new breakthrough general purpose technologies. But that takes a long time. I see that as the main reason, and the ongoing bureaucratization of science–– I fully accept and want to reform and want to change. But it's not literally my number one reason for stagnation.Dwarkesh Patel   Right. Is it just like a sine wave where you'll just have periods of easy-grab innovations and then harder-grab? Or is there something particular about this stagnation period?Tyler Cowen   I don't know what the function looks like. It just seems to me that today, we have enough diverse sources of ideas, enough wealth, enough different universities, research labs, that it ought not to go too badly. There's an awful lot of conformity, but it doesn't seem that absolute or extreme. With something like mRNA work, right. AI is making a lot of progress, fusion is being talked about in a serious way. It doesn't seem that grim to me.Dwarkesh Patel   What I find interesting is that you are an optimist in the short term, given this uncertainty, but in the long term, given the uncertainty about the future of human civilization, you're a pessimist.Tyler Cowen   It’s the same view. The more “progress” advances, the easier it is to destroy things. The chance of an accident can be small, and I think it is small. But again, bad things happen. It’s easier to destroy than create.Dwarkesh Patel   Right. Do you have an emotional reaction to the idea that the human story is almost certain to end? Do you think we only have 700 years of this left?Tyler Cowen   I don't know what I can do about it. I try actually to do something about it so I have a reaction. But I'm aware of the extreme fallibility embedded in all such projections. I'm like, let's just wake up this morning, and let's do some stuff now. And like, I'm going to do it. I hope there's a payoff under all these different scenarios.Dwarkesh Patel   Yeah. Do you think that as state capacity just continues to decline—Tyler Cowen   I don't know that it's declining. It feels like it is. But it's a bit like being in the longest line at the supermarket, you notice it more. The US State has done a bunch of things well. If you look at the war against terror, I don't know who or what gets the credit, but compared to what we expected right after 9/11, it’s gone okay. Operation warp speed went amazingly well. Just the local DMV works way better than it used to. So it's a very complex picture when it comes to state capacity. It's not flat out in decline, I would say.Dwarkesh Patel   So what is the explanation for why it gets better over time? There's a public choice theory explanation for why it might get worse, but to the extent that certain parts of it are getting better over time..Tyler Cowen   The explanation I have is so stupid, I'm embarrassed to present it. You have some people in the system who want to make it better, and they make it better. It’s not very sophisticated. I don't know a deep way of tracing it to differential incentive structures. It’s just demand.Dwarkesh Patel   Okay. So are you optimistic about libertarianism in the long term, if saved capacity continues to get better?Tyler Cowen   I don't think we'll ever have libertarian societies. I think there's quite a good chance we will get more good reforms than bad ones, so capitalism, democracy, and broadly classical liberal values will advance. That's optimistic. I think there's quite a good chance for that.Dwarkesh Patel   Is there any difference between you and Fukuyama’s view of the end of history? That there’s nothing more compelling than capitalist liberal democracy?Tyler Cowen   Well, he's changed his view a number of times. You can read the original Fukuyama as being quite pessimistic, there's something about demand for esteem and self-respect that the end of history doesn't satisfy so that unravels. Then there's the Fukuyama view that the rest of history is all about how we’ll manipulate biology–– which seems to be significant. Maybe he overstated it, but I don't dismiss it at all. Then it's like all these other Fukuyama restatements since then that makes me dizzy. I just asked a simple question: are you long the market or short the market? I'm long the market. I don't know what he is. Very few people are short so I hope he's long the market too. This is one of my favorite forcing questions. Are you long the market? Are you short the market? People spew so much b******t, and it's all tribalism, so when you ask them “Are you short the market?”, they say something like “Oh, well, I haven't bought anything lately.” It's like they become morons when you ask them this question. They should just say, “those are my tribalist sympathies, I'm neurotic and really stressed.” What I do is pretty optimistic, of course.Dwarkesh Patel   But the general fact that people are more neurotic, it seems like Fukuyama is right in the sense that, the last man in liberal democracy will be a neurotic mess. I think that's how somebody could characterize American politics at least. So is he right in a way that humans are not satisfied by liberal democracies?Tyler Cowen   I don't think people are satisfied by anything. He's right. I'm not sure it's a special problem for a liberal democracy, probably less. There are other ways to anesthetize yourself.Dwarkesh Patel   So there's no form of government or like no structure of society where people are just like, generally a mess.Tyler Cowen   I haven't seen it. Yeah, like, when would that have been? Maybe right after you went to war, there's some kind of giddiness and desire to build for the future. But it can't last that long.What are Podcasts for? Dwarkesh Patel   I'm curious why you continue to read. One of the reasons you say that reading is fast for you is because you know many of the things that are already in books. So then why continue doing it, if you already know many of the things that are in there?Tyler Cowen   Well, it's often frustrating, but I do try to read in new areas. I very much prefer travelling to reading as a way of learning things. But I can't always travel. At the margin, I would rather travel more and read less. Absolutely.Dwarkesh Patel   Okay. Let me ask a meta question. What do you think podcasts are for? What is happening?Tyler Cowen   To anaesthetize people? To feel they're learning something? To put them to sleep. So they can exercise and not feel like idiots. Occasionally to learn something. To keep themselves entertained while doing busy work of some kind.Dwarkesh Patel   Is this the same as the anesthetizing? [laughs]Tyler Cowen   You want to feel you're imbibing the most important ideas, and there are very costly, tough ways to do that. For example: to actually work on one of those problems as a researcher. But most people can't do that (through no fault of their own). Even if they’re academics, maybe they just can't do it. So one of the next best things is to listen to someone to at least pretend that they've done it. And it's okay, it's a substitute. Like, why not? What are you supposed to do? Watch TV?Dwarkesh Patel   Okay, but is your own podcast a complement to actual intellectual inquiry?Tyler Cowen   I don't assume that it is. I think of it as a very high-class form of entertainment. More than anything, right, which I like to be clear. I don't feel bad about that.Dwarkesh Patel   Yeah, but I do wonder if the substitute would have actually been real engagement or if it would have just been just pure entertainment.Tyler Cowen   It will probably be a lesser podcast, I guess. Dwarkesh Patel   Yeah. Well, on that note, Tyler, this was a lot of fun. I do want to thank you, especially because you were my fourth guest on the podcast, and it was great having you on early; it was a huge help in terms of growing the podcast.Tyler Cowen   Happy to be on it again. Yeah, thank you for coming by. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Charles C. Mann is the author of three of my favorite history books: 1491. 1493, and The Wizard and the Prophet. We discuss:* why Native American civilizations collapsed and why they failed to make more technological progress* why he disagrees with Will MacAskill about longtermism* why there aren’t any successful slave revolts* how geoengineering can help us solve climate change* why Bitcoin is like the Chinese Silver Trade* and much much more!Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here. Some really cool guests coming up, subscribe to find out about future episodes!Follow me on Twitter for updates on future episodes.If you enjoyed this episode, you may also enjoy my interviews of Will MacAskill (about longtermism), Steve Hsu (about intelligence and embryo selection), and David Deutsch (about AI and the problems with America’s constitution).Timestamps(0:00:00) -Epidemically Alternate Realities(0:00:25) -Weak Points in Empires(0:03:28) -Slave Revolts(0:08:43) -Slavery Ban(0:12:46) - Contingency & The Pyramids(0:18:13) - Teotihuacan(0:20:02) - New Book Thesis(0:25:20) - Gender Ratios and Silicon Valley(0:31:15) - Technological Stupidity in the New World(0:41:24) - Religious Demoralization(0:44:00) - Critiques of Civilization Collapse Theories(0:49:05) - Virginia Company + Hubris(0:53:30) - China’s Silver Trade(1:03:03) - Wizards vs. Prophets(1:07:55) - In Defense of Regulatory Delays(0:12:26) -Geoengineering(0:16:51) -Finding New Wizards(0:18:46) -Agroforestry is Underrated(1:18:46) -Longtermism & Free MarketsTranscriptDwarkesh Patel   Okay! Today I have the pleasure of speaking with Charles Mann, who is the author of three of my favorite books, including 1491: New Revelations of America before Columbus. 1493: Uncovering the New World Columbus Created, and The Wizard and the Prophet: Two Remarkable Scientists and Their Dueling Visions to Shape Tomorrow's World. Charles, welcome to the Lunar Society.Charles C. Mann   It’s a pleasure to be here.Epidemically Alternate RealitiesDwarkesh Patel   My first question is: How much of the New World was basically baked into the cake? So at some point, people from Eurasia were going to travel to the New World, bringing their diseases. Considering disparities and where they would survive, if the Acemoglu theory that you cited is correct, then some of these places were bound to have good institutions and some of them were bound to have bad institutions. Plus, because of malaria, there were going to be shortages in labor that people would try to fix with African slaves. So how much of all this was just bound to happen? If Columbus hadn't done it, then maybe 50 years down the line, would someone from Italy have done it? What is the contingency here?Charles C. Mann   Well, I think that some of it was baked into the cake. It was pretty clear that at some point, people from Eurasia and the Western Hemisphere were going to come into contact with each other. I mean, how could that not happen, right? There was a huge epidemiological disparity between the two hemispheres––largely because by a quirk of evolutionary history, there were many more domesticable animals in Eurasia and the Eastern hemisphere. This leads almost inevitably to the creation of zoonotic diseases: diseases that start off in animals and jump the species barrier and become human diseases. Most of the great killers in human history are zoonotic diseases. When people from Eurasia and the Western Hemisphere meet, there are going to be those kinds of diseases. But if you wanted to, it's possible to imagine alternative histories. There's a wonderful book by Laurent Binet called Civilizations that, in fact, does just that. It's a great alternative history book. He imagines that some of the Vikings came and extended further into North America, bringing all these diseases, and by the time of Columbus and so forth, the epidemiological balance was different. So when Columbus and those guys came, these societies killed him, grabbed his boats, and went and conquered Europe. It's far-fetched, but it does say that this encounter would’ve happened and that the diseases would’ve happened, but it didn’t have to happen in exactly the way that it did. It’s also perfectly possible to imagine that Europeans didn't engage in wholesale slavery. There was a huge debate when this began about whether or not slavery was a good idea. There were a lot of reservations, particularly among the Catholic monarchy asking the Pope “Is it okay that we do this?” You could imagine the penny dropping in a slightly different way. So, I think some of it was bound to happen, but how exactly it happened was really up to chance, contingency, and human agency,Weak Points in EmpiresDwarkesh Patel   When the Spanish first arrived in the 15th and 16th centuries, were the Incas and the Aztecs at a particularly weak point or particularly decadent? Or was this just how well you should have expected this civilization to be functioning at any given time period?Charles C. Mann   Well, typically, empires are much more jumbly and fragile entities than we imagine. There's always fighting at the top. What Hernán Cortés was able to do, for instance, with the Aztecs––who are better called The Triple Alliance (the term “Aztec” is an invention from the 19th century). The Triple Alliance was comprised of three groups of people in central Mexico, the largest of which were the Mexica, who had the great city of Tenochtitlan. The other two guys really resented them and so what Cortes was able to do was foment a civil war within the Aztec empire: taking some enemies of the Aztec, some members of the Aztec empire, and creating an entirely new order. There's a fascinating set of history that hasn't really emerged into the popular consciousness. I didn't include it in 1491 or 1493 because it was so new that I didn't know anything about it; everything was largely from Spanish and Mexican scholars about the conquest within the conquest. The allies of the Spaniards actually sent armies out and conquered big swaths of northern and southern Mexico and Central America. So there’s a far more complex picture than we realized even 15 or 20 years ago when I first published 1491. However, the conquest wasn't as complete as we think. I talk a bit about this in 1493 but what happens is Cortes moves in and he marries his lieutenants to these indigenous people, creating this hybrid nobility that then extended on to the Incas. The Incas were a very powerful but unstable empire and Pizarro had the luck to walk in right after a civil war. When he did that right after a civil war and massive epidemic, he got them at a very vulnerable point. Without that, it all would have been impossible. Pizarro cleverly allied with the losing side (or the apparently losing side in this in the Civil War), and was able to create a new rallying point and then attack the winning side. So yes, they came in at weak points, but empires typically have these weak points because of fratricidal stuff going on in the leadership.Dwarkesh Patel   It does also remind me of the East India Trading Company.Charles C. Mann   And the Mughal empire, yeah. Some of those guys in Bengal invited Clive and his people in. In fact, I was struck by this. I had just been reading this book, maybe you've heard of it: The Anarchy by William Dalrymple.Dwarkesh Patel   I’ve started reading it, yeah but I haven’t made much progress.Charles C. Mann   It's an amazing book! It's so oddly similar to what happened. There was this fratricidal stuff going on in the Mughal empire, and one side thought, “Oh, we'll get these foreigners to come in, and we'll use them.” That turned out to be a big mistake.Dwarkesh Patel   Yes. What's also interestingly similar is the efficiency of the bureaucracy. Niall Ferguson has a good book on the British Empire and one thing he points out is that in India, the ratio between an actual English civil servant and the Indian population was about 1: 3,000,000 at the peak of the ratio. Which obviously is only possible if you have the cooperation of at least the elites, right? So it sounds similar to what you were saying about Cortes marrying his underlings to the nobility. Charles C. Mann   Something that isn’t stressed enough in history is how often the elites recognize each other. They join up in arrangements that increase both of their power and exploit the poor schmucks down below. It’s exactly what happened with the East India Company, and it's exactly what happened with Spain. It's not so much that there was this amazing efficiency, but rather, it was a mutually beneficial arrangement for Tlaxcala, which is now a Mexican state. It had its rights, and the people kept their integrity, but they weren’t really a part of the Spanish Empire. They also weren’t really wasn't part of Mexico until around 1857. It was a good deal for them. The same thing was true for the Bengalis, especially the elites who made out like bandits from the British Empire.Slave Revolts Dwarkesh Patel   Yeah, that's super interesting. Why was there only one successful slave revolt in the new world in Haiti? In many of these cases, the ratios between slaves and the owners are just huge. So why weren't more of them successful?Charles C. Mann   Well, you would first have to define ‘successful’. Haiti wasn't successful if you meant ‘creating a prosperous state that would last for a long time.’ Haiti was and is (to no small extent because of the incredible blockade that was put on it by all the other nations) in terrible shape. Whereas in the case of Palmeres, you had people who were self-governing for more than 100 years.. Eventually, they were incorporated into the larger project of Brazil. There's a great Brazilian classic that’s equivalent to what Moby Dick or Huck Finn is to us called Os Sertões by a guy named Cunha. And it's good! It's been translated into this amazing translation in English called ​​Rebellion in the Backlands. It’s set in the 1880s, and it’s about the creation of a hybrid state of runaway slaves, and so forth, and how they had essentially kept their independence and lack of supervision informally, from the time of colonialism. Now the new Brazilian state is trying to take control, and they fight them to the last person. So you have these effectively independent areas in de facto, if not de jure, that existed in the Americas for a very long time. There are some in the US, too, in the great dismal swamp, and you hear about those marooned communities in North Carolina, in Mexico, where everybody just agreed “these places aren't actually under our control, but we're not going to say anything.”  If they don't mess with us too much, we won't mess with them too much. Is that successful or not? I don't know.Dwarkesh Patel   Yeah, but it seems like these are temporary successes..Charles C. Mann   I mean, how long did nations last? Like Genghis Khan! How long did the Khan age last? But basically, they had overwhelming odds against them. There’s an entire colonial system that was threatened by their existence. Similar to the reasons that rebellions in South Asia were suppressed with incredible brutality–– these were seen as so profoundly threatening to this entire colonial order that people exerted a lot more force against them than you would think would be worthwhile.Dwarkesh Patel   Right. It reminds me of James Scott's Against the Grain. He pointed out that if you look at the history of agriculture, there're many examples where people choose to run away as foragers in the forest, and then the state tries to bring them back into the fold.Charles C. Mann   Right. And so this is exactly part of that dynamic. I mean, who wants to be a slave, right? So as many people as possible ended up leaving. It’s easier in some places than others.. it's very easy in Brazil. There are 20 million people in the Brazilian Amazon and the great bulk of them are the descendants of people who left slavery. They're still Brazilians and so forth, but, you know, they ended up not being slaves.Slavery BanDwarkesh Patel   Yeah, that's super fascinating. What is the explanation for why slavery went from being historically ever-present to ending at a particular time when it was at its peak in terms of value and usefulness? What's the explanation for why, when Britain banned the slave trade, within 100 or 200 years, there ended up being basically no legal sanction for slavery anywhere in the world?Charles C. Mann   This is a really good question and the real answer is that historians have been arguing about this forever. I mean, not forever, but you know, for decades, and there's a bunch of different explanations. I think the reason it's so hard to pin down is… kind of amazing. I mean, if you think about it, in 1800, if you were to have a black and white map of the world and put red in countries in which slavery was illegal and socially accepted, there would be no red anywhere on the planet. It’s the most ancient human institution that there is. The Code of Hammurabi is still the oldest complete legal code that we have, and about a third of it is about rules for when you can buy slaves, when you can sell slaves, how you can mistreat them, and how you can’t–– all that stuff. About a third of it is about buying, selling, and working other human beings. So this has been going on for a very, very long time. And then in a century and a half, it suddenly changes. So there's some explanation, and it's that machinery gets better. But the reason to have people is that you have these intelligent autonomous workers, who are like the world's best robots. From the point of view of the owner, they're fantastically good, except they're incredibly obstreperous and when they're caught, you're constantly afraid they're going to kill you. So if you have a chance to replace them with machinery, or to create a wage where you can run wage people, pay wage workers who are kept in bad conditions but somewhat have more legal rights, then maybe that's a better deal for you. Another one is that industrialization produced different kinds of commodities that became more and more valuable, and slavery was typically associated with the agricultural laborer. So as agriculture diminished as a part of the economy, slavery become less and less important and it became easier to get rid of them. Another one has to do with the beginning of the collapse of the colonial order. Part of it has to do with.. (at least in the West, I don't know enough about the East) the rise of a serious abolition movement with people like Wilberforce and various Darwins and so forth. And they're incredibly influential, so to some extent, I think people started saying, “Wow, this is really bad.”  I suspect that if you looked at South Asia and Africa, you might see similar things having to do with a social moment, but I just don't know enough about that. I know there's an anti-slavery movement and anti-caste movement in which we're all tangled up in South Asia, but I just don't know enough about it to say anything intelligent.Dwarkesh Patel   Yeah, the social aspect of it is really interesting. The things you mentioned about automation, industrialization, and ending slavery… Obviously, with time, that might have actually been why it expanded, but its original inception in Britain happened before the Industrial Revolution took off. So that was purely them just taking a huge loss because this movement took hold. Charles C. Mann   And the same thing is true for Bartolome de Las Casas. I mean, Las Casas, you know, in the 1540s just comes out of nowhere and starts saying, “Hey! This is bad.” He is the predecessor of the modern human rights movement. He’s an absolutely extraordinary figure, and he has huge amounts of influence. He causes Spain’s king in the 1540s to pass what they call The New Laws which says no more slavery, which is a devastating blow enacted to the colonial economy in Spain because they depended on having slaves to work in the silver mines in the northern half of Mexico and in Bolivia, which was the most important part of not only the Spanish colonial economy but the entire Spanish empire. It was all slave labor. And they actually tried to ban it. Now, you can say they came to their senses and found a workaround in which it wasn't banned. But it's still… this actually happened in the 1540s. Largely because people like Las Casas said, “This is bad! you're going to hell doing this.”Contingency & The Pyramids Dwarkesh Patel   Right. I'm super interested in getting into The Wizard and the Prophet section with you. Discussing how movements like environmentalism, for example, have been hugely effective. Again, even though it probably goes against the naked self-interest of many countries. So I'm very interested in discussing that point about why these movements have been so influential!But let me continue asking you about globalization in the world. I'm really interested in how you think about contingency in history, especially given that you have these two groups of people that have been independently evolving and separated for tens of thousands of years. What things turn out to be contingent? What I find really interesting from the book was how both of them developed pyramids––  who would have thought that structure would be within our extended phenotype or something?Charles C. Mann    It's also geometry! I mean, there's only a certain limited number of ways you can pile up stone blocks in a stable way. And pyramids are certainly one of them. It's harder to have a very long-lasting monument that's a cylinder. Pyramids are also easier to build: if you get a cylinder, you have to have scaffolding around it and it gets harder and harder.With pyramids, you can use each lower step to put the next one, on and on, and so forth. So pyramids seem kind of natural to me. Now the material you make them up of is going to be partly determined by what there is. In Cahokia and in the Mississippi Valley, there isn't a lot of stone. So people are going to make these earthen pyramids and if you want them to stay on for a long time, there’s going to be certain things you have to do for the structure which people figured out. For some pyramids, you had all this marble around them so you could make these giant slabs of marble, which seems, from today's perspective, incredibly wasteful. So you're going to have some things that are universal like that, along with the apparently universal, or near-universal idea that people who are really powerful like to identify themselves as supernatural and therefore want to be commemorated. Dwarkesh Patel   Yes, I visited Mexico City recently.Charles C. Mann Beautiful city!TeotihuacanDwarkesh Patel Yeah, the pyramids there… I think I was reading your book at the time or already had read your book. What struck me was that if I remember correctly, they didn't have the wheel and they didn't have domesticated animals. So if you really think about it, that’s a really huge amount of human misery and toil it must have taken to put this thing together as basically a vanity project. It’s like a huge negative connotation if you think about what it took to construct it.Charles C. Mann   Sure, but there are lots of really interesting things about Teotihuacan. This is just one of those things where you can only say so much in one book. If I was writing the two-thousand-page version of 1491, I would have included this. So Tehuácan pretty much starts out as a standard Imperial project, and they build all these huge castles and temples and so forth. There's no reason to suppose it was anything other than an awful experience (like building the pyramids), but then something happened to Teotihuacan that we don’t understand. All these new buildings started springing up during the next couple of 100 years, and they're all very very similar. They're like apartment blocks and there doesn't seem to be a great separation between rich and poor. It's really quite striking how egalitarian the architecture is because that's usually thought to be a reflection of social status. So based on the way it looks, could there have been a political revolution of some sort? Where they created something much more egalitarian, probably with a bunch of good guy kings who weren't interested in elevating themselves so much? There's a whole chapter in the book by David Wingrove and David Graeber, The Dawn of Everything about this, and they make this argument that Tehuácan is an example that we can look at as an ancient society that was much more socially egalitarian than we think. Now, in my view, they go a little overboard–– it was also an aggressive imperial power and it was conquering much of the Maya world at the same time. But it is absolutely true that something that started out one way can start looking very differently quite quickly. You see this lots of times in the Americas in the Southwest–– I don't know if you've ever been to Chaco Canyon or any of those places, but you should absolutely go! Unfortunately, it's hard to get there because of the roads terrible but overall, it’s totally worth it. It's an amazing place. Mesa Verde right north of it is incredible, it's just really a fantastic thing to see. There are these enormous structures in Chaco Canyon, that we would call castles if they were anywhere else because they're huge. The biggest one, Pueblo Bonito, is like 800 rooms or some insane number like that. And it's clearly an imperial venture, we know that because it's in this canyon and one side is getting all the good light and good sun–– a whole line of these huge castles. And then on the other side is where the peons lived. We also know that starting around 1100, everybody just left! And then their descendants start the Puebla, who are these sort of intensely socially egalitarian type of people. It looks like a political revolution took place. In fact, in the book I'm now writing, I'm arguing (in a sort of tongue-in-cheek manner but also seriously) that this is the first American Revolution! They got rid of these “kings” and created these very different and much more egalitarian societies in which ordinary people had a much larger voice about what went on.Dwarkesh Patel   Interesting. I think I got a chance to see the Teotihuacan apartments when I was there, but I wonder if we’re just looking at the buildings that survived. Maybe the buildings that survived were better constructed because they were for the elites? The way everybody else lived might have just washed away over the years.Charles C. Mann   So what's happened in the last 20 years is basically much more sophisticated surveys of what is there. I mean, what you're saying is absolutely the right question to ask. Are the rich guys the only people with things that survived while the ordinary people didn’t? You can never be absolutely sure, but what they did is they had these ground penetrating radar surveys, and it looks like this egalitarian construction extends for a huge distance. So it's possible that there are more really, really poor people. But at least you'd see an aggressively large “middle class” getting there, which is very, very different from the picture you have of the ancient world where there's the sun priest and then all the peasants around them.New Book ThesisDwarkesh Patel   Yeah. By the way, is the thesis of the new book something you're willing to disclose at this point? It’s okay if you’re not––Charles C. Mann   Sure sure, it’s okay! This is a sort of weird thing, it's like a sequel or offshoot of 1491. That book, I'm embarrassed to say, was supposed to end with another chapter. The chapter was going to be about the American West, which is where I grew up, and I'm very fond of it. And apparently, I had a lot to say because when I outlined the chapter; the outline was way longer than the actual completed chapters of the rest of the book. So I sort of tried to chop it up and so forth, and it just was awful. So I just cut it. If you carefully look at 1491, it doesn't really have an ending. At the end, the author sort of goes, “Hey! I'm ending, look at how great this is!” So this has been bothering me for 15 years. During the pandemic, when I was stuck at home like so many other people, I held out what I had since I've been saving string and tossing articles that I came across into a folder, and I thought, “Okay, I'm gonna write this out more seriously now.” 15 or 20 years later. And then it was pretty long so I thought “Maybe this could be an e-book.” then I showed it to my editor. And he said, “That is not an e-book. That's an actual book.” So I take a chapter and hope I haven't just padded it, and it's about the North American West. My kids like the West, and at various times, they've questioned what it would be like to move out there because I'm in Massachusetts, where they grew up. So I started thinking “What is the West going to be like, tomorrow? When I'm not around 30 or 50 years from now?”It seems to be that you won't know who's president or who's governor or anything, but there are some things we can know. It’d be hotter and drier than it is now or has been in the recent past, like that wouldn’t really be a surprise. So I think we can say that it's very likely to be like that. All the projections are that something like 40% of the people in the area between the Mississippi and the Pacific will be of Latino descent–– from the south, so to speak. And there's a whole lot of people from Asia along the Pacific coast, so it's going to be a real ethnic mixing ground. There's going to be an epicenter of energy, sort of no matter what happens. Whether it's solar, whether it's wind, whether it's petroleum, or hydroelectric, the West is going to be economically extremely powerful, because energy is a fundamental industry.And the last thing is (and this is the iffiest of the whole thing), but I'm going to go out on a limb and say that the ongoing recuperation of sovereignty by the 294 federally recognized Native nations in the West is going to continue. That's been going in this very jagged way, but definitely for the last 50 or 60 years, as long as I've been around, the overall trend is in a very clear direction. So then you think, okay, this West is going to be wildly ethnically diverse, full of competing sovereignties and overlapping sovereignties. Nature is also going to really be in kind of a terminal. Well, that actually sounds like the 1200s! And the conventional history starts with Lewis and Clark and so forth. There’s this breakpoint in history when people who looked like me came in and sort of rolled in from the East and kind of took over everything. And the West disappears! That separate entity, the native people disappear, and nature is tamed. That's pretty much what was in the textbooks when I was a kid. Do you know who Frederick Jackson Turner is? Dwarkesh Patel  No.Charles C. Mann So he's like one of these guys where nobody knows who he is. But he was incredibly influential in setting intellectual ideas. He wrote this article in 1893, called The Significance of the Frontier. It was what established this idea that there’s this frontier moving from East to West and on this side was savagery and barbarism, and on this other side of civilization was team nature and wilderness and all that. Then it goes to the Pacific, and that’s the end of the West. That's still in the textbooks but in a different form: we don't call native people “lurking savages” as he did. But it's in my kids' textbooks. If you have kids, it'll very likely be in their textbook because it's such a bedrock. What I'm saying is that's actually not a useful way to look at it, given what's coming up. A wonderful Texas writer, Bruce Sterling, says, “To know the past, you first have to understand the future.”It's funny, right? But what he means is that all of us have an idea of where the trajectory of history is going. A whole lot of history is about asking, “How did we get here? How do we get there?” To get that, you have to have an idea of what the “there” is. So I'm saying, I'm writing a history of the West with that West that I talked about in mind. Which gives you a very different picture: a lot more about indigenous fire management, the way the Hohokam survived the drought of the 1200s, and a little bit less about Billy the Kid. Gender Ratios and Silicon Valley Dwarkesh Patel   I love that quote hahaha. Speaking of the frontier, maybe it's a mistaken concept, but I remember that in a chapter of 1493, you talk about these rowdy adventurer men who outnumber the women in the silver mines and the kind of trouble that they cause. I wonder if there's some sort of distant analogy to the technology world or Silicon Valley, where you have the same kind of gender ratio and you have the same kind of frontier spirit? Maybe not the same physical violence––– more sociologically. Is there any similarity there?Charles C. Mann   I think it's funny, I hadn't thought about it. But it's certainly funny to think about. So let me do this off the top of my head. I like the idea that at the end of it, I can say, “wait, wait, that's ridiculous.“ Both of them would attract people who either didn't have much to lose, or were oblivious about what they had to lose, and had a resilience towards failure. I mean, it's amazing, the number of people in Silicon Valley who have completely failed at numbers of things! They just get up and keep‌ trying and have a kind of real obliviousness to social norms. It's pretty clear they are very much interested in making a mark and making their fortunes themselves. So there's at least a sort of shallow comparison, there are some certain similarities. I don't think this is entirely flattering to either group. It’s absolutely true that those silver miners in Bolivia, and in northern‌ Mexico, created to a large extent, the modern world. But it's also true that they created these cesspools of violence and exploitation that had consequences we're still living with today. So you have to kind of take the bitter with the sweet. And I think that's true of Silicon Valley and its products *chuckles* I use them every day, and I curse them every day.Dwarkesh Patel   Right.Charles C. Mann   I want to give you an example. The internet has made it possible for me to do something like write a Twitter thread, get millions of people to read it, and have a discussion that's really amazing at the same time. Yet today, The Washington Post has an article about how every book in Texas (it’s one of the states) a child checks out of the school library goes into a central state databank. They can see and look for patterns of people taking out “bad books” and this sort of stuff. And I think “whoa, that's really bad! That's not so good.” It's really the same technology that brings this dissemination and collection of vast amounts of information with relative ease. So with all these things, you take the bitter with the sweet. Technological Stupidity in the New WorldDwarkesh Patel   I want to ask you again about contingency because there are so many other examples where things you thought would be universal actually don't turn out to be. I think you talked about how the natives had different forms of metallurgy, with gold and copper, but then they didn't do iron or steel. You would think that given their “warring nature”, iron would be such a huge help. There's a clear incentive to build it. Millions of people living there could have built or developed this technology. Same with the steel, same with the wheel. What’s the explanation for why these things you think anybody would have come up with didn't happen?Charles C. Mann   I know. It's just amazing to me! I don't know. This is one of those things I think about all the time. A few weeks ago, it rained, and I went out to walk the dog. I'm always amazed that there are literal glistening drops of water on the crabgrass and when you pick it up, sometimes there are little holes eaten by insects in the crabgrass. Every now and then, if you look carefully, you'll see a drop of water in one of those holes and it forms a lens. And you can look through it! You can see that it's not a very powerful lens by any means, but you can see that things are magnified. So you think “How long has there been crabgrass? Or leaves? And water?”  Just forever! We've had glass forever! So how is it that we had to wait for whoever it was to create lenses? I just don't get it. In book 1491, I mentioned the moldboard plow, which is the one with a curving blade that allows you to go through the soil much more easily. It was invented in China thousands of years ago, but not around in Europe until the 1400s. Like, come on, guys! What was it? And so, you know, there's this mysterious sort of mass stupidity. One of the wonderful things about globalization and trade and contact is that maybe not everybody is as blind as you and you can learn from them. I mean, that's the most wonderful thing about trade. So in the case of the wheel, the more amazing thing is that in Mesoamerica, they had the wheel on child's toys. Why didn’t they develop it? The best explanation I can get is they didn't have domestic animals. A cart then would have to be pulled by people. That would imply that to make the cart work, you'd have to cut a really good road. Whereas they had these travois, which are these things that you hold and they have these skids that are shaped kind of like an upside-down V. You can drag them across rough ground, you don't need a road for them. That's what people used in the Great Plains and so forth. So you look at this, and you think “maybe this was the ultimate way to save labor. I mean, this was good enough. And you didn't have to build and maintain these roads to make this work”  so maybe it was rational or just maybe they're just blinkered. I don’t know. As for assembly with steel, I think there's some values involved in that. I don't know if you've ever seen one of those things they had in Mesoamerica called Macuahuitl. They’re wooden clubs with obsidian blades on them and they are sharp as hell. You don't run your finger along the edge because they just slice it open. An obsidian blade is pretty much sharper than any iron or steel blade and it doesn't rust. Nice. But it's much more brittle. So okay, they're there, and the Spaniards were really afraid of them. Because a single blow from these heavy sharp blades could kill a horse. They saw people whack off the head of a horse carrying a big strong guy with a single blow! So they're really dangerous, but they're not long-lasting. Part of the deal was that the values around conflict were different in the sense that conflict in Mesoamerica wasn't a matter of sending out foot soldiers in grunts, it was a chance for soldiers to get individual glory and prestige. This was associated with having these very elaborately beautiful weapons that you killed people with. So maybe not having steel worked better for their values and what they were trying to do at war. That would’ve lasted for years and I mean, that's just a guess. But you can imagine a scenario where they’re not just blinkered but instead expressive on the basis of their different values. This is hugely speculative. There's a wonderful book by Ross Hassig about old Aztec warfare. It's an amazing book which is about the military history of The Aztecs and it's really quite interesting. He talks about this a little bit but he finally just says we don't know why they didn't develop all these technologies, but this worked for them.Dwarkesh Patel   Interesting. Yeah, it's kind of similar to China not developing gunpowder into an actual ballistic material––Charles C. Mann   Or Japan giving up the gun! They actually banned guns during the Edo period. The Portuguese introduced guns and the Japanese used them, and they said “Ahhh nope! Don’t want them.” and they banned them. This turned out to be a terrible idea when Perry came in the 1860s. But for a long time, supposedly under the Edo period, Japan had the longest period of any nation ever without a foreign war. Dwarkesh Patel   Hmm. Interesting. Yeah, it's concerning when you think the lack of war might make you vulnerable in certain ways. Charles C. Mann   Yeah, that's a depressing thought.Religious DemoralizationDwarkesh Patel   Right. In Fukuyama’s The End of History, he's obviously arguing that liberal democracy will be the final form of government everywhere. But there’s this point he makes at the end where he's like, “Yeah, but maybe we need a small war every 50 years or so just to make sure people remember how bad it can get and how to deal with it.” Anyway, when the epidemic started in the New World, surely the Indians must have had some story or superstitious explanation–– some way of explaining what was happening. What was it?Charles C. Mann   You have to remember, the germ theory of disease didn't exist at the time. So neither the Spaniards, or the English, or the native people, had a clear idea of what was going on. In fact, both of them thought of it as essentially a spiritual event, a religious event. You went into areas that were bad, and the air was bad. That was malaria, right? That was an example. To them, it was God that was in control of the whole business. There's a line from my distant ancestor––the Governor Bradford of Plymouth Colony, who's my umpteenth, umpteenth grandfather, that's how waspy I am, he's actually my ancestor––about how God saw fit to clear the natives for us. So they see all of this in really religious terms, and more or less native people did too! So they thought over and over again that “we must have done something bad for this to have happened.” And that’s a very powerful demoralizing thing. Your God either punished you or failed you. And this was it. This is one of the reasons that Christianity was able to make inroads. People thought “Their god is coming in and they seem to be less harmed by these diseases than people with our God.” Now, both of them are completely misinterpreting what's going on! But if you have that kind of spiritual explanation, it makes sense for you to say, “Well, maybe I should hit up their God.”Critiques of Civilization Collapse TheoriesDwarkesh Patel   Yeah, super fascinating. There's been a lot of books written in the last few decades about why civilizations collapse. There's Joseph Tainter’s book, there’s Jared Diamond's book. Do you feel like any of them actually do a good job of explaining how these different Indian societies collapsed over time?Charles C. Mann   No. Well not the ones that I've read. And there are two reasons for that. One is that it's not really a mystery. If you have a society that's epidemiologically naive, and smallpox sweeps in and kills 30% of you, measles kills 10% of you, and this all happens in a short period of time, that's really tough! I mean COVID killed one million people in the United States. That's 1/330th of the population. And it wasn't even particularly the most economically vital part of the population. It wasn't kids, it was elderly people like my aunt–– I hope I'm not sounding callous when I'm describing it like a demographer. Because I don't mean it that way. But it caused enormous economic damage and social conflict and so forth. Now, imagine something that's 30 or 40 times worse than that, and you have no explanation for it at all. It's kind of not a surprise to me that this is a super challenge. What's actually amazing is the number of nations that survived and came up with ways to deal with this incredible loss.That relates to the second issue, which is that it's sort of weird to talk about collapse in the ways that they sometimes do. Like both of them talk about the Mayan collapse. But there are 30 million Mayan people still there. They were never really conquered by the Spaniards. The Spaniards were still waging giant wars in Yucatan in the 1590s. In the early 21st century, I went with my son to Chiapas, which is the southernmost exit province. And that is where the Commandante Cero and the rebellions were going on. We were looking at some Mayan ruins, and they were too beautiful, and I stayed too long, and we were driving back through the night on these terrible roads. And we got stopped by some of these guys with guns. I was like, “Oh God, not only have I got myself into this, I got my son into this.” And the guy comes and looks at us and says, “Who are you?” And I say that we're American tourists. And he just gets this disgusted look, and he says, “Go on.” And you know, the journalist in me takes over and I ask, “What do you mean, just go on?” And he says, “We're hunting for Mexicans.” And as I’m driving I’m like “Wait a minute, I'm in Mexico.” And that those were Mayans. All those guys were Maya people still fighting against the Spaniards. So it's kind of funny to say that their society collapsed when there are Mayan radio stations, there are Maya schools, and they're speaking Mayan in their home. It's true, they don't have giant castles anymore. But, it's odd to think of that as collapse. They seem like highly successful people who have dealt pretty well with a lot of foreign incursions. So there's this whole aspect of “What do you mean collapse?” And you see that in Against the Grain, the James Scott book, where you think, “What do you mean barbarians?” If you're an average Maya person, working as a farmer under the purview of these elites in the big cities probably wasn't all that great. So after the collapse, you're probably better off. So all of that I feel is important in this discussion of collapse. I think it's hard to point to collapses that either have very clear exterior causes or are really collapses of the environment. Particularly the environmental sort that are pictured in books like Diamond has, where he talks about Easter Island. The striking thing about that is we know pretty much what happened to all those trees. Easter Island is this little speck of land, in the middle of the ocean, and Dutch guys come there and it's the only wood around for forever, so they cut down all the trees to use it for boat repair, ship repair, and they enslave most of the people who are living there. And we know pretty much what happened. There's no mystery about it.Virginia Company + HubrisDwarkesh Patel   Why did the British government and the king keep subsidizing and giving sanctions to the Virginia Company, even after it was clear that this is not especially profitable and half the people that go die? Why didn't they just stop?Charles C. Mann   That's a really good question. It's a super good question. I don't really know if we have a satisfactory answer, because it was so stupid for them to keep doing that. It was such a loss for so long. So you have to say, they were thinking, not purely economically. Part of it is that the backers of the Virginia Company, in sort of classic VC style, when things were going bad, they lied about it. They're burning through their cash, they did these rosy presentations, and they said, “It's gonna be great! We just need this extra money.” Kind of the way that Uber did. There's this tremendous burn rate and now the company says you're in tremendous trouble because it turns out that it's really expensive to provide all these calves and do all this stuff. The cheaper prices that made people like me really happy about it are vanishing. So, you know, I think future business studies will look at those rosy presentations and see that they have a kind of analogy to the ones that were done with the Virginia Company. A second thing is that there was this dog-headed belief kind of based on the inability to understand longitude and so forth, that the Americas were far narrower than they actually are. I reproduced this in 1493. There were all kinds of maps in Britain at the time showing these little skinny Philippine-like islands. So there's the thought that you just go up the Chesapeake, go a couple 100 miles, and you're gonna get to the Pacific into China. So there's this constant searching for a passage to China through this thought to be very narrow path. Sir Francis Drake and some other people had shown that there was a West Coast so they thought the whole thing was this narrow, Panama-like landform. So there's this geographical confusion. Finally, there's the fact that the Spaniards had found all this gold and silver, which is an ideal commodity, because it's not perishable: it's small, you can put it on your ship and bring it back, and it's just great in every way. It's money, essentially. Basically, you dig up money in the hills and there's this long-standing belief that there's got to be more of that in the Americas, we just need to find out where. So there's always that hope. Lastly, there's the Imperial bragging rights. You know, we can't be the only guys with a colony. You see that later in the 19th century when Germany became a nation and one of the first things it does is “Let’s look for pieces of Africa that the rest of Europe hasn't claimed,” and they set up their own mini colonial empire. So there's this kind of “Keeping Up with the Joneses” aspect, it just seems to be sort of deep in the European ruling class. So then you got to have an empire that in this weird way, seems very culturally part of it. I guess it's the same for many other places. As soon as you feel like you have a state together, you want to index other things. You see that over and over again, all over the world. So that's part of it. All those things, I think, contributed to this. Outright lying, this delusion, other various delusions, plus hubris.Dwarkesh Patel   It seems that colonial envy has today probably spread to China. I don't know too much about it, but I hear that the Silk Road stuff they're doing is not especially economically wise. Is this kind of like when you have the impulse where if you're a nation trying to rise, you have that “I gotta go here, I gotta go over there––Charles C. Mann   Yeah and “Show what a big guy I am. Yeah,––China’s Silver TradeDwarkesh Patel   Exactly. So speaking of China, I want to ask you about the silver trade. Excuse another tortured analogy, but when I was reading that chapter where you're describing how the Spanish silver was ending up with China and how the Ming Dynasty caused too much inflation. They needed more reliable mediums of exchange, so they had to give up real goods from China, just in order to get silver, which is just a medium of exchange––but it’s not creating more apples, right? I was thinking about how this sounds a bit like Bitcoin today, (obviously to a much smaller magnitude) but in the sense that you're using up goods. It's a small amount of electricity, all things considered, but you're having to use up real energy in order to construct this medium of exchange. Maybe somebody can claim that this is necessary because of inflation or some other policy mistake and you can compare it to the Ming Dynasty. But what do you think about this analogy? Is there a similar situation where real goods are being exchanged for just a medium of exchange?Charles C. Mann   That's really interesting. I mean, on some level, that's the way money works, right? I go into a store, like a Starbucks and I buy a coffee, then I hand them a piece of paper with some drawings on it, and they hand me an actual coffee in return for a piece of paper. So the mysteriousness of money is kind of amazing. History is of course replete with examples of things that people took very seriously as money. Things that to us seem very silly like the cowry shell or in the island of Yap where they had giant stones! Those were money and nobody ever carried them around. You transferred the ownership of the stone from one person to another person to buy something. I would get some coconuts or gourds or whatever, and now you own that stone on the hill. So there's a tremendous sort of mysteriousness about the human willingness to assign value to arbitrary things such as (in Bitcoin’s case) strings of zeros and ones. That part of it makes sense to me. What’s extraordinary is when the effort to create a medium of exchange ends up costing you significantly–– which is what you're talking about in China where people had a medium of exchange, but they had to work hugely to get that money. I don't have to work hugely to get a $1 bill, right? It's not like I'm cutting down a tree and smashing the papers to pulp and printing. But you're right, that's what they're kind of doing in China. And that's, to a lesser extent, what you're doing in Bitcoin. So I hadn't thought about this, but Bitcoin in this case is using computer cycles and energy. To me, it's absolutely extraordinary the degree to which people who are Bitcoin miners are willing to upend their lives to get cheap energy. A guy I know is talking about setting up small nuclear plants as part of his idea for climate change and he wants to set them up in really weird remote areas. And I was asking “Well who would be your customers?” and he says Bitcoin people would move to these nowhere places so they could have these pocket nukes to privately supply their Bitcoin habits. And that’s really crazy! To completely upend your life to create something that you hope is a medium of exchange that will allow you to buy the things that you're giving up. So there's a kind of funny aspect to this. That was partly what was happening in China. Unfortunately, China's very large, so they were able to send off all this stuff to Mexico so that they could get the silver to pay their taxes, but it definitely weakened the country.Wizards vs. ProphetsDwarkesh Patel   Yeah, and that story you were talking about, El Salvador actually tried it. They were trying to set up a Bitcoin city next to this volcano and use the geothermal energy from the volcano to incentivize people to come there and mine cheap Bitcoin. Staying on the theme of China, do you think the prophets were more correct, or the wizards were more correct for that given time period? Because we have the introduction of potato, corn, maize, sweet potatoes, and this drastically increases the population until it reaches a carrying capacity. Obviously, what follows is the other kinds of ecological problems this causes and you describe these in the book. Is this evidence of the wizard worldview that potatoes appear and populations balloon? Or are the prophets like “No, no, carrying capacity will catch up to us eventually.”Charles C. Mann   Okay, so let me interject here. For those members of your audience who don't know what we're talking about. I wrote this book, The Wizard and the Prophet. And it’s about these two camps that have been around for a long time who have differing views regarding how we think about energy resources, the environment, and all those issues. The wizards, that's my name for them––Stuart Brand called them druids and, in fact, originally, the title was going to involve the word druid but my editor said, “Nobody knows what a Druid is” so I changed it into wizards–– and anyway the wizards would say that science and technology properly applied can allow you to produce your way out of these environmental dilemmas. You turn on the science machine, essentially, and then we can escape these kinds of dilemmas. The prophets say “No. Natural systems are governed by laws and there's an inherent carrying capacity or limit or planetary boundary.” there are a bunch of different names for them that say you can't do more than so much.So what happened in China is that European crops came over. One of China's basic geographical conditions is that it's 20% of the Earth's habitable surface area, or it has 20% of the world's population, but only has seven or 8% of the world's above-ground freshwater. There are no big giant lakes like we have in the Great Lakes. And there are only a couple of big rivers, the Yangtze and the Yellow River. The main staple crop in China has to be grown in swimming pools, and that's you know, rice. So there's this paradox, which is “How do you keep people fed with rice in a country that has very little water?” If you want a shorthand history of China, that's it. So prophets believe that there are these planetary boundaries. In history, these are typically called Malthusian Limits after Malthus and the question is: With the available technology at a certain time, how many people can you feed before there's misery?The great thing about history is it provides evidence for both sides. Because in the short run, what happened when American crops came in is that the potato, sweet potato, and maize corn were the first staple crops that were dryland crops that could be grown in the western half of China, which is very, very dry and hot and mountainous with very little water. Population soars immediately afterward, but so does social unrest, misery, and so forth. In the long run, that becomes adaptable when China becomes a wealthy and powerful nation. In the short run, which is not so short (it's a couple of centuries), it really causes tremendous chaos and suffering. So, this provides evidence for both sides. One increases human capacity, and the second unquestionably increases human numbers and that leads to tremendous erosion, land degradation, and human suffering.Dwarkesh Patel   Yeah, that's a thick coin with two sides. By the way, I realized I haven't gotten to all the Wizard and Prophet questions, and there are a lot of them. So I––Charles C. Mann   I certainly have time! I'm enjoying the conversation. One of the weird things about podcasts is that, as far as I can tell, the average podcast interviewer is far more knowledgeable and thoughtful than the average sort of mainstream journalist interviewer and I just find that amazing. I don't understand it. So I think you guys should be hired. You know, they should make you switch roles or something.Dwarkesh Patel   Yeah, maybe. Charles C. Mann   It's a pleasure to be asked these interesting questions about subjects I find fascinating.Dwarkesh Patel   Oh, it's my pleasure to get to talk to you and to get to ask these questions. So let me ask about the Wizard and the Prophet. I just interviewed WIll McCaskill, and we were talking about what ends up mattering most in history. I asked him about Norman Borlaug and said that he’s saved a billion lives. But then McCaskill pointed out, “Well, that's an exceptional result” and he doesn't think the technology is that contingent. So if Borlaug hadn't existed, somebody else would have discovered what he discovered about short wheat stalks anyways. So counterfactually, in a world where Ebola doesn't exist, it's not like a billion people die, maybe a couple million more die until the next guy comes around. That was his view. Do you agree? What is your response?Charles C. Mann   To some extent, I agree. It's very likely that in the absence of one scientist, some other scientist would have discovered this, and I mentioned in the book, in fact, that there's a guy named Swaminathan, a remarkable Indian scientist, who’s a step behind him and did much of the same work. At the same time, the individual qualities of Borlaug are really quite remarkable. The insane amount of work and dedication that he did.. it's really hard to imagine. The fact is that he was going against many of the breeding plant breeding dogmas of his day, that all matters! His insistence on feeding the poor… he did remarkable things. Yes, I think some of those same things would have been discovered but it would have been a huge deal if it had taken 20 years later. I mean, that would have been a lot of people who would have been hurt in the interim! Because at the same time, things like the end of colonialism, the discovery of antibiotics, and so forth, were leading to a real population rise, and the amount of human misery that would have occurred, it's really frightening to think about. So, in some sense, I think he's (Will McCaskill) right. But I wouldn't be so glib about those couple of million people.Dwarkesh Patel   Yeah. And another thing you might be concerned about is that given the hostile attitude that people had towards the green revolution right after, if the actual implementation of these different strains of biochar sent in India, if that hadn't been delayed, it's not that weird to imagine a scenario where the governments there are just totally won over by the prophets and they decide to not implant this technology at all. If you think about what happened to nuclear power in the 70s, in many different countries, maybe something similar could have happened to the Green Revolution. So it's important to beat the Prophet. Maybe that's not the correct way to say it. But one way you could put it is: It’s important to beat the prophets before the policies are passed. You have to get a good bit of technology in there.Charles C. Mann   This is just my personal opinion, but you want to listen to the prophets about what the problems are. They're incredible at diagnosing problems, and very frequently, they're right about those things. The social issues about the Green Revolution… they were dead right, they were completely right. I don't know if you then adopt their solutions. It's a little bit like how I feel about my editors–– my editors will often point out problems and I almost never agree with their solutions. The fact is that Borlaug did develop this wheat that came into India, but it probably wouldn't have been nearly as successful if Swaminathan hadn't changed that wheat to make it more acceptable to the culture of India. That was one of the most important parts for me in this book. When I went to Tamil Nadu, I listened to this and I thought, “Oh! I never heard about this part where they took Mexican wheat, and they made it into Indian wheat.” You know, I don't even know if Borlaug ever knew or really grasped that they really had done that! By the way, a person for you to interview is Marci Baranski–– she's got a forthcoming book about the history of the Green Revolution and she sounds great. I'm really looking forward to reading it. So here's a plug for her.In Defense of Regulatory DelaysDwarkesh Patel   So if we applied that particular story to today, let's say that we had regulatory agencies like the FDA back then that were as powerful back then as they are now. Do you think it's possible that these new advances would have just dithered in some approval process that took years or decades to complete? If you just backtest our current process for implementing technological solutions, are you concerned that something like the green revolution could not have happened or that it would have taken way too long or something?Charles C. Mann   It's possible. Bureaucracies can always go rogue, and the government is faced with this kind of impossible problem. There's a current big political argument about whether former President Trump should have taken these top-secret documents to his house in Florida and done whatever he wanted to? Just for the moment, let's accept the argument that these were like super secret toxic documents and should not have been in a basement. Let's just say that's true. Whatever the President says is declassified is declassified. Let us say that's true.  Obviously, that would be bad. You would not want to have that kind of informal process because you can imagine all kinds of things–– you wouldn't want to have that kind of informal process in place. But nobody has ever imagined that you would do that because it's sort of nutty in that scenario.Now say you write a law and you create a bureaucracy for declassification and immediately add more delay, you make things harder, you add in the problems of the bureaucrats getting too much power, you know–– all the things that you do. So you have this problem with the government, which is that people occasionally do things that you would never imagine. It’s completely screwy. So you put in regulatory mechanisms to stop them from doing that and that impedes everybody else. In the case of the FDA, it was founded in the 30 when some person produced this thing called elixir sulfonamides. They killed hundreds of people! It was a flat-out poison! And, you know, hundreds of people died. You think like who would do that? But somebody did that. So they created this entire review mechanism to make sure it never happened again, which introduced delay, and then something was solidified. Which they did start here because the people who invented that didn't even do the most cursory kind of check. So you have this constant problem. I'm sympathetic to the dilemma faced by the government here in which you either let through really bad things done by occasional people, or you screw up everything for everybody else. I was tracing it crudely, but I think you see the trade-off. So the question is, how well can you manage this trade-off? I would argue that sometimes it's well managed. It's kind of remarkable that we got vaccines produced by an entirely new mechanism, in record time, and they passed pretty rigorous safety reviews and were given to millions and millions and millions of people with very, very few negative effects. I mean, that's a real regulatory triumph there, right?So that would be the counter-example: you have this new thing that you can feed people and so forth. They let it through very quickly. On the other hand, you have things like genetically modified salmon and trees, which as far as I can tell, especially for the chestnuts, they’ve made extraordinary efforts to test. I'm sure that those are going to be in regulatory hell for years to come. *chuckles* You know, I just feel that there's this great problem. These flaws that you identified, I would like to back off and say that this is a problem sort of inherent to government. They're always protecting us against the edge case. The edge case sets the rules, and that ends up, unless you're very careful, making it very difficult for everybody else.Dwarkesh Patel   Yeah. And the vaccines are an interesting example here. Because one of the things you talked about in the book–– one of the possible solutions to climate change is that you can have some kind of geoengineering. Right? I think you mentioned in the book that as long as even one country tries this, then they can effectively (for relatively modest amounts of money), change the atmosphere. But then I look at the failure of every government to approve human challenge trials. This is something that seems like an obvious thing to do and we would have potentially saved hundreds of thousands of lives during COVID by speeding up the vaccine approval. So I wonder, maybe the international collaboration is strong enough that something like geoengineering actually couldn't happen because something like human challenge trials didn't happen.Geoengineering Charles C. Mann   So let me give a plug here for a fun novel by my friend, Neal Stephenson, called Termination Shock. Which is about some rich person just doing it. Just doing geoengineering. The fact is that it's actually not actually against the law to fire off rockets into the stratosphere. In his case, it's a giant gun that shoots shells full of sulfur into the upper atmosphere. So I guess the question is, what timescale do you think is appropriate for all this? I feel quite confident that there will be geoengineering trials within the next 10 years. Is that fast enough? That's a real judgment call. I think people like David Keith and the other advocates for geoengineering would have said it should have happened already and that it’s way, way too slow. People who are super anxious about moral hazard and precautionary principles say that that’s way, way too fast. So you have these different constituencies. It's hard for me to think off the top of my head of an example where these regulatory agencies have actually totally throttled something in a long-lasting way as opposed to delaying it for 10 years. I don’t mean to imply that 10 years is nothing. But it’s really killing off something. Is there an example you can think of?Dwarkesh Patel   Well, it's very dependent on where you think it would have been otherwise, like people say maybe it was just bound to be the state. Charles C. Mann   I think that was a very successful case of regulatory capture, in which the proponents of the technology successfully created this crazy…. One of the weird things I really wanted to explain about nuclear stuff is not actually in the book. I actually wrote a whole long section in but cut it out because I felt like it was just too much in the weeds. Anyway, if you have a coal plant, they have environmental rules. The rules are basically based on a threshold principle where you set a safe threshold for the emission of particulates and as long as you're below that threshold, you're fine. Nuclear power has a thing for its main type of pollution, which is radiation. It’s what’s called the Linear Threshold Model. What it says is that you have to reduce radiation to the maximum extent practicable, and essentially, if your nuclear power is way cheaper than coal power (which it is), that means you have more profits so you can spend more money on reducing it. So you're going even further on the road to diminishing returns. You have a completely different regulatory standard for nuclear (I'm talking about this country) than you do for coal. So you have this bizarre fact that coal power plants emit more radiation than nuclear plants do because of the residual radiation when the coal is dug up from underneath the earth. So you have a very strange case of regulatory capture, in which you have a completely inconsistent set of safety standards across different parts of the same industry. So the question to me in sort of an empirical vision is: How common is that? Is this some weird thing that's happened to nuclear? Finding New WizardsDwarkesh Patel   Yeah, yeah. Okay so assume that you're in the 1960s. Let’s say that you’re a philanthropic donor and you’re the 1960s version of an effective altruist who’s interested in doing the most good possible. In retrospect, it's clear that you should have funded Borlaug. I mean, counterfactually, he still does it, but let's just say that his work depends on your funding. How could you have identified work like that? Is there some criteria that is broadly applicable where you could have identified his work in Mexico using it?Charles C. Mann   That's a really good question! I mean, that's the greatest good for the greatest number question. To do that, you would have to say, “What are the biggest problems facing the planet?” And then presumably, if you're Will McCaskill or somebody like that, you say, “All lives are equal. So what is the thing that's most affecting the most number of lives?” In that case, it’s probably clean drinking water. I think that's the biggie. So that means funding primarily urban infrastructure for water and setting up some kind of foundation or some independent agency that's insulated from the government to actually keep those water systems going. That would be my answer to that. That's how you would do it, I think you'd try to figure out, you know, “What are the bare necessities? What's killing more people than anything else?” In the 1960s, that was probably food and water. The Food and Agriculture Organization, once they got interested in Borlaug actually did a pretty good job of promoting him, and there's the creation of the sea guard system. Water is completely neglected and actually, I would channel it towards water.Dwarkesh Patel   Interesting. Okay. I'm going to name two trends, and I want to know what you think these two imply for the debate between wizards and prophets in the future. So one of the trends is declining research productivity–– in terms of how many new important advancements each researcher is able to make, there's evidence that shows that that’s exponentially decaying.Charles C. Mann   I think that's wrong that they think that and the reason is that in the areas that I'm familiar with, there are two things that are going on. One is in particle physics. It's harder and harder to make discoveries, because of the penalty of your own success, you're pushing harder and harder to really get to where you're going. It's just incredibly expensive. So that's a natural phenomenon. It's not anything really to worry about because, you know, what do you want to do? Undo the past 50 years of success in particle physics? People like Murray Gell-Mann could do a huge amount because we didn't know anything. So you're seeing just plain old diminishing returns. The second thing though, and I think this is something important, is that it feels like agricultural research. The vast majority of research is in a bunch of narrow areas: wheat, rice, maize, and so forth. There are all kinds of alternative crops that are hardly looked at and could be really important, particularly in a time of climate change, when we are going to have to have a much more resilient in creating that varied agricultural system to deal with the uncertainties of climate change. There's hardly any research done in agroforestry–– all those crops are essentially wild. You know, how many people are you know, except for William Powell looking at chestnut there's practically no real genetic research into increasing tree crop productivity. There's also not nearly enough research into things like cassava, where you could do a huge amount. When I talk to people, I always say: go to these other crops that are really, really important. They're going to be even more important in the future, and there's virtually no research on them. By doing that, you could make giant strides rather than being the person who's trying to increasingly optimize wheat–– something that's already been optimized by 10,000 people. So part of it is that there’s this channeling of people into fields that are already well trodden. I think that you can see that in many many areas of research. That would be a partial answer to that question.Agroforestry is UnderratedDwarkesh Patel   I see, yeah. So I was going to ask–– if there's declining research productivity, maybe there are less rabbits you could keep pulling out of the hat like Borlaug did. But let me just ask instead with regards to increasing the productivity of trees in order to potentially deal with climate change, what in the book you speculate about and C4 photosynthesis?Charles C. Mann   You know, that's just an example of the kind of thing that you could do.Dwarkesh Patel   What is the status of that? Are you optimistic about that, or?Charles C. Mann   Yeah, they're plugging away. You know, it's a hugely difficult problem, but it's extraordinarily interesting. To get something like C4 rice would be just an absolutely gigantic increase in productivity. But even in drylands areas, there's this method of agriculture that's used in West Africa and places like Northern Mexico called civil pastoral farming where you have ruminants, cows and so forth and trees. To create a system that is way easier on the land, uses way less water, and is almost as productive as annual crops. Almost no research has gone into that. That would be another example of a kind of thing that you could do that I would argue would have a much greater impact than the person trying to get the latest flavor of cherry-flavored nose drops are something–– which is what a huge amount of research is in.Dwarkesh Patel   There have been people speculating recently that environmental contaminants are leading to a host of bad outcomes in health in the West, especially obesity. How plausible do you think this is?Charles C. Mann   I always wonder about the mechanism. What would be the mechanism that these tiny trace amounts of these compounds have in them? How come that as our environment has generally gotten cleaner, obesity has risen? So I'm immediately skeptical of this. One of the issues here is that you're dealing with problems that are on the very limits of our ability to measure. If you're looking for these things, obviously, they have very very long-term effects–– whatever they are. So how are you going to actually ascertain that? People who make very strong claims based on facts without a mechanism that is at the very limits of our ability to measure just doesn't seem like all that promising to me? Yeah, so not impossible. Not impossible. But the claims you might see, I always think, how could they possibly know that?Dwarkesh Patel   Yeah. So one of these people is a good friend of mine: Slime Mold Time Mold who’s an anonymous blogger on the internet. They set up something called a potato diet and it was like a four-week study. I thought you might have interesting thoughts on this, given that the chapters in your book were dedicated to the humble potato and its impact on the world. So basically, they only ate potatoes for four weeks. And as you talked about in the book, potatoes have a bunch of micronutrients that––Charles C. Mann   They’re really good for you! If you're gonna do that, use potatoes.Dwarkesh Patel   Yep. And then people lost a lot of weight. Why? Is it something you would have expected? What do you think of this just recapitulating Irish history?Charles C. Mann   Well, the Irish history is both analogous and not analogous, because it is true–– they ate nothing but potatoes. But also those people who were always vigorously physically exercising, because they were out in the fields with really poor tools. So it's a really different situation from you and me where no matter how many times you go to the gym, that's not the same as working for 10 hours in the fields. Also, the epidemiological environment is so crazy different. All the people in Ireland only live to the age of 40. Anyway, there's a whole host of studies that show that extreme diets always work. You know, for example, people eat nothing but beans, etc. and people lose a lot of weight in the short term. It's really difficult to show that it's possible to keep it off and if it's possible for people to maintain these kinds of diets for long periods of time.Dwarkesh Patel   Right, right. I remember that part of the book where you have that passage from Adam Smith, where he's commenting on how all these Irish people only ate potatoes, but all of them seemed so healthy and beautiful.Charles C. Mann   Well, they're also on the fields and not in London, right? Adam Smith, looking at Edinburgh and places like that, which are the most unhealthy places on the planet!Longtermism & Free MarketsDwarkesh Patel   Say you have no discount rate. So you think future people matter exactly as much as current people. Does that shift you more towards the prophet side or the wizard side? Not in absolute terms, but from where you're starting out?Charles C. Mann   I have to say, I'm uncomfortable with this entire thing and this reason is something Will McCaskill talks about. From what I've read of his work, he takes it seriously enough to question how we don't actually know what those future people will want. There's no question that what we want today would have seemed abhorrent to most people in the 1800s. So the idea that we can have any other idea other than they probably want to be alive? It seems much more questionable than I think it does. So, there's two ways to look at it. One is the wizards say-–– we have an idea: “they're going to want to live in this certain kind of utopia and live their longest lives and have the maximum possible physical comfort.” Which is generally what the wizards say. And that seems perfectly reasonable to me. But the prophets might say, “Well, we should be more epistemologically humble. We don't know what they want so let's preserve as many options as possible for them.” That doesn't seem crazy. I personally probably lean more towards the wizards on this. But if a prophet said that to me, I wouldn't say “Oh, you're wrong.” Because that's the same argument about burying nuclear waste, which I also think is very powerful. We should probably not bury it in some system where it can't be gotten rid of for 10,000 years, we should just make sure that we can track it for a couple 100 years, and there'll be more options for people 200 years from now than there are today.Dwarkesh Patel   Okay. What’s wrong with the basic free market objection to the carrying capacity arguments, which goes: let's say we do reach the ends of some resource? Then its price would just increase until you reached some sort of sustainable equilibrium, and people would just decrease their consumption and keep it constant or something. An example: people are concerned that as the developing world gets richer, people are going to eat more meat. But if it's true that it consumes 10 times the energy than the grain that's just like feeding them directly, then that will be represented in the price and so the trend lines might be mistaken because the price of meat will increase or something. Charles C. Mann   I think that's a very powerful argument. But the problem with it is that the kinds of things that we're talking about and care about for carrying capacity are things like bubble gum, or things like food, water, and energy. Those have never, as far as I know, been governed by anything remotely resembling the free market. They aren't today, they never have been in the past. So it seems to me like an interesting thought experiment to imagine what would happen if you truly had a free market for those things. But it also seems pointless because if I had to bet, I bet that it would be the same way it's been for the last couple thousand years. And we don't have a free market, we already have all kinds of weird distortions. From your point of view––  the tremendous amount of food that's wasted, the crazy arrangements we have for water in the system, these ludicrous things like.. You're in Texas, right? So you have this thing where Texas has its own independent grid, so it can't trade energy with other states that are nearby. Like, what the heck is that? That's really crazy. I mean, I don't want to pick on Texas, but I think there are equally crazy things all over the place, the impossibility of building long-distance, high-tension lines, because various states have just arbitrarily imposed rules that make it impossible. There are all kinds of crazy things going on. So I guess, what you're saying is it's very likely to be true in a system that will never exist, unfortunately. Because that's kind of a nice idea.Dwarkesh Patel   Right? Okay. That seems like an excellent note to close on. This is extra.. I learned so much from the books and I learned so much from talking to you, so I really really enjoyed this.  The books that we talked about were 1491: New Revelations of America before Columbus. 1493: Uncovering the New World Columbus Created, and The Wizard and the Prophet: Two Remarkable Scientists and Their Dueling Visions to Shape Tomorrow's World if anyone’s interested. So is there any other place that you would like to direct viewers who might want to check out your work?Charles C. Mann   Stay tuned for my book about the West! Which should be coming out next year if I'm at all lucky.Dwarkesh Patel   Okay, and I'd love to have you back on again when it comes out.Charles C. Mann   Oh, sure we can talk about how Texas has got an amazing history. Yeah, definitely. One of the things I learned about the Comanche Indians and their role in Texas history is just totally eye-popping really amazing. So that's actually a very fun part two so we can talk about your Texas roots.Dwarkesh Patel   Definitely. Well, thanks so much for coming on, Charles.Charles C. Mann  Sure. Pleasure. Nice to meet you.Please share if you enjoyed this episode. Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Austin Vernon is an engineer working on a new method for carbon capture, and he has one of the most interesting blogs on the internet, where he writes about engineering, software, economics, and investing.We discuss how energy superabundance will change the world, how Starship can be turned into a kinetic weapon, why nuclear is overrated, blockchains, batteries, flying cars, finding alpha, & much more!Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.Subscribe to find out about future episodes!Follow Austin on Twitter. Follow me on Twitter for updates on future episodes.Please share if you enjoyed this episode! Helps out a ton!Timestamps(0:00:00) - Intro(0:01:53) - Starship as a Weapon(0:19:24) - Software Productivity(0:41:40) - Car Manufacturing(0:57:39) - Carbon Capture(1:16:53) - Energy Superabundance(1:25:09) - Storage for Cheap Energy(1:31:25) - Travel in Future(1:33:27) - Future Cities(1:39:58) - Flying Cars(1:43:26) - Carbon Shortage(1:48:03) - Nuclear(2:12:44) - Solar(2:14:44) - Alpha & Efficient Markets(2:22:51) - ConclusionTranscriptIntroDwarkesh Patel (00:00:00):Okay! Today, I have the pleasure of interviewing Austin Vernon who writes about engineering, software, economics, and investing on the internet, though not that much else is known about him. So Austin, do you want to give us a bit of info about your background? I know that the only thing the internet knows about you is this one little JPEG that you had to upload with your recent paper. But what about an identity reveal or I guess a little bit of a background reveal? Just to the extent that you're comfortable sharing.Austin Vernon (00:00:29):My degree is in chemical engineering and I’ve had a lifelong love for engineering as well as things like the Toyota Production System. I've also worked as a chemical engineer in a large processing facility where I've done a lot of petroleum engineering. I taught myself how to write software and now I'm working on more research and the early commercialization of CO2 electrolysis.Dwarkesh Patel (00:00:59):Okay yeah. I'm really interested in talking about all those things. The first question I have is from Alex Berger, who's the co-CEO of Open Philanthropy. When I asked on Twitter what I should ask you, he suggested that I should ask “Why so shady?” Famously you have kind of an anonymous personality, pseudonymous thing going on the internet. What's up with that?Austin Vernon (00:01:25):Yeah. I think he posted a tweet that said “I don't know who this guy is or if he's credible at all, but his stuff sure is interesting”. That really made me laugh. I thought that was hilarious. Fame just doesn't seem necessary, I think I'm fine with my ideas being well known and communicating, but I have less desire to be personally famous.Starship as a WeaponDwarkesh Patel (00:01:52):Gotcha, gotcha. I wanted to start off with a sexy topic, let's talk about using Starship as a kinetic weapon. I thought that was one of the more amusing posts you wrote. Do you want to talk more about how this would be possible?Austin Vernon (00:02:08):Well, I think the main thing with Starship is that you're taking a technology and you're making it about 100 times cheaper for cargo and 1000 times cheaper for people. When things like that happen that drastically, you're just looking at huge changes and it’s really hard to anticipate what some of those can be when the change is that drastic. I think there's a lot of moon-based, Mars-based stuff that doesn't really catch the general public's eye. They also have trouble imagining some of the point-to-point travel that could be possible. But when you start talking about it as a weapon, then I think it lets people know they should be paying attention to this technology. And we certainly do not want to be second or third getting it. We should make sure that we're going to be first.Dwarkesh Patel (00:03:05):Yeah. I think you mentioned this in the post, but as recently as the '90s, the cost of sending one kilogram to space was around $20,000. More recently, SpaceX has brought it to $2,000. Lots of interesting questions pop up when you ask, “What will be possible once we get it down to $200 per kilogram to send into orbit?” One of them could be about how we might manufacture these weapons that are not conventional ballistics. Do you want to talk about why this might be an advancement over conventional ballistic weapons?Austin Vernon (00:03:37):Well, regular conventional ballistic weapons are extremely expensive. This is more like a bomb truck. But usually we think of B52 as the bomb truck and this could be even cheaper than the B52, delivering just mass on target. When you think about how expensive it is to fly a B52 from Barksdale in Louisiana all the way across the world.. you can do it from south Texas or Florida with the Starship and get more emissions per day and the fuel ends up being. When you go orbital, it takes a lot to get to orbit. But then once you're in orbit, your fuel consumption's pretty good. So over long distances, it has a lot of advantage. That's why the point-to-point works for longer distances.Austin Vernon (00:04:27):There's really a sweet spot with these weapons where you want it to be pretty accurate, but you also want it to be cheap. You're seeing that problem with Russia right now as they have some fancy parade style weapons that are really expensive, like multi-billion dollar cruise missiles, but they're missing that $5,000 guided artillery shell or that $20,000 JDM that you can just pit massive. Or the multiple launch rocket system, guided rockets. They're really short on all those because I think they had just had a limited amount of chips they could get from the US into Russia to make these advanced weapons.Austin Vernon (00:05:07):But yeah, so the Starship gives you just a platform to deliver. You could put JDMs in a shroud, or you could just have the iron unguided kinetic projectiles, and it just becomes impossible for a ship to launch missiles to intercept yours if your cost is so low, you can just overwhelm them.Dwarkesh Patel (00:05:29):Okay. There are a few terms there that neither I nor the audience might know. So what is JDM? What is shroud? And why are chips a bottleneck here? Why can't it just be any micro-controller?Austin Vernon (00:05:42):So JDM is Joint Direct Attack Munition. So what we did is we took all our Vietnam surplus bonds and we put this little fin-kit on it and it costs like $20,000, which is cheap for a weapon because the actual bond costs, I don't know, $3,000. And then it turns it into a guided weapon that, before you were probably lucky to get within 500 meters of a target, now you can get it in with two meters. So the number of missions you have to do with your planes and all that goes down by orders of magnitude. So it's an absolutely huge advantage in logistics and in just how much firepower you can put on a target. And we didn't even have to make new bombs, we just put these kits on all our old bombs.Austin Vernon (00:06:33):Let's see.. Yeah the chips are a problem. There's this organization called RUSI. I think they're in the UK, but they've been tearing down all these Russian weapons they found in Ukraine and they all have American chips in them. So technically, they're not supposed to be able to get these chips. And yet, Russia can't make a lot of its own chips. And especially not the specialized kinds you might want for guided weapons. So they've been somehow smuggling in chips from Americans to make their advanced weaponsDwarkesh Patel (00:07:03):What is special about these? As far as I'm aware, the trade with China is still going on and we get a lot of our chips manufactured from Taiwan or China. So why can't they do the same?Austin Vernon (00:07:14):It's the whole integration. It's not just the specific chip, but the board. They're more like PLCs where you almost have wired-in programming and they come with this ability to do the guidance and all that stuff. It all kind of has to work together. I think that's the way I understand it. I don't know. Maybe I don't have a really good answer for that one, but they're hard to replicate is what matters.Dwarkesh Patel (00:07:43):Okay that's interesting. Yeah, I guess that has a lot of interesting downstream effects, because for example, India buys a lot of its weapons from Russia. So if Russia doesn't have access to these, then other countries that buy from Russia won't have access to these either.Dwarkesh Patel (00:07:58):You had an interesting speculation in the post where you suggested that you could just keep these kinetic weapons in orbit, in a sort of Damocles state really, almost literally. That sounds like an incredibly scary and risky scenario where you could have orbital decay and you could have these kinetic weapons falling from the sky and destroying cities. Do you think this is what it will look like or could look like in 10 to 20 years?Austin Vernon (00:08:26):Well, yeah, so the advantage of having weapons on orbit is you can hit targets faster. So if you're launching the rocket from Florida, you're looking at maybe 30 minutes to get there and the target can move away in that time. Whereas if you're on orbit, you can have them spaced out to where you're hitting within a few minutes. So that's the advantage there.Austin Vernon (00:08:46):You really have to have a two stage system I think for most, because if you have a really aerodynamic rod that's going to give you really good performance in the low atmosphere, it’ll end up going too fast and just burn up before it gets there. Tungsten's maybe the only thing that you could have that could go all the way through which is why I like the original concept of using these big tungsten rods the size of a telephone pole. But tungsten's pretty expensive. And the rod concept kind of limits what you can do.Austin Vernon (00:09:28):So a lot of these weapons will have, that's what I was talking about with the shroud, something that actually slows you down in the upper atmosphere. And then once you're at the velocity where you're not just going to melt, then you open it up and let it go. So if you actually had it fall from the sky, some may make it to the ground, but a lot would burn up. So a lot of the stuff that makes it to the ground is actually pretty light. It's stuff that can float and has a large surface area. Yeah, that's the whole thing with Starship. Or not Starship, but Starlink. All those satellites are meant to completely fall apart on de-orbit.Dwarkesh Patel (00:10:09):I see. One of the implications of that is that these may be less powerful than we might fear, because since kinetic energy is mass times velocity squared and there's an upper bound on the velocity (velocity being the component that grows the kinetic energy faster), then it suggests that you can upper bound the power these things will have. You know what I mean?Austin Vernon (00:10:32):Yeah, so even the tungsten rods. Sometimes people, they're not very good at physics, so they don't do the math. They think it's going to be a nuclear weapon, but it's really not. I think even the tungsten rod is like 10 tons of T&T or something. It's a big bomb, but it's not a super weapon.Austin Vernon (00:10:54):So I think I said in the post, it's about using advanced missiles where they're almost more defensive weapons so I can keep you from pitting your ship somewhere. Yeah I could try to bombard your cities, but I can't take ground with it. I can't even police sea lanes with it really. I'd still have to use regular ships if I had this air cover to go enforce the rules of the sea and stuff like that.Dwarkesh Patel (00:11:23):Yeah. You speculated in the post, I think, that you could load this up with shrapnel and then it could explode next to an incoming missile or an incoming aircraft. Could these get that accurate? Because that was surprising speculation to me.Austin Vernon (00:11:43):I think for ships, it's pretty... I was watching videos of how fast a ship can turn and stuff. If you're going to do an initial target on a ship to try to kill their radars, you'd want to do it above the ceiling of their missiles. So it's like, how much are they going to move between your release where you stop steering and that? The answer’s maybe 1000 feet. So that's pretty simple because you just shrapnel the area.Austin Vernon (00:12:12):Targeting aircraft, you would be steering all the way in. I'd say it's doable, but it'd be pretty hard. You'd actually maybe want to even go slower than you would with the ship attack. You'd need a specialized package to attack the aircraft, but if you have enough synthetic aperture radar and stuff like that, you could see these aircraft using satellites and then guide the bomb in the whole way. You could even load heat seeking missiles into a package that unfurls right next to them and launch conventional missiles too, probably. It’d be pretty hard to do some of this stuff, but they’re just the things you might be able to do if you put some effort into it.Dwarkesh Patel (00:12:57):Yeah. The reason I find this kind of speculation really interesting is because when you look at the modern weaponry that's used in conflicts, it just seems directly descendant from something you would've seen in World War II or something. If you think about how much warfare changed between 1900 and 1940, it's like, yeah, they're not even the same class of weapons anymore. So it's interesting to think about possibilities like these where the entire category of weapons has changed.Austin Vernon (00:13:33):You’re right and that's because our physical technology hasn't changed that much. So it really has just made more sense to put better electronics in the same tanks. We haven't learned enough about tanks to build a new physical tank that's way better, so we just keep upgrading our existing tanks with better electronics. They're much more powerful, they're more accurate. A lot of times, they have longer range weapons and better sensors. So the tank looks the same, but it maybe has several times more killing power. But the Ukraine war right now, they're using a lot of 40, 50 year old weapons so that especially looks like that.Dwarkesh Patel (00:14:20):Yeah. Which kind of worries you if you think about the stockpiles our own military has. I'm not well educated on the topic, but I imagine that we don't have the newest of the new thing. We probably have maintained versions of decades old technology.Austin Vernon (00:14:35):We spend so much, we've got relatively... This kind of gets into debate about how ready our military is. For certain situations, it's more ready than others. I'd say in general, most people talking about it have the incentive to downplay our capabilities because they want more defense spending. There's lots of reasons. So I think we're probably more capable than what you might see from some editorial in The Hill or whatever. Us just sending a few weapons over to Ukraine and seeing how successful they've been at using them, I think, shows a little bit of that.Austin Vernon (00:15:18):There's so much uncertainty when it comes to fighting, especially when you're talking about a naval engagement, where we don't just don't have that many ships in general… you can have some bad luck. So I think you always want to be a little bit wary. You don't want to get overconfident.Dwarkesh Patel (00:15:37):Yeah. And if the offensive tech we sent to Ukraine is potentially better than the defensive tech, it's very possible that even a ballistic missile that China or Russia could launch would sink a battleship and then kill the 2,000 or 1,000 whatever soldiers that are on board. Or I guess, I don't know, you think this opens up avenues for defensive tech as well?Austin Vernon (00:16:03):Yeah––generally the consensus is that defensive technology has improved much more recently than offensive technology. This whole strategy China has is something they call anti-access/area denial, A2/AD. That's basically just how missiles have gotten better because the sensors on missiles have gotten better. So they can keep our ships from getting close to them but they can't really challenge us in Hawaii or something. And it really goes both ways, I think people forget that. So yeah, it's hard for us to get close to China, but Taiwan has a lot of missiles with these new sensors as well. So I think it's probably tougher for China to do it close to Taiwan than most people would say.Dwarkesh Patel (00:16:55):Oh, interesting. Yeah, can you talk more about that? Because every time I read about this, people are saying that if China wanted to, they could knock out Taiwan's defenses in a short amount of time and take it over. Yeah, so can you talk about why that's not possible?Austin Vernon (00:17:10):Well, it might be, but I think it's a guess of the uncertainty [inaudible 00:17:14]. Taiwan has actually one of the largest defense budgets in the world and they've recently been upping it. I think they spend, I don't know, $25 billion a year and they added an extra $5 billion. And they've been buying a lot of anti-ship missiles, a lot of air defense missiles.. Stuff that Ukraine could only dream of. I think Ukraine's military budget was $2 billion and they have a professional army. And then the other thing is Taiwan’s an island, whereas Russia could just roll over the land border into Ukraine.Austin Vernon (00:17:44):There's just been very few successful amphibious landings in history. The most recent ones were all the Americans in World War II and Korea. So the challenge there is just... It's kind of on China to execute perfectly and do that. So if they had perfect execution, then possibly it would be feasible. But if their air defenses on their ships aren't quite as good as we think they could possibly be, then they could also end up with half their fleet underwater within 10 hours.Dwarkesh Patel (00:18:20):Interesting. And how has your view of Taiwan's defensive capabilities changed... How has the Ukraine conflict updated your opinion on what might happen?Austin Vernon (00:18:29):I didn't really know how much about it. And then I started looking at Wikipedia and stuff and all this stuff they're doing. Taiwan just has a lot of modern platforms like F16s with our anti-ship missiles. They actually have a lot of their own. They have indigenous fighter bombers, indigenous anti-ship missiles because they're worried we might not always sell them to them.Austin Vernon (00:18:54):They've even recently gotten these long range cruise missiles that could possibly target leadership in Beijing. So I think that makes it uncomfortable for the Chinese leadership. If you attack them, you're going to have to go live in a bunker. But again, I'm not a full-time military analyst or something, so there's a lot of uncertainty around what I'm saying. It's not a given that China's just going to roll over them.Software ProductivityDwarkesh Patel (00:19:22):Okay. That's comforting to hear. Let's talk about an area where I have a little bit of a point of contact. I thought your blog post about software and the inability of it to increase productivity numbers, I thought that was super fascinating. So before I ask you questions about it, do you want to lay out the thesis there?Austin Vernon (00:19:43):Yeah. So if there's one post I kind of felt like I caught lightning in a bottle on, it's that one. Everything I wanted to put in, it just fit together perfectly, which is usually not the case.Austin Vernon (00:19:55):I think the idea is that the world's so complex and we really underestimate that complexity. If you're going to digitize processes and automate them and stuff, you have to capture all that complexity basically at the bit level, and that's extremely difficult. And then you also have diminishing returns where the easily automatable stuff goes first and then it's increasing corner cases to get to the end, so you just have to go through more and more code basically. We don't see runaway productivity growth from software because we're fighting all this increasing complexity.Dwarkesh Patel (00:20:39):Yeah. Have you heard of the waterbed theory of complexity by the way?Austin Vernon (00:20:42):I don't think so.Dwarkesh Patel (00:20:44):Okay. It's something that comes up in compiler design: the idea is that there's a fixed amount of complexity in a system. If you try to reduce it, what you'll end up doing is just you'll end up migrating the complexity elsewhere. I think an example that's used of this is when they try to program languages that are not type safe, something like Python. You can say, “oh, it's a less complex language”, but really, you've added complexity when, I don't know, two different types of numbers are interacting like a float and an int. As your program grows, that complexity exponentially grows along with all the things that could go wrong when you're making two things interact in a way that you were expecting not to. So yeah, the idea is you can just choose where to have your complexity, but you can't get rid of that complexity.Austin Vernon (00:21:38):I think that’s kind of an interesting thing when you start pairing it with management theory... when you add up all the factors, the most complex thing you're doing is high volume car manufacturing. And so we got a lot of innovations and organization from car manufacturers like the assembly line. Then you had Sloan at GM basically creating the way the modern corporation is run, then you have the Toyota Production System.Austin Vernon (00:22:11):But arguably now, creating software is actually the most complex thing we do. So there's all these kinds of squishy concepts that underlie things like the Toyota Production System that softwares had to learn and reimagine and adopt and you see that with Agile where, “oh, we can't have long release times. We need to be releasing every day,” which means we're limiting inventory there.Austin Vernon (00:22:42):There's a whole thing especially that's showing up in software that existed in carbon manufacturing where you're talking about reducing communication. So Jeff Bezos kind of now famously said, "I want to reduce communication," which is counterintuitive to a lot of people. This is age-old in car manufacturing where Toyota has these cards that go between workstations and they tell you what to do. So people normally think of them as limiting inventory, but it also tells the worker exactly what they're supposed to be doing at what pace, at what time. The assembly line is like that too. You just know what to do because you're standing there and there's a part here and it needs to go on there, and it comes by at the pace you're supposed to work at.Austin Vernon (00:23:29):It's so extreme that there's this famous paper, by List, Syverson and Levitt. They went to a car factory and studied how defects propagated in cars and stuff. Once a car factory gets up and running, it doesn't matter what workers you put in there, if workers are sick or you get new workers, the defect rate is the same. So all the knowledge is built into the manufacturing line.Austin Vernon (00:23:59):There’s these concepts around idiot-proofing and everything that are very similar to what you'll see. You had Uncle Bob on here. So Uncle Bob says only put one input into a function and stuff like that because you'll mix them up otherwise. The Japanese call it poka-yoke. You make it where you can't mess it up. And that's another way to reduce communication, and then software, of course you have APIs.Austin Vernon (00:24:28):So I'm really interested in this overall concept of reducing communication, and reducing how much cooperation and everything we need to run the economy.Dwarkesh Patel (00:24:41):Right. Right. Speaking of the Toyota Production System, one thing they do to reduce that defect rate is if there's a problem, all the workers in that chain are forced to go to the place where the defect problem is and fix it before doing anything else. The idea there is that this will give them context to understand what the problem was and how to make sure it doesn't happen again. It also prevents a build up of inventory in a way that keeps making these defects happen or just keeps accumulating inventory before the place that can fix the defects is able to take care of them.Austin Vernon (00:25:17):Right. Yeah, yeah. Exactly.Dwarkesh Patel (00:25:19):Yeah. But I think one interesting thing about software and complexity is that software is a place where complexity is the highest in our world right now but software gives you the choice to interface with the complexity you want to interface with. I guess that's just part of specialization in general, but you could say for example that a machine learning model is really complex, but ideally, you get to a place where that's the only kind of complexity you have to deal with. You're not having to deal with the complexity of “How is this program compiled? How are the libraries that I'm using? How are they built?” You can fine tune and work on the complexity you need to work on.Dwarkesh Patel (00:26:05):It's similar to app development. Byrne Hobart has this blog post about Stripe as solid state. The basic idea is that Stripe hides all the complexity of the financial system: it charges a higher fee, but you can just treat it as an abstraction of a tithe you have to pay, and it'll just take care of that entire process so you can focus on your comparative advantage.Austin Vernon (00:26:29):It's really actually very similar in car manufacturing and the Toyota Production System if you really get into it. It's very much the same conceptual framework. There's this whole idea in Toyota Production System, everyone works at the same pace, which you kind of talked about. But also, your work content is the same. There's no room for not standardizing a way you're going to do things. So everyone gets together and they're like, “All right, we're going to do this certain part. We're going to put it together this certain way at this little micro station. And it's going to be the same way every time.” That's part of how they're reducing the defect rates. If your assembly process is longer than what your time allotment is to stay in touch with the rest of the process, then you just keep breaking it down into smaller pieces. So through this, each person only has to know a very small part of it.Austin Vernon (00:27:33):The overall engineering team has all sorts of strategies and all sorts of tools to help them break up all these processes into very small parts and make it all hold together. It's still very, very hard, but it's kind of a lot of the same ideas because you're taking away the complexity of making a $30,000 car or 30,000 part car where everyone's just focusing on their one little part and they don't care what someone else is doing.Dwarkesh Patel (00:28:06):Yeah. But the interesting thing is that it seems like you need one person who knows how everything fits together. Because from what I remember, one of the tenets of the Toyota Production System was you need to have a global view. So, in that book, was it the machine or the other one, the Toyota Production System book? But anyways, they were talking about examples where people would try to optimize for local efficiencies. I think they especially pointed to Ford and GM for trying to do this where they would try to make machines run all the time. And locally, you could say that, “oh this machine or process is super efficient. It's always outputting stuff.” But it ignores how that added inventory or that process had a bad consequence for the whole system.Dwarkesh Patel (00:28:50):And so it's interesting if you look at a company like Tesla that’s able to do this really well. Tesla is run like a monarchy and this one guy has this total global view of how the entire process is supposed to run and where you have these inefficiencies.. You had some great examples of this in the blog post. I think one of the examples is this guy (the author) goes to this factory and he asks, "Is this an efficient factory?" And the guy's like, "Yeah, this is totally efficient. There's nothing we can do, adopting the Toyota way, to make this more efficient."Dwarkesh Patel (00:29:22):And so then he's like, "Okay, let me look." And he finds that they're treating steel in some way, and the main process does only take a couple of seconds, but some local manager decided that it would be more efficient to ship their parts out, to get the next stage of the process done somewhere else. So this is locally cheaper, but the result is that it takes weeks to get these parts shipped out and get them back. Which means that the actual time that the parts spend getting processed is 0.1% of the time, making the whole process super inefficient. So I don't know, it seems like the implication is you need a very monarchical structure, with one person who has a total view, in order to run such a system. Or am I getting that wrong?Austin Vernon (00:30:12):Not necessarily. I mean, you do have to make sure you're not optimizing locally, but I think it's the same. You have that same constraint in software, but I think a lot of times people are just running over it because processing has been getting so much cheaper. People are expensive, so if you could save development time, it just ends up the trade offs are different when you're talking about the tyranny of physical items and stuff like that, the constraints get a little more severe. But I think you have the same overall. You still have to fight local optimization, but the level you have to is probably different with physical goods.Austin Vernon (00:30:55):I was thinking about the smart grid situation from a software perspective, and there's this problem where, okay, I'm putting my solar farm here and it's impacting somewhere far away, and that's then creating these really high upgrade costs, that cost two or three times more than my solar farm. Well, the obvious thing would be, if you're doing software, is like you're going to break all these up into smaller sections, and then you wouldn't be impacting each other and all that, and you could work and focus on your own little thing.Austin Vernon (00:31:29):But the problem with that is if you're going to disconnect these areas of the grid, the equipment to do that is extremely expensive. It's not like I'm just going to hit a new tab and open a new file and start writing a new function. And not only that, but you still have to actually coordinate how this equipment is going to operate. So if you just let the grid flow as it does, everyone knows what's going to happen because they could just calculate the physics. If you start adding in all these checkpoints where humans are doing stuff, then you have to actually interface with the humans, and the amount of things that can happen really starts going up. So it's actually a really bad idea to try to cart all this stuff off, just because of the reality of the physical laws and the equipment you need and everything like that.Dwarkesh Patel (00:32:22):Okay. Interesting. And then I think you have a similar Coasean argument in your software post about why vertically integrating software is beneficial. Do you want to explain that thesis?Austin Vernon (00:32:34):Yeah. I think it actually gets to what we're talking about here, where it allows you to avoid the local optimization. Because a lot of times you're trying to build a software MVP, and you're tying together a few services… they don't do quite what you need, so if you try to scale that, it would just break. But if you're going to take a really complex process, like car manufacturing or retail distribution, or the home buying process or something, you really have to vertically integrate it to be able to create a decent end-to-end experience and avoid that local optimization.Austin Vernon (00:33:20):And it's just very hard otherwise, because you just can't coordinate effectively if you have 10 different vendors trying to do all the same thing. You end up in just constant vendor meetings, where you're trying to decide what the specs are or something instead of giving someone the authority, or giving a team the authority to just start building stuff. Then if you look at these companies, they have to implement these somewhat decentralized processes when they get too complex, but at least they have control over how they're interfacing with each other. Walmart, as the vendors, control their own stock. They don't tell the vendor, "We need X parts." It's just like, it's on you to make sure your shelf is stocked.Dwarkesh Patel (00:34:07):Yeah. Yeah. So what was really interesting to me about this part of the post was, I don't know, I guess I had heard of this vision of we're software setting, where everybody will have a software as a service company, and they'll all be interfacing with each other in some sort of cycle where they're all just calling each other's APIs. And yeah, basically everybody and their mother would have a SAAS company. The implication here was, from your argument, that given the necessity of integrating all those complexity vertically in a coherent way, then the winners in software should end up being a few big companies, right? They compete with each other, but still...Austin Vernon (00:34:49):I think that's especially true when you're talking about combining bits and apps. Maybe less true for pure software. The physical world is just so much more complex, and so the constraints it creates are pretty extreme, compared to like... you could maybe get away with more of everyone and their mom having an API in a pure software world.Dwarkesh Patel (00:35:14):Right. Yeah. I guess, you might think that even in the physical world, given that people really need to focus on their comparative advantage, they would just try to outsource the software parts to these APIs. But is there any scenario where the learning curve for people who are not in the firm can be fast enough that they can keep up with the complexity? Because there's huge gains for specialization and competition that go away if this is the world we're forced to live in. And then I guess we have a lot of counter examples, or I guess we have a lot of examples of what you're talking about. Like Apple is the biggest market cap in the world, right? And famously they're super vertically integrated. And yeah, obviously their thing is combining hardware and software. But yeah, is there any world in which it can keep that kind of benefit, but have it be within multiple firms?Austin Vernon (00:36:10):This is a post I've got on my list I want to write. The blockchain application, which excites me personally the most, is reimagining enterprise software. Because the things you're talking about, like hard typing and APIs are just basically built into some of these protocols. So I think it just really has a lot of exciting implications for how much you can decentralize software development. But the thing is, you can still do that within the firm. So I think I mentioned this, if the government's going to place all these rules on the edge of the firm, it makes transactions with other firms expensive. So a few internal transactions can be cheaper, because they're avoiding the government reporting and taxes and all that kind of stuff. So I think you'd have to think about how these technologies can reduce transaction costs overall and decentralize that, but also what are the costs between firms?Dwarkesh Patel (00:37:22):Yeah, it's really interesting if the costs are logistic, or if they're based on the knowledge that is housed, as you were talking about, within a factory or something. Because if it is just logistical and stuff, like you had to report any outside transactions, then it does imply that those technology blockchain could help. But if it is just that you need to be in the same office, and if you're not, then you're going to have a hard time keeping up with what the new requirements for the API are, then maybe it's that, yeah, maybe the inevitability is that you'll have these big firms that are able to vertically integrate.Austin Vernon (00:37:59):Yeah, for these big firms to survive, they have to be somewhat decentralized within them. So I think you have... you're going to the same place as just how are we viewing it, what's our perception? So even if it's a giant corporation, it's going to have very independent business units as opposed to something like a 1950s corporation.Dwarkesh Patel (00:38:29):Yeah. Byrne Hobart, by the way, has this really interesting post that you might enjoy reading while you're writing that post. It's type safe communications, and it's about that Bezos thing, about his strict style for how to communicate and how little to communicate. There's many examples in Amazon protocols where you have to... the only way you can put in this report, is in this place you had to give a number. You can't just say, "This is very likely," you had to say like, "We project X percent increase," or whatever. So it has to be a percent. And there's many other cases where they're strict about what type definition you can have in written reports or something. It has kind of the same consequence that type strict languages have, which is that you can keep track of what the value is through the entire chain of the flow of control.Austin Vernon (00:39:22):You've got to keep work content standardized.Dwarkesh Patel (00:39:26):So we've been hinting at the Coasean analysis to this. I think we just talked about it indirectly, but for the people who might not know, Coase has this paper called The Theory of Firms, and he's trying to explain why we have firms at all. Why not just have everybody compete in the open market for employment, for anything? Why do we have jobs? Why not just have... you can just hire a secretary by the day or something.Dwarkesh Patel (00:39:51):And the conclusion he comes to is that by having a firm you're reducing the transaction cost. So people will have the same knowledge about what needs to get done, obviously you're reducing the transaction cost of contracting, finding labor, blah, blah, blah. And so the conclusion it comes to is the more the transaction costs are reduced within people in a firm, as compared to the transaction cost between different firms, the bigger firms will get. So I guess that's why the implication of your argument was that there should be bigger tech firms, right?Austin Vernon (00:40:27):Yes, yes, definitely. Because they can basically decrease the transaction costs faster within, and then even at the limit, if you have large transaction costs outside the firm, between other firms that are artificially imposed, then it will make firms bigger.Dwarkesh Patel (00:40:45):What does the world look like in that scenario? So would it just be these Japanese companies, these huge conglomerates who are just... you rise through the ranks, from the age of 20 until you die? Is that what software will turn into?Austin Vernon (00:40:59):It could be. I mean, I think it will be lots of very large companies, unless there's some kind of change in inner firm transaction costs. And again, that could possibly come from blockchain like technology, but you probably also need better regulation to make that cheaper, and then you would have smaller firms. But again, in the end, it doesn't really matter. You'd be working in your little unit of the big bank of corporate, or whatever. So I don't know what that would look like on a personal level.Car ManufacturingDwarkesh Patel (00:41:40):Yeah. Okay. So speaking of these Japanese companies, let's talk about car manufacturing and everything involved there. Yeah, so we kind of hinted at a few elements of the Toyota way and production earlier, but do you want to give a brief overview of what that is, so we can compare it to potentially other systems?Austin Vernon (00:42:02):I think all these kinds of lean Toyota process systems, they do have a lot of similarities, where mostly you want to even-out your production, so you're producing very consistently, and you want to break it into small steps and you want to limit the amount of inventory you have in your system. When you do this, it makes it easy to see how the process is running and limit defects. And the ultimate is you're really trying to reduce defects, because they're very expensive. It's a little bit hard to summarize. I think that's my best shot at it there, quickly off the top of my head.Dwarkesh Patel (00:42:49):Yeah. The interesting thing about the Toyota system, so at least when the machine was released, is they talk about... that book was released I think the nineties, and they went to the history of Toyota, and one of the interesting things they talked about was there was a brief time where the company ran... I think, was this after World War II? But anyways, the company ran into some troubles. They needed to layoff people to not go bankrupt. They had much more debt on books than they had assets. So yeah, they wanted to layoff people, but obviously the people were not happy about this, so there were violent protests about this. And in fact I think the US written constitution gave strong protections to labor that they hadn't had before, which gave labor an even stronger hand here.Dwarkesh Patel (00:43:42):So anyway, Toyota came to this agreement with the unions that they'd be allowed to do this one time layoff to get the company on the right track, but afterwards they could never lay somebody off. Which would mean that a person who works at Toyota works there from the time they graduate college or high school till they die. Right? I don't know, that's super intense in a culture. I mean, in software, where you have the average tenure in a company's one year, the difference is so much.Dwarkesh Patel (00:44:13):And there's so many potential benefits here, I guess a lot of drawbacks too. But one is, obviously if you're talking in a time scale of 50 years, rather than one year, the incentives are more aligned between the company and the person. Because anything you could do in one year is not going to have a huge impact on your stock options in that amount of time. But if this company's your retirement plan, then you have a much stronger incentive to make sure that things at this company run well, which means you're probably optimizing for the company's long term cash flow yourself. And also, there's obviously benefits to having that knowledge built up in the firm from people who have been there for a long time. But yeah, that was an interesting difference. One of the interesting differences, at least.Austin Vernon (00:45:00):I mean, I think there's diminishing returns to how long your tenure's going to be. Maybe one year's too short, but there's a certain extent to where, if you grow faster than your role at the company, then it's time to switch. It's going to depend on the person, but maybe five years is a good number. And so if you're not getting promoted within the firm, then your human capital's being wasted, because you could go somewhere else and have more responsibility and perform better for them. Another interesting thing about that story, is almost all lean turnarounds, where they're like, we're going to implement something like Toyota production system, they come with no layoff promises. Because if you're going to increase productivity, that's when everyone's like, "Oh gosh, I'm going to get laid off." So instead you have to increase output and take more market share, is what you do.Dwarkesh Patel (00:46:00):It's kind of like burning your bridges, right? So this is the only way.Austin Vernon (00:46:05):The process really requires complete buy-in, because a lot of your ideas for how you're going to standardize work content come from your line workers, because that's what they're doing every day. So if you don't have their buy-in, then it's going to fail. So that's why it's really necessary to have those kinds of clauses.Dwarkesh Patel (00:46:22):Yeah. Yeah, that makes sense. I think it was in your post where you said, if somebody makes their process more efficient, and therefore they're getting more work allotted to them, then obviously they're going to stop doing that. Right? Which means that, I don't know, do you ought to give more downtime to your best workers or something or the people who are most creative in your company?Austin Vernon (00:46:48):I was just going to say, if you're a worker at a plant, then a lot of times for that level of employee, actually small rewards work pretty well. A lot of people on drilling rigs used to give the guys that met certain targets $100 Walmart gift cards. So sometimes small, it's a reward, new ideas, stuff like that works.Austin Vernon (00:47:15):But because the whole system has to grow together, if you just improve one part of the process, it may not help you. You have to be improving all the right processes so normally it's much more collaborative. There's some engineer that's looking at it and like, "All right, this is where we're struggling," or "We have our defects here." And then you go get together with that supervisor and the workers in that area, then you all figure out what improvements could be together. Because usually the people already know. This is like, you see a problem at the top, and you're just now realizing it. Then you go talk to the people doing the work, and they're like, "Oh yeah, I tried to tell you about that two weeks ago, man." And then you figure out a better process from there.Dwarkesh Patel (00:47:58):Based on your recommendation, and Steven Malina's recommendation, I recently read The Goal. And after reading the book, I'm much more understanding of the value that consultants bring to companies, potentially. Because before you could think, “What does a 21 year old, who just graduated college, know about manufacturing? What are they going to tell this plant that they didn't already know? How could they possibly be adding value?” And afterwards, it occurred to me that there's so many abstract concepts that are necessary to understand in order to be able to increase your throughput. So now I guess I can see how somebody who's generically smart but doesn't have that much industry knowledge might be able to contribute to a plan and value consultants could be bringing.Austin Vernon (00:48:43):I think this applies to consultants or young engineers. A lot of times you put young engineers just right in the thick of it, working in production or process right on the line, where you're talking to the workers the most. And there's several advantages to that. One, the engineer learns faster, because they're actually seeing the real process, and the other is there's easy opportunities for them to still have a positive impact on the business, because there's $100 bills laying on the ground just from going up and talking to your workers and learning about stuff and figuring out problems they might be having and finding out things like that that could help you lower cost. I think there's a lot of consultants that... I don't know how the industry goes, but I would guess there's... I know Accenture has 600,000 employees. I don't know if that many, but it's just a large number, and a lot are doing more basic tasks and there are some people that are doing the more high level stuff, but it's probably a lot less.Dwarkesh Patel (00:49:51):Yeah. Yeah. There was a quote from one of those books that said, "At Toyota we don't consider you an engineer unless you need to wash your hands before you can have lunch." Yeah. Okay. So in your blog post about car manufacturing, you talk about Tesla. But what was really interesting is that in a footnote, I think you mentioned that you bought Tesla stocks in 2014, which also might be interesting to talk about again when we go to the market and alpha part. But anyways. Okay. And then you talk about Tesla using something called metal manufacturing. So first of all, how did you know in 2014 that Tesla was headed here? And what is metal manufacturing and how does it differ from the Toyota production system?Austin Vernon (00:50:42):Yeah. So yeah, I just was goofing around and made that up. Someone actually emailed me and they were like, "Hey, what is this metal manufacturing? I want to learn more about this." It's like, "Well, sorry, I just kind of made that up, because I thought it sounded funny." But yeah, I think it's really the idea that there's this guy, Dimming, and he found a lot of the same ideas that Toyota ended up implementing, and Toyota respected his ideas a lot. America never really got fully on board with this in manufacturing. Of course it's software people that are coming and implementing this and manufacturing now which is like the real American way of doing things.Austin Vernon (00:51:32):Because when you look at these manufacturing processes, the best place to save money and optimize is before you ever build the process or the plant. It's very early on. So I think if there's a criticism of Toyota, it's that they're optimizing too late and they're not creative enough in their production technology and stuff. They're very conservative, and that's why they have hydrogen cars and not battery cars, even though they came out with the Prius, which was the first large sales hybrid.Austin Vernon (00:52:12):So yeah, I think what Tesla's doing with really just making Dimming's ideas our own and really just Americanizing it with like, "Oh, well, we want to cast this, because that would be easier." Well, we can't, because we don't have an alloy. "We'll invent the alloy." I love it. It's great. Mostly, I love Tesla because they do such... I agree with their engineering principles. So I didn't know that the company would come to be so valuable. It's just, I was just always reading their stock reports and stuff so I was like, "Well, at least I need to buy some stock so that I have a justification for spending all this time reading their 10 Ks."Dwarkesh Patel (00:52:53):I want to get a little bit more in detail about the exact difference here. So lean production, I guess, is they're able to produce their cars without defects and with matching demand or whatever. But what is it about their system that prevents them from making the kinds of innovations that Tesla is able to make?Austin Vernon (00:53:16):It's just too incremental. It's so hard to get these processes working. So the faster you change things, it becomes very, very difficult to change the whole system. So one of the advantages Tesla has is, well, if you're making electric cars, you have just a lot less parts. So that makes it easier. And once you start doing the really hard work of basically digitizing stuff, like they don't have speed limit dials, you start just removing parts from the thing and you can actually then start increasing your rate of change even faster.Austin Vernon (00:53:55):It makes it harder to get behind if you have these old dinosaur processes. But I think there's a YouTube channel called The Limiting Factor, and he actually went into the detail of numbers on what it costs for Tesla to do their giga-casting, which saves tons of parts and deletes zillions of thousands of robots from their process. If you already have an existing stamping line and all that, where you're just changing the dyes based on your model, then it doesn't make sense to switch to the casting. But if you're building new factories, like Tesla is, well, then it makes sense to do the casting and you can build new factories very cheaply and comparatively and much easier. So there's a little bit of... they just have lots of technical data, I guess you could say, in a software sense.Dwarkesh Patel (00:54:47):Yeah. That's super interesting. The analogy is actually quite... it's like, Microsoft has probably tens of thousands of software engineers who are just basically servicing its technical debt and making sure that the old systems run properly, whereas a new company like Tesla doesn't have to deal with that. The thing that's super interesting about Tesla is like, Tesla's market cap is way over a trillion, right? And then Toyota's is 300 billion. And Tesla is such a new company. The fact that you have this Toyota, which is legendary for its production system, and this company that's less than two decades old is worth many times more, it's kind of funny.Austin Vernon (00:55:32):Yeah. I would say that, in that measure, I don't like market cap. You need to use enterprise value. These old car companies have so much debt, that if you look at enterprise value, it's not so jarring. Literally, I don't know, I can't remember what GM's worth, like 40 billion or something, and then they have $120 billion in debt. So their enterprise value is five times more than their market cap.Dwarkesh Patel (00:56:02):What is enterprise value?Austin Vernon (00:56:03):Enterprise value is basically what is the value of the actual company before you have any claims on it. It's the market cap plus your debt. But basically, if you're the equity holder and the company gets sold, you have to pay the debt first. So you only get the value of what's left over after the debt. So that's why market cap is... when Tesla has very little debt and a lot of market cap, and then these other guys have a lot of debt with less market cap, it skews the comparison.Dwarkesh Patel (00:56:34):Yeah, and one of the interesting things, it's similar to your post on software, is that it seems like one of the interesting themes across your work is automating processes often leads to decreased eventual throughput, because you're probably adding capacity in a place that you're deciding excess capacity, and you're also making the money part of your operation less efficient by have it interface with this automated part. It sounds like there's a similar story there with car manufacturing, right?Austin Vernon (00:57:08):Yeah. I think if we tie it back into what we were talking about earlier, automation promotes local optimization and premature optimization. So a lot of times it's better to figure out, instead of automating a process to make a really hard to make part, you should just figure out how to make that part easy to make. Then after you do that, then it may not even make sense to automate it anymore. Or get rid of it all together, then you just delete all those robots.Austin’s Carbon Capture ProjectDwarkesh Patel (00:57:37):Yeah. Yeah, that's interesting. Okay. So let's talk about the project that you're working on right now, the CO2 electrolysis. Do you want to explain what this is, and what your current approach is? What is going on here?Austin Vernon (00:57:55):Yeah, so I think just overall, electrofuels right now are super underrated, because you're about to get hopefully some very cheap electricity from solar, or it could be, maybe, some land. If we get really lucky, possibly some nuclear, geothermal. It’ll just make sense to create liquid fuels, or natural gas, or something just from electricity and air, essentially.Austin Vernon (00:58:25):There's a whole spectrum of ways to do this, so O2 electrolysis is one of those. Basically, you take water, electricity, and CO2, and a catalyst. And then, you make more complex molecules, like carbon monoxide, or formic acid, or ethylene, or ethanol, or methane or methine. Those are all options. But it's important to point out that, right now, I think if you added up all the CO2 electrolyzers in the world, you'd be measuring their output and kilograms per day. We make millions of tons per day off of the products I just mentioned. So there's a massive scale up if it's going to have a wider impact.Austin Vernon (00:59:15):So there's some debate. I think the debate for the whole electrofuels sector is: How much are you going to do in the electrolyzer? One company whose approach I really like is Terraform Industries. They want to make methane, which is the main natural gas. But they're just making hydrogen in their electrolyzer, and then they capture the CO2 and then put it into a methanation reaction. So everything they're doing is already world scale, basically.Austin Vernon (00:59:47):We've had hydrogen electrolyzers power fertilizer plants, providing them with the Hydrogen that they need. Methanation happens in all ammonia plants and several other examples. It's well known, very old. Methanation is hydrogen CO2 combined to make water and methane. So their approach is more conservative, but if you do more in the electrolyzer, like I'm going to make the methane actually in the electrolyzer instead of adding this other process, you could potentially have a much simpler process that has less CapEx and scales downward better. Traditional chemical engineering heavily favors scaling. With the more Terraform processes, they're playing as absolutely ginormous factories. These can take a long time to build.Austin Vernon (01:00:42):So one of the things they're doing is: they're having to fight the complexity that creeps into chemical engineering every step of the way. Because if they don't, they'll end up with a plant that takes 10 years to build, and that's not their goal. It takes 10 years to build a new refinery, because they're so complex. So yeah, that's where I am. I'm more on the speculative edge, and it's not clear yet which products will be favorable for which approaches.Dwarkesh Patel (01:01:15):Okay, yeah. And you're building this out of your garage, correct?Austin Vernon (01:01:19):Yeah. So that's where electrolyzers... Everything with electric chemistry is a flat plate instead of a vessel, so it scales down. So I can have a pretty good idea of what my 100 square centimeter electrolyzer is going to do, if I make it quite a bit bigger. I have to worry about how my flow might interact in the larger one and make sure the mixing's good, but it's pretty straightforward because you're just making your flat plate a larger area. Whereas the scale, it is different from scaling a traditional chemical process.Dwarkesh Patel (01:01:56):I'm curious how cheap energy has to be before this is efficient. If you're turning it into methane or something like that, presumably for fuel, is the entire process energy positive? Or how cheap would energy, electricity you need to get before that's the case?Austin Vernon (01:02:18):The different products and different methods have different crossovers. So Terraform Industries, they're shooting for $10 a megawatt hour for electricity. But again, their process is simpler, a little less efficient than a lot of the other products. They also have better premiums, just worth more per ton than methane. So your crossover happens somewhere in between $10 and $20 a megawatt hour, which is... I mean, that's pretty... Right now, solar, it's maybe like $25. Maybe it's a little higher because payment prices have gone up in the last year, but I think the expectation is they'll come back down. And so, getting down to $15 where you start having crossovers for some of these products like ethanol or ethylene or methanol, it's not science fiction.Dwarkesh Patel (01:03:08):I think in Texas where I live, that's where it's at right? The cost of energy is 20 or something dollars per megawatt hour.Austin Vernon (01:03:16):Well, not this summer! But yeah, a lot of times in Texas, the wholesale prices are around $25 to $30.Dwarkesh Patel (01:03:26):Gotcha. Okay. Yeah. So a lot of the actual details you said about how this works went over my head. So what is a flat plate? I guess before you answer that question, can you just generally describe the approach? What is it? What are you doing to convert CO2 into these other compounds?Austin Vernon (01:03:45):Well, yeah, it literally just looks like an electrolyzer. You have two sides and anode and a cathode and they're just smushed together like this because of the electrical resistance. If you put them far apart, it makes it... uses up a lot of energy. So you smush them together as close as you can. And then, you're basically just trading electrons back and forth. On one side, you're turning CO2 into a more complex molecule, and on the other side, you're taking apart water. And so, when you take apart the water, it balances out the equation, balances out your electrons and everything like that. I probably need to work on that elevator pitch there, huh?Dwarkesh Patel (01:04:31):I guess what the basic idea is, you need to put power in to convert CO2 into these other compounds.Austin Vernon (01:04:38):The inputs are electricity, water, and CO2, and the output is usually oxygen and whatever chemical you're trying to create is, along with some side reactions.Dwarkesh Patel (01:04:49):And then, these chemicals you mentioned, I think ethanol, methane, formic acid, are these all just fuels or what are the other uses for them?Austin Vernon (01:04:58):A lot of people are taking a hybrid approach with carbon monoxide. So this would be like Twelve Co… They've raised a lot of money to do this and 100 employees or something. You can take that carbon monoxide and make hydrogen, and then you have to send gas to make liquid fuels. So they want to make all sorts of chemicals, but one of the main volume ones would be like jet fuel.Austin Vernon (01:05:22):Let's see Formic acid is, it's the little fry of all these. It is an additive in a lot of things like preserving hay for animals and stuff like that. Then, ethanol there's people that want to... There's this company that makes ethylene, which goes into plastics that makes polyethylene, which is the most produced plastic. Or you can burn it in your car, although I think ethanol is a terrible vehicle fuel. But then you can also just make ethylene straight in the electrolyzer. So there's many paths. So which path wins is an interesting race to see.Dwarkesh Patel (01:06:13):The ability to produce jet fuel is really interesting, because in your energy superabundance paper, you talk about... You would think that even if we can electrify everything in solar and when it becomes super cheap, that's not going to have an impact on the prices to go to space for example. But I don't know. If a process like this is possible, then it's some way to in financial terms, add liquidity. And then turn, basically, this cheap solar and wind into jet fuel through this indirect process. So the price to send stuff to space or cheap plane flights or whatever––all of that goes down as well.Austin Vernon (01:06:52):It basically sets a price ceiling on the price of oil. Whatever you can produce this for is the ceiling now, which is maybe the way I think about it.Dwarkesh Patel (01:07:06):Yeah. So do you want to talk a little bit about how your background led into this project? This is your full-time thing, right? I don't know if I read about that, but where did you get this idea and how long have you been pursuing it? And what's the progress and so on.Austin Vernon (01:07:20):I've always loved chemical engineering, and I love working at the big processing plant because it's like being a kid in a candy store. If I had extra time, I'd just walk around and look at the plant, like it’s so cool. But the plant where I worked at, their up time was 99.7%. So if you wanted to change anything or do anything new, it terrified everyone. That's how they earned their bonuses: run the plant a 100% uptime all the time. So that just wasn't a good fit for me. And also, so I always wanted my own chemical plant, but it's billions of dollars to build plants so that was a pretty big step. So I think this new technology of... there's a window where you might be able to build smaller plants until it optimizes to be hard to enter again.Dwarkesh Patel (01:08:21):And then, why will it become hard to enter again? What will happen?Austin Vernon (01:08:27):If someone figures out how to build a really cheap electrolyzer, and they just keep it as intellectual property, then it would be hard to rediscover that and compete with them.Dwarkesh Patel (01:08:38):And so, how long have you been working on this?Austin Vernon (01:08:42):Oh, not quite a year. But yeah, I actually got this idea to work on it from writing my blog. So when I wrote the heating fuel post, I didn't really know much about... There's another company in the space, Prometheus Fuels and I'm like, "Oh, this is an interesting idea." And then, I got talking to a guy named Brian Heligman, and he's like, "You should do this, but not what Prometheus is doing." And so, then I started looking at it and I liked it, so I've been working on it since.Dwarkesh Patel (01:09:08):Yeah. It's interesting because if energy does become as cheap as you suspect it might. If this process works, then yeah, this is a trillion dollar company probably, right? If you're going to get the patents and everything.Austin Vernon (01:09:22):I mean, maybe. With chemical plants, there's a certain limitation where your physical limitation is. There's only so many places that are good places for chemical plants. You start getting hit by transportation and all that. So, you can't just produce all the chemical for the entire world in Texas and transport it all around. It wouldn't work. So you're talking about a full, globe-spanning thing. At that point, if you're building factories all over the world, someone's going to figure out what your intellectual property is and all that. You would have to keep innovating to stay ahead of the competitors. I think that would limit your... Ultimately, it's a commodity. You're making commodity, so you don't have the same kind of defensibility that other sectors do.Dwarkesh Patel (01:10:18):I see. Yeah, yeah, yeah. Okay. There's not network effects I guess?Austin Vernon (01:10:22):Yeah. This is not quite consistent with what I just said about harder to enter. But I think what happens is the scale starts increasing as you go on. Even though this is easier to scale down, there's certain elements that are very much hard to scale and then the organization as well. Basically, you'll end up with early on a few competitors that continue to grow against each other and limit the margins. It'd be hard to be the fifth 30 years down the line.Dwarkesh Patel (01:11:05):What is the state of this project right now? Are you guys planning on starting a company, and what are the milestones you guys are shooting for?Austin Vernon (01:11:14):Right now, it is just me, but I have a family of engineers. We're all engineers, so it's loosely supported by them right now, by other people in my family as well, they're participating some. But yeah, basically, I just have to get... I've already done a lot of the theoretical design work at just a very cursory level to make sure it makes sense, and the cost will be reasonable and stuff like that. So now, it's working on the electrolizer to, basically, meet the targets you need for reliability and product concentration and energy costs. Also then just, is it manufacturable? Because right now, a lot of electrolyzers they use in the labs, they're literally smaller than a postage stamp, and they're very difficult to make.Dwarkesh Patel (01:12:10):Okay. I see. So you started working on this before or after you had quit your job?Austin Vernon (01:12:16):Oh, yeah. After. I quit my job five years ago or something. I was doing software stuff in between.Dwarkesh Patel (01:12:21):Oh, yeah? What did you work on?Austin Vernon (01:12:24):I worked on several products. I have one that’s an oil and gas data service that's somewhat successful. I’ve kept paying customers, but it's still relatively small.Dwarkesh Patel (01:12:37):Okay. I see. Yeah. So it seems like your blog is pretty recent, right? You started that about a year ago. What encouraged you to do that?Austin Vernon (01:12:48):Well, let's see. I was curious about cryptography in general, but specifically for blockchains. I wanted to be able to read the Bitcoin white paper and understand some of this IPFS. So I figured the best way to do it was... people talked about like, "Oh yeah, you should write, blah, blah, blah." So I did, "Well, I'll create an IPFS blog." I did that and learned a lot. It was not the most reliable blog when I was running it on my own Droplet and everything. So thankfully, I migrated to a service that has much more up time than my own server. So then, I wrote several posts to basically learn about it. I wrote posts about hash functions and private key cryptography. So then I could understand the white papers and what they're doing with the math and the cryptography. Eventually, I had this blog–– so my first non-crypto topic was on how to build a cheaper house or why it's difficult to reduce home construction costs. That made it on Hacker News and all that. It's like, "Oh, maybe actually people want to read this stuff," so I've just been writing since then in my spare time.Dwarkesh Patel (01:14:18):I actually interned for Protocol Labs, which is a place that built IPFS.Austin Vernon (01:14:25):Oh, yeah?Dwarkesh Patel (01:14:26):Yeah. So I got a chance to learn a lot about it and... about how file coin exactly works. That part threw me into a world for a while. But yeah, it's really interesting. I actually had a blog on IPFS. I mean, it was just a toy thing, not the one that I actually ended up writing on. The thing is, obviously at the moment, being it's like... nobody else is going to seat it for you, so you got to use a centralized service anyways, like Piñata, but it is a fun exercise.Austin Vernon (01:14:57):I was just running it off of Droplet and on DigitalOcean. If you use the direct content hash, it works pretty well, even if you're linking through your ENS name. But the problem is, of course, when I was first doing this, the fees on Ethereum were so high that I didn't want to change that link all the time. So I tried to use the pinning feature with IPNS because CloudFlare does the e-thought link. And then, they look up whatever your IPNS name is. And then, they tried to go find it.Austin Vernon (01:15:35):So the breaking point for me was how CloudFlare couldn't always find my server using IPNS. Now, the service I'm using is called Fleek. They basically go directly to the content hash, but on DNS it's cheap to change. You can change it in one minute. If Ethereum fees got lower, I might switch back to that, but I don't want to... Eventually, and I think it will be. What if it's like 1 cent transactions? Then it would be no big deal to just change the content hash every time you update your website.Dwarkesh Patel (01:16:17):What is the reason for having it on Ethereum?Austin Vernon (01:16:21):Just for fun.Dwarkesh Patel (01:16:23):It is inconvenient, I guess, if your content hash is changing every time you update the website, so you got to keep re-updating the actual... where people can find the site or use some other service to take care of it.Austin Vernon (01:16:34):I mean, yeah, if transactions are cheap, then you just have... You could automate it all, and it just cost you a little bit of money each time, and it'd be fine. But it was like $50, and I'm not going to pay $50 to post a blog post.Energy SuperabundanceDwarkesh Patel (01:16:47):Yeah. Yeah. And then, you find a typo. It's like, "Oh, gosh, I can't fix that." So you have a paper that you recently released with Eli Dourado on energy superabundance, and you have lots and lots of interesting speculation in there for what might be possible if energy gets a lot cheaper. I think we should just jump into it. On the big picture, as I'm sure you're aware, per capita energy used since the 1970s has not gone up. Before that, there's this thing called the Henry Adams Curve, where per capita energy use would increase 2% a year.Dwarkesh Patel (01:17:22):After 1970, that was no longer the case. Ironically enough, right after, the Department of Energy was created. But nonetheless, we've still had economic growth since the 1970s. I mean, it's been slower, but even though per capita energy hasn't increased per capita, GDP has increased. I think in the paper's abstract or the introduction, you talk about why increasing energy use is necessary for increasing economic growth. But doesn't that pattern suggest that you can still have decent economic growth without having to use energy, or have we just not come across the constraints yet?Austin Vernon (01:17:57):Hey, I mean, you just have diminishing returns. There's physical limits to how efficient things could be, and as you get closer to that efficiency limit, it's harder and harder and takes more and more effort. There's some diminishing returns there, where if you can just... A perfect example of what we were just talking about is oil's quite expensive and natural gas is expensive too. Oil’s easy to transport, you can produce it anywhere in the world and get anywhere else pretty cheaply. Natural gas is extremely expensive transport, but it's very useful fuel and for also making fertilizer. Not everyone has natural gas or the economic capability to extract natural gas using traditional processes. So if you have independent energy because you can just build these natural gas factories, where you're just using sunshine and water and air, then all of a sudden everyone has access to natural gas even if you weren't blessed with easily obtainable, natural gas reserves.Austin Vernon (01:19:00):I think that there's this whole story about the tyranny of geography here when it comes to energy. Because there are some countries that have extreme electricities per capita, like Iceland and Norway, where they have crazy amounts of hydro-power and people build aluminum plants there and stuff like that. Then you have places in Africa, where they have no coal, very little gas. They're just energy starved. Their transportation system sucks. You can't transport coal in.Austin Vernon (01:19:39):The hydropower is... There's only so much of it. It may not be close to where their cities are. So if you start adding solar to the mix for them, and some of these other technologies, it could really be an incredible increase in energy availability for them. I think we talked about that in the paper. We're looking at doubling rich-world use of energy, but it would be more like 10x more if you live in Africa.Dwarkesh Patel (01:20:08):Yeah. Yeah. So I wonder, if that's the case, then as energy becomes that abundant, will it just be other resources that become the bottleneck in terms of what our civilization needs... ? For example the actual resources that are necessary to build the factories and the raw materials? To what extent can even that be...Austin Vernon (01:20:34):I would argue the ultimate limit is like.. it is really human capital. What more abundant energy does is it allows you to redeploy human capital away from trying to figure out how to use scarce energy sources. Here's an example I love about trucking. I love trucks, not as big a fan of freight trains, but freight trains are extremely efficient. They get like 10 times more efficient than a truck or something.Austin Vernon (01:21:15):They use just very little fuel, but the flip sde is that the train doesn't come by all the time and they may not hold to the schedule. You have to aggregate your product with the other stuff or your raw materials, and it adds a lot of cost to your production. Toyota production system runs on trucks, not trains. The reason is that trucks are just extremely flexible. They come when you need it. They go when you need it. And even then, people still complain about truck drivers not showing up when you want them.Austin Vernon (01:21:51):When you have cheaper energy, this electrification and automation of trucking, you are going to shift a huge amount of goods from trains to trucks. And it's going to just have huge knock on effects all across the economy. It's more specialization. There's a lot of products that you're just limited to your suppliers because transportation's expensive. It reduces working capital, because a lot of times it takes longer on trains, similar stuff like smaller ships, more air freight. One thing that shocked me as Eli was telling me about how the elasticity of demand for air freight is just insane. When you even decrease the cost a little bit, demand goes to the roof.Austin Vernon (01:22:37):So I'm pretty sure that there'll be some kind of... You always think, "Oh, we can't do this with batteries," and then someone comes up with a more clever idea. So even if you have a 500 mile rein limit for your freight plane. The freight doesn't care if you have to stop every 500 miles to refuel or recharge. You can go over land on almost all these routes. You could go up through Japan and the Aleutian Islands, or you could go overland from China to Europe, charging just wherever's convenient.Austin Vernon (01:23:15):If that electric plane has half the operating cost of the jet plane, the amount of freight you're moving on airplanes will go way up, and it'll go down on ships. And then, everyone will be better off. Because right now, if you're a shipping company, you have real working capital problems, because your stuff sits on a boat for a month, and you've got to finance that and do all this stuff. And then, what if things change in the meantime? Like, "Oh, I don't really want that product anymore," so the air freight is just an absolute economic, just booster. So if you could make that cheaper, it's really exciting because it uses way more energy.Dwarkesh Patel (01:24:01):An analogy that had just occurred to me is, you could imagine that with computational power, if Moore's Law had stopped in 2005, we would still have a lot of interesting applications using compute and the effects of the computer would still have permeated society. But obviously, a lot of things that are possible today with computers, they just wouldn't have been tried or been possible in that kind of world.Austin Vernon (01:24:27):Okay. Yeah. I mean, all your engineers would be working on optimization instead of building new products.Dwarkesh Patel (01:24:34):Yeah. I think in J. Storr Hall's new book on... "Where's My Flying Car?" One of the points he makes is that GDP growth has been probably overstated because a lot of what constituted the growth has just been increasing the efficiency of existing machines to make them use less energy. Which still doesn't result in more total resources or goods or services being produced. But yeah, instead of making the laundry machine more efficient, you can just create a new kind of machine that may need to use more energy. So for this vision to come to pass, do you need energy to... Is it just enough that energy becomes super cheap or do you need advances in the ability to store that energy as well? So for example, lithium batteries are the bottleneck, does it matter if you can get energy super cheap, if you can't put them in appliances or cars or planes or whatever?Austin Vernon (01:25:33):I think the important thing to think about here is that our current energy is so expensive, especially electricity. With our energy resources, which are basically thermal, it's quite difficult to make electricity comparatively. And so, what we use electricity for is stuff we really want to use electricity for. It's hard to imagine that... We're not going to turn our air conditioner off. We're going to run it. And so, we're willing to pay a lot of money for that electricity to run our air conditioner. Whereas, if you look at really closely at a lot of the use cases that use tons of extra energy, they're much more flexible in how they use the energy. There's not a whole lot of storage evolved. If you're looking at growing crops or making methane for rocket fuel or making chemicals, you can design these processes to run when the energy's available. And so, the batteries are really going to be for keeping air conditioner on.. where you're willing to pay a lot of money. So I don't really see the batteries and storage as a limit.Storage for Cheap EnergyDwarkesh Patel (01:26:47):Okay. If you had something like air freight, right? If that's the thing we're concerned about. Wouldn't you need some way to store that electricity for air freight, or maybe you can just convert it to jet fuel? Is that what you're saying?Austin Vernon (01:27:03):Yeah. I was thinking of more grid storage, but yeah, transportation's going to dominate battery demand. Grid storage is tiny in comparison, but I think you're basically getting to the point where we're making batteries out of dirt because that's how you scale it. So, if you're making batteries out of carbon and iron and phosphate, it becomes about how many battery factories you want to build. There's plenty of lithium, it's just you have to build the lithium mines. I don't really see any hard limits there eventually. Once you build all the factories, then yeah, you're pretty much ready to go.Dwarkesh Patel (01:27:44):Is the point you're making with the alternative batteries that even if they're worse than lithium batteries we'll have just so much energy that it doesn't matter? As in even if we lose a lot of it, that's fine, we'll just use whatever we can take. Or are you saying that we'll produce batteries with other chemistries that are as good as lithium batteries or better?Austin Vernon (01:28:06):Right now the shortage is really nickel. So in the very short term, lithium's kind of starting to be a shortage, but there's plenty of lithium. It won't be a problem. With lithium iron phosphate or whatever, there's a huge amount of substitution right now because it's avoiding nickel. It's not quite as good as some of the nickel chemistries, but for a lot of applications, it just doesn't matter like for a lot of cars and everything like that. And you're going to have the aircraft and stuff paying the premium for the high energy density batteries. Eventually  technologies could just use less and less materials because they're better batteries, like some of these concepts around solid state. I'm not sure if those will come to fruition and if they'll be really that much better when they do come, but I think there's lots of opportunities for substitution down the line.Dwarkesh Patel (01:29:03):What is solid state, by the way?Austin Vernon (01:29:04):Right now, all our batteries charge and discharge through the lithium ion going back and forth between the cathode and the anode. It travels through a liquid and the liquid is electrolyte, which means ions can travel through it. Solid electrolytes are a little more challenging so that's why we don't have them. You get rid of the liquid and it's just like the ion has to travel through a solid instead. The promise is it could be a much higher energy density and theoretically cheaper too, just because it weighs less and stuff, but there's all sorts of problems around how they degrade faster. Batteries have six different areas where you have to hit the requirements and if you miss one, then it's no good so they're kind of hard to improve in that sense.Dwarkesh Patel (01:30:02):I guess if the energy super abundance is going to come from solar and wind, obviously these are intermittent sources of energy, in that case, you would need there to be progress in the battery storage, that's contingent on that. Right?Austin Vernon (01:30:16):Yeah. I think that's what I mean, a lot of the extra energy uses that we talk about don't really require many batteries, if any batteries at all. The transportation, yes, you have batteries in them, but if you're going to have abundant nuclear electricity, or abundant geothermal electricity, you still have to build all those electric vehicles. You still need the batteries for that. So the extra batteries that solar and wind require over geothermal, I think could end up being pretty minimal. Maybe the way I think about it is if you can have solar, a farm that's going to give you $10 a megawatt of our electricity, you have to figure out how to utilize that. And if you do, then you'll be very rich and you'll beat the guy who's paying $40 a megawatt hour from the more expensive traditional generators.Dwarkesh Patel (01:31:12):Yeah. But before we get into which sources of energy are most promising, let's talk about some of the other applications of an energy support abundance. Obviously we talked a little bit about travel, but one thing that might be concerning with air travel, at least for passengers, is if the bottleneck step there is TSA and other regulations, to what extent will reducing the travel time or increasing flight speed or number of flights have an impact on how much time you're going to spend in an airport or in transit?Austin Vernon (01:31:47):Well, so right now, if you think about Airbus, they have this super jumbo thing. I can't remember what that plane’s number was, but none of the airlines really loved it because it's too big. It's too hard to get everyone loaded and unloaded and you really just hit this economies of scale. So the electric planes are likely to be just tiny in comparison, 10 passengers. It's easier to load and unload or you're going to fly out of smaller airports so you won't be going to this giant regional airport that just, has all the parking problems and all the security, you'll be driving to your neighborhood general aviation airport, where there's a small line to get through. And a lot of these small aircraft, under certain situations, even avoid some of the screening requirements, because they're just not as dangerous. If you have a small plane, there's only so much damage you can do with it. Dwarkesh Patel (01:32:42):I did not know that. I got to start booking planes from the smaller airports or something to avoid the TSA.Austin Vernon (01:32:48):It's very nascent, but there's some business models that are coming down from the net jet style to a little more commercial. I think that they're trying to hit a price point that's similar to first class, but you get to avoid all the airport craziness. And I think, I'm just kind of a believer in if that existed, people would get angry enough that they would loosen up a lot of the rules. It seems impossible to change those rules now, but I think for the average person, it just costs them no time because most people don't even fly very much.Travel in the FutureDwarkesh Patel (01:33:26):Yeah. Do you want to talk about your vision for what a city could look like if energy got a lot cheaper? In the paper you have all kinds of interesting projections about drones and electric deliveries and just the entire congestion of the 3D space, and I guess with tunnels as well. Well, what does the city look like with energy superabundance?Austin Vernon (01:33:48):Basically disaggregate the car to a certain extent, inner city car trips are less because flying's going to be cheaper and it's going to be more convenient to have the bots deliver your stuff. I love the tunnels because I don't like taking people's land so with tunnels you can run new roads and everything without imminent domaining and taking people's land away from them when they don't want to lose their land. That process is so, it makes people so angry when you take their land that it's very expensive to imminent domain people, because they will fight you until literally the sheriff has to show up and haul them away. If you can go around that with tunnels existing right away it just makes that societal cost of doing some of this stuff significantly less expensive and it's then just the engineering challenge.Future CitiesAustin Vernon (01:34:54):I think there's really an opportunity now there. Boring Company is the most famous, but recently I think there's another company that wants to do tunnels for electricity. They have this plasma boring machine concept–– it seems pretty crazy right now, but it's just one of those solutions where you're going to reduce the coordination cost across the whole economy and improve property rights so people should really try to build it.Dwarkesh Patel (01:35:26):You mentioned one of these machines in your blog post on tunneling and it was DS, SpaceX1, I forgot the name of it, but it's like this insane thing.Austin Vernon (01:35:34):Prufrock?Dwarkesh Patel (01:35:35):Yeah, exactly. It's pretty big but apparently it's all electric, which is kind of insane, and it can just do it in one go. How is it getting the material out if you're just doing the tunneling in one step?Austin Vernon (01:35:51):The problem is that most of the tunneling is in soft soil and it's difficult to drill through soft soil because of the materials handling. When you first start drilling an oil well through this stuff, you actually have to limit your drilling speed and you don't even have to put any weight on the bit, just the pumping fluid around basically jets out the fluid. That's kind of what you're doing with the boring machine and the soft soil stuff. So managing the spoils, which is they have muck carts a lot of times, I think maybe it's basically like trying to do a conveyor belt, but you could also just make it a full liquid and pump it out. In the oil field we carry our cuttings in mud and we pump it.Austin Vernon (01:36:36):Then they have, the other big challenge is they have to keep the walls from caving in on them so that's... Current boring machines and soft soil spend enormous amounts of time erecting these tunnel supports that keep it from collapsing in themself. So it's kind of counterintuitive. It's actually dramatically faster to bore in hard rock than soft soil because in soft soil you spend so much non-productive time, whereas in hard rock, you're just blowing and going.Dwarkesh Patel (01:37:09):Interesting. Yeah. Okay. To get back to the cities, you mentioned something in the paper, Marchetti's constant, which is about how the amount of time people spend in transport per day is the same so if you just increase the amount of speed in which they can move with VTOLs (Vertical Takeoff and Landing) or other kinds of things, then they have a wider surface area in which they can explore. Right?Austin Vernon (01:37:37):Yeah. I don't know if physically the cities will look that much different, but their effective economic size will be much larger because you could live in Cedar Rapids and commute to Minneapolis with some of these technologies. Your city in Cedar Rapids still looks the same, but you don't have to work there. If you have a better job in Minneapolis, you could commute there three times a week or whatever it is, five days a week.Dwarkesh Patel (01:38:11):Yeah. It's super interesting. But does that imply, by the way, that if the commute time stays the same and people just get more spread out.. If energy becomes cheaper, then neighborhoods and cities kind of become this unwalkable mess out of a Jane Jacob's nightmare if the conglomeration goes away?Austin Vernon (01:38:29):I think it's actually the opposite. If you have tunnels and if you have some, these alternative methods to cars, then you use cars less. And I think in many cities, they never made sense for cars anyway, because they were built before cars. In New York city, you're never going to move everyone around on a car unless you build tunnels, you could then. But even then I think there's other technologies there that make a lot of sense. I think people like walkable so even though I live in a city that requires a car, some of the hottest neighborhoods are walkable neighborhoods where the neighborhood is walkable itself and then you just drive your car to wherever else you need. The car is hidden within the neighborhood.Dwarkesh Patel (01:39:22):Okay. It's interesting. I guess we'll see more segregation (not in the racial sense or anything) but in the sense that people will prefer to live in these walkable neighborhoods so they don't have any problem commuting to work using a VTOL or something. What you would end up seeing is these walkable neighborhoods and then industrial zones that are way far away, distance wise, but not that far away time wise.Austin Vernon (01:39:46):Right. And it's the same for if you want to live in a small town. Now it would be too far to commute to the city, but you could in the future. Flying CarsDwarkesh Patel (01:39:56):Yeah. More choice. I see. What is holding back VTOLs? VTOL, by the way, is Vertical Take Off and Landing. The reason you need to go to an airport is because you need a large landing pad to take off and land. The hope is that if you could just vertically take off, then you would be able to lift off from your roof or something. Obviously we've had prototypes of this kind of stuff since the thirties. Why don't we have these widely available? Is energy the constraint, or is it something else?Austin Vernon (01:40:26):Well, I think in the past, theoretically liquid fuels were dense enough, but they're too complex, too expensive because when you're turning heat energy into mechanical energy, it's just a lot of weight and complexity comes with that. Some of these old concepts, you have all these engines and all that. And so if you electrify them, it really changes the game. Because it's not just batteries, it's the motors, it's the inverters, that are now getting dense enough and small enough to make sense. It takes time to get this stuff through the FAA, for better or worse. The technology hasn't been good enough long enough to get stuff through the FAA.Austin Vernon (01:41:14):And there are some limitations I think right now. A lot of people wouldn't use batteries and the batteries are just on the edge of good enough. You're going to have a 50 mile VTOL, not a couple hundred mile VTOL, but eventually my dream VTOL application is a nuclear power quadcopter that carries a container. So you can take the container directly from the factory in Vietnam or wherever, directly to the people who are using it or the warehouse in Arkansas or whatever.Dwarkesh Patel (01:41:50):Yeah. That would be interesting. Theoretically, you could have these drones that are carrying these huge payloads, weight wise.Austin Vernon (01:41:58):But you wouldn't necessarily want a large payload. You just want whatever the customer wants, you want to size your vehicle to deliver that payload, and that's the most efficient.Dwarkesh Patel (01:42:12):Oh, I see. Right. Because it doesn't need to be a shipping container or a shipping vessel where you just have it be huge. And then what does this mean for computing? If energy gets a lot cheaper, I guess if Bitcoin mining becomes, well, it doesn't necessarily become more profitable because other people's energy's cheaper too, but what are the other consequences? Is spinning up an AWS server just become trivial now and then building a deep learning model costs nothing in terms of GPU time? What impact does this have on computing?Austin Vernon (01:42:48):Yeah, I think the limitation would probably still be just chips for a while until you figure out a better production process for that. I think it'd be a while before it becomes energy. I think smartphones really worry about energy. There could be some interesting things with smartphones if you have a very power dense betavoltaic battery which is a nuclear battery that you don't have to worry about running down. But outside of smartphones, I'm not sure that energy is the limit for a lot of those computing.Carbon ShortageDwarkesh Patel (01:43:26):And one of the interesting things that you speculate about at the end of the paper is about a potential carbon shortage. I think in an email to Tyler Cowen, he published on his blog, you said by the end of this century, we'll have a carbon shortage because of the process you talked about earlier, the thing you're working on, if you can take CO2 out of the atmosphere. What is the probability that this ends up happening? Do you think it's more than 50% by the end of the century or is it just speculation?Austin Vernon (01:43:58):I think it's extremely high that it happens and it's harder to put the timeline on it. By the end of the century might be a little, I think I ran some numbers in there and if you 10X current plastic production, and then you're just land filling it all, I think it was a little over a hundred years to get, and you're assuming you're out, the rest of your carbon output is zero in that scenario. But it's probably pretty hard to do it in a hundred, by the end of the century without a lot of growth, but it's kind of the exponential thing that can get you where... I think some large number of the carbon emissions have happened in the last 20 years, and it was very small before 1950. You could kind of get surprised at the back half, the last 10 years it goes crazy. It makes it hard to predict.Dwarkesh Patel (01:44:53):By the way, in Will Mcaskill’s new book on longtermism, one of the things he speculates about is if society collapses and we need to restart, one of the things we'll need is coal or some other sort of dense, easy-to use-fuel. And the problem is we've been burning up easily accessible coal, like coal in places where we could just dig up and find it, and so one of the things he's concerned about is making sure we leave some easily accessible coal silos around so that in case society collapses, we can restart and use these to power up a second industrial revolution. I wonder if you could use a process like this with carbon sequestration to actually just build up these kinds of reserves. I don't know if a long term, if somebody's really interested in making sure we have that kind of resource. They could just use this process to... Is that possible? OrAustin Vernon (01:45:51):Actually there's a company called Charm Industrial, and they're basically doing that because they take trees and they do a process called fast pyrolysis. It's where you burn biomass without oxygen, anoxic environment. And it makes this bio-oil and then they're injecting the oil down into wells and selling carbon credit. So it's already happening, you could say.Dwarkesh Patel (01:46:15):Oh wow. And that’s easy to burn and stuff? Austin Vernon (01:46:21):Yeah. If you just want to burn it for heat, it's okay, but it's hard to refine. There are a lot of people that tried to do bio-oil as an alternative for petroleum 20 years ago, Cleantech 1.0, and they all failed. So it makes me laugh that they're reimagining the process to sell what are right now very expensive carbon credits. But you could do something similar. Actually you could do something similar just to make straight carbon and stuff if you wanted to.Dwarkesh Patel (01:46:50):Okay. I see. The thing that I find interesting about this is that often in the case of global problems, people will early on identify that a thing is going to be a problem, but it often ends up being the case that they get the direction of the problem opposite. If you think about population, in the seventies, people were correct that global population was going to be a problem. The thing is, it seems like now the problem is going to be that the population might decline too fast, not that it's going to grow exponentially. And I think this is another example of this kind of thing where CO2 is going to be a problem either way. It just, I'm not sure if it's going to be a problem where we'll over reproduce it or we'll have shortages.Austin Vernon (01:47:36):Yeah. If you just think about the large scale, if you're going to be like Kardashev, whatever scale civilization, where you're using condensed amounts of energy, that's going to have side effects and you're going to have to figure out how to manage that one way or the other. One of those is eventually earth may just be a nature preserve and we all live in space or something.NuclearDwarkesh Patel (01:48:01):Yeah. Okay. Let's talk about nuclear energy. It seems like you're much less optimistic about nuclear energy than you are about solar and wind. Do you want to explain why that's the case?Austin Vernon (01:48:15):Yeah. Well, especially solar more so than wind. Wind, I think it's limiting because it's transmission problems and again, if you want to build out huge amounts of wind like some of these zero carbon plans call for, you're going to have to take a lot of people's land to build transmission lines and stuff. Which really pisses people off and they fight hard and it becomes expensive. It's not like... The wind turbines are relatively easy to sight because you pay people and you'll actually see, they never put above ground power lines on the people's land, where they put the wind turbines. They're always underground so at least they get to the county right away. But when you get these giant transmission lines, like Grainbelt or something, they almost inevitably have to go across a lot of people's lands and you can't just stuff them all in county and state right aways because the pylons are so big.Dwarkesh Patel (01:49:12):Sorry, what is the pylon?Austin Vernon (01:49:13):The pylon is what holds the wire up, the tall tower. Yeah, solar is, it's much more flexible where it can go. I think when it comes to solar getting cheaper, the obstacles are just pretty simple. It's like, "Well gosh, it's expensive to put all this racking. Why don't we just lay the panels on the ground?” “Gosh, this glass we're encasing with is getting expensive and we don't need it to last 80 years or 50 years. We can just put some plastic on it instead." We've gotten these, the actual materials and stuff so cheap and all the other labor and stuff is getting more expensive. Well, why don't we just add another layer and make more energy? Those are your solar solutions to get down to $10 a megawatt hour, and they're pretty straightforward.Austin Vernon (01:49:57):Whereas nuclear is like, "Well the light water reactor can't get us there. Let's instead cool our reactor with sodium, which catches fire when it, it explodes when it reacts with water and catches fire when it reacts with air." Or there's, you could cool it with liquid lead. That's an option. Helium, which leaks a lot. Or you could do molten salts that corrode everything. We don't really have anything like that, and so I think when you start looking at, this is for large reactors. So I think those solutions for very large reactors are pretty hard. It's pretty difficult. And there's a lot of reasons why. Why did we make these weird choices? Well, a lot of stuff just reacts poorly when you expose it to neutrons and stuff. They each have their own features that make them possibly good candidates.Austin Vernon (01:50:57):I actually think regulation is actually, it's oversold a little bit. And I think actually to the extent that if people were internally consistent, then they would see NRC as a regulatory success story because, the background on this is my wife's mom and step father are nuclear engineers that have worked at all levels of the nuclear power industry so I get to ask them the general questions and learn a lot about it, which is nice. It's very helpful for learning about it.Austin Vernon (01:51:33):But there's, back in the eighties, the nuclear power industry was in real trouble because their competitors in coal and natural gas got deregulated. Most of the cost of coal is the rail getting there, and the rail industry got deregulated and then the national gas industry got deregulated. So the cost of their alternatives was falling and they had to build more safety into their plants because of all these, it wasn't just three miles out. It was Browns Ferry. It was Rancho Heco, all these things that could have been really scary and, to a certain extent, we got a little bit lucky that we didn't have a worse disaster. They were just relatively limited accidents at their sites.Austin Vernon (01:52:25):There was actually a time where nuclear power plants were selling for less than what their fuel was worth in their plant, around there. What the industry did and what NRC did is they moved to probabilistic risk assessment, which is usually the gold standard. People are really happy that we use probabilistic risk assessment for commercial crew, with NASA and SpaceX. And they want the FDA to use more probability, more expected value. What this allowed was it's basically you're rolling up some of the rules and moving it into the risk assessment. Around 1980 nuclear power plants only ran about 60% of the time. They weren't very reliable. They had all sorts of unplanned outages, stuff like that. The safest mode of operation is just running as designed. The more consistent nuclear power is, the safer it is. The probabilistic risk assessment allows you to do repairs while you're running, which was kind of discouraged before. It'll be like if your main cooling pump is leaking, before you'd be like, "Oh, gosh, I hope we can make it," and then eventually it just fails and you shut down the reactor. And now it's like, "All right. Well, we have backups. The safest thing to do is actually repair it now while the plant's still running and then get it repaired and put it back online." Not only, to give you the idea of the safety standards that NRC has, I think for the nuclear plant taking damage is one time in 10,000 reactor years. And then for a large release it's one in 100,000 reactor years, and there's 93 operating reactors that––less than 93 sites. We should only see a three mile island under the current standards once every hundred years or so. A large release, like a Fukushima type situation, should only happen once every thousand years.Austin Vernon (01:54:37):But they had, just in a few years in the 1970s, the industry had three or four of these damage events at least. I don't know how many officially count, but probably at least three. The safety is incredible. And now the operating capacity is up to over 90% so the plants are just extremely reliable and it lowers their costs because their costs are so fixed. When you compare it to a country like France? They've had a lot of reliability problems with their nuclear fleet in the last couple years. This year, their capacity factor I think is barely over 60%. We have 90 gigawatts of nuclear. They have 60 gigawatts. That makes a huge difference for Europe that those plants aren't running full out. And it is really, you see a lot of charts about, "If Germany didn't shut down its reactors, what would the energy balance be?" But you don't see as many, "If the French could run their reactors like American reactors, what would the energy balance be?" I could go on about how that integrates into new plants, if you want to know about that.Dwarkesh Patel (01:55:46):Yeah, I do. Because the line I've always heard on this from my bubble is like, "Oh, they haven't approved a new plant. The NRC has not approved a new thing since, a new plant, since it was created." I guess they just approved the design for the new, small modular reactors, which I guess I'd love to hear your opinion on as well. I'm very curious to hear this perspective.Austin Vernon (01:56:07):Well, okay. So think about it, you're in the 1980s, you had new sources of fuel, you had new competitors, you also, by the end of the decade, increased the amount your nuclear power plants ran by a lot. So a lot of these new power plants that people were thinking about building were at existing sites, like an extra reactor at Watts Bar or whatever. And well, you basically just got like a buy two, get one free, by running your plant better. So you don't really need them as much. So all those contributed to just not making sense to build new nuclear power plants, because the existing fleet ran better, and more competitors, and electricity demand slowed down.Austin Vernon (01:56:50):Is it hard to get through NRC approval? Yes. That last one, the mini reactor you're talking about took 10 years or something. But when you think about a probabilistic risk assessment, no one ever says, "Well, gosh, NRC's current standards of a large release, which would basically happen one every thousand years... We're not arguing over that. We're just talking past each other, I guess, instead.Austin Vernon (01:57:19):So to me, that's a pretty reasonable risk level. If you're going to 10x your reactors,  that means almost certainly you'd have a Fukushima within your lifetime if you go with NRC standards. But it actually turns out that it's pretty cheap to do way better. A lot of the reason why the plants weren't built may not necessarily have been because of regulation, but because the market conditions changed. You had more competitors, and the coal with the gas, being deregulated. And then you also had increased production from the existing nuclear plant. So if you're going to build an extra nuclear plant or an extra reactor at an existing site, then you might not have needed to anymore because you got so much more production out of your existing plants. Stuff like shortening the fueling time and all-around improvements, paired with electricity demand flattening is what really made new plants not economic or not necessary.Austin Vernon (01:58:27):When we really think about the probabilistic risk assessment, it just takes a lot of engineering time to get it through. If you look at how hard it was for SpaceX to get Falcon 9 and Dragon through NASA's loss of crew risk calculations… it took years, it took hundreds of millions of dollars. So it's kind of funny that people see that as a success. Especially when the stakes were only a few lives for people that volunteered for danger. And then you have a nuclear power plant, where we're going through the same problematic risk assessment, and it could impact many more people's lives. That's not good enough. So I think it would make more sense to argue about the risk factor, how much risk we should take with the actual numbers, as opposed to just like, "Oh, I'm mad that we're not building nuclear power plants."Austin Vernon (01:59:28):Actually it becomes very inexpensive to improve the risk probabilities, because the old plants that we're running now have active safety systems, which means you have to maintain them and they have to work. So if you want to move the control rods back into the reactor, well, there's like a mechanism and a motor that does that that can fail. So when you're calculating your risk, you have to calculate, "Oh gosh, what if this motor fails? Or what if my control fails? Or what if I don't have a properly trained operator to do it?" And it's the same for the cooling systems. But this new generation of plants, they have passive safety systems where natural convection can cool a reactor in an emergency, or... The rods are more like a dead man switch, where if something happens, they just drop in from gravity. And so the new power plants, like this one that just got approved, or the one they're building down in Georgia, can be orders of magnitude safer than the running plants.Austin Vernon (02:00:29):It's not really a huge cost increase. You're just changing how you do these things. In fact, if you look at all the literature, they're actually supposed to be less complex and easier to build. But you're talking about a project that is so complicated, it takes thousands of workers, years and years to build, working every day. And it's like, if you're going to go through and do the engineering in great detail to prove that you're playing it safe under the problem risk assessment, it's going to take hundreds of thousands of hours of engineering time. That's why you see... I mean, why are investors willing to pay that at this point, after you build it because of the rank and cycle and all that, like is it going to generate economic power? The fact is it's not necessarily going to. I think one way to think about this is my father-in-law.Austin Vernon (02:01:27):He always says, when people ask him about why we're not doing more nuclear, he says, "Well, you have to think about the politics first, and economics second." Those are the important ones. So people are submitting designs to build plants that are big enough to impact lots of people's lives, even if that risk is very low.Austin Vernon (02:01:47):Some people still are bothered by that. But also, they're selling an easily substitutable commodity in most cases. I think a lot of times on the political side, if you can substitute nuclear power, people will. Even if it's coal or whatever, people don't really care that much about the emissions. They just care about their electricity turning on. And I think you see the opinion change very fast when nuclear power is no longer the substitute. All of a sudden Germany's like, "Well, we could turn our reactors back on." Or Japan, same way. They've had these reactors off for years, but now that there's an energy crunch, they're like, "Well, let's turn em back on."Austin Vernon (02:02:25):So I think the future for nuclear power, which would be a better future, is you create products that impact less people's lives, or have the potential to impact less people's lives, and also are not substitutable. I think that means small reactors. If you have a battery that can power your phone or have a little battery out in your garage that can power your house, these are hard to make. There's a lot of problems, especially in power density–– nuclear is very energy dense, but not necessarily power dense. So you have to do a lot of work on that to get there. But one of the most exciting examples of recent nuclear technology is these people at some national labs and NASA got together and created this KRUSTY reactor, and only to, it's only one kilowatt. So it's small. I think the thing weighs 400 kilograms. It fits in the room. But they got the whole project done in a couple years for less than $20 million. And it worked great. It's very safe, just because, partly because it's so small, but it has almost no moving parts. The whole thing has a Sterling engine on top, and that's the only moving part. Austin Vernon (02:03:19):So it's really... And there's several startups now that are working on improving that technology and commercializing it. So that's the kind of nuclear stuff that when I talk about small nuclear, micro nuclear, is really exciting to me because it has so much potential. And when you start putting nuclear in that small form factor, there's no other energy source that can compete with it on energy density. So you can do things you could never do before, whereas selling to the grid in a large power plant is like, "Well, I can do that in lots of ways." And if you think through this lens, then you see the entire nuclear debate is the nuclear proponents trying to claim that nuclear is not substitutable, and that we should pay more, accept the risk, or whatever. And maybe we should, but it makes it hard to promote that technology. If you could have a phone that you never tried to charge, people would love that. It'd be like, "I don't care if that's nuclear. I just have a phone that never goes dead."Dwarkesh Patel (02:04:41):I guess the question is: is the lengthy and expensive process necessary for the probabilistic risk assessment? If there's a way you could just have the process not be more streamlined, and be as effective in evaluating the harm. I guess another thing is if we haven't seen... Zero people, or very few people have directly died from nuclear, right? So is it just that we've gotten lucky or you're saying that could have been way more, and we're just in a lucky timeline?Austin Vernon (02:05:14):I guess I'll go backwards a little bit here, on answering those questions. I think what people are responding to is even if Fukushima didn't have airborne radiation (that was very dangerous) people still got removed from their home. And there's a lot of costs for associated with that. It's hard for me to believe that if we had a similar thing in the US, there wouldn't be some type of mandatory evacuations that were really unpleasant. If you could get your power from coal or natural gas, without that risk, I mean, a lot of people would make that trade off.Austin Vernon (02:05:54):And I think the other thing with Fukushima is, as I understand it, because it was on the ocean with fast currents, they were able to use a lot of seawater to keep the reactor from getting too out of control. But they were just dumping a lot of the radioactive stuff into the ocean, but it was dispersing quickly, it wasn't a big deal. So if you're on a freshwater reservoir like most US power plants are, your risk equation might have been different there. I don't know enough about it to know if that really matters. But I think the main thing is because of the precautionary principle, people are still going to get removed from their homes and people don't like that.Austin Vernon (02:06:39):Let's see. I'm making it... I mean, you can always streamline processes, but the thing is, people are submitting designs that are extremely complex. So whether your design is ultra safe, or not safe at all, to do all the engineering to prove that costs about the same either way. So that's part of why these new plants are so much safer than the NRC standards. It's just not that hard to make them that much safer. And you're going to spend the same engineering resources no matter what, based on your plant complexity. So that's the difference why KRUSTY was able to go through so fast. Their thing is very simple. They don't have very many moving parts. There's only so many things that can go wrong with it. I think that's what's exciting to me about these other startups is they have the potential to get through faster, with less money, and then there's real markets and remote power space, military, where people are willing to pay the premium for these initial models.Dwarkesh Patel (02:07:43):Okay, I see. Okay. So you're not bearish on nuclear in the future, given the new designs with passive cooling and stuff like that. It was more like the old designs that you're pessimistic about, is that correct?Austin Vernon (02:07:56):Yeah. I mean, if you look at what the cost of electricity is going to be from that, if they ever build the reactors that just got proven or just got approved, it's quite expensive. I think usually it's around like $40 - $50 a megawatt hour, best case, but more likely it could be up to like $80 a megawatt hour. So they're not building it in deregulated power markets, because you lose money. But there are places where it could make sense. Some places, like in Europe, have very expensive electricity.Dwarkesh Patel (02:08:31):And Japan and Singapore, and there's a lot of other places that are...Austin Vernon (02:08:34):Yeah, yeah. So there could be some markets in there, but that technology then still has to compete with those places building solar panels or all these other technologies that you could do. Then there's the whole argument, well, nuclear can do this and that, but I think the people building the reactors clearly don't want to build them in deregulated power markets because it's not economic. That's why I'm excited about the small, because there's alternative markets other than selling this substitutable commodity that's very cheap.Dwarkesh Patel (02:09:08):Have you talked to Eli about this? What is his opinion?Austin Vernon (02:09:12):Yeah. So Eli finds out about these new startups that fit this bill and sends me the information on them because he knows I'm excited about it. His specialty is governmental affairs. So I'm sure there's still lots of opportunity to improve the process at NRC. Recently INPO, which is the industry group that's very much a German style industry group, it's very powerful, their goal with NRC was to reduce the nuclear rules by one third. And then you also have NRC writing new standards for gen-four reactors that's supposed to be done in a couple years, but Congress instructed them to do it. So there's lots of opportunity to try to improve the process, but it's very complex. I'll give one example, the Browns Ferry accident. The main thing that came out of that was, you can't have control cables for safety systems on, redundant safety systems on the same cable tray, because that cable tray catches on fire you lose both systems.Austin Vernon (02:10:14):So it's very, very expensive to run extra cable trays and all this cable separation. That's actually one of the problems that's delaying Vogtle and Georgia right now–– they had 500 issues of safety systems sharing the same cable tray. So they have to build all new cable trays and clean out the mess of the stuff they already built and redo it. Super expensive. So the NRC tried a pilot program where they did a performance base safety as opposed to just the strict cable separation rule, and I think Oconee was one of the power plants that tried it. It ended up being more expensive than just the simple rule. So the reality is often very complex. I think when you have these complex plants, it's just hard to do. So it can always be improved, but I think the small could end up greatly out competing the large because they have less complexity.Dwarkesh Patel (02:11:18):You had a small section in that piece about fusion where you were especially pessimistic about fusion. Well, what is your take on fusion?Austin Vernon (02:11:28):Well, it's kind of the same thing. I'm not pessimistic about fusion, I'm pessimistic about fusion technologies that heat up water to make steam, and run it through a steam turbine.Dwarkesh Patel (02:11:37):Because they're not efficient?Austin Vernon (02:11:38):It's just so expensive. Literally just pitting in the steam turbine and the condenser and all that kind of stuff you need for that, basically makes you uncompetitive on most deregular power markets.Dwarkesh Patel (02:11:53):Yeah. So I mean there's startups who have plans to do direct energy conversion. I don't know how feasible those plans are, but yeah, presumably you think those are... In those cases, do you think fusion could have a big future?Austin Vernon (02:12:06):Yeah, yeah. Again, I don't know too much about... The same as you, I don't know too much about their specific technology, but if you're pursuing a direct conversion technology, you actually have a chance of success. I think a lot of people I've talked to in the fusion space, they're like, "Well, I can make electricity for $50 a megawatt hour. And because I'm fusion, people should pay me $50." And it's like, well, not everyone may want to pay you $50.SolarDwarkesh Patel (02:12:34):Yeah. Yeah. I mean, it might involve an initial period of large subsidies that we had to give electric vehicles, and even solar, we had to give huge subsidies to solar in the beginning when we were at the beginning of the learning curve, so... That might be necessary though.Austin Vernon (02:12:50):Yeah. I mean, I really disagree with the subsidy solars had, actually. And I think it, just like if you actually look at the numbers, it proves the point. People say like, "Oh, because Germany did the feed in tariffs, it made solar cheap." So if you had a country that's 1% of the population, they spent a tiny portion of their GDP and that was enough to scale the technology, well, you should just let some other fool do that, and reap the benefits. So I would be supportive of taking away most of the subsidies for energy in general.Dwarkesh Patel (02:13:21):Just to make sure I understood that argument, you're saying that it's unlikely that the small subsidies that Germany gave were enough to actually make the difference? Is that what...Austin Vernon (02:13:29):Well, I'm just saying, if it took such a small amount of subsidy to do it, someone will be foolish enough to do that. In this case, it was Germany. They spent a lot of money doing that. They're not reaping the benefit from.Dwarkesh Patel (02:13:43):Yeah. It's not compatible with their environment, so... And their climate I mean, yeah.Austin Vernon (02:13:48):We benefited from them doing that. We still do spend some subsidies on solar. And I think they're very poorly designed. So it would be better just to get rid of them. But the thing with fusion, if you're just heating up water to make steam, it's that technology, there's no learning curve anymore for steam engines basically, because that technology's so mature. So that's why some people are looking at super critical CO2 cycles, because, well, maybe this could be a little cheaper than doing steam turbines. That's some possibility there. And there's some other technologies that, maybe someday you have thermoelectric generators and stuff like that. But I think the direct conversion technologies have just a massive advantage. Not only an initial cost, but in ongoing operating cost.Alpha and Efficient MarketsDwarkesh Patel (02:14:39):Okay. Okay. There's one more topic I really want to talk about, which was... Yeah, you have an interesting post on where you can actually expect to find alpha, given that at least public markets are efficient? Do you want to explain the basic thesis of that post before I ask you specific questions about it?Austin Vernon (02:14:58):Yeah. If I was going to dumb that post down, I love Fama’s original paper where he lays out this efficient market hypothesis thesis and he is like, "There's multiple types of information." And so the first is, if you just have pricing data for stocks or whatever securities, you can be the smartest person in the world, and you're not going to make any money doing that, because it's just random.Austin Vernon (02:15:22):But if you start incorporating more information, what's in 10Ks and all that, if you're super, super smart, you might be able to make a little bit of money there. We see that with Renaissance Technologies, and you can debate about Warren Buffet and all that. But then there's the third category, which is the strong type information. And it's basically you have legally acquired private information, and you can make money that way and be significantly less smart. So if you want to just take Fama's paper, how do I make money? It's like, "Okay, well I should find legal ways to acquire this information, and then I don't have to be super genius to make money on it."Dwarkesh Patel (02:16:11):What I thought was really interesting in your post was you had this point about how one of the ways you can actually earn excess returns is through labor, right? Buffet, in the earliers at least, he would go into these factories and interrogate every single piece of operations and whatever. I thought it was an interesting twist on Piketty's thesis. So I don't know if you've seen his stuff, but he has this claim that, well, not only does capital earn more than... The gains to capital are higher than the gains to labor, but the more capital you have, the higher returns you can earn.Dwarkesh Patel (02:16:49):I guess Harvard has access to hedge funds that may be able to earn excess returns. Basically if you take this view, it's basically the inversion of Piketty, because over time as Buffet has gotten wealthier, his returns have gone down, because it's harder to invest the marginal dollar more effectively. As you said, with the medallion fund, yeah, they no longer accept outside money. Then the interesting thing about labor is, the reason that Buffet was able to earn those excess returns in the beginning, was because of the labor he put in. So the interesting thing is, capital is just fungible with other capital. So capital doesn't enjoy as high returns as really good labor, really smart labor, which is the opposite of the Piketty thesis.Austin Vernon (02:17:33):And I think, there was actually a paper, I think it was on marginal revolution a couple years back. So I'm pulling from my memory here, so I could be missing a little bit, but basically it studied all these businesses and what happened to the business after a founder unexpectedly died and the profit just... It looks like these are capital returns so many people would see them, but then the earnings just drop like a rock, because they lost some irreplaceable human capital there, and they didn't spend any time training them because they died unexpectedly.Dwarkesh Patel (02:18:10):Right, which also has an interesting implication for CEO pay, which is just that... Actually, okay. In the Marxist sense, what is pay? It's like, your pay is what it costs to replace you right? And if Steve Jobs was so irreplaceable that if he goes away, earnings are going to drop like a rock, and stock prices are going to drop like a rock. Actually, that means that he should get paid... That's how expensive it is to replace him. He may be irreplaceable. So it's actually worth whatever dozens of millions of dollars you're paying him.Austin Vernon (02:18:43):Yeah. Yeah. I'm generally a proponent for letting the market decide that.Dwarkesh Patel (02:18:49):Yeah. Yeah. Okay, and then another way you suggested was that firms could earn excess returns by developing a unique brand. So YCombinator is probably able to earn excess returns through normal venture capitalism because of their unique brand. Yeah, I thought that was really interesting. Do you want to talk to me more about that?Austin Vernon (02:19:06):I think it's just a lot of this intangible capital and labor are complements for regular capital, and I think you can see it too. If you build a brand around that, you're a good investor. You can raise money from other people and charge the money on it, more so than if you're just a no name. So I think there's lots of examples of that where building a brand or building relationships is extremely valuable, just like specific knowledge can conduct your returns. I mean it's a type of specific knowledge.Dwarkesh Patel (02:19:45):Well, what do you mean a specific knowledge?Austin Vernon (02:19:48):Well, I mean to build a brand like YCombinator, you have to understand what tech founders want. So they use that knowledge to create a place that's great to go do your startup.Dwarkesh Patel (02:20:02):Yeah, yeah, yeah. Interesting. Is the market for blogging efficient? So now there's actually financial rewards to blogging. The Effective Ideas blog prize, there's other kinds of grants like this. Recently they opened a contest where you can win many prizes where it seems like if you're really good at blogging, you could earn six figures, it seems. Given the regularity in size of these prizes, is this a market that we should expect to be efficient?Austin Vernon (02:20:34):I think it would be hard to measure. Given my own experience, I'm blogging for free, but the benefits I've gotten from learning about what I'm blogging about, and then the few connections I've made that have helped me with my projects I'm working on. There's huge returns. If my project's successful, these returns could be just almost immeasurable. So yeah, I would guess it's very hard to measure and probably inefficient in that more people could blog, because it's hard to predict the returns to what your blogging might have. But I guess if you're going to do these blog prizes, I don't know if the blog prize... Because the blog prizes are about specific topics, I don't know how much that helps the efficiency there.Dwarkesh Patel (02:21:20):Yeah. Yeah. Let's take that part of it out. Let's just talk about the factor you mentioned.. This is a regular thing you hear from people who write online, which is that the gains they get are huge and that's also the case in my case. So it's kind of interesting. Efficient Markets don’t.. just because the stock market is efficient, that doesn't mean that everybody will put their money into the stock market. That's not the implication. But the question is, given that you're writing something that's high quality, will it get noticed by the market? Will it get the attention and broadcasting that it deserves? And in my experience, actually, I guess this was the case. You mentioned that when some of your first posts ended up on Hacker News. So in that sense that market was efficient. But yeah, it seems to me that when somebody finds a good blogger, it's not hard for their initial post, or at least their subsequent post as they get better to gain an audience.Austin Vernon (02:22:18):Yeah, I do think that. And I don't know what the counterfactual is. We don't know about the people that didn't have posts go to Hacker News, so it could've easily been... I mean, I think that what the alternative for me is, I just would've blogged way less, if one of those early posts hadn't gotten more attention. So yeah. It's hard to know what the counterfactual is.. how many people have just abandoned blogs after writing three posts. They would've written one more. Maybe it would've been better.ConclusionDwarkesh Patel (02:22:49):Yeah. Yeah. Okay. Awesome. This has been a lot of fun. I think we're two hours over at this point, so thank you so much for your time!Austin Vernon (02:22:59):All right. Thank you.Dwarkesh Patel (02:23:00):I don't know if you have any other final thoughts or any other subjects that we should hit on or...Austin Vernon (02:23:06):No, I think we covered everything.Dwarkesh Patel (02:23:09):Okay, cool. Awesome. And then just people can find you at Austin Vernon dot...Austin Vernon (02:23:15):Dot site.Dwarkesh Patel (02:23:16):Okay. AustinVernon.site. And then your Twitter is?Austin Vernon (02:23:20):I think it's Vernon3Austin.Dwarkesh Patel (02:23:22):Okay. And it'll also be in the story description, but yeah. Okay. Yeah. Thanks so much for coming on, man. This was a lot of fun.Austin Vernon (02:23:28):All right. Thank you.Dwarkesh Patel (02:23:31):All right. I hope you enjoyed that episode with Austin Vernon. This one was a lot of fun. If you did like it, I would really appreciate it if you could share the podcast. Put the episode in your group chats, put it on Twitter, share it to friends who you think might enjoy it. That kind of stuff helps out more than you would imagine. I want to give a special shout out to Sonya Gupta for her help in prepping me for this episode. Austin is, as you can tell, really smart and technical, so I would not have been able to prepare for this episode without Sonya's help. She's got an amazing technical mind, and did a ton to help me out with preparing questions and doing research into the topics we talked about. I also want to thank my amazing editor and producer Graham Besolou for the work he puts into this podcast. All right. See you on the next one. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Steve Hsu is a Professor of Theoretical Physics at Michigan State University and cofounder of the company Genomic Prediction.We go deep into the weeds on how embryo selection can make babies healthier and smarter. Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Subscribe to find out about future episodes!Read the full transcript here.Follow Steve on Twitter. Follow me on Twitter for updates on future episodes.Please share if you enjoyed this episode! Helps out a ton!Timestamps(0:00:14) - Feynman’s advice on picking up women(0:11:46) - Embryo selection(0:24:19) - Why hasn't natural selection already optimized humans?(0:34:13) - Aging(0:43:18) - First Mover Advantage(0:53:49) - Genomics in dating(1:00:31) - Ancestral populations(1:07:58) - Is this eugenics?(1:15:59) - Tradeoffs to intelligence(1:25:01) - Consumer preferences(1:30:14) - Gwern(1:34:35) - Will parents matter?(1:45:25) - Wordcels and shape rotators(1:57:29) - Bezos and brilliant physicists(2:10:23) - Elite educationTranscriptDwarkesh Patel  0:00  Today I have the pleasure of speaking with Steve Hsu. Steve, thanks for coming on the podcast. I'm excited about this.Steve Hsu  0:04  Hey, it's my pleasure! I'm excited too and I just want to say I've listened to some of your earlier interviews and thought you were very insightful, which is why I was excited to have a conversation with you.Dwarkesh Patel 0:14That means a lot for me to hear you say because I'm a big fan of your podcast.Feynman’s advice on picking up womenDwarkesh Patel  0:17  So my first question is: “What advice did Richard Feynman give you about picking up girls?”Steve Hsu  0:24   Haha, wow! So one day in the spring of my senior year, I was walking across campus and saw Feynman coming toward me. We knew each other from various things—it's a small campus, I was a physics major, and he was my hero–– so I'd known him since my first year. He sees me, and he's got this Long Island or New York borough accent and says, "Hey, Hsu!"  I'm like, "Hi, Professor Feynman." We start talking. And he says to me, "Wow, you're a big guy." Of course, I was much bigger back then because I was a linebacker on the Caltech football team. So I was about 200 pounds and slightly over 6 feet tall. I was a gym rat at the time, and I was much bigger than him. He said, "Steve, I got to ask you something." Feynman was born in 1918, so he's not from the modern era. He was going through graduate school when the Second World War started. So, he couldn't understand the concept of a health club or a gym. This was the 80s and was when Gold's Gym was becoming a world national franchise. There were gyms all over the place like 24-Hour Fitness. But, Feynman didn't know what it was. He's a fascinating guy. He says to me, "What do you guys do there? Is it just a thing to meet girls? Or is it really for training? Do you guys go there to get buff?" So, I started explaining to him that people are there to get big, but people are also checking out the girls. A lot of stuff is happening at the health club or the weight room. Feynman grills me on this for a long time. And one of the famous things about Feynman is that he has a laser focus. So if there's something he doesn't understand and wants to get to the bottom of it, he will focus on you and start questioning you and get to the bottom of it. That's the way his brain worked. So he did that to me for a while because he didn't understand lifting weights and everything. In the end, he says to me, "Wow, Steve, I appreciate that. Let me give you some good advice."Then, he starts telling me how to pick up girls—which he's an expert on. He says to me, "I don't know how much girls like guys that are as big as you." He thought it might be a turn-off. "But you know what, you have a nice smile." So that was the one compliment he gave me. Then, he starts to tell me that it's a numbers game. You have to be rational about it. You're at an airport lounge, or you're at a bar. It's Saturday night in Pasadena or Westwood, and you're talking to some girl. He says, "You're never going to see her again. This is your five-minute interaction. Do what you have to do. If she doesn't like you, go to the next one." He also shares some colorful details. But, the point is that you should not care what they think of you. You're trying to do your thing. He did have a reputation at Caltech as a womanizer, and I could go into that too, but I heard all this from the secretaries.Dwarkesh Patel  4:30  With the students or only the secretaries? Steve Hsu  4:35  Secretaries! Well mostly secretaries. They were almost all female at that time. He had thought about this a lot and thought of it as a numbers game. The PUA guys (pick-up artists) will say, “Follow the algorithm, and whatever happens, it's not a reflection on your self-esteem. It's just what happened. And you go on to the next one.” That was the advice he was giving me, and he said other things that were pretty standard: Be funny, be confident—just basic stuff. Steve Hu: But the main thing I remember was the operationalization of it as an algorithm. You shouldn’t internalize whatever happens if you get rejected, because that hurts. When we had to go across the bar to talk to that girl (maybe it doesn’t happen in your generation), it was terrifying. We had to go across the bar and talk to some lady! It’s loud, and you’ve got a few minutes to make your case. Nothing is scarier than walking up to the girl and her friends. Feynman was telling me to train myself out of that. You're never going to see them again; the face space of humanity is so big that you'll probably never re-encounter them again. It doesn't matter. So, do your best. Dwarkesh Patel  6:06  Yeah, that's interesting because.. I wonder whether he was doing this in the 40’–– like when he was at that age, was he doing this? I don't know what the cultural conventions were at the time. Were there bars in the 40s where you could just go ahead and hit on girls or? Steve Hsu  6:19  Oh yeah, absolutely. If you read literature from that time, or even a little bit earlier like Hemingway or John O'Hara, they talk about how men and women interacted in bars and stuff in New York City. So, that was much more of a thing back than when compared to your generation. That's what I can’t figure out with my kids! What is going on? How do boys and girls meet these days? Back in the day, the guy had to do all the work. It was the most terrifying thing you could do, and you had to train yourself out of that.Dwarkesh Patel  6:57  By the way, for the context for the audience, when Feynman says you were a big guy, you were a football player at Caltech, right? There's a picture of you on your website, maybe after college or something, but you look pretty ripped. Today, it seems more common because of the gym culture. But I don’t know about back then. I don't know how common that body physique was.Steve Hsu  7:24  It’s amazing that you asked this question. I'll tell you a funny story. One of the reasons Feynman found this so weird was because of the way body-building entered the United States.  They were regarded as freaks and homosexuals at first. I remember swimming and football in high school (swimming is different because it's international), and in swimming, I picked up a lot of advanced training techniques from the Russians and East Germans. But football was more American and not very international. So our football coach used to tell us not to lift weights when we were in junior high school because it made you slow. “You’re no good if you’re bulky.” “You gotta be fast in football.” Then, something changed around the time I was in high school–the coaches figured it out. I began lifting weights since I was an age group swimmer, like maybe age 12 or 14. Then, the football coaches got into it mainly because the University of Nebraska had a famous strength program that popularized it.At the time, there just weren't a lot of big guys. The people who knew how to train were using what would be considered “advanced knowledge” back in the 80s. For example, they’d know how to do a split routine or squat on one day and do upper body on the next day–– that was considered advanced knowledge at that time. I remember once.. I had an injury, and I was in the trainer's room at the Caltech athletic facility. The lady was looking at my quadriceps. I’d pulled a muscle, and she was looking at the quadriceps right above your kneecap. If you have well-developed quads, you'd have a bulge, a bump right above your cap. And she was looking at it from this angle where she was in front of me, and she was looking at my leg from the front. She's like, “Wow, it's swollen.” And I was like, “That's not the injury. That's my quadricep!” And she was a trainer! So, at that time, I could probably squat 400 pounds. So I was pretty strong and had big legs. The fact that the trainer didn't really understand what well-developed anatomy was supposed to look like blew my mind!So anyway, we've come a long way. This isn't one of these things where you have to be old to have any understanding of how this stuff evolved over the last 30-40 years.Dwarkesh Patel  10:13  But, I wonder if that was a phenomenon of that particular time or if people were not that muscular throughout human history. You hear stories of  Roman soldiers who are carrying 80 pounds for 10 or 20 miles a day. I mean, there are a lot of sculptures in the ancient world, or not that ancient, but the people look like they have a well-developed musculature.Steve Hsu  10:34  So the Greeks were very special because they were the first to think about the word gymnasium. It was a thing called the Palaestra, where they were trained in wrestling and boxing. They were the first people who were seriously into physical culture specific training for athletic competition.Even in the 70s, when I was a little kid, I look back at the guys from old photos and they were skinny. So skinny! The guys who went off and fought World War Two, whether they were on the German side, or the American side, were like 5’8-5’9 weighing around 130 pounds - 140 pounds. They were much different from what modern US Marines would look like. So yeah, physical culture was a new thing. Of course, the Romans and the Greeks had it to some degree, but it was lost for a long time. And, it was just coming back to the US when I was growing up. So if you were reasonably lean (around 200 pounds) and you could bench over 300.. that was pretty rare back in those days.Embryo selectionDwarkesh Patel  11:46  Okay, so let's talk about your company Genomic Prediction. Do you want to talk about this company and give an intro about what it is?Steve Hsu  11:55  Yeah. So there are two ways to introduce it. One is the scientific view. The other is the IVF view. I can do a little of both. So scientifically, the issue is that we have more and more genomic data. If you give me the genomes of a bunch of people and then give me some information about each person, ex. Do they have diabetes? How tall are they? What's their IQ score?  It’s a natural AI machine learning problem to figure out which features in the DNA variation between people are predictive of whatever variable you're trying to predict.This is the ancient scientific question of how you relate the genotype of the organism (the specific DNA pattern), to the phenotype (the expressed characteristics of the organism). If you think about it, this is what biology is! We had the molecular revolution and figured out that it’s people's DNA that stores the information which is passed along. Evolution selects on the basis of the variation in the DNA that’s expressed as phenotype, as that phenotype affects fitness/reproductive success. That's the whole ballgame for biology. As a physicist who's trained in mathematics and computation, I'm lucky that I arrived on the scene at a time when we're going to solve this basic fundamental problem of biology through brute force, AI, and machine learning. So that's how I got into this. Now you ask as an entrepreneur, “Okay, fine Steve, you're doing this in your office with your postdocs and collaborators on your computers. What use is it?” The most direct application of this is in the following setting: Every year around the world, millions of families go through IVF—typically because they're having some fertility issues, and also mainly because the mother is in her 30s or maybe 40s. In the process of IVF, they use hormone stimulation to produce more eggs. Instead of one per cycle, depending on the age of the woman, they might produce anywhere between five to twenty, or even sixty to a hundred eggs for young women who are hormonally stimulated (egg donors).From there, it’s trivial because men produce sperm all the time. You can fertilize eggs pretty easily in a little dish, and get a bunch of embryos that grow. They start growing once they're fertilized. The problem is that if you're a family and produce more embryos than you’re going to use, you have the embryo choice problem. You have to figure out which embryo to choose out of  say, 20 viable embryos. The most direct application of the science that I described is that we can now genotype those embryos from a small biopsy. I can tell you things about the embryos. I could tell you things like your fourth embryo being an outlier. For breast cancer risk, I would think carefully about using number four. Number ten is an outlier for cardiovascular disease risk. You might want to think about not using that one. The other ones are okay. So, that’s what genomic prediction does. We work with 200 or 300 different IVF clinics in six continents.Dwarkesh Patel  15:46  Yeah, so the super fascinating thing about this is that the diseases you talked about—or at least their risk profiles—are polygenic. You can have thousands of SNPs (single nucleotide polymorphisms) determining whether you will get a disease. So, I'm curious to learn how you were able to transition to this space and how your knowledge of mathematics and physics was able to help you figure out how to make sense of all this data.Steve Hsu  16:16  Yeah, that's a great question. So again, I was stressing the fundamental scientific importance of all this stuff. If you go into a slightly higher level of detail—which you were getting at with the individual SNPs, or polymorphisms—there are individual locations in the genome, where I might differ from you, and you might differ from another person. Typically, each pair of individuals will differ at a few million places in the genome—and that controls why I look a little different than youA lot of times, theoretical physicists have a little spare energy and they get tired of thinking about quarks or something. They want to maybe dabble in biology, or they want to dabble in computer science, or some other field. As theoretical physicists, we always feel, “Oh, I have a lot of horsepower, I can figure a lot out.” (For example, Feynman helped design the first parallel processors for thinking machines.) I have to figure out which problems I can make an impact on because I can waste a lot of time. Some people spend their whole lives studying one problem, one molecule or something, or one biological system. I don't have time for that, I'm just going to jump in and jump out. I'm a physicist. That's a typical attitude among theoretical physicists. So, I had to confront sequencing costs about ten years ago because I knew the rate at which they were going down. I could anticipate that we’d get to the day (today) when millions of genomes with good phenotype data became available for analysis. A typical training run might involve almost a million genomes or half a million genomes. The mathematical question then was: What is the most effective algorithm given a set of genomes and phenotype information to build the best predictor?  This can be boiled down to a very well-defined machine learning problem. It turns out, for some subset of algorithms, there are theorems— performance guarantees that give you a bound on how much data you need to capture almost all of the variation in the features. I spent a fair amount of time, probably a year or two, studying these very famous results, some of which were proved by a guy named Terence Tao, a Fields medalist. These are results on something called compressed sensing: a penalized form of high dimensional regression that tries to build sparse predictors. Machine learning people might notice L1-penalized optimization. The very first paper we wrote on this was to prove that using accurate genomic data and these very abstract theorems in combination could predict how much data you need to “solve” individual human traits. We showed that you would need at least a few hundred thousand individuals and their genomes and their heights to solve for height as a phenotype. We proved that in a paper using all this fancy math in 2012. Then around 2017, when we got a hold of half a million genomes, we were able to implement it in practical terms and show that our mathematical result from some years ago was correct. The transition from the low performance of the predictor to high performance (which is what we call a “phase transition boundary” between those two domains) occurred just where we said it was going to occur. Some of these technical details are not understood even by practitioners in computational genomics who are not quite mathematical. They don't understand these results in our earlier papers and don't know why we can do stuff that other people can't, or why we can predict how much data we'll need to do stuff. It's not well-appreciated, even in the field. But when the big AI in our future in the singularity looks back and says, “Hey, who gets the most credit for this genomics revolution that happened in the early 21st century?” they're going to find these papers on the archive where we proved this was possible, and how five years later, we actually did it. Right now, it's under-appreciated, but the future AI––that Roko's Basilisk AI–will look back and will give me a little credit for it. Dwarkesh Patel  21:03  Yeah, I was a little interested in this a few years ago. At that time, I looked into how these polygenic risk scores were calculated. Basically, you find the correlation between the phenotype and the alleles that correlate with it. You add up how many copies of these alleles you have, what the correlations are, and you do a weighted sum of that. So that seemed very simple, especially in an era where we have all this machine learning, but it seems like they're getting good predictive results out of this concept. So, what is the delta between how good you can go with all this fancy mathematics versus a simple sum of correlations?Steve Hsu  21:43  You're right that the ultimate models that are used when you've done all the training and when the dust settles, are straightforward. They’re pretty simple and have an additive structure. Basically, I either assign a nonzero weight to this particular region in the genome, or I don't. Then, I need to know what the weighting is, but then the function is a linear function or additive function of the state of your genome at some subset of positions. The ultimate model that you get is straightforward. Now, if you go back ten years, when we were doing this, there were lots of claims that it was going to be super nonlinear—that it wasn't going to be additive the way I just described it. There were going to be lots of interaction terms between regions. Some biologists are still convinced that's true, even though we already know we have predictors that don't have interactions.The other question, which is more technical, is whether in any small region of your genome, the state of the individual variants is highly correlated because you inherit them in chunks. You need to figure out which one you want to use. You don't want to activate all of them because you might be overcounting. So that's where these L-1 penalization sparse methods force the predictor to be sparse. That is a key step. Otherwise, you might overcount. If you do some simple regression math, you might have 10-10 different variants close by that have roughly the same statistical significance.But, you don't know which one of those tends to be used, and you might be overcounting effects or undercounting effects. So, you end up doing a high-dimensional optimization, where you grudgingly activate an SNP when the signal is strong enough. Once you activate that one, the algorithm has to be smart enough to penalize the other ones nearby and not activate them because you're over-counting effects if you do that. There's a little bit of subtlety in it. But, the main point you made is that the ultimate predictors, which are very simple and addictive—sum over effect sizes and time states—work well. That’s related to a deep statement about the additive structure of the genetic architecture of individual differences. In other words, it's weird that the ways that I differ from you are merely just because I have more of something or you have less of something. It’s not like these things are interacting in some incredibly understandable way. That's a deep thing—which is not appreciated that much by biologists yet. But over time, they'll figure out something interesting here.Why hasn’t natural selection already optimized humans?Dwarkesh Patel  24:19  Right. I thought that was super fascinating, and I commented on that on Twitter. What is interesting about that is two things. One is that you have this fascinating evolutionary argument about why that would be the case that you might want to explain. The second is that it makes you wonder if becoming more intelligent is just a matter of turning on certain SNPs. It's not a matter of all this incredible optimization being like solving a sudoku puzzle or anything. If that's the case, then why hasn't the human population already been selected to be maxed out on all these traits if it's just a matter of a bit flip?Steve Hsu  25:00  Okay, so the first issue is why is this genetic architecture so surprisingly simple? Again, we didn't know it would be simple ten years ago. So when I was checking to see whether this was a field that I should go into depending on our capabilities to make progress, we had to study the more general problem of the nonlinear possibilities. But eventually, we realized that most of the variance would probably be captured in an additive way. So, we could narrow down the problem quite a bit. There are evolutionary reasons for this. There’s a famous theorem by Fisher, the father of population genetics (aka. frequentist statistics). Fisher proved something called Fisher's Fundamental Theorem of Natural Selection, which says that if you impose some selection pressure on a population, the rate at which that population responds to the selection pressure (let’s say it’s the bigger rats that out-compete, the smaller rats) then at what rate does the rat population start getting bigger? He showed that it's the additive variants that dominate the rate of evolution. It's easy to understand why if it's a nonlinear mechanism, you need to make the rat bigger. When you sexually reproduce, and that gets chopped apart, you might break the mechanism. Whereas, if each short allele has its own independent effect, you can inherit them without worrying about breaking the mechanisms. It was well known among a tiny theoretical population of biologists that adding variants was the dominant way that populations would respond to selection. That was already known. The other thing is that humans have been through a pretty tight bottleneck, and we're not that different from each other. It's very plausible that if I wanted to edit a human embryo and make it into a frog, then there are all kinds of subtle nonlinear things I’d have to do. But all those identical nonlinear complicated subsystems are fixed in humans. You have the same system as I do. You have the not human, not frog or ape, version of that region of DNA, and so do I. But the small ways we differ are mostly little additive switches. That's this deep scientific discovery from over the last 5-10 years of work in this area. Now, you were asking about why evolution hasn't completely “optimized” all traits in humans already. I don't know if you’ve ever done deep learning or high-dimensional optimization, but in that high-dimensional space, you're often moving on a slightly-tilted surface. So, you're getting gains, but it's also flat. Even though you scale up your compute or data size by order of magnitude, you don't move that much farther. You get some gains, but you're never really at the global max of anything in these high-dimensional spaces. I don't know if that makes sense to you. But it's pretty plausible to me that two things are important here. One is that evolution has not had that much time to optimize humans. The environment that humans live in changed radically in the last 10,000 years. For a while, we didn't have agriculture, and now we have agriculture. Now, we have a swipe left if you want to have sex tonight. The environment didn't stay fixed. So, when you say fully optimized for the environment, what do you mean? The ability to diagonalize matrices might not have been very adaptive 10,000 years ago. It might not even be adaptive now. But anyway, it's a complicated question that one can't reason naively about. “If God wanted us to be 10 feet tall, we'd be 10 feet tall.” Or “if it's better to be smart, my brain would be *this* big or something.” You can't reason naively about stuff like that.Dwarkesh Patel  29:04  I see. Yeah.. Okay. So I guess it would make sense then that for example, with certain health risks, the thing that makes you more likely to get diabetes or heart disease today might be… I don't know what the pleiotropic effect of that could be. But maybe that's not that important one year from now.Steve Hsu  29:17  Let me point out that most of the diseases we care about now—not the rare ones, but the common ones—manifest when you're 50-60 years old. So there was never any evolutionary advantage of being super long-lived. There's even a debate about whether the grandparents being around to help raise the kids lifts the fitness of the family unit. But, most of the time in our evolutionary past, humans just died fairly early. So, many of these diseases would never have been optimized against evolution. But, we see them now because we live under such good conditions, we can regulate people over 80 or 90 years.Dwarkesh Patel  29:57  Regarding the linearity and additivity point, I was going to make the analogy that– and I'm curious if this is valid– but when you're programming, one thing that's good practice is to have all the implementation details in separate function calls or separate programs or something, and then have your main loop of operation just be called different functions like, “Do this, do that”, so that you can easily comment stuff away or change arguments. This seemed very similar to that where by turning these names on and off, you can change what the next offering will be. And, you don't have to worry about actually implementing whatever the underlying mechanism is. Steve Hsu  30:41  Well, what you said is related to what Fisher proved in his theorems. Which is that, if suddenly, it becomes advantageous to have X, (like white fur instead of black fur) or something, it would be best if there were little levers that you could move somebody from black fur to white fur continuously by modifying those switches in an additive way. It turns out that for sexually reproducing species where the DNA gets scrambled up in every generation, it's better to have switches of that kind. The other point related to your software analogy is that there seem to be modular, fairly modular things going on in the genome. When we looked at it, we were the first group to have, initially, 20 primary disease conditions we had decent predictors for. We started looking carefully at just something as trivial as the overlap of my sparsely trained predictor. It turns on and uses *these* features for diabetes, but it uses *these* features for schizophrenia. It’s the stupidest metric, it’s literally just how much overlap or variance accounted for overlap is there between pairs of disease conditions. It's very modest. It's the opposite of what naive biologists would say when they talk about pleiotropy.They're just disjoint! Disjoint regions of your genome that govern certain things. And why not? You have 3 billion base pairs—there's a lot you can do in there. There's a lot of information there. If you need 1000 to control diabetes risk, I estimated you could easily have 1000 roughly independent traits that are just disjoint in their genetic dependencies. So, if you think about D&D,  your strength, decks, wisdom, intelligence, and charisma—those are all disjoint. They're all just independent variables. So it's like a seven-dimensional space that your character lives in. Well, there's enough information in the few million differences between you and me. There's enough for a 1000-dimensional space of variation.“Oh, how considerable is your spleen?” My spleen is a little bit smaller, yours is a little bit bigger - that can vary independently of your IQ. Oh, it's a big surprise. The size of your spleen can vary independently of the size of your big toe. If you do information theory, there are about 1000 different parameters, and I can vary independently with the number of variants I have between you and me. Because you understand some information theory, it’s trivial to explain, but try explaining to a biologist and you won't get very far.Dwarkesh Patel  33:27  Yeah, yeah, do the log two of the number of.. is that basically how you do it? Yeah.Steve Hsu  33:33  Okay. That's all it is. I mean, it's in our paper. We look at how many variants typically account for most of the variation for any of these major traits, and then imagine that they're mostly disjoint. Then it’s just all about: how many variants do you need to independently vary 1000 traits? Well, a few million differences between you and me are enough. It's very trivial math. Once you understand the base and how to reason about information theory, then it's very trivial. But, it ain’t trivial for theoretical biologists, as far as I can tell.AgingDwarkesh Patel  34:13  But the result is so interesting because I remember reading in The Selfish Gene that, as he (Dawkins) hypothesizes that the reason we could be aging is an antagonistic clash. There's something that makes you healthier when you're young and fertile that makes you unhealthy when you're old. Evolution would have selected for such a trade-off because when you're young and fertile, evolution and your genes care about you. But, if there's enough space in the genome —where these trade-offs are not necessarily necessary—then this could be a bad explanation for aging, or do you think I'm straining the analogy?Steve Hsu  34:49  I love your interviews because the point you're making here is really good. So Dawkins, who is an evolutionary theorist from the old school when they had almost no data—you can imagine how much data they had compared to today—he would tell you a story about a particular gene that maybe has a positive effect when you're young, but it makes you age faster. So, there's a trade-off. We know about things like sickle cell anemia. We know stories about that. No doubt, some stories are true about specific variants in your genome. But that's not the general story. The general story you only discovered in the last five years is that thousands of variants control almost every trait and those variants tend to be disjoint from the ones that control the other trait. They weren't wrong, but they didn't have the big picture.Dwarkesh Patel  35:44  Yeah, I see. So, you had this paper, it had polygenic, health index, general health, and disease risk.. You showed that with ten embryos, you could increase disability-adjusted life years by four, which is a massive increase if you think about it. Like what if you could live four years longer and in a healthy state? Steve Hsu  36:05  Yeah, what's the value of that? What would you pay to buy that for your kid?Dwarkesh Patel  36:08  Yeah. But, going back to the earlier question about the trade-offs and why this hasn't already been selected for,  if you're right and there's no trade-off to do this, just living four years older (even if that's beyond your fertility) just being a grandpa or something seems like an unmitigated good. So why hasn’t this kind of assurance hasn't already been selected for? Steve Hsu  36:35  I’m glad you're asking about these questions because these are things that people are very confused about, even in the field. First of all, let me say that when you have a trait that's controlled by  10,000 variants (eg. height is controlled by an order of 10,000 variants and probably cognitive ability a little bit more), the square root of 10,000 is 100.  So, if I could come to this little embryo, and I want to give it one extra standard deviation of height, I only need to edit 100. I only need to flip 100 minus variance to plus variance. These are very rough numbers. But, one standard deviation is the square root of “n”. If I flip a coin “n” times, I want a better outcome in terms of the number of ratio heads to tails. I want to increase it by one standard deviation. I only need to flip the square root of “n” heads because if you flip a lot, you will get a narrow distribution that peaks around half and the width of that distribution is the square root of “n”. Once I tell you, “Hey, your height is controlled by 10,000 variants, and I only need to flip 100 genetic variants to make you one standard deviation for a male,” (that would be three inches tall, two and a half or three inches taller), you suddenly realize, “Wait a minute, there are a lot of variants up for grabs there. If I could flip 500 variants in your genome, I would make you five standard deviations taller, you'd be seven feet tall.”  I didn't even have to do that much work, and there's a lot more variation where that came from. I could have flipped even more because I only flipped 500 out of 10,000, right? So, there's this quasi-infinite well of variation that evolution or genetic engineers could act on. Again, the early population geneticists who bred corn and animals know this. This is something they explicitly know about because they've done calculations. Interestingly, human geneticists who are mainly concerned with diseases and stuff, are often unfamiliar with the math that the animal breeders already know. You might be interested to know that the milk you drink comes from heavily genetically-optimized cows bred artificially using almost exactly the same technologies that we use for genomic prediction. But they're doing it to optimize milk production and stuff like this. So there is a big well of variance. It's a consequence of the trait's polygenicity. On the longevity side of things, it does look like people could “be engineered” to live much longer by flipping the variants that make the risk for diseases that shorten your life. The question is then, “Why didn't evolution give us life spans of thousands of years?” People in the Bible used to live for thousands of years. Why don't we? I mean, *chuckles* that probably didn’t happen. But the question is, you have this very high dimensional space, and you have a fitness function. How big is the slope in a particular direction of that fitness function? How much more successful reproductively would Joe caveman have been if he lived to be 150 instead of only 100 or something? There just hasn't been enough time to explore this super high-dimensional space. That's the actual answer. But now, we have the technology, and we're going to f*****g explore it fast. That's the point that the big lightbulb should go off. We’re mapping this space out now. Pretty confident in 10 years or so, with the CRISPR gene editing technologies will be ready for massively multiplexed edits. We'll start navigating in this high-dimensional space as much as we like. So that's the more long-term consequence of the scientific insights.Dwarkesh Patel  40:53  Yeah, that's super interesting. What do you think will be the plateau for a trait of how long you’ll live? With the current data and techniques, do you think it could be significantly greater than that?Steve Hsu  41:05  We did a simple calculation—which amazingly gives the correct result. This polygenic predictor that we built (which isn't perfect yet but will improve as we gather more data) is used in selecting embryos today. If you asked, out of a billion people, “What's the best person typically, what would their score be on this index and then how long would they be predicted to live?”’ It's about 120 years. So it's spot on. One in a billion types of person lives to be 120 years old. How much better can you do? Probably a lot better. I don't want to speculate, but other nonlinear effects, things that we're not taking into account will start to play a role at some point. So, it's a little bit hard to estimate what the true limiting factors will be. But one super robust statement, and I'll stand by it, debate any Nobel Laureate in biology who wants to discuss it even,  is that there are many variants available to be selected or edited. There's no question about that. That's been established in animal breeding in plant breeding for a long time now. If you want a chicken that grows to be *this* big, instead of *this* big, you can do it. You can do it if you want a cow that produces 10 times or 100 times more milk than a regular cow. The egg you ate for breakfast this morning, those bio-engineered chickens that lay almost an egg a day… A chicken in the wild lays an egg a month. How the hell did we do that? By genetic engineering. That's how we did it. Dwarkesh Patel  42:51  Yeah. That was through brute artificial selection. No fancy machine learning there.Steve Hsu  42:58  Last ten years, it's gotten sophisticated machine learning genotyping of chickens. Artificial insemination, modeling of the traits using ML last ten years. For cow breeding, it's done by ML. First Mover AdvantageDwarkesh Patel  43:18  I had no idea. That's super interesting. So, you mentioned that you're accumulating data and improving your techniques over time, is there a first mover advantage to a genomic prediction company like this? Or is it whoever has the newest best algorithm for going through the biobank data? Steve Hsu  44:16  That's another super question. For the entrepreneurs in your audience, I would say in the short run, if you ask what the valuation of GPB should be? That's how the venture guys would want me to answer the question. There is a huge first mover advantage because they're important in the channel relationships between us and the clinics. Nobody will be able to get in there very easily when they come later because we're developing trust and an extensive track record with clinics worldwide—and we're well-known. So could 23andme or some company with a huge amount of data—if they were to get better AI/ML people working on this—blow us away a little bit and build better predictors because they have much more data than we do? Possibly, yes. Now, we have had core expertise in doing this work for years that we're just good at it. Even though we don't have as much data as 23andme, our predictors might still be better than theirs. I'm out there all the time, working with biobanks all around the world. I don't want to say all the names, but other countries are trying to get my hands on as much data as possible.But, there may not be a lasting advantage beyond the actual business channel connections to that particular market. It may not be a defensible, purely scientific moat around the company. We have patents on specific technologies about how to do genotyping or error correction on the embryo, DNA, and stuff like this. We do have patents on stuff like that. But this general idea of who will best predict human traits from DNA? It's unclear who's going to be the winner in that race. Maybe it'll be the Chinese government in 50 years? Who knows?Dwarkesh Patel  46:13  Yeah, that's interesting. If you think about a company Google, theoretically, it's possible that you could come up with a better algorithm than PageRank and beat them. But it seems like the engineer at Google is going to come up with whatever edge case or whatever improvement is possible.Steve Hsu  46:28  That's exactly what I would say. PageRank is deprecated by now. But, even if somebody else comes up with a somewhat better algorithm if they have a little bit more data, if you have a team doing this for a long time and you're focused and good, it's still tough to beat you, especially if you have a lead in the market.Dwarkesh Patel  46:50  So, are you guys doing the actual biopsy? Or is it just that they upload the genome, and you're the one processing just giving recommendations? Is it an API call, basically?Steve Hsu  47:03  It's great, I love your question. It is totally standard. Every good IVF clinic in the world regularly takes embryo biopsies. So that's standard. There’s a lab tech doing that. Okay. Then, they take the little sample, put it on ice, and ship it. The DNA as a molecule is exceptionally robust and stable. My other startup solves crimes that are 100 years old from DNA that we get from some semen stain on some rape victim, serial killer victims bra strap, we've done stuff that.Dwarkesh Patel  47:41  Jack the Ripper, when are we going to solve that mystery?Steve Hsu  47:44  If they can give me samples, we can get into that. For example, we just learned that you could recover DNA pretty well if someone licks a stamp and puts it on their correspondence. If you can do Neanderthals, you can do a lot to solve crimes. In the IVF workflow, our lab, which is in New Jersey, can service every clinic in the world because they take the biopsy, put it in a standard shipping container, and send it to us. We’re actually genotyping DNA in our lab, but we've trained a few of the bigger clinics to do the genotyping on their site. At that point, they upload some data into the cloud, and then they get back some stuff from our platform. And at that point, it's going to be the whole world, every human who wants their kid to be healthy and get the best they can– that data is going to come up to us, and the report is going to come back down to their IVF physician. Dwarkesh Patel  48:46  Which is great if you think that there's a potential that this technology might get regulated in some way, you could go to Mexico or something, have them upload the genome (you don't care what they upload it from), and then get the recommendations there. Steve Hsu  49:05  I think we’re going to evolve to a point where we are going to be out of the wet part of this business and only in the cloud and bit part of this business. No matter where it is, the clinics are going to have a sequencer, which is *this* big, and their tech is going to quickly upload and retrieve the report for the physician three seconds later. Then, the parents are going to look at it on their phones or whatever. We’re basically there with some clinics. It’s going to be tough to regulate because it’s just this. You have the bits, and you’re in some repressive, terrible country that doesn’t allow you to select for some special traits that people are nervous about, but you can upload it to some vendor that’s in Singapore or some free country, and they give you the report back. Doesn’t have to be us, we don’t do the edgy stuff. We only do the health-related stuff right now. But, if you want to know how tall this embryo is going to be… I’ll tell you a mind-blower! When you do face recognition in AI, you're mapping someone's face into a parameter space on the order of hundreds of parameters, each of those parameters is super heritable. In other words, if I take two twins and photograph them, and the algorithm gives me the value of that parameter for twin one and two, they're very close. That's why I can't tell the two twins apart, and face recognition can ultimately tell them apart if it’s really good system. But you can conclude that almost all these parameters are identical for those twins. So it's highly heritable. We're going to get to a point soon where I can do the inverse problem where I have your DNA  and I predict each of those parameters in the face recognition algorithm and then reconstruct the face. If I say that when this embryo will be 16, that is what she will look like. When she's 32, this is what she's going to look like. I'll be able to do that, for sure. It's only an AI/ML problem right now. But basic biology is clearly going to work. So then you're going to be able to say, “Here's a report. Embryo four is so cute.” Before, we didn't know we wouldn't do that, but it will be possible. Dwarkesh Patel  51:37  Before we get married, you'll want to see what their genotype implies about their faces' longevity. It's interesting that you hear stories about these cartel leaders who will get plastic surgery or something to evade the law, you could have a check where you look at a lab and see if it matches the face you would have had five years ago when they caught you on tape.Steve Hsu  52:02  This is a little bit back to old-school Gattaca, but you don't even need the face! You can just take a few molecules of skin cells and phenotype them and know exactly who they are. I've had conversations with these spooky Intel folks. They're very interested in, “Oh, if some Russian diplomat comes in, and we think he's a spy, but he's with the embassy, and he has a coffee with me, and I save the cup and send it to my buddy at Langley, can we figure out who this guy is? And that he has a daughter who's going to Chote? Can do all that now.Dwarkesh Patel  52:49  If that's true, then in the future, world leaders will not want to eat anything or drink. They'll be wearing a hazmat suit to make sure they don't lose a hair follicle.Steve Hsu  53:04  The next time Pelosi goes, she will be in a spacesuit if she cares. Or the other thing is, they're going to give it. They're just going to be, “Yeah, my DNA is everywhere. If I'm a public figure, I can't track my DNA. It's all over.”Dwarkesh Patel  53:17  But the thing is, there's so much speculation that Putin might have cancer or something. If we have his DNA, we can see his probability of having cancer at age 70, or whatever he is, is 85%. So yeah, that’d be a very verified rumor. That would be interesting. Steve Hsu  53:33  I don't think that would be very definitive. I don't think we'll reach that point where you can say that Putin has cancer because of his DNA—which I could have known when he was an embryo. I don't think it's going to reach that level. But, we could say he is at high risk for a type of cancer. Genomics in datingDwarkesh Patel  53:49  In 50 or 100 years, if the majority of the population is doing this, and if the highly heritable diseases get pruned out of the population, does that mean we'll only be left with lifestyle diseases? So, you won't get breast cancer anymore, but you will still get fat or lung cancer from smoking?Steve Hsu  54:18  It's hard to discuss the asymptotic limit of what will happen here. I'm not very confident about making predictions like that. It could get to the point where everybody who's rich or has been through this stuff for a while, (especially if we get the editing working) is super low risk for all the top 20 killer diseases that have the most life expectancy impact. Maybe those people live to be 300 years old naturally. I don't think that's excluded at all. So, that's within the realm of possibility. But it's going to happen for a few lucky people like Elon Musk before it happens for shlubs like you and me. There are going to be very angry inequality protesters about the Trump grandchildren, who, models predict will live to be 200 years old. People are not going to be happy about that.Dwarkesh Patel  55:23  So interesting. So, one way to think about these different embryos is if you're producing multiple embryos, and you get to select from one of them, each of them has a call option, right? Therefore, you probably want to optimize for volatility as much, or if not more than just the expected value of the trait. So, I'm wondering if there are mechanisms where you can  increase the volatility in meiosis or some other process. You just got a higher variance, and you can select from the tail better.Steve Hsu  55:55  Well, I'll tell you something related, which is quite amusing. So I talked with some pretty senior people at the company that owns all the dating apps. So you can look up what company this is, but they own Tinder and Match. They’re kind of interested in perhaps including a special feature where you upload your genome instead of Tinder Gold / Premium.  And when you match- you can talk about how well you match the other person based on your genome. One person told me something shocking. Guys lie about their height on these apps. Dwarkesh Patel  56:41  I’m shocked, truly shocked hahaha. Steve Hsu  56:45  Suppose you could have a DNA-verified height. It would prevent gross distortions if someone claims they're 6’2 and they’re 5’9. The DNA could say that's unlikely. But no, the application to what you were discussing is more like, “Let's suppose that we're selecting on intelligence or something. Let's suppose that the regions where your girlfriend has all the plus stuff are complementary to the regions where you have your plus stuff. So, we could model that and say,  because of the complementarity structure of your genome in the regions that affect intelligence, you're very likely to have some super intelligent kids way above your, the mean of your you and your girlfriend's values. So, you could say things like it being better for you to marry that girl than another. As long as you go through embryo selection, we can throw out the bad outliers. That's all that's technically feasible. It's true that one of the earliest patent applications, they'll deny it now. What's her name? Gosh, the CEO of 23andme…Wojcicki, yeah. She'll deny it now. But, if you look in the patent database, one of the very earliest patents that 23andme filed when they were still a tiny startup was about precisely this: Advising parents about mating and how their kids would turn out and stuff like this. We don't even go that far in GP, we don't even talk about stuff like that, but they were thinking about it when they founded 23andme.Dwarkesh Patel  58:38  That is unbelievably interesting. By the way, this just occurred to me—it's supposed to be highly heritable, especially people in Asian countries, who have the experience of having grandparents that are much shorter than us, and then parents that are shorter than us, which suggests that the environment has a big part to play in it malnutrition or something. So how do you square that our parents are often shorter than us with the idea that height is supposed to be super heritable.Steve Hsu  59:09  Another great observation. So the correct scientific statement is that we can predict height for people who will be born and raised in a favorable environment. In other words, if you live close to a McDonald's and you're able to afford all the food you want, then the height phenotype becomes super heritable because the environmental variation doesn't matter very much. But, you and I both know that people are much smaller if we return to where our ancestors came from, and also, if you look at how much food, calories, protein, and calcium they eat, it's different from what I ate and what you ate growing up. So we're never saying the environmental effects are zero. We're saying that for people raised in a particularly favorable environment, maybe the genes are capped on what can be achieved, and we can predict that. In fact, we have data from Asia, where you can see much bigger environmental effects. Age affects older people, for fixed polygenic scores on the trait are much shorter than younger people.Ancestral populationsDwarkesh Patel  1:00:31  Oh, okay. Interesting. That raises the next question I was about to ask: how applicable are these scores across different ancestral populations?Steve Hsu  1:00:44  Huge problem is that most of the data is from Europeans. What happens is that if you train a predictor in this ancestry group and go to a more distant ancestry group, there's a fall-off in the prediction quality. Again, this is a frontier question, so we don't know the answer for sure. But many people believe that there's a particular correlational structure in each population, where if I know the state of this SNP, I can predict the state of these neighboring SNPs. That is a product of that group's mating patterns and ancestry. Sometimes, the predictor, which is just using statistical power to figure things out, will grab one of these SNPs as a tag for the truly causal SNP in there. It doesn't know which one is genuinely causal, it is just grabbing a tag, but the tagging quality falls off if you go to another population (eg. This was a very good tag for the truly causal SNP in the British population. But it's not so good a tag in the South Asian population for the truly causal SNP, which we hypothesize is the same). It's the same underlying genetic architecture in these different ancestry groups. We don't know if that's a hypothesis. But even so, the tagging quality falls off. So my group spent a lot of our time looking at the performance of predictor training population A, and on distant population B, and modeling it trying to figure out trying to test hypotheses as to whether it's just the tagging decay that’s responsible for most of the faults. So all of this is an area of active investigation. It'll probably be solved in five years. The first big biobanks that are non-European are coming online. We're going to solve it in a number of years.Dwarkesh Patel  1:02:38  Oh, what does the solution look like?  Unless you can identify the causal mechanism by which each SNP is having an effect, how can you know that something is a tag or whether it's the actual underlying switch?Steve Hsu  1:02:54  The nature of reality will determine how this is going to go. So we don't truly know if the innate underlying biology is true. This is an amazing thing. People argue about human biodiversity and all this stuff, and we don't even know whether these specific mechanisms that predispose you to be tall or have heart disease are the same in these different ancestry groups. We assume that it is, but we don't know that. As we get further away to Neanderthals or Homo Erectus, you might see that they have a slightly different architecture than we do. But let's assume that the causal structure is the same for South Asians and British people. Then it's a matter of improving the tags. How do I know if I don't know which one is causal? What do I mean by improving the tags? This is a machine learning problem. If there's an SNP, which is always coming up as very significant when I use it across multiple ancestry groups, maybe that one's casual. As I vary the tagging correlations in the neighborhood of that SNP, I always find that that one is the intersection of all these different sets, making me think that one's going to be causal. That's a process we're engaged in now—trying to do that. Again, it's just a machine learning problem. But we need data. That's the main issue.Dwarkesh Patel  1:04:32  I was hoping that wouldn't be possible because one way we might go about this research is that it itself becomes taboo or causes other sorts of bad social consequences if you can definitively show that on certain traits, there are differences between ancestral populations, right? So, I was hoping that maybe there was an evasion button where we can't say because they're just tags, and the tags might be different between different ancestral populations. But with machine learning, we’ll know.Steve Hsu  1:04:59  That's the situation we're in now, where you have to do some fancy analysis if you want to claim that Italians have lower height potential than Nordics—which is possible. There's been a ton of research about this because there are signals of selection. The alleles, which are activated in height predictors, look like they've been under some selection between North and South Europe over the last 5000 years for whatever reason. But, this is a thing debated by people who study molecular evolution. But suppose it's true, okay? That would mean that when we finally get to the bottom of it, we find all the causal loci for height, and the average value for the Italians is lower than that for those living in Stockholm. That might be true. People don't get that excited? They get a little bit excited about height. But they would get really excited if this were true for some other traits, right?Suppose the causal variants affecting your level of extraversion are systematic, that the average value of those weighed the weighted average of those states is different in Japan versus Sicily. People might freak out over that. I'm supposed to say that's obviously not true. How could it possibly be true? There hasn't been enough evolutionary time for those differences to arise. After all, it's not possible that despite what looks to be the case for height over the last 5000 years in Europe, no other traits could have been differentially selected over the last 5000 years. That's the dangerous thing. Few people understand this field well enough to understand what you and I just discussed and are so alarmed by it that they're just trying to suppress everything. Most of them don't follow it at this technical level that you and I are just discussing. So, they're somewhat instinctively negative about it, but they don't understand it very well.Dwarkesh Patel  1:07:19  That's good to hear. You see this pattern that by the time that somebody might want to regulate or in some way interfere with some technology or some information, it already has achieved wide adoption. You could argue that that's the case with crypto today. But if it's true that a bunch of IVF clinics worldwide are using these scores to do selection and other things, by the time people realize the implications of this data for other kinds of social questions, this has already been an existing consumer technology.Is this eugenics?Steve Hsu  1:07:58  That's true, and the main outcry will be if it turns out that there are massive gains to be had, and only the billionaires are getting them. But that might have the consequence of causing countries to make this free part of their national health care system. So Denmark and Israel pay for IVF. For infertile couples, it's part of their national health care system. They're pretty aggressive about genetic testing. In Denmark, one in 10 babies are born through IVF. It's not clear how it will go. But we're in for some fun times. There's no doubt about that.Dwarkesh Patel  1:08:45  Well, one way you could go is that some countries decided to ban it altogether. And another way it could go is if countries decided to give everybody free access to it. If you had to choose between the two,  you would want to go for the second one. Which would be the hope. Maybe only those two are compatible with people's moral intuitions about this stuff. Steve Hsu  1:09:10  It’s very funny because most wokeist people today hate this stuff. But, most progressives like Margaret Sanger, or anybody who was the progressive intellectual forebears of today's wokeist, in the early 20th century, were all that we would call today in Genesis because they were like, “Thanks to Darwin, we now know how this all works. We should take steps to keep society healthy and (not in a negative way where we kill people we don't like, but we should help society do healthy things when they reproduce and have healthy kids).” Now, this whole thing has just been flipped over among progressives. Dwarkesh Patel  1:09:52  Even in India, less than 50 years ago, Indira Gandhi, she's on the left side of India's political spectrum. She was infamous for putting on these forced sterilization programs. Somebody made an interesting comment about this where they were asked, “Oh, is it true that history always tilts towards progressives? And if so, isn't everybody else doomed? Aren't their views doomed?”The person made a fascinating point: whatever we consider left at the time tends to be winning. But what is left has changed a lot over time, right? In the early 20th century, prohibition was a left cause. It was a progressive cause, and that changed, and now the opposite is the left cause. But now, legalizing pot is progressive. Exactly. So, if Conquest’s second law is true, and everything tilts leftover time, just change what is left is, right? That's the solution. Steve Hsu  1:10:59  No one can demand that any of these woke guys be intellectually self-consistent, or even say the same things from one year to another. But one could wonder what they think about these literally Communist Chinese. They’re recycling huge parts of their GDP to help the poor and the southern stuff. Medicine is free, education is free, right? They're clearly socialists, and literally communists. But in Chinese, the Chinese characters for eugenics is a positive thing. It means healthy production. But more or less, the whole viewpoint on all this stuff is 180 degrees off in East Asia compared to here, and even among the literal communists—so go figure.Dwarkesh Patel  1:11:55  Yeah, very based. So let's talk about one of the traits that people might be interested in potentially selecting for: intelligence. What is the potential for us to acquire the data to correlate the genotype with intelligence?Steve Hsu  1:12:15  Well, that's the most personally frustrating aspect of all of this stuff. If you asked me ten years ago when I started doing this stuff what were we going to get, everything was gone. On the optimistic side of what I would have predicted, so everything's good. Didn't turn out to be interactively nonlinear, or it didn't turn out to be interactively pleiotropic. All these good things, —which nobody could have known a priori how they would work—turned out to be good for gene engineers of the 21st century. The one frustrating thing is because of crazy wokeism, and fear of crazy wokists, the most interesting phenotype of all is lagging because everybody's afraid, even though there are very good reasons for medical researchers to want to know the cognitive ability of people in their studies. For example, when you want to study aging, or decline of cognitive function memory, in older people, you want to have baseline measurements of how good their cognitive function was when they were younger, right? So very good reasons for why you want to have all this data. But, researchers are afraid because it's also linked to all these controversial social issues. So, there's just a ginormous amount of genomic data, where there's no cognitive measurement attached as a field to that data—which would have been very cheap to measure. Again, wokists hate this, but I can measure your IQ on a 12-minute test no problem, right? Not with perfect accuracy, but I can get instrumental measurements. If I take it  the NFL has this thing called the Wonderlic—every player being considered for the draft is asked to take this Wonderlic—it's a short test, 12 minutes long, and it's pretty highly correlated (0.8 or 0.9), maybe with a more fulsome IQ measure. So, it would be trivial and inexpensive to gather this data. Once we have my prediction from this earlier math that I was talking about, when you get to a border a million, it could be 1 million or 2 million well-phenotyped people and genomes, we would be able to build a pretty decent IQ predictor that might have a standard error of maybe 10 points or something. That would be incredible for science, but not getting done.Dwarkesh Patel  1:14:58  Suppose there are differences in how things are tagged between different ancestral groups (I'm not talking about average differences or anything, just how the genotype is tagged). And if the Chinese do this first, then, they have an advantage that can't be transferred over, right? Because it's only applicable or advantageously applicable to their population.Steve Hsu  1:15:24  That's a great point. Even a small country like Singapore or Taiwan has enough data to do this. No problem for Estonia. They could do it and have this thing working and just not share it with anybody. So, it's certainly possible. Now that's a little bit too science-fictiony because the leaders who run these countries are not transhumanist rationalists people who read your blog or my blog posts on the internet. I don't think anything that exciting is going to happen. Maybe it will.Tradeoffs to intelligenceDwarkesh Patel  1:15:59  Do you think that the potential for pleiotropy is higher with intelligence? I mean, with certain populations? Oh, of course, by the way, they're slim or 5000 is not enough, blah blah blah. But given that you see with certain populations like Ashkenazi Jews, you have a higher incidence of nervous system disorders like Tay Sachs and other things, that seems potential to be the trade-off of higher average intelligence. Do you think that maybe pleiotropy has a higher chance of occurring with intelligence?Steve Hsu  1:16:39  It can only be speculation at this stage. With the history of the Ashkenazi Jews, they also went through some very narrow population bottlenecks. There are some special aspects of their genetics. Whether it's related to cognitive function or not, we don't really know for sure, but there are many reasons why they have a fairly high proportion of inherited diseases and things that they're dealing with. This is one of the reasons why Israel is so progressive when it comes to genetic screening and IVF. One thing people talk a lot about is schizophrenia. So they say that schizophrenia could be correlated with creativity. So if your brother's schizophrenic, maybe you're more likely to be creative. He's super creative, but we don't know what he's talking about. Hahahah. So people say that if you start screening against schizophrenia, maybe we won't get creative geniuses. So there are all kinds of pleiotropic things that are possibly true.  But the thing I keep wanting to go back to is that if it's 10,000-20,000 different genetic variants, locations in your genome, that are more or less determining your genetic, cognitive potential, I can go around the high dimensional space. If I find out you can make someone smart using this stuff in this cluster, but it makes them dull or makes them autistic, or it makes them they don't have big muscles, I'll just go round. I don't need to use those, I have plenty more, look over here! Those 500, I don't need to use, I will use *these* 500. This is why it's important to look at historical geniuses who were pretty normal. Maybe they're even good athletes. And, maybe they even were good with the ladies. These people existed. So you have these existence proofs that I can if I need to, if I'm a really good genetic engineer, and I can operate in this 10,000-dimensional space, whatever obstacle you put for me, I will just drive around it. I need lots of data and lots of ML. I'll do it. That's the answer, which, again, most people don't really get. But it's true.Dwarkesh Patel  1:18:56  So I mean, there's a thing where if two traits are correlated at the ends, that person who was, for example, the smartest will not necessarily be the person who is strong. These aren't necessarily correlated, but the person who has the highest mathematical ability will not be the person who has the highest verbal ability—even though the two are correlated. At some point, it'll be interesting because parents will have to make that trade-off, even if two things are extraordinarily correlated. It'll be interesting to see how they choose.Steve Hsu  1:19:21  Eventually, you'll have to trust your friendly neighborhood genetic engineer to advise. There's gonna be a lot more modeling going on in the background.Dwarkesh Patel  1:19:30  For the time being, we're stuck with educational attainment as a correlate. That concerns me because educational attainment also probably correlates with other things that somebody might want or they might not want—which are conscientiousness and conformity. If you're Bryan Caplan Caplan, in the case against education, he says that the three things education signals are conscientiousness, conformity, and intelligence. You want intelligence? Most parents probably want conscientiousness rather than conformity, but some might not. Hopefully, we can get the direct intelligence data itself. But, is there some way to segment out the conformity part of that educational attainment data?Steve Hsu  1:20:12  In my dream world,  if I were the CEO of 23andme or something, what would I do (oh, warning, they're actually secretly doing this, but you didn't hear that from me)? I would have little surveys on the site that say, “Can you do a personality survey, and one of the categories will be conscientiousness, and one will be extraversion, right?” Conformity is not a traditional, Big Five thing. But, you can have questions about how conforming someone is. Of course, we know how to do a little math. So, we can diagonalize a matrix of correlated measurements of all these different things. So, I might be able to remove the chunk within EA (Educational attainment), which is due to conformism, remove the chunk, which is due to conscientiousness, and leave behind the chunk, which correlates highly with the separate IQ predictor that I built separately using a different method. All these things are understood solutions, these problems are understood. It's just a data problem.I'll tell you an interesting thing. There are 20,000 sibling pairs in the UK Biobank. Three years ago, most people didn’t really understand these polygenic scores, and they were very skeptical, thinking that we weren’t really capturing the real stuff, etc. My group was the first to say: let’s look to see how well we can predict which of the two brothers who experienced the same environment will be taller. How well does my predictor do that? I'm going to predict which of these two brothers has diabetes. Now does the diabetes predictor really do that? You're modeling out all the environmental s**t because they grew up in the same family, right? We showed that the predictive power falls off if you're trying to do this trick with unrelated pairs of people versus brothers who grew up in the same house or sisters is minor. It's a small fall-off in predictive power. Basically, we are getting the true genetic stuff. One of the interesting things is when you look at EA— if you build a predictor and you ask, “Does it work better or worse when I try to predict which of the two brothers got more education?” It turns out it works much worse. And that’s because part of what that predictor is capturing is some maybe property of the parents who beat them and made them go to school, but both brothers got beaten and had the skill—so that the reduction in quality of EA prediction for brothers is quite a bit higher than if you're just trying to predict G (General Intelligence). So we have predictors we built that just predict G. Those have a much smaller reduction in quality when you apply them to brothers than in unrelated pears. I went through that quickly, so people could look up the paper. But the point is that we can see EA is weird and is a very different trait than G from these kinds of results. Again, people who criticize us have no idea how sophisticated the work is. They don't read our papers. If they try to read our papers, they can't understand them. But we've done all this stuff. Now, a guy who comes from a physics background or from an AI/ML background can absorb it. But a lot of our critics just can't absorb it. It's literally a G thing. They can't absorb it. So they just want to keep criticizing us forever. Dwarkesh Patel  1:24:04  The funny thing is that I have a much easier time when I read your papers. In the pros part. And the explanation in the organization is…I don't know if it's your physics background, or whatever. But, I noticed it's Scott Aaronson’s papers as well. They're written like essays, as long as you understand the underlying ideas, they're so easy to absorb. Whereas, if I just read a random thing on Bio Archive, it’s like “I don't even know where to get started with this.”It is just written so turgidly.Steve Hsu  1:24:30  I'm totally with you. There are multiple reasons for this. One thing is maybe that I'm an outsider. So I'm trying to write it very clearly. Conceptually, maybe the theoretical physicists would write it. But also it's a slightly selected population. Scott has an enormously popular blog, and he writes these huge posts all the time. I have a blog too, so we are a little bit better at expressing ourselves or clarifying ideas than the average scientist who's just trying to get the thing out and publish it in Nature. Consumer preferencesDwarkesh Patel  1:25:01  Awesome. Let's talk a little about what consumers actually want. Gwern has this really detailed post about embryo selection. He writes in it, “My belief is that the total uptake will be fairly modest as a fraction of the population,” and he's talking about embryo selection there. “A large fraction of the population expresses hostility towards any new fertility-related technology whatsoever, and people open to the possibility will be deterred by the necessity of advanced family planning and the high financial cost of IVF, and the fact that the IVF process is lengthy and painful.” So, he seems very pessimistic about the possibility that this is something that millions of people are using—what is your reaction to his take here?Steve Hsu  1:25:49  There are two perspectives that you could adopt in looking at this. One is a venture capitalist perspective, where you ask: “How big is this market? What's it worth dominating this market? What valuation should I accept from these pirates at GP?” The other perspective is being worried that humans are all going to engineer themselves to be blond, 6’4, and we're going to be suddenly susceptible to all kinds of diseases—and one single, cold virus will kill all of us. So, there's two different perspectives on what level of penetration will this technology have.From the venture guys' perspective, I will just say this: one out of 10 babies in Denmark is born this way. Would you capture a market that interfaces with one out of 10 families, and that's going to grow, of course. One out of 10 families in all developed countries, maybe including China. Do you have the genome of mom and dad and the kid?  Maybe you can sell them some health services later on? Maybe your relationship with these people is sticky? That's for the venture guys. From the, “Oh, I'm really worried about human evolution!” Or, “When are we going to get another von Neumann?” That's a different question.It may be that it'll never be more than 10 or 20% of the population that's using IVF. Through IVF, embryo selection, and maybe potentially editing someday. In that sense, why worry, there's always going to be this natural reservoir of the wild type that has much more genetic diversity? Maybe this is  the Goldilocks world. But imagine the Goldilocks world where there's plenty of wild-type people, and then there's plenty of people using these advanced technologies, and everybody's happy—including our investors.Dwarkesh Patel  1:28:01  Something tells me that that will not be satisfying for the people who are concerned about the evolutionary diversity or whatever. I have the sense that this whole argument is just a front for a moral reservation about this technology.Steve Hsu  1:28:17  Exactly. It's a front for people who just hate it. But what is Gwern saying? Is he saying that these 10% of babies born in Denmark are already mostly screened for chromosomal abnormalities? If I take that same data, and I can generate this other report, are you really not going to look at that report? Are you gonna say, “Well, one of my one of these kids is going to be super high risk for macular degeneration or something, but I'm already screening them for chromosomal abnormalities?  Is that really going to happen? I don't think so. That 10% of the population that's using IVF is going to look at the report, which can be generated by the cost of running some bits through the AWS server. I'm not sure what he means by that. I admire Gwern a lot. But what does he mean by that? Not many people are going to adopt it. Does he mean that the percentage of adoption within IVF families or the fraction of the population that's already doing IVF? Because those are already big numbers. So I don't know what he means. Dwarkesh Patel  1:29:28  One way to think about genetic prediction, given your earlier statement about the Scandinavian countries doing a lot of IVF, is that it’s because of how old people are when they're having babies. A venture capitalist can think of your company as a way to get exposure to demographic collapse, right?Steve Hsu  1:29:47  Yes, that's been mentioned. By the way, it's 3-5% of us. It ain't small. If you go to a kindergarten, there are IVF babies there. Have you seen IVF babies running around in the playground? So I don't know whether their perspective is, is this a big enough market for you to make money in it? Or is this going to change the future of the human species? You can have different perspectives.GwernDwarkesh Patel  1:30:14  By the way, Gwern is such an interesting character. I've been reading him for a long time, but obviously, his persona is very mysterious. Do you know what is going on here? How did this person get into it? It's a really interesting and detailed report he published in every selection. What is going on here?Steve Hsu  1:30:40  Well, Gwern is a super smart guy! I know a lot of scholars and serious scientists and intellectuals in the academy, and even though I didn't quite agree with his take that you just mentioned–– I mean, it might not be technically wrong, because I'm not sure what he meant by his words. I'm not even sure he would disagree with the quantitative things I just mentioned to you. But, I just want to say some positive things about Gwern because I like to read his stuff. In the early days, he was already following much of this stuff about genomic prediction and embryo selection. He's written stuff on GPT-3 and alignment risk. He's written lots and lots of insightful things. He's quite impressive, even if you compare him to the most, famous academic scholars—whether it's Steve Pinker, or somebody who has written a lot of stuff that people read—and as obviously, been thinking deeply about a lot of different things during the course of a very serious life. I think Gwern is super awesome. He's right up there with those guys. So, it's awesome that we live in this internet age where some totally anonymous dude can produce really good thoughts about a wide variety of things. He's not wrong with most of the stuff he writes about embryo selection—it's pretty much right. I have a very high opinion of Gwern.Dwarkesh Patel  1:32:13  It's interesting with people like Gwern—it's almost in the model, you can think of early 20th century or late 19th century, these gentleman scholars, who would just pontificate about a lot of different subjects—I wonder if we're gonna see a return of the sort of generalist thinker. Maybe we've over-indexed on specialists, but now it's now the time for somebody like you! Theoretical physics, bringing all of that computational and mathematical knowledge to genomics—is that the new trend in science, at least at the upper levels?Steve Hsu  1:32:47  I don't think it's a trend. So, in terms of Gwern having a platform, you can tell he's thinking and reading a lot. He's thinking, and then he's writing very insightful stuff, and he has an audience, thanks to the internet, so people can read it. That is an amazing positive trend, which will continue. So, we're in a way, in a golden age for intellectual exchange. Even the conversation that you and I are having is an example of that. The thing I'm afraid is not going to happen is that because science is so specialized now (it takes so much money and resources and institutional support within a university or lab or something to get stuff done), it's getting less and less common to find polymathic people who can do things at the frontier, where they make a significant contribution, and it's recognized by the natives in that sub-specialty that's becoming rarer. It was much less rare in the time of Feynman and von Neumann and people like that, just because the science was smaller. Feynman played around with some molecular biology, which was a big thing. He was friends with Francis Crick—who was down in San Diego. So, he would do stuff like that. Now, it's almost impossible. People would tell me, “Steve, why’re you f*****g around with this stuff? You're wasting your talent.” So, I don't think the trends are good for that. But for general intellectual exchange, the trend is good.Will parents matter?Dwarkesh Patel  1:34:35  Yeah, that's interesting. Going back to IVF, do you think the gains will be greater in any given trait you could think about for parents who are already high in that trait or for parents who are lower in that trait compared to the average population?Steve Hsu  1:34:52  I don't think the base level of mom and dad is a big factor. The big factor is how good are your predictors? And how many embryos are you looking at? Or how good are your editing tools? By the way, I just want to reinforce something I recently learned—it was so impressive that it freaked me out. I thought, “Oh, I'm in this field. So in this industry, I know about it,” but our company was having some conversations with a company that handles egg donation. So it's IVF space. And the egg donors are typically young women 22-23, that could even be college-age women who are paid a sum of money to go through an IVF cycle and just donate the eggs to some billionaire family or whoever wants the eggs. And I was told that 60 to 100 eggs per cycle is not unknown. It's shocking because usually, it's an older woman in her 30s, or 40s, who is going through it, and they're struggling just to get some viable embryos. And then, when you run that same process with a 19-year-old, what do you get? And I was shocked at how high these numbers were.In principle, let's just imagine you're a billionaire oligarch, but very tech savvy. You want to have some, you want to have a large family, and you want to have high-quality kids, maybe very long-lived healthy Kids—you might be selecting the best out of hundreds. There are 100 parallel universes I could live in. I get to peek into each one and then choose. I'm going to step through door number 742 because that's the outcome I like. Not that expensive. But amazing that people can now do this.Dwarkesh Patel  1:36:53  That'll imply that the returns of being young when you have kids will increase because IVF is theoretically supposed to help kids when you have kids when you're old, so it's evening the playing field. The addition of this with the additional embryos for somebody as young as I know, it's we're tilting away in favor of young now—at least of your care about those traits that genetic screening could help you figure out. So let me ask you about what you think about some possibilities Gwern talks about in that post. One is that we might turn induced pluripotent stem cells into embryos, and then we'll be able to select across hundreds of embryos without having to harvest eggs.Steve Hsu  1:37:41  Yeah, so eggs are the limiting factor; sperm is cheap. The stem cell technology takes a skin cell and revert it to the pluripotent state so that it can become some other cell that is a skin cell that may be an egg cell—that technology has been more or less mastered for mice and rats. There are a few labs in Japan where they seem to have fully mastered this for multiple generations of rats using induced pluripotent C to make the eggs. So, my guess would be to get it working in humans is not that hard. It's a matter of some years of just slaving away in the lab to get it working. I know of startups that are working on this. Now, there's going to be some trepidation. Initially, why would you do that if you can pay some 19-year-old to be your egg donor? For example, some gay couples really want to do it, because maybe they think they can make their partner’s skin into an egg. So there are reasons why you do it. But for many people, they would say that an egg was made through a new and untested process and they’d rather have a normal egg. Well, I don't have that additional risk in this whole thing. So I don't know what will happen there adoption-wise. But I do think that it's just a technological prediction. It will be possible. We're not that far from being able to do it.The fact that we can do it in rats means we're not too far. It could have enormous implications for natural selection. If you wanted to be able to select from the best of 1000 embryos, eventually there's no technical barrier. Now, I would say that on roughly the same timescale for the pluripotent production of eggs to mature, they are to be tested so that people are confident in it. Multiplex, very accurate CRISPR-based editing will also arrive on that same timescale. At that point, why are you fooling around this? I just went in and did it to make the changes I needed to make. Over that same timescale,  it's roughly the timescale over which we'll figure out where the real causal is. Dwarkesh Patel  1:40:32  Which is what is nice because, otherwise, you're just changing the tack. Steve Hsu  1:40:36  So, all of this is stuff that I'm fully confident you're going to see. I may not see all of it, but I'll see the technology perfected; I won't necessarily see this impact on society. But you'll probably see. Dwarkesh Patel  1:40:54  I'm hoping it's ready by the time I'm ready to have kids—which is still a while away. Another possibility that Gwern discusses is iterated embryo selection, which you can just keep…I'll let you describe how it works. But what do you think about this possibility?Steve Hsu  1:41:08  Yeah, so you make a bunch of embryos, and then you decide which ones you want. Before you actually make it into a person so that then that person grows up and reproduces, you reproduce just using iterations of embryos. That's also plausible, too. All of these molecular technologies have a chance of working. I don't know anybody who's spending all their time working on that. But yeah, that could work as well. Well, I still want to say that I made these jokes about the wokists, and progressives and people who hate us, and I feel it's wrongheaded of them. I consider myself a progressive, I don't consider myself woke. But the goals of having healthy beautiful people who live to be 200 years old—who’s against that? I'm also against inequality in society. Consistent with growth and advancement in science and technology, we should try to have a fairly egalitarian society. I'm for all those things. So if you're a wokeist watching this interview to just hate Steve Hsu or something, think why you're angry at me. I'm actually exploring how the world is. Don't you want to know how the world actually is if we have an inequality problem because some people don't do well in school, don't you want to give those families these resources so they can fix it for the next generation? Isn't that the ultimate goal of what you want?Dwarkesh Patel  1:42:50  To steel-man a little bit, someone might say, “Listen, one of the things that prevents a runaway divergence between families over time in the model of Piketty, or something, is a reversion to the mean. I listened to your interview with Gregory Clark, where he says that this is already the case. But to the extent that it doesn't get magnified over time. The reason is that it's hard to maintain a leech in genetics is because of reversion to the mean.If you can keep that up, and if there's increasing returns to having good genes, because you can then afford these kinds of treatments, then the possibility of society, instead of  a normal distribution for society, you can have a bimodal distribution that keeps getting further and further apart. That is a potential possibility.Steve Hsu  1:43:43  The Morlocks and the Eloy. That is a fair concern that this could lead to grotesque, huge inequality. That is a risk of the technology in it. A lot of that depends on society, too. I mean, when someone confronts me with that, I will acknowledge it as a legitimate concern. But then I'll say that we live in a country—which is the richest, in some sense,—the richest country in the world, and there are plenty of people who don't even have health care. Did you worry about that inequality?  We have a lot of inequality, there are a lot of things for you to worry about when it comes to inequality. Dwarkesh Patel  1:44:26  Actually, maybe this might not be globally beneficial, both for at least this particular debate. It might be beneficial if the case was when I asked you, “Oh, do people who are lower on some trait have greater potential for increasing that trait than somebody who's higher up on it?” If that was the case, you could just say, "Listen, the smart people are just going to ask them taught at some point, whereas the dumb people can just catch up over time, right?”Steve Hsu  1:44:51  Well, again, if you're more of a left guy, and you like government intervention, and so this becomes part of the government health care system, and it's free. You say we will allow more aggressive edits or more embryos to be produced. For below-average families, there's a very natural way you can redistribute, just  you're going to forcibly take a bunch of money from me when I die that I would rather pass on to my kids, you're going to forcibly take it from me. But you can forcibly give more genomic prediction sources to people who need them. It's easy. Wordcels and shape rotatorsDwarkesh Patel  1:45:25  Just to shift topics quite a bit here, you had an interesting post on that recent Twitter viral meme about the wordcels and shape rotators. About how the content of a shape rotator combines two separate abilities, math, and spatial ability, that is, yeah, when you do principal component analysis and psychometrics, they turn out to be different but correlated. As a programmer, I'm really curious about which of those is the one that is required more for that particular skill set. Because I'm the type of person that when we're talking about abstractions, data structures, and the flow of a program, I just intuitively think about it. I just think and imagine what it looks like visually. Whereas I know friends who I said, “So clearly programming is visual-spatial ability. And they said that actually, they don't imagine it visually at all that for them, it's much more of just looking through the loop and asking what's going to happen next. So yeah, I'm curious, which of these is a better description of programming? Steve Hsu  1:46:33  Your description captures the whole story that people are very different in how they attack, even though they're attacking the same problem in the way that their brain does it.  That's one of the most fascinating things about this field of psychometrics in psychology is really trying to get into that. One of the things that fascinated me when I was being educated and going through training in theoretical physics and math was looking at how my classmates at Caltech or Richard Feynman, or how somebody approached a problem, which might be totally different than the way I would do it, or the way that we would communicate about the solution once we got it. And there are clear visual people: Feynman was a very visual thinker. Other people are more logical or go verbal, where they're stepping through things. And it might even be, and they hear the arguments as they step through it or something. So everybody's different. And those things are super fascinating. Something that's gone out of fashion now, but was very, in fact, very, in very standard when I was growing up is when I took shop class, I don't know if you had to take shop class in junior high, or high school, but we had to take shop class, which where you go to bend metal, and literally they have machines that would weave I made an ashtray or something out of steel or something. So yes, in that class, which is very spatially loaded,  you could have guys, I had a friend who was you ever had a very high LSAT score and went to Princeton, to study English, that guy could not spatially rotate at all, he was totally lost in figuring out how to, do the bends to make the ashtray or whatever, right. So you see that very clearly. And in those old days, when things were more based on when you went shopping class, sometimes we just gave you a standardized test, which was a standardized test of spatial ability. So we're all, my generation is, you don't have to lie to me about all these things. We saw how it works—we saw people take the standardized test for spatial ability, especially in visualization. We saw people try to f*****g work the machine, the metal bending machine, and some people just couldn't actually make the thing.In the real economy of atoms, grams of steel, kilograms of steel (which is all moved to China now or something), all this stuff is super important. You can't just theorize about, “Okay, then I have this module that does this, and this function will have these types.” Like, well, that's nice and super valuable in this part of the economy (academia), but somebody's got to get this plant working. And it's got to be efficient. And we got to put the machines here so we don't have to carry the ship too far from here. That's very spatially loaded, which used to be part of the American economy and education system. Now it's all gone. But it's real, it's not fake. No, people are not making this up. And psychometricians of the 1950s and 60s would have been, yeah, here's my 10 volume treatise on spatial, measuring spatial visualization ability or something. Dwarkesh Patel  1:49:43  If you read the biography of somebody like Einstein, I mean, he was especially known for being a spatial thinker. He was incredibly visual. Thought experiments like “what does it look like or what does it feel to be moving at this speed” or whatever? Super interesting. In the case of programmers, I'm not sure I got your answer. But what do you think is the more important skill for that particular discipline? Steve Hsu  1:50:09  People are going to do it in different ways. Yeah. I do think that if you compare the category of engineers to the category of software developers, engineers generally, have higher, on average higher spatial ability, and they're using it. Whereas you can be an awesome programmer with zero spatial ability. That's my guess.Dwarkesh Patel  1:50:31  Yeah, I wonder if when you're studying history or something, you notice that some people are really attracted to the military history aspect of it, and seeing how the units move. I wonder if that's because they have a higher spatial ability, and they need to be able to understand how the units are moving, and so on.Steve Hsu  1:50:50  I was gonna say - this is a very weird thing for me to reveal that, sometimes when I'm having trouble falling asleep, I'll be visualizing. Recently, I was thinking about how I would use a ballistic missile to target an aircraft carrier. Or sometimes, if I'm trying to go to sleep, I'll just be visualizing, “Okay, when you're at about an altitude of five kilometers, what can your radar see? And how much resolution do you need? And then how much time do you have to hit the ship?” And, I'll be thinking about stuff for relaxation.  This is highly visual but also quantitative because you have to make some estimates. But, that would be typical of a lot of physicists. Because if we start talking about it, we'd be like, “Oh, yeah, right. And you've only got about a point of order a 10th of a second to do this. And you've bet you're thinking of doing it in milliseconds, so we're okay.” And then anyway, that type of thinking is very prevalent amongst certain types of people. Dwarkesh Patel  1:51:52  Right. Now, I'm curious why it's the case that people from physics often transition to finance.  I know that was something you're considering at one point—is the underlying knowledge of mathematics just the same? Or is it just such a credible signal of mathematical ability? And gee, do quant firms want to hire physics students?Steve Hsu  1:52:20  The answer is a little bit complicated.  All the factors you mentioned are true. But one of the things was that in the early phase, in the 80s, and 90s, when a lot of people in my generation went into finance, a lot of them went to trade derivatives. If you look at options, pricing theory looks a lot like physics—it's the mathematics of random walks. So, there was a very tight, not tight connection. But the concepts were strongly related to what was necessary. Now, he brought it out a little bit more to say, “Okay, but nowadays, if you go to really big quant funds, and they're looking for a signal and analyzing tons of data,” they're not trading derivatives, just actual names of stocks or whatever. There's more load on people with machine learning and CS backgrounds now. The physicists who go in there have to use that subset of their skills, but the funds would just as soon hire a CS or ML-type guy to do it. So it's a little bit of a complicated answer.Dwarkesh Patel  1:53:28  Yeah, that's super interesting. Because I mean, back in the 90s and early 2000s, I read that book about the fall of long-term capital management.Steve Hsu  1:53:42  Actually, there are two books; there's one called When Genius Fails. And then there are actually three books, at least three books, but they're all good.Dwarkesh Patel  1:53:50  Then you just hear about the people who created options and pricing theory there, about applying calculus to random walks and stuff—stuff I don't understand. But just super cool that you have these mathematicians that are just coming in and applying these ideas to finance.Steve Hsu  1:54:06  They will. I want to say one thing about physicists, which is a little different from mathematicians, and computer science guys. Maybe not so different from data science guys, but definitely different from most computer science guys and most math guys because we spend a lot of time looking at bad noisy data. So even if you're a theorist, you had to go through these lab courses. For me, those lab courses were among the hardest, the worst! You’d have to go in and build some electronic equipment to take some data, and it could be extremely noisy.  You're measuring muon cosmic rays coming through the roof and hitting your detector and then, you have to analyze the data. And, when you're building this thing, you screw it up. You get data that makes no sense, or you say something about the amplifier wasn't right, or you're used to seeing data that sucks. You have this theoretical view of what should be happening, maybe you're visualizing it as the muon comes in, and it does this and, and interpolating between the theoretical view of what should be happening with the particles and the systems, and what the actual data looks like. Saying, “Oh, s**t, we didn't do this, or we didn't shield this part. So that's why we're getting that.” That's something physicists are very used to doing. Mathematicians are often shitty at it—they just accept, “Oh, I just accept this is the data. Now I will now reason with this data.” The same could be true for computer science people. But you need someone who's actually had to deal with shitty data and try to connect it to a very elegant mathematical model. That's something physicists are uniquely used to. Dwarkesh Patel  1:55:45  That's also true of CS people, which is that in debugging, there are many potential problems that could happen. Obviously, one of them is that you wrote the code wrong. But often you get to the actual implementation, there are so many layers of abstraction beneath you and above the actual hardware that you have to figure out like, “Why is the correspondence between this idea I had and the actual program output not the same?”Steve Hsu  1:56:14  That's fair. Because when you debug your code, there are many different ways it could have failed. You have to, in a sense, step back and model , “Oh, maybe this module is feeding me something wrong. And that's what's causing the problem, or this other layer.” So that is very analogous to when we have to deal with a physical experiment in the lab. The thing with physics, though, is that we were really, really geared towards getting toward the underlying reality.Like if it’s really late at night, and my lab partner and I just want to get out and go to sleep, we can't tell ourselves that things are okay. “We didn't actually screw up the shielding on that.” “It's okay, and we'll just bring the data home and look at it.” Now we have to actually decide, do we have to spend three more hours ripping this thing apart and re-shielding it? Or we have to get to the real underlying reality, and we can't fake it. We can't just pretend that this admission scheme will work perfectly. We can't lie to ourselves about it. That's true for coders, too. But, anyway, it's very different from social scientists and stuff where they can just decide I don't like that reality, I'll just make up this model for how society behaves. And then I'm done. We can't do that.Bezos and brilliant physicistsDwarkesh Patel  1:57:29  Yeah. So given the theoretical physicists' skill set, as you just mentioned, is it potentially the case? I mean, obviously, the common criticism of  physics as a community is that they're absorbing too much talent—that three or four standard deviations above average intelligence people are working on a field that, in popular convention, at least seems, isn't making as much progress. Dwarkesh: More people in physics are making the step you made, which is learning all these skills in theoretical physics, and moving out of it. Maybe finance is one way in which we're getting these pro-social benefits from the skills that physics builds. Stepping into fields of genomics or things like that. Should more physicists be just using their skills elsewhere?Steve Hsu  1:58:16  Number one, the attrition rate is super high. So even if you take this set of kids that are plus three or four standard deviations in ability, and they enter a physics major at Princeton, or MIT or something, the fraction of them that actually end up as practicing physicists is pretty small. So they're bleeding off at all points. Bezos started in physics and, toward the end of his Princeton career, switched to computer science. Elon was in graduate school in physics at Applied Physics or physics at Stanford, and he bled out. So it's already the case that for me, one way to say it is that education is phenomenal; you should try to get that education; it'll pay off for you later. You'll probably bleed out, and you'll trade away and do something else. Now, if you say, “Okay, of the thousands of theoretical physicists, or physicists who do fundamental research, including the experimentalists, around the world, there are tens of thousands. Maybe some of those guys should also be doing more cancer research or financial modeling.” Maybe we should tear them off, you should remove even more of those guys and have them do more so that there's still some argument in favor of that. But, we do need a core of people that are trying to do these tough fundamental answers to these hard fundamental questions about nature.Dwarkesh Patel  1:59:38  The Bezos example is fascinating. For the people in the audience who might not know: His original plan was to become a theoretical physicist. He didn't pursue it because he noticed one of his friends was just so much obviously more gifted than him at that skill. The story they tell us is about Bezos working on a problem for many hours and making no progress before asking a friend who solved the entire problem in his mind. Basically, Bezos realized that it (theoretical physics) was not his competitive advantage. Steve Hsu  2:00:20  I gotta add one anecdote. So, I know many of the guys in Bezos’ eating club, we also tick because we're very similar in vintage, a lot of them were late. So I know all these guys, I know all these Bezos stories. The funny thing is the guy you're talking about (guy who solved the physics problem in his mind), whose name I believe is Asana, is a Sri Lankan guy. He went to grad school at Caltech. At one point, we met up at Caltech when I was visiting, and he was in grad school. I met this guy and talked to him about Bezos. We had other friends in common so we weren't focused on Bezos, but yeah, I met this guy in that anecdote that you just mentioned. Dwarkesh Patel  2:01:19  That's good to know. Because that is relevant to my question. My friend and I have continually debated the importance of intelligence at the peak of entrepreneurial or engineering ability. And he uses that anecdote to say, “Oh, look, Bezos was not smart enough to be a theoretical physicist. So, therefore, intelligence is not that important. Beyond a confident, not incredibly high point. And afterward, Bezos was creative or blah, blah, blah. He was hard working.” I don't know; my perception of the story was, “Okay, he's not intelligent enough to be a theoretical physicist. He's below five standard deviations or four standard deviations above the mean; clearly, just studying physics at Princeton is itself a testament that it's probably at least  two or three standard deviations about, well, at least three.” What was the perception of those people you talked to at Princeton, about Jeff Bezos? Is it that he just was super hardworking or creative? Or is intelligence super high, just not high enough to be a theoretical physicist?Steve Hsu  2:02:30  Yeah, this is a great topic that many people are interested in. And even among my close friends. In school, we all talk about this stuff. You have to distinguish between the very abstract intelligence—which is helpful in physics and math, or maybe computer science, versus a more generalist intelligence. Those are correlated, but they're not the same thing. So, I would say Bezos is probably very off-scale for ability to work hard, take risks, function under pressure, focus, and generalist intelligence.Since these traits are at least somewhat uncorrelated, if you're top 10%, in each of these five, simultaneously, already pretty rare individual because plenty of the physics guys who did better than Bezos in the physics classes could not lead a company, they could not put together a presentation that would convince a venture capitalist to invest. So it's a different skill set that we're talking about. The idea that there's a unit dimensional measure of cognitive abilities is not that useful. I'm probably guilty. People say, "Wait, Steve Hsu just said that, but he's the guy most responsible for promulgating this perspective. But it's only because it's the simplest thing to talk about. If you compress it to one general factor, it's just easier to talk about—it doesn't mean that the other components are not meaningful. We just got done talking about verbal vs. spatial vs. some more generalized mathematical talent. So obviously, it's a high dimensional, not that high dimensional, it's at least a multi-dimensional space of abilities that we're talking about. Now, the point about Bezos, which is nontrivial, though, which is directly relevant to the life experiences of  physicists who leave physics and do other stuff, is that very often in an engineering setting, or a startup setting, people say “You don't know s**t about that! What are you talking about?”But the reality is people who do perform on a technical problem that the startup has to solve—in Bezos his case, it was often optimization of some supply chain thing or optimization of some sorting process or reducing the error rate. The people in the company uniformly say that when Bezos comes in the room, he will give us good feedback on the solution to this ops problem that could be better than what we said, or at least he finds the problems with what we said, or if we did an excellent job on it, he gets it right away, which is some executives might not get it right away. So my point is that people with these super high raw G abilities generally can be helpful in these technological environments. Even if they don't have a lot of background, they can still come in and be helpful. And sometimes they can solve problems that the people who are well trained in the area are having trouble with. That is fair. But it's not fair to say there's just some unit dimensional measure of intelligence. This guy always beats this guy, this guy always beats this guys–it doesn't work that way. But it just, on some of these scales, these guides are generally more helpful than the critics would give them credit for.Dwarkesh Patel  2:06:01  Your life story is an example of that. But, I had another experience of this, which was I recently interviewed Sam Bankman-Fried, who is the CEO of FTX, on my podcast. For all interviews, I tried to come up with questions that the guest probably had not heard before. I tried really hard to come up with questions that he might not have heard before that might have been really interesting and challenging to answer. I listen to all the interviews he’d ever done and then prayed for a long time.  But yeah, if you look and listen to that interview, you'll notice how he answers these questions. It sounds like he was just talking to somebody about that. No matter how creative a question I could try to throw at him, it's just his ability to grok. All the context is explained in a way that an audience would understand. It was exceptional.Steve Hsu  2:07:03  Being a super successful founder selects for the ability to figure out how to effectively communicate with a person according to their background. Whether it’s an investor or someone from a tech-heavy venture fund, you have to think about how they think about a problem. Founders are selected for being excellent multiband communicators across different cultures and stuff like this. It's not surprising to me that this guy would have those capabilities. Dwarkesh Patel  2:07:54  Okay, so you are a practitioner of jiu-jitsu and other martial arts. One notable aspect of those disciplines is that you can punch above your weight, right? Royce, Gracie, and the UFC are great examples of this. Is that possible with a trait like intelligence? Is it possible that we have techniques or other ways of compensating for your analogy? Or just natural weight? What is jujitsu for fighting?Steve Hsu  2:08:37  Great question. So, in a way, jiu-jitsu is applied physics because you're thinking about two arms and questions like “if it’s easier for you to punch and knock me out before I can close a distance and force you to grapple with me?” I do Jiu Jitsu so much because it's very rational. It's a scientific analysis of what two humans can do to each other. It's a technology in terms of what technologies people can use, amplifying their brain power. We're surrounded by it. So, here's an exciting thing. Suppose you and your girlfriend are trying to get the answer to some question. And you're both using Google. There's an enormous variance in who immediately puts the search term in that gets the right at the top hit is the direct answer to your question, and that's very cheap, very G-loaded. But if you get good at using particular technologies or specific information channels, you can't amplify your ability beyond just what the raw capability is. So, my answer is that there are tools, but nobody uses them. There’s no dojo where you can go where they start teaching you immediately, “This, do this, this, this, and this,” and then go the guy who's bigger than you, take him down and choke them out. There isn't anything analogous to this for cognition. But I can see how people can amplify their capabilities in different ways, either more or less effectively.Elite educationDwarkesh Patel  2:10:23  Now, you had a blog post a long time ago about elite education. And in it, you talked about how even if you control for the SAT, the top jobs people hear about from elite schools are overrepresented. So I'm curious, do you think this is because of a selection effect, Harvard selecting based on personality? That selects for certain high achievers? Or is that something about being at Harvard that makes you a high achiever, but what is going on?Steve Hsu  2:10:57  I researched this question pretty aggressively when I was first when I first became an entrepreneur. Because I was like, “Well, we can raise this much money, we can get these meetings with these funds. But how the hell did this guy raise $100 million for the stupid idea, what the hell?” And then I would start looking into this guy's background, I'd see he went to Harvard. So I got intensely interested in super outlier guys—how did this guy get a job writing for The Simpsons? What would I write? This other guy writes for The Simpsons, but he went to Ohio State. So he's ten layers of social networking away from The Simpsons, but the Harvard guys are not—his buddies at the Crimson. There are multiple factors,why? Take two kids. They both scored 1580 on the SATs. One goes to Ohio State on the Ohio regents scholarship for engineering. And the other one goes to Harvard, even though the engineering school there sucks. What's the difference in their lives? Maybe the guy went to Harvard because he understands how the world works a little better than the other dude. When he gets to Harvard, he will meet many super ambitious, aggressive, smart kids. Some of those kids are children of super-wealthy people.Some of them are children of super influential people. And all of them are trying to get ahead. They're super ambitious—they know what it means to be a managing director at Goldman or become a partner at McKinsey—they know what those things are. If you didn't know them because you grew up in Ohio, you learn them immediately. You just get a better view of what's possible in the elite sector of society from that exposure. So there are multiple factors in networking, some of these Harvard kids come from super wealthy families, some of them their dad used to play golf, the head of the fund that he's trying to get a meeting with, right? So it's all those things together. I'm not saying it's good, but I understand how the world works. I understand why this other dude can raise so much more money than I can raise or get meetings that I can get. Right. So that's how I was initially interested in this question.Dwarkesh Patel  2:13:26  Why are China and India underrepresented massively in Nobel Prizes per capita? Even in computer science, when I would try to find papers on specific subjects, it was rare that they would come from China or something like that. And when they did, it was just that the quality was much worse than the ones I could find from a professor in the US. I'm curious why you think that is. It can't just be the population or anything  that because when those researchers come to the US, they're producing stellar research; what is happening here? Why is this effect natural? And if so, what is the explanation?Steve Hsu  2:14:11  Well, the easy answer to that question is that many of the things you mentioned are lagging indicators. So they reflect how the West was developed and had a solid scientific and engineering tradition, while China and India were desperately poor and didn't have any of that. In my own life, in the last 20 years when I visited universities in China, South Korea, and Taiwan. They had plenty of talented undergraduates, but the best of undergraduates always wanted to come to the US for their Ph.D. They went from that to some of the best undergraduates deciding to stay there–– so the researchers who are professors there are becoming world-class. But that happened only in my adult lifetime. So, you can see it's a heavily lagging indicator.Interestingly, in my physics career, I knew several…. The Indian term was called toppers. So the people who take the exams rank every kid in the country who takes the exam, right? So, I knew guys who were number one, number two, or number five on the IIT entrance exam, but they ended up going to Caltech, or they ended up going to MIT. So, there's this massive brain drain. It's a super powerful, elite brain drain. MIT recently has just been recruiting. If you win one of these Olympians, you get a gold medal, and the informatics Olympiad or the math at MIT will try to get you to come to MIT. So, this enormous sucking of talent into the United States is excellent. But that's why when you go to IIT, even though the undergraduates are super bright, the professors are… (no offense to my colleagues who teach there), but if those professors got a bid from UCLA, the professors there would generally move to UCLA. So that's the difference. But that's gradually evening out.Dwarkesh Patel  2:16:10  Are there any downsides to the fact that we can pay researchers or postdocs in the US less because we're partially paying foreign workers in visas? Is that just a market arbitrage that has positive externalities for the economy? Or is there some downside to the fact that native it's not competitive for native-born workers?Steve Hsu  2:16:34  Suitable for the US, overall, on average, bad for developing countries because you're stealing their talent. It's terrible for native-born Americans who have to compete against the best brains from all over the world; so much harder for an American kid, too, to get the job he deserves at these elite levels strongly impacted by immigration. So, you have winners and losers. Whether there's a long-term problem for America... Some guys are super obsessed who comment on my blog now and then studied where all the IMO, international math olympiad winners were going, where are they what,and they claim they're seeing this huge drop off in kids who grew up in America who are not first children of immigrants, but have instead simply been here a while. They just never win these competitions. So ultimately, you might be  discouraging the native talent pool by just letting the door open and bringing in all these super talented people from outside. So there could be some second-order effects that aren’t so sound.Dwarkesh Patel  2:17:49  Although it's interesting when you look at an industry like tech, there's a similar aspect of foreign competition being allowed in because of H1B visas, the compensation has remained competitive. Is it just because Tech is in super inelastic demand for talent?Steve Hsu  2:18:10  Yeah. This is a little more focused on software development and ML and stuff, but if you look at more traditional engineering fields, which aren't as hot (ex. engineers at Boeing, etc.) those guys would probably say that their salaries are heavily suppressed by the existence of hungry engineers from India and China. So in the software/tech industry, because it's been so hot for so long, it doesn't feel this effect so much. So yeah it's got plenty of elasticity.Dwarkesh Patel  2:18:42  Awesome. Okay, Steve, this was so much fun. I really enjoyed this conversation. Loved preparing for it, talking to you, and I really got to learn a lot more about this subject that I had been interested in for a long time. Is there anything else we should touch upon on any of the subjects we've covered today or failed to cover today?Steve Hsu  2:19:00  Well, we've covered so much, and I just really think you're a great interviewer. Your questions are always getting at a key thing that many people are confused about. There's a lot of depth there. So, I thought it was great. There's plenty more we could talk about—we should just get together and do this some other time. But I don't think you left anything out.Dwarkesh Patel  2:19:21  If you're willing, I would love to do version two of this, where we talk about your physics work and the other subjects we might have missed this time around.Steve Hsu  2:19:29  Yeah, we get to talk about many worlds and quantum computing. Yes.Dwarkesh Patel  2:19:33  Haha this will be fun. In the meantime, do you want to give people your website, your podcast, and your Twitter, so they know where to find you?Steve Hsu  2:19:45  My last name is Hsu. That's the hardest thing for people because it's anti-phonetic. Just search for me. I'm on Twitter. I have a blog and a podcast called Manifold, which doesn't have a huge listenership, but I tried to keep the quality level high and get best-in-class guests. We’re willing to go into some depth, so it's got a very niche audience. But if you'd like the conversation that we just had here, you'll probably like Manifold. So you can look for that in all the usual places you get your podcasts and YouTube.Dwarkesh Patel  2:20:23  The podcast is similar. It's exactly what I'm trying to do here. You just know so much about so many different fields. It's so fun to listen to where you're having expert-level conversations and everything from social science to foreign policy. So yeah, Manifold podcast is a place to check out.Steve Hsu  2:20:54  Yeah, my pleasure. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Will MacAskill is one of the founders of the Effective Altruist movement and the author of the upcoming book, What We Owe The Future.We talk about improving the future, risk of extinction & collapse, technological & moral change, problems of academia, who changes history, and much more.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website + Transcript here.Follow Will on Twitter. Follow me on Twitter for updates on future episodes.Subscribe to find out about future episodes!Timestamps(00:23) - Effective Altruism and Western values(07:47) - The contingency of technology(12:02) - Who changes history?(18:00) - Longtermist institutional reform(25:56) - Are companies longtermist?(28:57) - Living in an era of plasticity(34:52) - How good can the future be?(39:18) - Contra Tyler Cowen on what’s most important(45:36) - AI and the centralization of power(51:34) - The problems with academiaPlease share if you enjoyed this episode! Helps out a ton!TranscriptDwarkesh Patel 0:06Okay, today I have the pleasure of interviewing William MacAskill. Will is one of the founders of the Effective Altruism movement, and most recently, the author of the upcoming book, What We Owe The Future. Will, thanks for coming on the podcast.Will MacAskill 0:20Thanks so much for having me on.Effective Altruism and Western valuesDwarkesh Patel 0:23My first question is: What is the high-level explanation for the success of the Effective Altruism movement? Is it itself an example of the contingencies you talk about in the book?Will MacAskill 0:32Yeah, I think it is contingent. Maybe not on the order of, “this would never have happened,” but at least on the order of decades. Evidence that Effective Altruism is somewhat contingent is that similar ideas have been promoted many times during history, and not taken on.We can go back to ancient China, the Mohists defended an impartial view of morality, and took very strategic actions to help all people. In particular, providing defensive assistance to cities under siege. Then, there were early utilitarians. Effective Altruism is broader than utilitarianism, but has some similarities. Even Peter Singer in the 70s had been promoting the idea that we should be giving most of our income to help the very poor — and didn’t get a lot of traction until early 2010 after GiveWell and Giving What We Can launched.What explains the rise of it? I think it was a good idea waiting to happen. At some point, the internet helped to gather together a lot of like-minded people which wasn’t possible otherwise. There were some particularly lucky events like Alex meeting Holden and me meeting Toby that helped catalyze it at the particular time it did.Dwarkesh Patel 1:49If it's true, as you say, in the book, that moral values are very contingent, then shouldn't that make us suspect that modern Western values aren't that good? They're mediocre, or worse, because ex ante, you would expect to end up with a median of all the values we could have had at this point. Obviously, we'd be biased in favor of whatever values we were brought up in.Will MacAskill 2:09Absolutely. Taking history seriously and appreciating the contingency of values, appreciating that if the Nazis had won the World War, we would all be thinking, “wow, I'm so glad that moral progress happened the way it did, and we don't have Jewish people around anymore. What huge moral progress we had then!” That's a terrifying thought. I think it should make us take seriously the fact that we're very far away from the moral truth.One of the lessons I draw in the book is that we should not think we're at the end of moral progress. We should not think, “Oh, we should lock in the Western values we have.” Instead, we should spend a lot of time trying to figure out what's actually morally right, so that the future is guided by the right values, rather than whichever happened to win out.Dwarkesh Patel 2:56So that makes a lot of sense. But I'm asking a slightly separate question—not only are there possible values that could be better than ours, but should we expect our values - we have the sense that we've made moral progress (things are better than they were before or better than most possible other worlds in 2100 or 2200)- should we not expect that to be the case? Should our priors be that these are ‘meh’ values?Will MacAskill 3:19Our priors should be that our values are as good as expected on average. Then you can make an assessment like, “Are other values of today going particularly well?” There are some arguments you could make for saying no. Perhaps if the Industrial Revolution happened in India, rather than in Western Europe, then perhaps we wouldn't have wide-scale factory farming—which I think is a moral atrocity. Having said that, my view is to think that we're doing better than average.If civilization were just a redraw, then things would look worse in terms of our moral beliefs and attitudes. The abolition of slavery, the feminist movement, liberalism itself, democracy—these are all things that we could have lost and are huge gains.Dwarkesh Patel 4:14If that's true, does that make the prospect of a long reflection dangerous? If moral progress is a random walk, and we've ended up with a lucky lottery, then you're possibly reversing. Maybe you're risking regression to the mean if you just have 1,000 years of progress.Will MacAskill 4:30Moral progress isn't a random walk in general. There are many forces that act on culture and on what people believe. One of them is, “What’s right, morally speaking? What's their best arguments support?” I think it's a weak force, unfortunately.The idea of lumbar flexion is getting society into a state that before we take any drastic actions that might lock in a particular set of values, we allow this force of reason and empathy and debate and goodhearted model inquiry to guide which values we end up with.Are we unwise?Dwarkesh Patel 5:05In the book, you make this interesting analogy where humans at this point in history are like teenagers. But another common impression that people have of teenagers is that they disregard wisdom and tradition and the opinions of adults too early and too often. And so, do you think it makes sense to extend the analogy this way, and suggest that we should be Burkean Longtermists and reject these inside-view esoteric threats?Will MacAskill 5:32My view goes the opposite of the Burkean view. We are cultural creatures in our nature, and are very inclined to agree with what other people think even if we don't understand the underlying mechanisms. It works well in a low-change environment. The environment we evolved towards didn't change very much. We were hunter-gatherers for hundreds of years.Now, we're in this period of enormous change, where the economy is doubling every 20 years, new technologies arrive every single year. That's unprecedented. It means that we should be trying to figure things out from first principles.Dwarkesh Patel 6:34But at current margins, do you think that's still the case? If a lot of EA and longtermist thought is first principles, do you think that more history would be better than the marginal first-principles thinker?Will MacAskill 6:47Two things. If it's about an understanding of history, then I'd love EA to have a better historical understanding. The most important subject if you want to do good in the world is philosophy of economics. But we've got that in abundance compared to there being very little historical knowledge in the EA community.Should there be even more first-principles thinking? First-principles thinking paid off pretty well in the course of the Coronavirus pandemic. From January 2020, my Facebook wall was completely saturated with people freaking out, or taking it very seriously in a way that the existing institutions weren't. The existing institutions weren't properly updating to a new environment and new evidence.The contingency of technologyDwarkesh Patel 7:47In your book, you point out several examples of societies that went through hardship. Hiroshima after the bombings, Europe after the Black Death—they seem to have rebounded relatively quickly. Does this make you think that perhaps the role of contingency in history, especially economic history is not that large? And it implies a Solow model of growth? That even if bad things happen, you can rebound and it really didn't matter?Will MacAskill 8:17In economic terms, that's the big difference between economic or technological progress and moral progress. In the long run, economic or technological progress is very non-contingent. The Egyptians had an early version of the steam engine, semaphore was only developed very late yet could have been invented thousands of years in the past.But in the long run, the instrumental benefits of tech progress, and the incentives towards tech progress and economic growth are so strong, that we get there in a wide array of circumstances. Imagine there're thousands of different societies, and none are growing except for one. In the long run, that one becomes the whole economy.Dwarkesh Patel 9:10It seems that particular example you gave of the Egyptians having some ancient form of a steam engine points towards there being more contingency? Perhaps because the steam engine comes up in many societies, but it only gets turned into an industrial revolution in one?Will MacAskill 9:22In that particular case, there's a big debate about whether quality of metalwork made it actually possible to build a proper steam engine at that time. I mentioned those to share some amazing examples of contingency prior to the Industrial Revolution.It's still contingency on the order of centuries to thousands of years. Post industrial-revolution world, there's much less contingency. It's much harder to see technologies that wouldn't have happened within decades if they hadn't been developed when they were.Dwarkesh Patel 9:57The model here is, “These general-purpose changes in the state of technology are contingent, and it'd be very important to try to engineer one of those. But other than that, it's going to get done by some guy creating a start-up anyways?”Will MacAskill 10:11Even in the case of the steam engine that seemed contingent, it gets developed in the long run. If the Industrial Revolution hadn't happened in Britain in the 18th century, would it have happened at some point? Would similar technologies that were vital to the industrial revolution developed? Yes, there are very strong incentives for doing so.If there’s a culture that's into making textiles in an automated way as opposed to England in the 18th century, then that economy will take over the world. There's a structural reason why economic growth is much less contingent than moral progress.Dwarkesh Patel 11:06When people think of somebody like Norman Borlaug and the Green Revolution. It's like, “If you could have done something that, you'd be the greatest person in the 20th century.” Obviously, he's still a very good man, but would that not be our view? Do you think the green revolution would have happened anyways?Will MacAskill 11:22Yes. Norman Borlaug is sometimes credited with saving a billion lives. He was huge. He was a good force for the world. Had Norman Borlaug not existed, I don’t think a billion people would have died. Rather, similar developments would have happened shortly afterwards.Perhaps he saved tens of millions of lives—and that's a lot of lives for a person to save. But, it's not as many as simply saying, “Oh, this tech was used by a billion people who would have otherwise been at risk of starvation.” In fact, not long afterwards, there were similar kinds of agricultural development.Who changes history?Dwarkesh Patel 12:02What kind of profession or career choice tends to lead to the highest counterfactual impact? Is it moral philosophers?Will MacAskill 12:12Not quite moral philosophers, although there are some examples. Sticking on science technology, if you look at Einstein, theory of special relativity would have been developed shortly afterwards. However, theory of general relativity was plausibly decades in advance. Sometimes, you get surprising leaps. But, we're still only talking about decades rather than millennia. Moral philosophers could make long-term difference. Marx and Engels made an enormous, long-run difference. Religious leaders like Mohammed, Jesus, and Confucius made enormous and contingent, long-run difference. Moral activists as well.Dwarkesh Patel 13:04If you think that the changeover in the landscape of ideas is very quick today, would you still think that somebody like Marx will be considered very influential in the long future? Communism lasted less than a century, right?Will MacAskill 13:20As things turned out, Marx will not be influential over the long term future. But that could have gone another way. It's not such a wildly different history. Rather than liberalism emerging dominant in the 20th century, it was communism. The better technology gets, the better the ruling ideology is to cement its ideology and persist for a long time. You can get a set of knock-on effects where communism wins the war of ideas in the 20th century.Let’s say a world-government is based around those ideas, then, via anti-aging technology, genetic-enhancement technology, cloning, or artificial intelligence, it's able to build a society that possesses forever in accordance with that ideology.Dwarkesh Patel 14:20The death of dictators is especially interesting when you're thinking about contingency because there are huge changes in the regime. It makes me think the actual individual there was very important and who they happened to be was contingent and persistent in some interesting ways.Will MacAskill 14:37If you've got a dictatorship, then you've got single person ruling the society. That means it's heavily contingent on the views, values, beliefs, and personality of that person.Scientific talentDwarkesh Patel 14:48Going back to the second nation, in the book, you're very concerned about fertility. It seems your model about scientific and technological progress happens is number of people times average researcher productivity. If resource productivity is declining and the number of people isn't growing that fast, then that's concerning.Will MacAskill 15:07Yes, number of people times fraction of the population devoted to R&D.Dwarkesh Patel 15:11Thanks for the clarification. It seems that there have been a lot of intense concentrations of talent and progress in history. Venice, Athens, or even something like FTX, right? There are 20 developers making this a multibillion dollar company—do these examples suggest that organization and congregation of researchers matter more than the total amount?Will MacAskill 15:36The model works reasonably well. Throughout history, you start from a very low technological baseline compared to today. Most people aren't even trying to innovate. One argument for why Baghdad lost its Scientific Golden Age is because the political landscape changed such that what was incentivized was theological investigation rather than scientific investigation in the 10th/11th century AD.Similarly, one argument for why Britain had a scientific and industrial revolution rather than Germany was because all of the intellectual talent in Germany was focused on making amazing music. That doesn't compound in the way that making textiles does. If you look at like Sparta versus Athens, what was the difference? They had different cultures and intellectual inquiry was more rewarded in Athens.Because they're starting from a lower base, people trying to do something that looks like what we now think of as intellectual inquiry have an enormous impact.Dwarkesh Patel 16:58If you take an example like Bell Labs, the low-hanging fruit is gone by the late 20th century. You have this one small organization that has six Nobel Prizes. Is this a coincidence?Will MacAskill 17:14I wouldn't say that at all. The model we’re working with is the size of the population times the fraction of the population doing R&D. It's the simplest model you can have. Bell Labs is punching above its weight. You can create amazing things from a certain environment with the most productive people and putting them in an environment where they're ten times more productive than they would otherwise be.However, when you're looking at the grand sweep of history, those effects are comparatively small compared to the broader culture of a society or the sheer size of a population.Longtermist institutional reformDwarkesh Patel 18:00I want to talk about your paper on longtermist institutional reform. One of the things you advocate in this paper is that we should have one of the houses be dedicated towards longtermist priorities. Can you name some specific performance metrics you would use to judge or incentivize the group of people who make up this body?Will MacAskill 18:23The thing I'll caveat with longtermist institutions is that I’m pessimistic about them. If you're trying to represent or even give consideration to future people, you have to face the fact that they're not around and they can't lobby for themselves. However, you could have an assembly of people who have some legal regulatory power. How would you constitute that? My best guess is you have a random selection from the population? How would you ensure that incentives are aligned?In 30-years time, their performance will be assessed by a panel of people who look back and assess the policies’ effectiveness. Perhaps the people who are part of this assembly have their pensions paid on the basis of that assessment. Secondly, the people in 30-years time, both their policies and their assessment of the previous 30-years previous assembly get assessed by another assembly, 30-years after that, and so on. Can you get that to work? Maybe in theory—I’m skeptical in practice, but I would love some country to try it and see what happens.There is some evidence that you can get people to take the interests of future generations more seriously by just telling them their role. There was one study that got people to put on ceremonial robes, and act as trustees of the future. And they did make different policy recommendations than when they were just acting on the basis of their own beliefs and self-interest.Dwarkesh Patel 20:30If you are on that board that is judging these people, is there a metric like GDP growth that would be good heuristics for assessing past policy decisions?Will MacAskill 20:48There are some things you could do: GDP growth, homelessness, technological progress. I would absolutely want there to be an expert assessment of the risk of catastrophe. We don't have this yet, but imagine a panel of super forecasters predicting the chance of a war between great powers occurring in the next ten years that gets aggregated into a war index.That would be a lot more important than the stock market index. Risk of catastrophe would be helpful to feed into because you wouldn't want something only incentivizing economic growth at the expense of tail risks.Dwarkesh Patel 21:42Would that be your objection to a scheme like Robin Hanson’s about maximizing the expected future GDP using prediction markets and making decisions that way?Will MacAskill 21:50Maximizing future GDP is an idea I associate with Tyler Cowen. With Robin Hanson’s idea of voting on values but betting on beliefs, if people can vote on what collection of goods they want, GDP and unemployment might be good metrics. Beyond that, it's pure prediction markets. It's something I'd love to see tried. It’s an idea of speculative political philosophy about how a society could be extraordinarily different in structure that is incredibly neglected.Do I think it'll work in practice? Probably not. Most of these ideas wouldn't work. Prediction markets can be gamed or are simply not liquid enough. There hasn’t been a lot of success in prediction markets compared to forecasting. Perhaps you can solve these things. You have laws about what things can be voted on or predicted in the prediction market, you could have government subsidies to ensure there's enough liquidity. Overall, it's likely promising and I'd love to see it tried out on a city-level or something.Dwarkesh Patel 23:13Let’s take a scenario where the government starts taking the impact on the long-term seriously and institutes some reforms to integrate that perspective. As an example, you can take a look at the environmental movement. There're environmental review boards that will try to assess the environmental impact of new projects and repeal any proposals based on certain metrics.The impact here, at least in some cases, has been that groups that have no strong, plausible interest in the environment are able to game these mechanisms in order to prevent projects that would actually help the environment. With longtermism, it takes a long time to assess the actual impact of something, but policymakers are tasked with evaluating the long term impacts of something. Are you worried that it'd be a system that'd be easy to game by malicious actors? And they'd ask, “What do you think went wrong with the way that environmentalism was codified into law?”Will MacAskill 24:09It's potentially a devastating worry. You create something to represent future people, but they're not allowed to lobby themselves (it can just be co-opted). My understanding of environmental impact statements has been similar. Similarly, it's not like the environment can represent itself—it can't say what its interests are. What is the right answer there? Maybe there are speculative proposals about having a representative body that assesses these things and elect jobs by people in 30-years time. That's the best we've got at the moment, but we need a lot more thought to see if any of these proposals would be robust for the long term rather than things that are narrowly-focused.Regulation to have liability insurance for dangerous bio labs is not about trying to represent the interests of future generations. But, it's very good for the long-term. At the moment, if longtermists are trying to change the government, let's focus on a narrow set of institutional changes that are very good for the long-term even if they're not in the game of representing the future. That's not to say I'm opposed to all such things. But, there are major problems with implementation for any of them.Dwarkesh Patel 25:35If we don't know how we would do it correctly, did you have an idea of how environmentalism could have been codified better? Why was that not a success in some cases?Will MacAskill 25:46Honestly, I don't have a good understanding of that. I don't know if it's intrinsic to the matter or if you could’ve had some system that wouldn't have been co-opted in the long-term.Are companies longtermist?Dwarkesh Patel 25:56Theoretically, the incentives of our most long-term U.S. institutions is to maximize future cash flow. Explicitly and theoretically, they should have an incentive to do the most good they can for their own company—which implies that the company can’t be around if there’s an existential risk…Will MacAskill 26:18I don't think so. Different institutions have different rates of decay associated with them. So, a corporation that is in the top 200 biggest companies has a half-life of only ten years. It’s surprisingly short-lived. Whereas, if you look at universities Oxford and Cambridge are 800 years old. University of Bologna is even older. These are very long-lived institutions.For example, Corpus Christi at Oxford was making a decision about having a new tradition that would occur only every 400 years. It makes that kind of decision because it is such a long-lived institution. Similarly, the legends can be even longer-lived again. That type of natural half-life really affects the decisions a company would make versus a university versus a religious institution.Dwarkesh Patel 27:16Does that suggest that there's something fragile and dangerous about trying to make your institution last for a long time—if companies try to do that and are not able to?Will MacAskill 27:24Companies are composed of people. Is it in the interest of a company to last for a long time? Is it in the interests of the people who constitute the company (like the CEO and the board and the shareholders) for that company to last a long time? No, they don't particularly care. Some of them do, but most don't. Whereas other institutions go both ways. This is the issue of lock-in that I talked about at length in What We Owe The future: you get moments of plasticity during the formation of a new institution.Whether that’s the Christian church or the Constitution of the United States, you lock-in a certain set of norms. That can be really good. Looking back, the U.S. Constitution seems miraculous as the first democratic constitution. As I understand it, it was created over a period of four months seems to have stood the test of time. Alternatively, lock-in norms could be extremely dangerous. There were horrible things in the U.S. Constitution like the legal right to slavery proposed as a constitutional amendment. If that had locked in, it would have been horrible. It's hard to answer in the abstract because it depends on the thing that's persisting for a long time.Living in an era of plasticityDwarkesh Patel 28:57You say in the book that you expect our current era to be a moment of plasticity. Why do you think that is?Will MacAskill 29:04There are specific types of ‘moments of plasticity’ for two reasons. One is a world completely unified in a way that's historically unusual. You can communicate with anyone instantaneously and there's a great diversity of moral views. We can have arguments, like people coming on your podcast can debate what's morally correct. It's plausible to me that one of many different sets of moral views become the most popular ultimately.Secondly, we're at this period where things can really change. But, it's a moment of plasticity because it could plausibly come to an end — and the moral change that we're used to could end in the coming decades. If there was a single global culture or world government that preferred ideological conformity, combined with technology, it becomes unclear why that would end over the long-term? The key technology here is Artificial Intelligence. The point in time (which may be sooner than we think) where the rulers of the world are digital rather than biological, that [ideological conformity] could persist.Once you've got that and a global hegemony of a single ideology, there's not much reason for that set of values to change over time. You've got immortal leaders and no competition. What are the other kind of sources of value-change over time? I think they can be accounted for too.Dwarkesh Patel 30:46Isn't the fact that we are in a time of interconnectedness that won't last if we settle space — isn't that bit of reason for thinking that lock-in is not especially likely? If your overlords are millions of light years away, how well can they control you?Will MacAskill 31:01The “whether” you have is whether the control will happen before the point of space settlement. If we took to space one day, and there're many different settlements and different solar systems pursuing different visions of the good, then you're going to maintain diversity for a very long time (given the physics of the matter).Once a solar system has been settled, it's very hard for other civilizations to come along and conquer you—at least if we're at a period of technological maturity where there aren't groundbreaking technologies to be discovered. But, I'm worried that the control will happen earlier. I'm worried the control might happen this century, within our lifetimes. I don't think it’s very likely, but it's seriously on the table - 10% or something?Dwarkesh Patel 31:53Hm, right. Going back to the long-term of the longtermism movement, there are many instructive foundations that were set up about a century ago like the Rockefeller Foundation, Carnegie Foundation. But, they don't seem to be especially creative or impactful today. What do you think went wrong? Why was there, if not value drift, some decay of competence and leadership and insight?Will MacAskill 32:18I don't have strong views about those particular examples, but I have two natural thoughts. For organizations that want to persist a long time and keep having an influence for a long time, they’ve historically specified their goals in far too narrow terms. One fun example is Benjamin Franklin. He invested a thousand pounds for each of the cities of Philadelphia and Boston to pay out after 100 years and then 200 years for different fractions of the amount invested. But, he specified it to help blacksmith apprentices. You might think this doesn't make much sense when you’re in the year 2000. He could have invested more generally: for the prosperity of people in Philadelphia and Boston. It would have had plausibly more impact.The second is a ‘regression to the mean’ argument. You have some new foundation and it's doing an extraordinary amount of good as the Rockefeller Foundation did. Over time, if it's exceptional in some dimension, it's probably going to get closer to average on that dimension. This is because you’re changing the people involved. If you've picked exceptionally competent and farsighted people, the next generation are statistically going to be less so.Dwarkesh Patel 33:40Going back to that hand problem: if you specify your mission too narrowly and it doesn't make sense in the future—is there a trade off? If you're too broad, you make space for future actors—malicious or uncreative—to take the movement in ways that you would not approve of? With regards to doing good for Philadelphia, what if it turns into something that Ben Franklin would not have thought is good for Philadelphia?Will MacAskill 34:11It depends on what your values and views are. If Benjamin Franklin only cared about blacksmith's apprentices, then he was correct to specify it. But my own values tend to be quite a bit more broad than that. Secondly, I expect people in the future to be smarter and more capable. It’s certainly the trend over time. In which case, if we’re sharing similar broad goals, and they're implementing it in a different way, then they have it.How good can the future be?Dwarkesh Patel 34:52Let's talk about how good we should expect the future to be. Have you come across Robin Hanson’s argument that we’ll end up being subsistence-level ems because there'll be a lot of competition and minimizing compute per digital person will create a barely-worth-living experience for every entity?Will MacAskill 35:11Yeah, I'm familiar with the argument. But, we should distinguish the idea that ems are at subsistence level from the idea that we would have bad lives. So subsistence means that you get a balance of income per capita and population growth such that being poorer would cause deaths to outweigh additional births.That doesn't tell you about their well-being. You could be very poor as an emulated being but be in bliss all the time. That's perfectly consistent with the Malthusian theory. It might seem far away from the best possible future, but it could still be very good. At subsistence, those ems could still have lives that are thousands of times better than ours.Dwarkesh Patel 36:02Speaking of being poor and happy, there was a very interesting section in the chapter where you mentioned the study you had commissioned: you were trying to find out if people in the developing world find life worth living. It turns out that 19% of Indians would not want to relive their life every moment. But, 31% of Americans said that they would not want to relive their life at every moment? So, why are Indians seemingly much happier at less than a tenth of the GDP per capita?Will MacAskill 36:29I think the numbers are lower than that from memory, at least. From memory, it’s something more like 9% of Indians wouldn't want to live their lives again if they had the option, and 13% of Americans said they wouldn’t. You are right on the happiness metric, though. The Indians we surveyed were more optimistic about their lives, happier with their lives than people in the US were. Honestly, I don't want to generalize too far from that because we were sampling comparatively poor Americans to comparatively well-off Indians. Perhaps it's just a sample effect.There are also weird interactions with Hinduism and the belief in reincarnation that could mess up the generalizability of this. On one hand, I don't want to draw any strong conclusion from that. But, it is pretty striking as a piece of information, given that you find people's well-being in richer countries considerably happier than poorer countries, on average.Dwarkesh Patel 37:41I guess you do generalize in a sense that you use it as evidence that most lives today are living, right?Will MacAskill 37:50Exactly. So, I put together various bits of evidence, where approximately 10% of people in the United States and 10% of people in India seem to think that their lives are net negative. They think they contain more suffering than happiness and wouldn't want to be reborn and live the same life if they could.There's another scripture study that looks at people in United States/other wealthy countries, and asks them how much of their conscious life they'd want to skip if they could. Skipping here means that blinking would reach you to the end of whatever activity you're engaging with. For example, perhaps I hate this podcast so much that I would rather be unconscious than be talking to you. In which case, I'd have the option of skipping, and it would be over after 30 minutes.If you look at that, and then also asked people about the trade offs they would be willing to make as a measure of intensity of how much they're enjoying a certain experience, you reach the conclusion that a little over 10% of people regarded their life that day as being surveyed worse than if they'd been unconscious the entire day.Contra Tyler Cowen on what’s most importantDwarkesh Patel 39:18Jumping topics here a little bit, on the 80,000 Hours Podcast, you said that you expect scientists who are explicitly trying to maximize their impact might have an adverse impact because they might be ignoring the foundational research that wouldn't be obvious in this way of thinking, but might be more important.Do you think this could be a general problem with longtermism? If you were trying to find the most important things that are important long-term, you might be missing things that wouldn't be obvious thinking this way?Will MacAskill 39:48Yeah, I think that's a risk. Among the ways that people could argue against my general set of views, I argue that we should be doing fairly specific and targeted things like trying to make AI safe, well-govern the rise of AI, reduce worst-case pandemics that can kill us all, prevent a Third World War, ensure that good values are promoted, and avoid value lock-in. But, some people could argue (and people like Tyler Cowen and Patrick Collison do), that it's very hard to predict the future impact of your actions.It's a mug's game to even try. Instead, you should look at the things that have done loads of good consistently in the past, and try to do the same things. In particular, they might argue that means technological progress or boosting economic growth. I dispute that. It's not something I can give a completely knock-down argument to because we don’t know when we will find out who's right. Maybe in thousand-years time. But one piece of evidence is the success of forecasters in general. This also was true for Tyler Cowen, but people in Effective Altruism were realizing that the Coronavirus pandemic was going to be a big deal for them. At an early stage, they were worrying about pandemics far in advance. There are some things that are actually quite predictable.For example, Moore's Law has held up for over 70 years. The idea that AI systems are gonna get much larger and leading models are going to get more powerful are on trend. Similarly, the idea that we will be soon be able to develop viruses of unprecedented destructive power doesn’t feel too controversial. Even though it’s hard to predict loads of things, there are going to be tons of surprises. There are some things, especially when it comes to fairly long-standing technological trends, that we can make reasonable predictions — at least about the range of possibilities that are on the table.Dwarkesh Patel 42:19It sounds like you're saying that the things we know are important now. But, if something didn't turn out, a thousand years ago, looking back to be very important, it wouldn't be salient to us now?Will MacAskill 42:31What I was saying with me versus Patrick Collison and Tyler Cowen, who is correct? We will only get that information in a thousand-years time because we're talking about impactful strategies for the long-term. We might get suggestive evidence earlier. If me and others engaging in longtermism are making specific, measurable forecasts about what is going to happen with AI, or advances in biotechnology, and then are able to take action such that we are clearly reducing certain risks, that's pretty good evidence in favor of our strategy.Whereas, they're doing all sorts of stuff, but not make firm predictions about what's going to happen, but then things pop out of that that are good for the long-term (say we measure this in ten-years time), that would be good evidence for their view.Dwarkesh Patel 43:38You were saying earlier about the contingency in technology implies that given their worldview, even if you're trying to maximize what in the past is at the most impact, if what's had the most impact in the past is changing values, then economic growth might be the most important thing? Or trying to change the rate of economic growth?Will MacAskill 43:57I really do take the argument seriously of how people have acted in the past, especially for people trying to make a long-lasting impact. What things that they do that made sense and whatnot. So, towards the end of the 19th century, John Stuart Mill and the other early utilitarians had this longtermist wave where they started taking the interests of future generations very seriously. Their main concern was Britain running out of coal, and therefore, future generations would be impoverished. It's pretty striking because they had a very bad understanding of how the economy works. They hadn't predicted that we would be able to transition away from coal with continued innovation.Secondly, they had enormously wrong views about how much coal and fossil fuels there were in the world. So, that particular action didn't make any sense given what we know now. In fact, that particular action of trying to keep coal in the ground, given Britain at the time where we're talking about much lower amounts of coal—so small that the climate change effect is negligible at that level—probably would have been harmful.But, we could look at other things that John Stuart Mill could have done such promoting better values. He campaigned for women's suffrage. He was the first British MP. In fact, even the first politician in the world to promote women's suffrage - that seems to be pretty good. That seems to have stood the test of time. That's one historical data point. But potentially, we can learn a more general lesson there.AI and the centralization of powerDwarkesh Patel 45:36Do you think the ability of your global policymakers to come to a consensus is on net, a good or a bad thing? On the positive, maybe it helps around some dangerous tech from taking off, but on the negative side, prevent human challenge trials that cause some lock-in in the future. On net, what do you think about that trend?Will MacAskill 45:54The question of global integration, you're absolutely right, it's double-sided. One hand, it can help us reduce global catastrophic risks. The fact that the world was able to come come together and ban Chlorofluorocarbons was one of the great events of the last 50 years, allowing the hole in the ozone layer to to repair itself. But on the other hand, if it means we all converge to one monoculture and lose out on diversity, that's potentially bad. We could lose out on the most possible value that way.The solution is doing the good bits and not having the bad bits. For example, in a liberal constitution, you can have a country that is bound in certain ways by its constitution and by certain laws yet still enables a flourishing diversity of moral thought and different ways of life. Similarly, in the world, you can have very strong regulation and treaties that only deal with certain global public goods like mitigation of climate change, prevention of development of the next generation of weapons of mass destruction without having some very strong-arm global government that implements a particular vision of the world. Which way are we going at the moment? It seems to me we've been going in a pretty good and not too worrying direction. But, that could change.Dwarkesh Patel 47:34Yeah, it seems the historical trend is when you have a federated political body that even if constitutionally, the Central Powers constrain over time, they tend to gain more power. You can look at the U.S., you can look at the European Union. But yeah, that seems to be the trend.Will MacAskill 47:52Depending on the culture that's embodied there, it's potentially a worry. It might not be if the culture itself is liberal and promoting of moral diversity and moral change and moral progress. But, that needn't be the case.Dwarkesh Patel 48:06Your theory of moral change implies that after a small group starts advocating for a specific idea, it may take a century or more before that idea reaches common purchase. To the extent that you think this is a very important century (I know you have disagreements about that with with others), does that mean that there isn't enough time for longtermism to gain by changing moral values?Will MacAskill 48:32There are lots of people I know and respect fairly well who think that Artificial General Intelligence will likely lead to singularity-level technological progress and extremely rapid rate of technological progress within the next 10-20 years. If so, you’re right. Value changes are something that pay off slowly over time.I talk about moral change taking centuries historically, but it can be much faster today. The growth of the Effective Altruism movement is something I know well. If that's growing at something like 30% per year, compound returns mean that it's not that long. That's not growth. That's not change that happens on the order of centuries.If you look at other moral movements like gay rights movement, very fast moral change by historical standards. If you're thinking that we've got ten years till the end of history, then don't broadly try and promote better values. But, we should have a very significant probability mass on the idea that we will not hit some historical end of this century. In those worlds, promoting better values could pay off like very well.Dwarkesh Patel 49:59Have you heard of Slime Mold Time Mold Potato Diet?Will MacAskill 50:03I have indeed heard of Slime Mold Time Mold Potato Diet, and I was tempted as a gimmick to try it. As I'm sure you know, potato is close to a superfood, and you could survive indefinitely on butter mashed potatoes if you occasionally supplement with something like lentils and oats.Dwarkesh Patel 50:25Hm, interesting. Question about your career: why are you still a professor? Does it still allow you to the things that you would otherwise have been doing like converting more SBF’s and making moral philosophy arguments for EA? Curious about that.Will MacAskill 50:41It's fairly open to me what I should do, but I do spend significant amounts of time co-founding organizations or being on the board of those organizations I've helped to set up. More recently, working closely with the Future Fund, SBF’s new foundation, and helping them do as much good as possible. That being said, if there's a single best guess for what I want to do longer term, and certainly something that plays to my strengths better, it's developing ideas, trying to get the big picture roughly right, and then communicating them in a way that's understandable and gets more people to get off their seats and start to do a lot of good for the long-term. I’ve had a lot of impact that way. From that perspective, having an Oxford professorship is pretty helpful.The problems with academiaDwarkesh Patel 51:34You mentioned in the book and elsewhere that there's a scarcity of people thinking about big picture questions—How contingent is history? How are people happy generally?—Are these questions that are too hard for other people? Or they don't care enough? What's going on? Why are there so few people talking about this?Will MacAskill 51:54I just think there are many issues that are enormously important but are just not incentivized anywhere in the world. Companies don't incentivize work on them because they’re too big picture. Some of these questions are, “Is the future good, rather than bad? If there was a global civilizational collapse, would we recover? How likely is a long stagnation?” There’s almost no work done on any of these topics. Companies aren't interested too grand in scale.Academia has developed a culture where you don't tackle such problems. Partly, that's because they fall through the cracks of different disciplines. Partly because they seem too grand or too speculative. Academia is much more in the mode of making incremental gains in our understanding. It didn't always used to be that way.If you look back before the institutionalization of academic research, you weren't a real philosopher unless you had some grand unifying theory of ethics, political philosophy, metaphysics, logic, and epistemology. Probably the natural sciences too and economics. I'm not saying that all of academic inquiry should be like that. But should there be some people whose role is to really think about the big picture? Yes.Dwarkesh Patel 53:20Will I be able to send my kids to MacAskill University? What's the status on that project?Will MacAskill 53:25I'm pretty interested in the idea of creating a new university. There is a project that I've been in discussion about with another person who's fairly excited about making it happen. Will it go ahead? Time will tell. I think you can do both research and education far better than it currently exists. It's extremely hard to break in or creating something that's very prestigious because the leading universities are hundreds of years old. But maybe it's possible. I think it would could generate enormous amounts of value if we were able to pull it off.Dwarkesh Patel 54:10Excellent, alright. So the book is What We Owe The Future. I understand pre-orders help a lot, right? It was such an interesting read. How often does somebody write a book about the questions they consider to be the most important even if they're not the most important questions? Big picture thinking, but also looking at very specific questions and issues that come up. Super interesting read.Will MacAskill 54:34Great. Well, thank you so much!Dwarkesh Patel 54:38Anywhere else they can find you? Or any other information they might need to know?Will MacAskill 54:39Yeah, sure. What We Owe The Future is out on August 16 in the US and first of September in the United Kingdom. If you want to follow me on Twitter, I'm @WillMcCaskill. If you want to try and use your time or money to do good, Giving What We Can is an organization that encourages people to take a pledge to give a significant fraction of the income (10% or more) to the charities that do the most good. It has a list of recommended charities. 80,000 Hours—if you want to use your career to do good—is a place to go for advice on what careers have the biggest impact at all. They provide one-on-one coaching too.If you're feeling inspired and want to do good in the world, you care about future people and I want to help make their lives go better, then, as well as reading What We Owe The Future, Giving What We Can, and 80,000 hours are the sources you can go to and get involved.Dwarkesh Patel 55:33Awesome, thanks so much for coming on the podcast! It was a lot of fun.Will MacAskill 54:39Thanks so much, I loved it. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Joseph Carlsmith is a senior research analyst at Open Philanthropy and a doctoral student in philosophy at the University of Oxford.We discuss utopia, artificial intelligence, computational power of the brain, infinite ethics, learning from the fact that you exist, perils of futurism, and blogging.Watch on YouTube. Listen on Spotify, Apple Podcasts, etc.Episode website + Transcript here. Follow Joseph on Twitter. Follow me on Twitter.Subscribe to find out about future episodes!Timestamps(0:00:06) - Introduction(0:02:53) - How to Define a Better Future?(0:09:19) - Utopia(0:25:12) - Robin Hanson’s EMs(0:27:35) - Human Computational Capacity(0:34:15) - FLOPS to Emulate Human Cognition?(0:40:15) - Infinite Ethics(1:00:51) - SIA vs SSA(1:17:53) - Futurism & Unreality(1:23:36) - Blogging & Productivity(1:28:43) - Book Recommendations(1:30:04) - ConclusionPlease share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Fin Moorhouse is a Research Scholar and assistant to Toby Ord at Oxford University's Future of Humanity Institute. He co-hosts the Hear This Idea podcast, which showcases new thinking in philosophy, the social sciences, and effective altruism.We discuss for-profit entrepreneurship for altruism, space governance, morality in the multiverse, podcasting, the long reflection, and the Effective Ideas & EA criticism blog prize.Watch on YouTube. Listen on Spotify, Apple Podcasts, etc.Episode website + Transcript here.Follow Fin on Twitter. Follow me on Twitter.Subscribe to find out about future episodes!Timestamps(0:00:10) - Introduction(0:02:45) - EA Prizes & Criticism(0:09:47) - Longtermism(0:12:52) - Improving Mental Models(0:20:50) - EA & Profit vs Nonprofit Entrepreneurship(0:30:46) - Backtesting EA(0:35:54) - EA Billionares(0:38:32) - EA Decisions & Many Worlds Interpretation(0:50:46) - EA Talent Search(0:52:38) - EA & Encouraging Youth(0:59:17) - Long Reflection(1:03:56) - Long Term Coordination(1:21:06) - On Podcasting(1:23:40) - Audiobooks Imitating Conversation(1:27:04) - Underappreciated Podcasting Skills(1:38:08) - Space Governance(1:42:09) - Space Safety & 1st Principles(1:46:44) - Von Neuman Probes(1:50:12) - Space Race & First Strike(1:51:45) - Space Colonization & AI(1:56:36) - Building a Startup(1:59:08) - What is EA Underrating?(2:10:07) - EA Career Steps(2:15:16) - Closing RemarksPlease share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Alexander Mikaberidze is Professor of History at Louisiana State University and the author of The Napoleonic Wars: A Global History.He explains the global ramifications of the Napoleonic Wars - from India to Egypt to America. He also talks about how Napoleon was the last of the enlightened despots, whether he would have made a good startup founder, how the Napoleonic Wars accelerated the industrial revolution, the roots of the war in Ukraine, and much more!Watch on YouTube, or listen on Spotify, Apple Podcasts, or any other podcast platform.Episode website + Transcript here. Follow Professor Mikaberidze on Twitter. Follow me on Twitter for updates on future episodes.Subscribe to find out about future episodes!Timestamps:(0:00:00) Alexander Mikaberidze - Professor of history and author of “The Napoleonic Wars”(0:01:19) - The allure of Napoleon(0:13:48) - The advantages of multiple colonies(0:27:33) - The Continental System and the industrial revolution(0:34:49) - Napoleon’s legacy.(0:50:38) - The impact of Napoleonic Wars(1:01:23) - Napoleon as a startup founder(1:14:02) The advantages of war and how it shaped international government and to some extent, political structures.Please share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

I flew to the Bahamas to interview Sam Bankman-Fried, the CEO of FTX! He talks about FTX’s plan to infiltrate traditional finance, giving $100m this year to AI + pandemic risk, scaling slowly + hiring A-players, and much more.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website + Transcript here.Follow me on Twitter for updates on future episodesSubscribe to find out about future episodes!Timestamps(00:18) - How inefficient is the world?(01:11) - Choosing a career(04:15) - The difficulty of being a founder(06:21) - Is effective altruism too narrowminded?(09:57) - Political giving(12:55) - FTX Future Fund(16:41) - Adverse selection in philanthropy(18:06) - Correlation between different causes(22:15) - Great founders do difficult things(25:51) - Pitcher fatigue and the importance of focus(28:30) - How SBF identifies talent(31:09) - Why scaling too fast kills companies(33:51) - The future of crypto(35:46) - Risk, efficiency, and human discretion in derivatives(41:00) - Jane Street vs FTX(41:56) - Conflict of interest between broker and exchange(42:59) - Bahamas and Charter Cities(43:47) - SBF’s RAM-skewed mindUnfortunately, audio quality abruptly drops from 17:50-19:15TranscriptDwarkesh Patel 0:09Today on The Lunar Science Society Podcast, I have the pleasure of interviewing Sam Bankman-Fried, CEO of FTX. Thanks for coming on The Lunar Society.Sam Bankman-Fried 0:17Thanks for having me.How inefficient is the world?Dwarkesh Patel 0:18Alright, first question. Does the consecutive success of FTX and Alameda suggest to you that the world has all kinds of low-hanging opportunities? Or was that a property of the inefficiencies of crypto markets at one particular point in history?Sam Bankman-Fried 0:31I think it's more of the former, there are just a lot of inefficiencies.Dwarkesh Patel 0:35So then another part of the question is: if you had to restart earning to give again, what are the odds you become a billionaire, but you can't do it in crypto?Sam Bankman-Fried 0:42I think they're pretty decent. A lot of it depends on what I ended up choosing and how aggressive I end up deciding to be. There were a lot of safe and secure career paths before me that definitely would not have ended there. But if I dedicated myself to starting up some businesses, there would have been a pretty decent chance of it.Choosing a careerDwarkesh Patel 1:11So that leads to the next question—which is that you've cited Will MacAskill's lunch with you while you were at MIT as being very important in deciding your career. He suggested you earn-to-give by going to a quant firm like Jane Street. In retrospect, given the success you've had as a founder, was that maybe bad advice? And maybe you should’ve been advised to start a startup or nonprofit?Sam Bankman-Fried 1:31I don't think it was literally the best possible advice because this was in 2012. Starting a crypto exchange then would have been…. I think it was definitely helpful advice. Relative to not having gotten advice at all, I think it helps quite a bit.Dwarkesh Patel 1:50Right. But then there's a broader question: are people like you who could become founders advised to take lower variance, lower risk careers that in, expected value, are less valuable?Sam Bankman-Fried 2:02Yeah, I think that's probably true. I think people are advised too strongly to go down safe career paths. But I think it's worth noting that there's a big difference between what makes sense altruistically and personally for this. To the extent you're just thinking of personal criteria, that's going to argue heavily in favor of a safer career path because you have much more quickly declining marginal utility of money than the world does. So, this kind of path is specifically for altruistically-minded people.The other thing is that when you think about advising people, I think people will often try and reference career advice that others got. “What were some of these outward-facing factors of success that you can see?” But often the answer has something to do with them and their family, friends, or something much more personal. When we talk with people about their careers, personal considerations and the advice of people close to them weigh very heavily on the decisions they end up making.Dwarkesh Patel 3:17I didn't realize that the personal considerations were as important in your case as the advice you got.Sam Bankman-Fried 3:24Oh, I don’t think in my case. But, it is true with many people that I talked to.Dwarkesh Patel 3:29Speaking of declining marginal consumption, I'm wondering if you think the implication of this is that over the long term, all the richest people in the world will be utilitarian philanthropists because they don't have diminishing returns of consumption. They’re risk-neutral.Sam Bankman-Fried 3:40I wouldn't say all will, but I think there probably is something in that direction. People who are looking at how they can help the world are going to end up being disproportionately represented amongst the most and maybe least successful.The difficulty of being a founderDwarkesh Patel 3:54Alright, let’s talk about Effective Altruism. So in your interview with Tyler Cowen, you were asked, “What constrains the number of altruistically minded projects?” And you answered, “Probably someone who can start something.”Now, is this a property of the world in general? Or is this a property of EAs? And if it's about EAs, then is there something about the movement that drives away people who took could take leadership roles?Sam Bankman-Fried 4:15Oh, I think it's just the world in general. Even if you ignore altruistic projects and just look at profit-minded ones, we have lots of ideas for businesses that we think would probably do well, if they were run well, that we'd be excited to fund. And the missing ingredient quite frequently for them is the right person or team to take the lead on it. In general, starting something is brutal. It's brutal being a founder, and it requires a somewhat specific but extensive list of skills. Those things end up making it high in demand.Dwarkesh Patel 4:56What would it take to get more of those kinds of people to go into EA?Sam Bankman-Fried 4:59Part of it is probably just talking with them about, “Have you thought about what you can do for the world? Have you thought about how you can have an impact on the world? Have you thought about how you can maximize your impact on the world?” Many people would be excited about thinking critically and ambitiously about how they can help the world. So I think honestly, just engagement is one piece of this. And then even within people who are altruistically minded and thinking about what it would take for them to be founders, there are still things that you can do.Some of this is about empowering people and some of this is about normalizing the fact that when you start something, it might fail—and that's okay. Most startups and especially very early-stage startups should not be trying to maximize the chances of having at least a little bit of success. But that means you have to be okay with the personal fallout of failing and that we have to build a community that is okay with that. I don't think we have that right now, I think very few communities do.Is effective altruism too narrowminded?Dwarkesh Patel 6:21Now, there are many good objections to utilitarianism, as you know. You said yourself that we don't have a good account of infinite ethics—should we attribute substantial weight to the probability that utilitarianism is wrong? And how do you hedge for this moral uncertainty in your giving?Sam Bankman-Fried 6:35So I don't think it has a super large impact on my giving. Partially, because you'd need to have a concrete proposal for what else you would do that would be different actions-wise—and I don't know that that I've been compelled by many of those. I do think that there are a lot of things we don't understand right now. And one thing that you pointed to is infinite ethics. Another thing is that (I'm not sure this is moral uncertainty, this might be physical uncertainty) there are a lot of sort of chains of reasoning people will go down that are somewhat contingent on our current understanding of the universe—which might not be right. And if you look at expected-value outcomes, might not be right.Say what you will about the size of the universe and what that implies, but some of the same people make arguments based on how big the universe is and also think the simulation hypothesis has decent probability. Very few people chain through, “What would that imply?” I don't think it's clear what any of this implies. If I had to say, “How have these considerations changed my thoughts on what to do?”The honest answer is that they have changed it a little bit. And the direction that they pointed me in is things with moderately more robust impact. And what I mean by that is, I'm sure one way that you can calculate the expected value of an action is, “Here's what's going to happen. Here are the two outcomes, and here are the probabilities of them.” Another thing you can do is say - it's a little bit more hand-wavy - but, “How much better is this going to make the world? How much does it matter if the world is better in generic diffuse ways?” Typically, EA has been pretty skeptical of that second line of reasoning—and I think correctly. When you see that deployed, it's nonsense. Usually, when people are pretty hard to nail down on the specific reasoning of why they think that something might be good, it’s because they haven't thought that hard about it or don't want to think that hard about it. The much better analyzed and vetted pathways are the ones we should be paying attention to.That being said, I do think that sometimes EA gets too narrow-minded and specific about plotting out courses of impact. And this is one of the reasons why that people end up fixating on one particular understanding of the universe, of ethics, of how things are going to progress. But, all of these things have some amount of uncertainty in them. And when you jostle them, some theories of impact behave somewhat robustly and some of them completely fall apart. I’ve become a bit more sympathetic to ones that are a little robust under thoughts about what the world ends up looking like.Political givingDwarkesh Patel 9:57In the May 2022 Oregon Congressional Election, you gave 12 million dollars to Carrick Flynn, whose campaign was ultimately unsuccessful. How have you updated your beliefs about the efficacy of political giving in the aftermath?Sam Bankman-Fried 10:12It was the first time that I gave on that scale in a race. And I did it because he was, of all the candidates in the cycle, the most outspoken on the need for more pandemic preparedness and prevention. He lost—such is life. In the end, there are some updates on the efficacy of various things. But, I never thought that the odds were extremely high that he was going to win. It was always going to be an uncertain close race. There's a limit to how much you can update from a one-time occurrence. If you thought the odds were 50-50, and it turns out to be close in one direction or another, there's a maximum of a factor-of-two update that you have on that. There were a bunch of sort of micro-updates on specific factors of the race, but on a high level, it didn’t change my perspective on policy that much.Dwarkesh Patel 11:23But does it make you think there are diminishing or possibly negative marginal returns from one donor giving to a candidate? Because of the negative PR?Sam Bankman-Fried 11:30At some point, I think that's probably true.Dwarkesh Patel 11:33Continuing on the theme of politics, when is it more effective to give the marginal million dollars to a political campaign or institution to make some change at the government level (like putting in early detection)? Or when is it more effective to fund it yourself?Sam Bankman-Fried 11:47It's a good question. It's not necessarily mutually exclusive. One thing worth looking at is the scale of the things that need to happen. How much are things like international cooperation important for it? When you look at pandemic prevention, we're talking tens of billions of dollars of scale necessary to start putting this infrastructure in place. So it's a pretty big scale thing—which is hard to fund to that level individually. It’s also something where we’re going to need to have cooperation between different countries on, for example, what their surveillance for new pathogens looks like. And vaccine distribution If some countries have a great distribution of vaccines and others don't, that's not good. It's both not fair and not equitable for the countries that get hit hardest. But also, in a global pandemic, it's going to spread. You need global coverage. That's another reason that government has to be involved, at least to some extent, in the efforts.FTX Future FundDwarkesh Patel 12:55Let's talk about Future Fund. As you know, there are already many existing Effective Altruist organizations that do donations. What is the reason you thought there was more value in creating a new one? What's your edge?Sam Bankman-Fried 13:06 There's value in having multiple organizations. Every organization has its blind spots, and you can help cover those up if you have a few. If OpenPhil didn't exist, maybe we would have created an organization that looks more like OpenPhil. They are covering a lot of what we’re looking at—we're looking at overlapping, but not identical things. I think having that diversity can be valuable, but pointing to the ways in which we intentionally designed to be a little bit different from existing donors:One thing that I've been really happy about is the re-granting program. We have a number of people who are experts in various areas to who we've basically donated pots that they can re-grant. What are the reasons that we think this is valuable? One thing is giving more stakeholders a chance to voice their opinions because we can't possibly be listening to everyone in the world directly and integrating all those opinions to come up with a perfect set of answers. Distributing it and letting them act semi-autonomously can help with that. The other thing is that it helps with a large number of smaller grants. When you think about what an organization giving away $100 million in a year is thinking about, “if we divided that up into $25,000 grants, how many grants would that mean?” 4,000 grants to analyze, right? If we want to give real thought to each one of those, we can't do that.But on the flip side, sometimes the smaller grants are the most impactful per dollar and there are a lot of cases where someone really impressive has an exciting idea for a new foundation or a new organization that could do a lot of good for the world and needs $25,000 to get started. To rent out a small office, to be able to cover salaries for two employees for the first six months. Those are the kind of cases where a pretty small grant can make a huge change in the development of what might ultimately become a really impactful organization. But they're the kind of things that are really hard for our team to evaluate all of, just given the number of them—but the re-grantor program gives us a way to do that. Instead, we have 10, 50, or 100 re-grantors, who are going out and finding a lot of those opportunities close to them, they can then identify those and direct those grants—and it gives us a much wider reach. It also biases it less towards people who we happen to know, which is good.We don't want to just like overfund everyone we know and underfund everyone that we don’t. That's one initiative that I've been pretty excited about that we're going to keep doing. Another thing we've really tried to have a lot of emphasis on making the (application) process smooth and clean. There are pros and cons to this. But it drops the activation energy necessary for someone to decide to apply for a grant and fill out all of the forms. We’ve really tried to bring more people into the fold.Adverse selection in philanthropyDwarkesh Patel 16:41If you make it easy for people to fill out your application and generally fund things that other organizations wouldn't, how do you deal with the possibility of adverse selection in your philanthropic deal flow?Sam Bankman-Fried 16:52It's a really good question. It’s a worry that Bob down the street might see a great book case study that he wants and wonder if he can get funding for this bookcase as it’s going to house a lot of knowledge. Knowledge is good, right? Obviously, we would detect that pretty quickly. The basic answer is that we still vet all of these. We do have oversight of them. But, we also do a deep dive into both all of the large ones, but also into samplings of all the small ones. We do deep dives into randomly sampled subsets of them—which allows us to get a good statistical sense of whether we are facing significant adverse selection in them. So far, we haven't seen obvious signs of it, but we're going to keep doing these analyses and see if anything worrying comes out of those. But that's a way to be able to have more trusted analyses for more scaled-up numbers of grants.Correlation between different causesDwarkesh Patel 18:06A long time ago, you wrote a blog post about how EA causes are multiplicative, instead of additive. Do you still find that's the case with most of the causes you care about? Or are there cases where some of the causes you care about are negatively multiplicative? An example might be economic growth and the speed at which AI takes off.Sam Bankman-Fried 18:24Yeah, I think it’s getting more complicated. Specifically around AI, you have a lot of really complex factors that can point in the same direction or in opposite directions. Especially if what you think matters is something like the relative progress of AI safety research versus AI capabilities research, a lot of things are going to have the same impact on both of those, and thus confusing impact on safety as a whole.I do think it's more complicated now. It's not cleanly things just multiplying with each other. There are lots of cases where you see multiplicative behavior, but there are cases where you don't have that. The conclusion of this is: if you have multiplicative cases, you want to be funding each piece of it. But if you don't, then you want to be trained to identify the most impactful pieces and move those along. Our behavior should be different in those two scenarios.Dwarkesh Patel 19:23If you think of your philanthropy from a portfolio perspective, is correlation good or bad?Sam Bankman-Fried 19:29Expected value is expected value, right? Let's pretend that there is one person in Bangladesh and another one in Mexico. We have two interventions, both 50-50 on saving each of their lives. Suppose there’s some new drug that we could release to combat a neglected disease. This question is asking, “are they correlated?” “Are these two drugs correlated in their efficacy?” And my basic argument is, “it doesn't matter, right?” If you think about it from each of their perspectives, the person in Mexico isn't saying, “I only want to be saved in the cases where the person in Bangladesh is or isn't saved.” That’s not relevant. They want to live.The person in Bangladesh similarly wishes to live. You want to help both of them as much as you can. It's not super relevant whether there’s alignment or anti-alignment between the cases where you get lucky and the ones where you don't.Dwarkesh Patel 20:46What’s the most likely reason that Future Fund fails to live up to your expectations?Sam Bankman-Fried 20:51We get a little lame. We give to a lot of decent things. But all the cooler or more innovative things that we do, don't seem to work very well. We end up giving the same that everyone else is giving. We don’t turn out to be effective at starting new things, we don't turn out to be effective at thinking of new causes or executing them. Hopefully, we'll avoid that. But, it's always a risk.Dwarkesh Patel 21:21Should I think of your charitable giving, as a yearly contribution of a billion dollars? Or should I think of it as a $30 billion hedge against the possibility that there's going to be some existential risk that requires a large pool of liquid wealth?Sam Bankman-Fried 21:36It's a really good question, I'm not sure. We've given away about 100 million so far this year. We're going to start doing that because we think there are really important things to fund and to start scaling up those systems. We notice opportunities as they come and we have systems ready in place to give to them. But it's something we're really actively discussing internally—how concentrated versus diffuse we want that giving to be, and storing up for one very large opportunity versus a mixture of many.Great founders do difficult thingsDwarkesh Patel 22:15When you look at a proposal and think this project could be promising, but this is not the right person to lead it, what is the trait that's most often missing?Sam Bankman-Fried 22:22Super interesting. I am going to ignore the obvious answer which is that the guy is not very good and look at cases where it's someone pretty impressive, but not the right fit for this. There are a few things. One of them is how much are they going to want to deal with really messy s**t. This is a huge thing! When I was working at Jane Street, I had a great time there. One thing I didn’t realize was valuable until I saw the alternative—if I decided that is a good trade to buy one share of Apple stock on NASDAQ, there's a button to do that.If you as a random citizen want to buy one share of Apple stock directly on an exchange, it'll cost you tens of millions of dollars a year to get set up. You have to get a physical colo(cation) in Secaucus, New Jersey, have market data agreements with these companies, think about the sip and about the NBBO and whether you’re even allowed to list on NASDAQ, and then build the technological infrastructure to do it. But all of that comes after you get a bank account.Getting a bank account that's going to work in finance is really hard. I spent hundreds, if not thousands of hours of my life, trying to open bank accounts. One of the things at early Alameda that was really crucial to our ability to make money was having someone very senior spend hours per day in a physical bank branch, manually instructing wire transfers. If we didn't do that, we wouldn't have been able to do the trade.When you start a company, there are enormous amounts of s**t that looks like that. Things that are dumb or annoying or broken or unfair, or not how the world should work. But that’s how the world does work. The only way to be successful is to fight through that. If you're going to be like, “I'm the CEO, I don't do that stuff,” then no one's going to do that at your company. It's not going to get done. You won't have a bank account and you won't be able to operate. One of the biggest traits that are incredibly important for a founder and for an early team at a company (but not important for everything in life) is willing to do a ton of grunt work if it’s important for the company right then.Viewing it not as “low prestige” or “too easy” for you, but as, “This is the important thing. This is a valuable thing to do. So it's what I'm going to do.” That's one of the core traits. The other thing is asking if they’re excited about this idea? Will they actually put their heart and soul into it? Or are they going to be not really into it and half-ass? Those are two things that I really look for.Pitcher fatigue and the importance of focusDwarkesh Patel 25:51How have you used your insights about pitcher fatigue to allocate talent in your companies?Sam Bankman-Fried 25:58Haha. When it comes to pitchers, in baseball, there's a lot of evidence that they get worse over the course of the game. Partially, because it's hard on the arm. But, it's worth noting that the evidence seems to support the claim that it depends on the pitchers. But in general, you're better off breaking up your outings. It's not just a function of how many innings they pitch that season, but also extremely recently. If you could choose between someone throwing six innings every six days, or throwing three innings every three days, you should use the latter. That's going to get the better pitching on average, and just as many innings out of them—and baseball has since then moved very far in that direction. The average number of pitches thrown by starting pitchers has gone down a lot over the last 5-10 years.How do I use that in my company? There’s a metaphor here except this is with computer work instead of physical arm work. You don't have the same effect where your arm is getting sore, your muscles snap, and you need surgery if you pitch too hard for too long. That doesn't directly translate—but there's an equivalent of this with people getting tired and exhausted. But on the other hand, context is a huge, huge piece of being effective. Having all the context in your mind of what's going on, what you're working on, and what the company is doing makes it easier to operate effectively. For instance, if you could have either two half-time employees or one full-time employee, you're way better off with one full-time employee because they're going to have more context than either of the part-time employees would have—thus be able to work way more efficiently.In general, concentrated work is pretty valuable. If you keep breaking up your work, you're never going to do as great of work as if you truly dove into something.How SBF identifies talentDwarkesh Patel 28:30You've talked about how you weigh experience relatively little when you're deciding who to hire. But in a recent Twitter thread, you mentioned that being able to provide mentorship to all the people who you hire is one of the bottlenecks to you being able to scale. Is there a trade-off here where if you don't hire people for experience, you have to give them more mentorship and thus can't scale as fast?Sam Bankman-Fried 28:51It's a good question. To a surprising extent, we found that the experience of the people that we hire has not had much correlation with how much mentorship they need. Much more important is how they think, how good they are at understanding new and different situations, and how hard they try to integrate into their understanding of coding how FTX works. We actually have by and large found that other things are much better predictors of how much oversight and mentorship they’re going to need then.Dwarkesh Patel 29:35How do you assess that short of hiring them for a month and then seeing how they did?Sam Bankman-Fried 29:39It's tough, I don't think we're perfect at it. But things that we look at are, “Do they understand quickly what the goal of a product is? How does that inform how they build it?” When you're looking at developers, I think we want people who can understand what FTX is, how it works, and thus what the right way to architect things would be for that rather than treating it as an abstract engineering problem divorced from the ultimate product.You can ask people like, “Hey, here's a high-level customer experience or customer goal. How would you architect a system to create that?” That’s one thing that we look for. An eagerness to learn and adapt. It's not trivial to ask for that. But you can do some amount of that by giving people novel scenarios and seeing how much they break versus how much they bend. That can be super valuable. Specifically searching for developers who are willing to deal with messy scenarios rather than wanting a pristine world to work in. Our company is customer-facing and has to face some third-party tooling. All those things mean that we have to interface with things that are messy and the way the world is.Why scaling too fast kills companiesDwarkesh Patel 31:09Before you launched FTX, you gave detailed instructions to the existing exchanges about how to improve their system, how to remove clawbacks, and so on. Looking back, they left billions of dollars of value on the table. Why didn't they just fix what you told them to fix?Sam Bankman-Fried 31:22My sense is that it’s part of a larger phenomenon. One piece of this is that they didn't have a lot of market structure experts. They did not have the talent in-house to think really deeply about risk engines. Also, there are cultural barriers between myself and some of them, which meant that they were less inclined than they otherwise would have been to take it very seriously. Ignoring those factors, there's something much bigger at play there. Many of these exchanges had hired a lot of people and they got in very large. You might think they were more capable of doing things with more horsepower. But in practice, most of the time that we see a company grow really fast, really quickly, and get really big in terms of people, it becomes an absolute mess.Internally, there's huge diffusion of responsibility issues. No one's really taking charge. You can't figure out who's supposed to do what. In the end, nothing gets done. You actually start hitting the negative marginal utility of employees pretty quickly. The more people you have, the less total you get done. That happened to a number of them to the point where I sent them these proposals. Where did they go internally? Who knows. The Vice President of Exchange Risk Operations (but not the real one—the fake one operating under some department with an unclear goal and mission) had no idea what to do with it. Eventually, she passes it off to a random friend of hers that was the developer for the mobile app and was like, “You're a computer person, is this right?” They likely said, “I don’t know, I'm not a risk person,” and that's how it died. I’m not saying that’s literally what happened but sounds kinda like that’s probably happened. It's not like they had people who took responsibility and thought, “Wow, this is scary. I should make sure that the best person in the company gets this,” and pass it to the person who thinks about their risk modeling. I don't think that's what happened.The future of cryptoDwarkesh Patel 33:51There're two ways of thinking about the impact of crypto on financial innovation. One is the crypto maximalist view that crypto subsumes tradfi. The other is that you're basically stress-testing some ideas in a volatile, fairly unregulated market that you're actually going to bring to tradfi, but this is not going to lead to some sort of decentralized utopia. Which of these models is more correct? Or is there a third model that you think is the correct one?Sam Bankman-Fried 34:18Who knows exactly what's going to happen? It's going to be path-dependent. If I had to guess I would say that a lot of properties of what is happening crypto today will make their way into Trad Fi to some extent. I think blockchain settlement has a lot of value and can clean up a lot of areas of traditional market structure. Composable applications are super valuable and are going to get more important over time. In some areas of this, it's not clear what's going to happen. When you think about how decentralized ecosystems and regulation intersect, it's a little TBD exactly where that ends up.I don't want to state with extreme confidence exactly what will or won't happen. Stablecoins becoming an important settlement mechanism is pretty likely. Blockchains in general becoming a settlement mechanism, collateral clearing mechanism, and more assets getting tokenized seem likely. There being programs written on blockchains that people can add to that can compose with each other seems pretty likely to me. A lot of other areas of it could go either way.Risk, efficiency, and human discretion in derivativesDwarkesh Patel 35:46Let's talk about your proposal to the CFTC to replace Futures Commission Merchants with algorithmic real-time risk management. There's a worry that without human discretion, you have algorithms that will cause liquidation cascades when they were not necessary. Is there some role for human discretion in these kinds of situations?Sam Bankman-Fried 36:06There is! The way that traditional future market structure works is you have a clearinghouse with a decent amount of manual discretion in it connected to FCMs. Some of which use human discretion, and some of which use automated risk management algorithms with their clients. The smaller the client, the more automated it is. We are inverting that where at the center, you have an automated clearing house. Then, you connect it to FCM, which could use discretionary systems when managing their clients.The key difference here is that one way or another, the initial margin has to end up at the clearinghouse. A programmatic amount of it and the clearinghouse acts in a clear way. The goal of this is to prevent contagion between different intermediaries. Whatever credit decisions one intermediary makes, with respect to their customers, doesn't pose risk to other intermediaries. This is because someone has to post the collateral to the clearinghouse in the end—whether it's the FCM, their customer, or someone else. It gives clear rules of the road and lack of systemic risk spreading throughout the system and contains risk to the parties that choose to take that risk on - to the FCMs that choose to make credit decisions there.There is a potential role for manual judgment. Manual judgment can be valuable and add a lot of economic value. But it can also be very risky when done poorly. In the current system, each FCM is exposed to all of the manual bespoke decisions that each other FCM is making. That's a really scary place to be in, we've seen it blow up. We saw it blow up with LME nickel contracts and with a few very large traders who had positions at a number of different banks that ended up blowing out. So, this provides a level of clarity, oversight, and transparency to this system, so people know what risk they are, or are not taking on.Dwarkesh Patel 38:29Are you replacing that risk with another risk? If there's one exchange that has the most liquidity om futures and there’s one exchange where you're posting all your collateral (across all your positions), then the risk is that that single algorithm the exchange is using will determine when and if liquidation cascades happen?Sam Bankman-Fried 38:47It’s already the case that if you put all of your collateral with a prime broker, whatever that prime broker decides (whether it's an algorithm or a human or something in between) is what happens with all of your collateral. If you're not comfortable with that, you could choose to spread it out between different venues. You could choose to use one venue for some products and another venue for other products. If you don't want to cross-collateralized cross-margin your positions, you get capital efficiency for cross-margining them—for putting them in the same place. But, the downside of that is the risk of one can affect the other. There's a balance there, and I don't think it's a binary thing.Dwarkesh Patel 39:28Given the benefits of cross-margining and the fact that less capital has to be locked up as collateral, is the long-run equilibrium that the single exchange will win? And if that's the case, then, in the long run, there won't be that much competition in derivatives?Sam Bankman-Fried 39:40I don't think we're going to have a single exchange winning. Among other things, there are going to be different decisions made by different exchanges—which will be better or worse for particular situations. One thing that people have brought up is, “How about physical commodities?” Like corn or soy? What would our risk model say about that? It's not super helpful for those commodities right now because it doesn't know how to understand a warehouse. So, you might want to use a different exchange, which had a more bespoke risk model that tried to understand how the human would understand what physical positions someone had on. That would totally make sense. That can cause a split between different exchanges.In addition, we've been talking about the clearing house here, but many exchanges can connect to the same clearinghouse. We're already, as a clearing house, connected to a number of different DCMs and excited for that to grow. In general, there are going to be a lot of people who have different preferences over different details of the system and choose different products based on that. That's how it should work. People should be allowed to choose the option that makes the most sense for them.Jane Street vs FTXDwarkesh Patel 41:00What are the biggest differences in culture between Jane Street and FTX?Sam Bankman-Fried 41:05FTX has much more of a culture of like morphing and taking out a lot of random new s**t. I don’t want to say Jane Street is an ossified place or anything, it’s somewhat nimble. But it is more of a culture of, “We're going to be very good at this particular thing on a timescale of a decade.” There are some cases where that's true of FTX because some things are clearly part of our core business for a decade. But there are other things that we knew nothing about a year ago, and now have to get good at. There's been more adaptation and it's also a much more public-facing and customer-facing business than Jane Street is—which means that there are lots of things like PR that are much more central to what we're doing.Conflict of interest between broker and exchangeDwarkesh Patel 41:56Now in crypto, you're combining the exchange and the broker—they seem to have different incentives. The exchange wants to increase volume, and the broker wants to better manage risk, maybe with less leverage. Do you feel that in the long run, these two can stay in the same entity given the potential conflict of interest?Sam Bankman-Fried 42:13I think so. There's some extent to which they differ, but more that they actually want the same thing—and harmonizing them can be really valuable. One is to provide a great customer experience. When you have two different entities with two completely different businesses but have to go from one to the other, you're going to end up getting the least common denominator of the two as a customer. Everything is going to be supported as poorly as whichever of the two entities support what you're doing most poorly - and that makes it harder. Whereas synchronizing them gives us more ability to provide a great experience.Bahamas and Charter CitiesDwarkesh Patel 42:59How has living in the Bahamas impacted your opinion about the possibility of successful charter cities?Sam Bankman-Fried 43:06It's a good question. It's the first time and it’s updated positively. We've built out a lot of things here that have been impactful. It's made me feel like it is more doable than I previously would have thought. But it's a lot of work. It's a large-scale project if you want to build out a full city—and we haven’t built out a full city yet. We built out some specific pieces of infrastructure that we needed and we've gotten a ton of support from the country. They've been very welcoming, and there are a lot of great things here. This is way less of a project than taking a giant, empty plot of land, and creating a city in it. That's way harder.SBF’s RAM-skewed mindDwarkesh Patel 43:47How has having a RAM-skewed mind influence the culture of FTX and its growth?Sam Bankman-Fried 43:52On the upside, we've been pretty good at adapting and understanding what the important things are at any time. Training ourselves quickly to be good at those even if it looks very different than what we were doing. That's allowed us to focus a lot on the product, regulation, licensing, customer experience, branding, and a bunch of other things. Hopefully, it means that we're able to take whatever situations come up and provide reasonable feedback about them and reasonable thoughts on what to do rather than thinking more rigidly in terms of how previous situations were. On the flip side, I need to have a lot of people around me who will try and remember long-term important things that might get lost day-to-day. As we focus on things that pop up, it's important for me to take time periodically to step back and clear my mind and remember the big picture. What are the most important things for us to be focusing on?Please share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Agustin Lebron began his career as a trader and researcher at Jane Street Capital, one of the largest market-making firms in the world. He currently runs the consulting firm Essilen Research, where he is dedicated to helping clients integrate modern decision-making approaches in their business. We discuss how AI will change finance, why adverse selection makes trading and hiring so difficult, & what the future of crypto holds.Watch on YouTube, or listen on Spotify, Apple Podcasts, or any other podcast platform.Episode website + Transcript here.Buy The Laws of Trading.Follow Agustin on Twitter. Follow me on Twitter for updates on future episodes.Check out my blog: https://www.dwarkeshpatel.com/Subscribe to find out about future episodes!Timestamps:(00:00) - Introduction(04:18) - What happens in adverse selection?(09:22) - Why is having domain expertise in trading not important?(15:09) - How do you deal when you're on the other side of the adverse selection?(21:16) - Why you should invest in training your people?(25:37) - Is finance too big at 9% of GDP?(31:06) - Trading is very labor intensive(36:16) - Overlap of rationality community and trading(48:00) - The age of startup founders(50:43) - The role of market makers in crypto(57:31) - Three books that you recommend(58:47) - Life is long, not short(1:03:01) - Short history of Lunar SocietyPlease share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Ananyo Bhattacharya is the author of The Man from the Future: The Visionary Life of John von Neumann. He is a science writer who has worked at the Economist and Nature. Before journalism, he was a medical researcher at the Burnham Institute in San Diego, California. He holds a degree in physics from the University of Oxford and a PhD in protein crystallography from Imperial College London.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here.Follow Ananyo on Twitter. Follow me on Twitter for updates on future episodes.Timestamps:(0:00:30) - John Von Neumann - The Man From The Future(0:02:29) - The Forgotten Father of Game Theory(0:16:04) - The last representative of the great mathematicians(0:19:45) - Did John Von Neumann have a Miracle year?(0:26:31) - The fundamental theorem of John von Neumann’s game theory(0:29:34) - The strong supporter of "Preventive War”(0:50:51) - We can't all be superhuman Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Stephen Grugett is a cofounder of Manifold Markets, where anyone can create a prediction market. We discuss how prediction markets can change how countries and companies make important decisions.Manifold Markets: https://manifold.markets/Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here.Follow me on Twitter for updates on future episodes.Timestamps:(0:00:00) - Introduction(0:02:29) - Predicting the future(0:05:16) - Getting Accurate Information(0:06:20) - Potentials(0:09:29) - Not using internal prediction markets(0:11:04) - Doing the painful thing(0:13:31) - Decision Making Process(0:14:52) - Grugett’s opinion about insider trading(0:16:23) - The Role of prediction market(0:18:17) - Dealing with the Speculators(0:20:33) - Criticism of Prediction Markets(0:22:24) - The world when people cared about prediction markets(0:26:10) - Grugett’s Profile Background/Experience(0:28:49) - User Result Market(0:30:17) - The most important mechanism(0:32:59) - The 1000 manifold dollars(0:40:30) - Efficient financial markets(0:46:28) - Manifold Markets Job/Career Openings(0:48:02) - Objectives of Manifold Markets Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Today I talk to Pradyu Prasad (blogger and podcaster) about the book "Hirohito and the Making of Modern Japan" by Herbert P. Bix. We also discuss militarization, industrial capacity, current events, and blogging. Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Podcast website here.Follow Pradyu on Twitter. Follow me on Twitter for updates on future episodes.Follow Pradyu's Blog: https://brettongoods.substack.com/ Timestamps:(0:00:00) - Intro (0:01:59) - Hirohito and Introduction to the Book (0:05:39) - Meiji Restoration and Japan's Rapid Industrialization (0:11:11) - Industrialization and Traditional Military Norms (0:14:50) - Alternate Causes for Japanese Atrocities Richard Hanania's Public Choice Theory in Imperial Japan (0:17:03)(0:21:34) - Hirohito's Relationship with the Military (0:24:33) - Rant of Japanese Strategy (0:33:10) - Modern Parallel to Russia/Ukraine (0:38:22) - Economics of War and Western War Capacity (0:48:14) - Elements of Effective Occupation (0:55:53) - Ideological Fervor in WW2 Japan (0:59:25) - Cynicism on Elites(1:00:29) - The Legend of Godlike Hirohito (1:06:47) - Postwar Japanese Economy(1:13:23) - Blogging and Podcasting (1:20:31) - Spooky (1:38:00) - Outro Please share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Razib Khan is a writer, geneticist, and blogger with an interest in history, genetics, culture, and evolutionary psychology.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Podcast website here.Follow Razib on Twitter. Follow me on Twitter for updates on future episodesThanks for reading The Lunar Society! Subscribe to find out about future episodes!Time Stamps(0:00:05) Razib's Background(0:01:34) Dysgenics of Intelligence(0:04:23) Endogamy and Genetic traits in India(0:08:58) Similar Examples of Endogamy(0:14:28) Why So Many Brahmin CEOs(0:19:55) Razib the Globe Trotter, Geography Expert(0:25:04) Male/Female Genetic Variance(0:30:04) Agricultural Man and Our Tiny Brains(0:34:40) The Church of Science(0:42:33) Professorship, a family business(0:44:23) Long History(0:52:42) Future of Human-Computer Interfacing(0:56:30) Near Future of Gene Editing(0:59:19) Meta Questions and ClosingPlease share if you enjoyed this episode! Helps out a ton! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Jimmy Soni is the author of The Founders: The Story of Paypal and the Entrepreneurs Who Shaped Silicon Valley.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here.Follow Jimmy on Twitter. Follow me on Twitter for updates on future episodes! Timestamps:(0:00:00) - Bell Labs vs PayPal(0:05:12) - Scenius in Ancient Rome and America's Founding(0:07:02) - Girard at PayPal(0:15:17) - Thiel almost shorts the Dot com bubble(0:19:49) - Does Zero to One contradict PayPal's story?(0:27:57) - Hilarious Russian hacker story(0:29:06) - Why is Thiel so good at spotting talent?(0:34:50) - Did PayPal make talent or discover it?(0:40:40) - Japanese mafia invests in PayPal?!(0:44:42) - Upcoming TV show on PayPal(0:48:11) - Musk in ancient Rome(0:52:12) - Why didn't Musk keep pursuing finance?(0:56:32) - Why didn't the mafia get back together?(1:00:06) - Jimmy's writing process Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

I interview the economist Bryan Caplan about his new book, Labor Econ Versus the World, and many other related topics.Bryan Caplan is a Professor of Economics at George Mason University and a New York Times Bestselling author. His most famous works include: The Myth of the Rational Voter, Selfish Reasons to Have More Kids, The Case Against Education, and Open Borders: The Science and Ethics of Immigration.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Podcast website here.Follow Bryan on Twitter. Follow me on Twitter for updates on future episodes.Timestamps:(0:00:00) - Intro(0:00:33) - How many workers are useless, and why is labor force participation so low?(0:03:47) - Is getting out of poverty harder than we think?(0:10:43) - Are elites to blame for poverty?(0:14:56) - Is human nature to blame for poverty?(0:19:11) - Remote work and foreign wages(0:24:43) - The future of the education system?(0:29:31) - Do employers care about the difficulty of a curriculum?(0:33:13) - Why do companies and colleges discriminate against Asians?(0:42:01) - Applying Hanania's unitary actor model to mental health(0:50:38) - Why are multinationals so effective?(0:53:37) - Open borders and cultural norms(0:58:13) - Is Tyler Cowen right about automation? Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Richard Hanania is the President of the Center for the Study of Partisanship and Ideology and the author of Public Choice Theory and the Illusion of Grand Strategy: How Generals, Weapons Manufacturers, and Foreign Governments Shape American Foreign Policy.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here. Follow Richard on Twitter. Follow me on Twitter for updates on future episodes.Read Richard's Substack: https://richardhanania.substack.com/Timestamps:(0:00:00) - Intro(0:04:35) - Did war prevent sclerosis?(0:06:05) - China vs America's grand strategy(0:10:00) - Does the president have more power over foreign policy?(0:11:30) - How to deter bad actors?(0:15:39) - Do some countries have a coherent foreign policy?(0:16:55) - Why does self-interest matter in foreign but not domestic policy? (0:21:05) - Should we limit money in politics?(0:23:47) - Should we credit expertise for nuclear detante and global prosperity?(0:28:45) - Have international alliances made us safer?(0:31:57) - Why does academic bueracracy work in some fields?(0:36:26) - Did academia suck even before diversity?(0:39:34) - How do we get expertise in social sciences?(0:42:19) - Why are things more liberal?(0:43:55) - Why is big tech so liberal?(0:47:53) - Authoritarian populism vs libertarianism(0:51:40) - Can authoritarian governments increase fertility?(0:54:54) - Will increasing fertility be dysgenic?(0:56:43) - Will not having kids become cool?(0:59:22) -Advice for libertarians? Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

David Deutsch is the founder of the field of quantum computing and the author The Beginning of Infinity and The Fabric of Reality.Read me contra David on AI.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Read the full transcript with helpful links here.Follow David on Twitter. Follow me on Twitter for updates on future podcasts.Timestamps(0:00:00) - Will AIs be smarter than humans? (0:06:34) - Are intelligence differences immutable / heritable?(0:20:13) - IQ correletation of twins seperated at birth(0:27:12) - Do animals have bounded creativity?(0:33:32) - How powerful can narrow AIs be?(0:36:59) - Could you implant thoughts in VR?(0:38:49) - Can you simulate the whole universe?(0:41:23) - Are some interesting problems insoluble?(0:44:59) - Does America fail Popper's Criterion?(0:50:01) - Does finite matter mean there's no beginning of infinity?(0:53:16) - The Great Stagnation(0:55:34) - Changes in epistemic status is Popperianism(0:59:29) - Open ended science vs gain of function(1:02:54) - Contra Tyler Cowen on civilizational lifespan(1:07:20) - Fun criterion(1:14:16) - Does AGI through evolution require suffering?(1:18:01) - Would David enter the Experience Machine?(1:20:09) - (Against) Advice for young people Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Samo Burja is the founder of Bismarck Analysis and a Research Fellow at the Long Now Foundation. Samo writes and speaks about history, institutions, and strategy, and he is the creator of the Great Founder Theory of history.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here. Follow Samo's Twitter. Follow my twitter for updates on future episodes. Subscribe to Bismarck Brief: https://brief.bismarckanalysis.com/Thanks for reading The Lunar Society! Subscribe to find out about future episodes!Timestamps:(0:00:00) - Intro(0:00:17) - Are individuals causally responsible for history?(0:04:34) - Was Napoleon a great founder?(0:08:47) - What can great founder theory predict?(0:11:17) - How many live players are there?(0:15:40) - Is the market full of live players?(0:18:37) - How to cozy up to both sides?(0:22:58) - How do you become an intellectual?(0:27:34) - Aligning incentives for intellectuals(0:30:40) - What makes someone a great founder?(0:39:29) - Why is the centralized internet inevitable?(0:42:21) - Samo and I debate odds of civilizational collapse(0:48:17) - Is GDP fake?(0:56:52) - The world only has 1.5 civilizations(0:59:32) - Advice to effective altruists(1:02:30) - Advice to young people Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Rohit Krishnan is a venture capitalist who writes about "the strange loops underlying our systems of innovation" at https://www.strangeloopcanon.com. We discussed J. Storrs. Hall's book Where Is My Flying Car?Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website + transcript here. Relevant essays from Rohit:Review of Where Is My Flying CarThe Small Successes Of NanotechIsolated Narratives of ProgressMeditations On RegulationsFollow Rohit's Twitter. Follow me on Twitter for updates on future episodes.Timestamps:(00:00) - Why don't we have flying cars?(08:09) - Should we expect exponential growth?(18:13) - Machiavelli Effect and centralization of science funding(27:55) - We need more science fiction(32:40) - The return of citizen science?(37:40) - Have we grown too comfortable for progress?(42:15) - Is India the future of innovation?(47:15) - Is there an upper-income trap?(50:30) - Forecasts for technologiesTimestamps:00:00 Why don't we have flying cars?08:09 Should we expect exponential growth?18:13 Machiavelli Effect and centralization of science funding27:55 We need more science fiction32:40 The return of citizen science?37:40 Have we grown too comfortable for progress?42:15 Is India the future of innovation?47:15 Is there an upper-income trap?50:30 Forecasts for technologies Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Byrne Hobart writes The Diff, a newsletter about inflections in finance and technology with 24,000+ subscribers.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here. The Diff newsletter: https://diff.substack.com/Follow Byrne on Twitter. Follow me on Twitter for updates on future episodes!Thanks for reading The Lunar Society! Subscribe for free to receive new posts and support my work.Timestamps: (0:00:00) - Byrne's one big idea: stagnation (0:05:50) -Has regulation caused stagnation? (0:14:00) - FDA retribution (0:15:15) - Embryo selection (0:17:32) - Patient longtermism (0:21:02) - Are there secret societies? (0:26:53) - College, optionality, and conformity(0:34:40) - Differentiated credentiations underrated? (0:39:15) - WIll contientiousness increase in value? (0:44:26) - Why aren't rationalists more into finance? (0:48:04) - Rationalists are bad at changing the world. (0:52:20) - Why read more? (0:57:10) - Does knowledge have increasing returns? (1:01:30) - How to escape the middle career trap? (1:04:48) - Advice for young people (1:08:40) - How to learn about a subject? Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Roger's Bacon is a pseudonymous blogger and the creator of the new Seeds of Science journal.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Seeds of Science: https://www.theseedsofscience.org/Roger's Bacon blog: https://rogersbacon.substack.com/Follow Roger's Bacon Twitter. Follow me on Twitter for more updates. Timestamps(0:00:05) - Who is Roger's Bacon?(0:05:03) - The need for scientific diversity(0:10:50) - Why are our institutions so homogenous?(0:19:35) - In defense of cults(0:24:05) - Does innovation require isolation?(0:32:16) - Diversity of institutions vs individuals(0:36:05) - Can we create weird secret societies?(0:42:40) - Secret longtermists and pseudonymous thinkers(0:46:50) - Science needs religion(0:54:50) - How contingent is science(0:59:05) - Seeds of Science(1:09:50) - Randomness in science(1:14:55) - Why committees suck(1:21:05) - Resetting institutions and reinventing ideas(1:32:30) - Teaching at a STEM high school(1:53:01) - Big picture thinking vs technical skills(1:58:55) - Finding blindspots(2:01:57) - Being realistic about the far future Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

David Friedman is a famous anarcho-capitalist economist and legal scholar.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website + transcript here.David Friedman's website: http://www.daviddfriedman.com/Follow me on Twitter for updates on future episodes.Timestamps:(0:00:00) - Dating market (0:12:15) - The future of reputation (0:27:30) - How Friedman predicted bitcoin (0:35:35) - Prediction markets (0:40:00) - Can regulation stop progress globally? (0:45:50) - Lack of diversity in modern legal systems (0:54:20) - Friedman's theory of property rights (1:01:50) - Charles Murray's scheme to fight regulations (1:06:25) -Property rights of the poor (1:09:07) - Automation (1:16:00) - Economics of medieval reenactment (1:19:00) - Advice for futurist young people Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Sarah Fitz-Claridge is a writer, coach, and speaker with a fallibilist worldview. She started the journal that became Taking Children Seriously in the early 1990s after being surprised by the heated audience reactions she was getting when talking about children. She has spoken all over the world about her educational philosophy, and you can find transcripts of some of her talks on her website.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here. Sarah's Website: https://www.fitz-claridge.com/Follow Sarah on Twitter. Follow me on Twitter for updates. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Michael Huemer is a professor of philosophy at the University of Colorado. He is the author of more than sixty academic articles in epistemology, ethics, metaethics, metaphysics, and political philosophy, as well as eight amazing books.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Podcast website here. Buy Knowledge, Reality, and Value and The Problem of Political Authority.Read Michael’s awesome blog and follow me on Twitter for new episodes.Timestamps: (0:00:00) - Intro (0:01:07) - The Problem of Political Authority (0:03:25) - Common sense ethics  (0:09:39) - Stockholm syndrome and the charisma of power (0:18:14) - Moral progress (0:26:55) - Growth of libertarian ideas (0:33:37) - Does anarchy increase violence? (0:44:37) - Transitioning to anarchy (0:47:20) - Is Huemer attacking our society?! (0:51:40) - Huemer's writing process (0:53:18) - Is it okay to work for the government (0:56:39) - Burkean argument against anarchy (1:02:07) - The case for tyranny (1:11:58) - Underrated/overrated (1:25:55) - Huemer production function(1:30:41) - Favorite books (1:33:04) - Advice for young people Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Robert Martin (aka Uncle Bob) is a programming pioneer and bestselling author or Clean Code. We discuss the prospect of automating programming, spotting and developing coding talent, occupational licensing, quotas, and the elusive sense of style.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Listen to his fascinating talk on the future of programming: https://youtu.be/ecIWPzGEbFc Read his blog about programming: http://blog.cleancoder.com/ Buy his books on Amazon: https://www.amazon.com/kindle-dbs/ent... Thanks for reading The Lunar Society! Subscribe to find out about future episodes!Timestamps(0:00) - Automating programming (8:40) - Educating programmers (expertise, talent, university) (21:45) - Spotting talent (26:10) - Teaching kids (29:31) - Prose and music sense in coding (32:22) - Occupational licensing for programmers (35:49) - Why is tech political (39:28) - Quotas (42:29) - Advice to 20 yr old Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Scott Aaronson is a Professor of Computer Science at The University of Texas at Austin, and director of its Quantum Information Center. He's the author of one of the most interesting blogs on the internet: https://www.scottaaronson.com/blog/ and the book “Quantum Computing since Democritus”.He was also my professor for a class on quantum computing.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here. Follow me on Twitter to get updates on future episodes and guests.Timestamps(0:00) - Intro(0:33) - Journey through high school and college(12:37) - Early work(19:15) - Why quantum computing took so long(33:30) - Contributions from outside academia(38:18) - Busy beaver function(53:50) - New quantum algorithms(1:03:30) - Clusters(1:06:23) - Complexity and economics(1:13:26) - Creativity(1:24:07) - Advice to young people Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Scott is the author of Ultralearning and famous for the MIT Challenge, where he taught himself MIT's 4 year Computer Science curriculum in 1 year.I had a blast chatting with Scott Young about aggressive self-directed learning. Scott has some of the best advice out there about learning hard things. It has helped yours truly prepare to interview experts and dig into interesting subjects.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Podcast website here.Check out Scott’s website. Follow me on Twitter for updates on future episodes.Buy Scott’s book on Ultralearning: https://amzn.to/3TuPEbfTimestamps(00:00) - Intro (01:00) - Einstein (13:20) - Age (18:00) - Transfer (24:40) - Compounding (34:00) - Depth vs context (40:50) - MIT challenge (1:00:50) - Focus(1:10:00) - Role models (1:20:30) - Progress studies (1:24:25) - Early work and ambition (1:28:18) - Advice for 20 yr old (1:35:00) - Raising a genius baby? Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

I ask Charles Murray about Human Accomplishment, By The People, and The Curmudgeon's Guide to Getting Ahead.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Read the full transcript here.Follow Charles on Twitter. Follow me on Twitter for updates on future episodes.Timestamps(00:00) - Intro (01:00) - Writing Human Accomplishment (06:30) - The Lotka curve, age, and miracle years (10:38) - Habits of the greats (hard work) (15:22) - Focus and explore in your 20s (19:57) - Living in Thailand (23:02) - Peace, wealth, and golden ages (26:02) - East, west, and religion (30:38) - Christianity and the Enlightenment (34:44) - Institutional sclerosis (37:43) - Antonine Rome, decadence, and declining accomplishment (42:13) - Crisis in social science (45:40) - Can secular humanism win? (55:00) - Future of Christianity (1:03:30) - Liberty and accomplishment (1:06:08) - By the People (1:11:17) - American exceptionalism (1:14:49) - Pessimism about reform (1:18:43) - Can libertarianism be resuscitated? (1:25:18) - Trump's deregulation and judicial nominations (1:28:11) - Beating the federal government  (1:32:05) - Why don't big companies have a litigation fund? (1:34:05) - Getting around the Halo effect (1:36:07) - What happened to the Madison fund? (1:37:00) - Future of liberty (1:41:00) - Public sector unions (1:43:43) - Andrew Yang and UBI (1:44:36) - Groundhog Day (1:47:05) - Getting noticed as a young person (1:50:48) - Passage from Human Accomplishment Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Alex Tabarrok is a professor of economics at George Mason University and with Tyler Cowen a founder of the online education platform http://MRU.org.I ask Alex Tabarrok about the Grand Innovation Prize, the Baumol effect, and Dominant Assurance Contracts.Watch on YouTube, or listen on Spotify, Apple Podcasts, or any other podcast platform.Episode website here.Follow Alex on Twitter. Follow me on Twitter for updates on future episodes.Alex Tabarrok's and Tyler Cowen's excellent blog: https://marginalrevolution.com/ Thanks for reading The Lunar Society! Subscribe to find out about future episodes!Timestamps:(00:00) - Intro (00:34) - Grand Innovation Prize (08:45) - Prizes vs grants (14:10) -Baumol effect (27:50) - On Bryan Caplan's case against education (31:35) - Scaling education online (48:50) - Declining research productivity (52:15) - Dominant Assurance Contracts (58:40) - Future of governance(1:04:05) - On Robin Hanson's Futarchy(1:06:02) - Beating Adam Smith(1:08:35) - Our Warfare-Welfare State (1:19:30) - The Great Stagnation vs The Innovation Renaissance (1:21:40) - Advice to 20 year oldsShare Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Caleb Watney is the director of innovation policy at the Progressive Policy Institute.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Episode website here.Follow Caleb on Twitter. Follow me on Twitter for updates on future episodes.Caleb's new blog: https://www.agglomerations.tech/Timestamps(00:00) - Intro(00:20) - America's innovation engine is slowing(01:02) - Remote work/ agglomeration effects(08:45) - Chinese vs American innovation (16:23) - Reforming institutions (19:00) - Tom Cotton's critique of high skilled Immigration(22:26) - Eric Weinstein's critique of high skilled Immigration(26:02) - Reforming H1-B(30:30) - Immigration during recession(32:55) - Big tech / AI(38:20) - EU regulation (40:07) - Biden vs Trump (42:30) - Federal R & D (47:20) - Climate megaprojects (49:35) - Falling fertility rates (52:20) - Advice to 20 year olds Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Robin Hanson is a professor of economics at George Mason University. He is the author of The Elephant in the Brain and The Age of Em.  Robin's Twitter: https://twitter.com/robinhansonRobin's blog: https://www.overcomingbias.com/ Robin's website: http://mason.gmu.edu/~rhanson/home.htmlMy blog: https://dwarkeshpatel.com/My Twitter: https://twitter.com/dwarkesh_sp00:05 The long view 15:07 Subconscious vs conscious intelligence 20:28 Meditators 26:50 Signaling, norms, and motives 36:50 Conversation 42:54 2020 election nominees 49:25 Nerds in startups and social science 54:50 Academia and Robin 58:20 Dominance explains paternalism 1:09:32 Remote work 1:21:26 Advice for 20 yr old 1:28:05 Idea futures 1:32:13 Reforming institutions Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Jason Crawford writes at The Roots of Progress about the history of technology and industry and the philosophy of progress.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Podcast website here.Follow Jason on Twitter. Follow me on Twitter for updates on future episodes.Jason's website: https://jasoncrawford.org/ The Roots of Progress: https://rootsofprogress.org/   Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Matjaž Leonardis has co-written a paper with David Deutsch about the Popper-Miller Theorem. In this episode, we talk about that as well as the dangers of the scientific identity, the nature of scientific progress, and advice for young people who want to be polymaths.  Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Podcast website here.Follow Matjaž's excellent Twitter. Follow me on Twitter for updates on future episodes! Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Tyler Cowen is Holbert L. Harris Professor of Economics at George Mason University and also Director of the Mercatus Center.Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Transcript + Podcast website here.Follow Tyler Cowen on Twitter. Follow me on Twitter for updates on future episodes.Timestamps(0:00) - The Great Reset (2:58) - Growth and the cyclical view of history (4:00) - Time horizons, growth, and sustainability (5:30) - Space travel (8:11) - WMDs and end of humanity (10:57) - Common sense morality (12:20) - China and authoritarianism (13:45) - Are big businesses complacent?(17:15) - Online education vs university (20:45) - Aesthetic decline in West Virginia (23:20) - Advice for young people (25:18) - Mentors (27:15) - Identifying talent (29:50) - Can adults change? (31:45) - Capacity to change men vs women (33:10 ) - Are effeminate societies better? (35:15) - Conservatives and progress (36:50) - Biggest mistake in history (39:05) - Nuke in my lifetime (40:35) - Age and learning (42:45) - Pessimistic future (43:50) - Optimistic future (46:28) - Closing Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe

Bryan Caplan is a Professor of Economics at George Mason University and a New York Times Bestselling author. His most famous works include: The Myth of the Rational Voter, Selfish Reasons to Have More Kids, The Case Against Education, and Open Borders: The Science and Ethics of Immigration.I talk to Bryan about open borders, the idea trap, UBI, appeasement, China, the education system, and Bryan Caplan's next two books on poverty and housing regulation. Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform.Follow Bryan on Twitter. Follow me on Twitter for updates on future episodes. Get full access to The Lunar Society at www.dwarkeshpatel.com/subscribe