All-In · 2025-08-09 · 111 min

OpenAI's GPT-5 Flop, AI's Unlimited Market, China's Big Advantage, Rise in Socialism, Housing Crisis

Gavin BakerBen ShapiroPhil Deutch

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TL;DR

GPT-5 ended OpenAI’s run of decisively superior launches, even if calling it a “flop” overstates a mixed result. Gavin Baker cited Grok 4 at 44.4% on Humanity’s Last Exam versus GPT-5 at 42%, plus a meaningful Grok lead on ARC-AGI-2; GPT-5 was only “very narrowly ahead” on Artificial Analysis. His signal for investors: this was “the first time” OpenAI failed to clear every rival decisively, while Grok 5 and a new Gemini remain pending.
OpenAI’s more defensible GPT-5 advance may be product simplification, not frontier intelligence. Friedberg found that GPT-5 routed a simple retrieval request to a fast response and a complex research task into thinking mode, eliminating the model-picker alphabet soup that ordinary users cannot interpret. The router was reportedly inconsistent for the first 12–16 hours. Jason relayed Benchmark investor Eric Vishria’s view that even if OpenAI “never releases another model,” its users, distribution and product quality could still make it highly valuable.
The AI capex cycle already shows economic returns and full utilization, weakening comparisons with the telecom bubble. Gavin said return on invested capital at the hyperscalers has risen during the buildout, first through “silicon opex to replace human opex” and now through revenue acceleration: Meta’s engagement and ad targeting improved, while Microsoft reported significant Copilot uptake. Dot-com capital funded dark fiber that sat unused; today’s GPUs run so intensively “that they melt,” meaning supply remains behind observable demand.
Power, not model access alone, is becoming the binding asset in the AI race. Phil Deutch cited NVIDIA’s Climate in a Bottle and said the sector remains in the first half of the first inning for solving energy’s hardest problems. The discussion cited Anthropic’s request for 50 GW of US power over three years—roughly 5% of current US electricity production and comparable to an entire year’s recent capacity additions—while data centers need continuous, location-specific power and are relatively price-insensitive. The discussion also cited China adding one terawatt every 18 months, with solar additions at extraordinary scale and more than 150 nuclear reactors in some stage of deployment.
China’s advantage is coordinated manufacturing and infrastructure, but its own suppression of entrepreneurship and weak rule of law may cap it. The existential case presented in the discussion spans AI, military power, TikTok, BYD and state-backed brands; Friedberg instead asked, “Who’s going to win the internet?” and argued that advantage will vary across models, drones, supply chains and markets. China can “throttle up and throttle down entrepreneurship,” but company formation peaked around 2018, DeepSeek personnel are tightly controlled, and Phil’s factory experience was that “every day was a renegotiation on terms.”
The socialism debate converged on housing costs and economic insecurity as the combustible inputs, but not on whether failure will cure the politics. Friedberg warned that rising rent, groceries and government dependence create a “slow-burning” ratchet in which every failed program becomes an argument for more intervention; David Sacks warned that a downturn could produce a backlash “much further to the left than Obama ever was.” Jason’s counter-program was abundant housing, broader ownership and cheaper education: build 10 million homes, loosen regulation, and reduce the anxiety of households spending 60% of their budget on shelter.
Trump’s tariff experiment is producing real revenue but still lacks a stable test of its inflation, demand and growth effects. July receipts reached $30 billion and 2025 receipts about $127 billion, but Ben noted that weak inflation could reflect falling demand—and that maximizing tariff revenue ultimately conflicts with reshoring, which eliminates imports. Phil Libin put success at “50/50.” David Sacks and Chamath Palihapitiya argued that retaliation and early damage had been lighter than expected, while Gavin’s more cautious hedge was that Trump appears responsive to market feedback but needs to restore policy stability.
Apple’s $700 billion of buybacks crystallized the episode’s capital-allocation argument: the company could fund returns and still compete far more aggressively in AI. Gavin rejected the false choice between repurchases and R&D but suggested redirecting even $200 billion toward data centers, calling Apple’s AI products “terrible” and its inaction astonishing. Gavin also offered the upside case for augmented-reality glasses, while Friedberg suggested Apple could eventually become the operating system for homes, EV batteries and distributed power.

Digest · the substance, structured for research

1. GPT-5 broke OpenAI’s benchmark-winning streak

Jason framed the release as underwhelming relative to GPT-3.5 and GPT-4: the presentation contained flat or incorrect charts, calculation errors and typos, while Sam Altman’s Death Star teaser had encouraged expectations of something “otherworldly.” Alongside GPT-5, OpenAI released two open-weight models—explicitly not open source.
Gavin’s central observation was historical: “This is the first time that OpenAI has released a new model that was not decisively the best.” Previous challengers from Google or xAI had been overtaken quickly; this time, a frontier competitor released roughly one month earlier remained ahead on important tests.
On Humanity’s Last Exam, a deliberately punishing multidisciplinary benchmark, Gavin put Grok 4 at 44.4% and GPT-5 at 42%. Grok 4 was also “significantly better” on ARC-AGI-2, which targets the jagged frontier of tasks that humans find comparatively easy but AI systems find difficult; GPT-5 led Artificial Analysis only very narrowly.
Gavin hedged his xAI optimism carefully: his firm owns xAI shares, and “to be human is to be biased.” Still, xAI has the largest Blackwell cluster, Grok 5 is coming, OpenAI’s talent losses “may be beginning to weigh,” and the next Gemini will provide another clean test of whether OpenAI has surrendered the frontier lead.

2. GPT-5’s router may matter more than its raw intelligence

Friedberg’s practical test exposed the product advance: GPT-5 answered a simple information-retrieval question immediately, then independently entered thinking mode for a difficult research request. The system selected the underlying route without making the user decipher model names, letters and version numbers.
His UX thesis was categorical: “No one understands what those letters and numbers mean.” Mass-market AI needs a clean interface in which the system determines the appropriate model and reasoning depth, which could make unified GPT-5 more consequential than a small benchmark delta.
Gavin added an important launch caveat: the router was reportedly broken or inconsistent for many users during the first 12–16 hours. Benchmark scores and user impressions might therefore improve once the intended routing system operates reliably.
OpenAI’s moat may outlive its technical lead. Jason relayed Benchmark investor Eric Vishria’s argument that even if OpenAI “never releases another model,” its users, distribution and product execution could still support a highly valuable company.

3. AI is entering workflows before it reaches its economic ceiling

Phil said his investment team uses language models constantly for research efficiency but called the industry “the first half of the first inning.” His best specimen was NVIDIA’s “climate in a bottle”: a model of Earth that hints at AI eventually addressing energy trade-offs and other thorny physical problems.
At Daily Wire, AI already accelerates research and editing. Ben’s concrete example was a Jeremy’s Razors commercial made entirely with AI two months earlier: it retained “the kind of AI slop feel,” but it accomplished the job at far lower cost than a conventional shoot.
Ben’s investor question was whether productivity will arrive fast enough to justify hundreds of billions—and potentially $1 trillion–$2 trillion over five years—of data-center spending. He recalled that the internet functioned by 1999–2000, yet much of its economy-wide productivity took until roughly 2006–2007 to appear.

4. Utilization separates today’s AI boom from dark fiber

Gavin said the returns can be measured because the largest builders report quarterly. Return on invested capital has risen since AI spending began, initially through operating savings—“silicon opex to replace human opex”—and increasingly through revenue growth.
Meta’s recent upside was his strongest revenue example: AI keeps users engaged longer and improves ad targeting, producing better return on ad spend and encouraging advertisers to spend more. Even Microsoft, whose Copilot Gavin does not consider the best product, disclosed “pretty astonishing” adoption statistics.
The dot-com bubble was substantially a telecom bubble built on unused capacity. Tens of billions funded dark fiber in anticipation of future demand; AI infrastructure is the reverse, because GPUs are operated so intensively “that they melt.”
Gavin’s conclusion was that builders are not placing capacity far ahead of demand: “We’re clearly still behind demand.” Economic returns this early in the cycle do not eliminate investment risk, but they are materially better evidence than investors had at the comparable stage of the internet buildout.

5. AI demand has changed the power market before policy could

David Sacks argued that AI’s energy consequences could exceed those of the Inflation Reduction Act and last longer. Hyperscalers have supplied immediate, concrete demand for nuclear and other generation, helping revive small modular reactors without requiring investors to depend entirely on either political party.
Ben Shapiro cited Anthropic’s stated need for 50 GW of US power over three years as the scale marker. He described that as about 5% of US electricity production and comparable to all capacity recently added in a year, after decades in which national electricity demand was effectively flat and is now growing 2%–3%.
Data centers require continuous power in particular locations and are relatively price-insensitive. Hyperscalers also want carbon-free electricity and will pay for it—not merely because government mandates it, Ben argued, but because their organizations and workforces demand it.
Friedberg contrasted this with China adding one terawatt—1,000 GW—every 18 months. The discussion also noted that China imports much of its coal and gas, while its solar buildout is extraordinary, hydro and nuclear reduce fuel dependence, and more than 150 reactors are reportedly in some stage of deployment.

6. Solar’s success reopened the fight over nuclear crowd-out

Friedberg’s chart showed “hyperbolic growth” in solar after costs fell roughly 80%–90%. His reading of the One Big Beautiful Bill was that withdrawing incentives removes generation precisely when the US needs “all we can eat on energy” for AI and national competitiveness.
Friedberg’s counterargument was capital allocation: subsidized solar and wind raise private returns, diverting money from nuclear R&D and helping leave the US decades behind China’s Gen 4 systems—cleaner, meltdown-resistant reactors that China is already deploying at scale.
Jason called the idea that renewable subsidies caused nuclear’s problems “nutty.” Nuclear’s binding constraint was bureaucracy, not another five or ten cents per kilowatt-hour; a subsidy cannot solve a broken regulatory pathway, and centralized nuclear and distributed renewables need not be treated as interchangeable children fighting for one allowance.
Friedberg’s investor evidence was that capital entered SMRs when hyperscalers committed to buying their output, then accelerated when the administration issued four or five orders aimed at removing regulatory barriers. He remained unconvinced that solar and wind subsidies were responsible: government-directed returns can create bubbles and suppress investment in the path with the best long-term economics.

7. America and China disagree on whether AI can have many winners

Ben placed himself firmly in the “existential race” camp. TikTok demonstrated China’s ability to gather data and distribute propaganda at scale; an AI lead could extend that influence into business tools, military capacity, freedom of the seas, allied security and America’s economic position.
Friedberg rejected a single-winner frame: asking who wins AI resembles asking in 1996, “Who’s going to win the internet?” Models will keep evolving while advantage fragments across drone warfare, autonomous devices, manufacturing productivity, materials, supply chains and conventional businesses.
His warning was that superior models alone do not manufacture fleets. China already possesses production and materials advantages in autonomous warfare, while the US may dominate other vectors that AI enables, accelerates or magnifies.
Gavin said China itself clearly treats the contest as existential. On his information, DeepSeek employees cannot share a room with an American while in China and often have a CCP minder—an “astonishing” degree of control that reveals how strategically Beijing treats frontier-model knowledge.

8. China can mobilize capital faster than it can protect entrepreneurship

Jason’s Luckin Coffee, BYD and TikTok examples suggested China could use state-backed capitalism and globally attractive brands against the US. Ben called the system “state-sponsored corporatism”: concentrate extraordinary resources in one chosen industry, accept losses, and undercut market competitors.
Ben favors heavy tariffs on China, but only after building free-trade networks with everyone else and excluding China. Without that preliminary boxing-in, Beijing can “climb out the window” through alternative chip routes, TikTok structures and trade relationships.
Friedberg’s chart showed Chinese company formation peaking in 2018 alongside global venture investment, then falling after policy tightened and Jack Ma disappeared from public business life. The CCP can throttle entrepreneurship up, but wealth and independent power then accumulate; when it throttles down, the economy loses the bottom-up force that lifted living standards.
Gavin’s Soviet analogy made the allocation argument stark: near the end of the USSR, entrepreneurial production on roughly 2% of agricultural acreage reportedly generated a majority of the food. Phil supplied the institutional constraint from his Chinese wind-blade factory: without control of the company chop, ownership meant little, and “every day was a renegotiation on terms.”

9. Competing with corporatism tempts America to copy it

Ben said corporatist systems look spectacular early because they can mobilize everything toward one target, while a messy capitalist democracy spreads resources across many targets. If superintelligence is genuinely existential, AI might require something closer to a Manhattan Project—but that would not justify extending industrial planning across steel, copper and the whole economy.
On federal AI rules, Ben characterized preemption as a defense against state authoritarianism, not simply Washington seizing state power. The intended target is legislation from states such as California that could fill the field with restrictions and destroy competition.
Jason argued—and Ben Shapiro agreed—that an elected, accountable president may be preferable to an imperial judiciary when Congress has failed to legislate. Ben traced the deeper problem to the administrative state: Congress passes vague packages, delegates decisions and political heat to regulators, then returns home to claim the spending.
Ben Shapiro defended career civil servants doing essential safety, defense and intelligence work for limited recognition and pay. Jason placed the blame on Congress for abdicating authority, while Ben proposed that a third party prove itself through governorships and state legislatures before attempting to capture Washington.

10. Socialism advances through ratchets, not a single election

Friedberg predicted socialism would “sweep over this nation,” driven by stagnant wages, visibly higher groceries and rent, and a government that directly or indirectly employs, by his calculation, nearly half of Americans. Chamath countered that US capitalism, freedom and rule of law remain resilient and that political arithmetic eventually swings back.
Chamath viewed Zohran Mamdani as the near-term test: he disagreed with every policy but called him “an incredibly charismatic, effective politician.” If Mamdani wins and implements the agenda, Chamath expects failures in policing and government-run retail to discredit socialism quickly.
David Sacks’ pushback was that destruction takes time and can always be blamed on wealthy financiers who fled. More dangerously, a market crash, unemployment or renewed inflation could turn “the rich got richer and we got poorer” into a movement much further left than Obama.
Friedberg described the policy ratchet: if food stamps prove insufficient, expand them; if rent control fails, have government build housing. “The solution is never, let’s reduce the government’s role”—failure becomes evidence that intervention was too small, increasing taxes and regulation until the stated endpoint is seizing the means of production.

11. Housing costs are the most actionable source of political anger

Jason argued that households spending 60% of their “nut” on housing experience radically different anxiety from households that can afford ownership. His prescription combined Australian-style super funds, individual market ownership, housing deregulation, 10 million additional homes and even two new cities.
Education is already adjusting: young people are considering schools such as UT where an entire degree might cost $50,000, or entering trades where plumbers and electricians can earn $150,000 a year. Housing, however, remains the expense neither party has made its defining national project.
The discussion widened the diagnosis to falling geographic mobility. The traditional American dream was not necessarily to die where one’s grandparents lived; it was to cross an ocean or mountain, build a “ramshackle hut,” and move again if opportunity failed. Aggregate job openings cannot help workers unwilling or unable to relocate or change industries.

12. Tariff revenue is real, but its source may be shrinking demand

July tariff receipts reached about $30 billion and the 2025 total roughly $127 billion; $30 billion monthly annualizes to $360 billion. Jason and David Sacks discussed $250 billion as a plausible 2026 level, given that the broad regime began around midyear.
The June trade deficit fell to roughly $60 billion, its lowest since June 2023, without the immediate inflation surge many expected. Ben Horowitz’s caution was that muted prices might mean demand has already dropped, making current tariff receipts partly a one-time spike before import volumes and revenue decline.
Ben identified an internal contradiction: the administration cannot permanently maximize tariff revenue while celebrating reshoring. If imports are replaced by domestic production, the tariff base disappears; revenue and industrial substitution can coexist during transition, but “those two things are eventually mutually exclusive.”
Friedberg used Chinese solar panels to state the unavoidable trade-off: tariffs may level the playing field or protect supply chains, but they also increase US energy costs. Globalization was a net positive during his lifetime, and he could not confidently judge whether security benefits now outweigh its retreat.

13. Trump’s flexibility limits the downside but prolongs uncertainty

Ben Horowitz described Trump as a zero-sum thinker who treats trade deficits as evidence of losing, explaining why “reciprocal” rates were based on bilateral deficits rather than foreign tariff schedules. Switzerland’s 39% rate illustrated the ad hoc approach: individual battles and headlines, not a stable systems design.
Phil Libin separated three policies: low taxes and deregulation are constructive, while the tariff war significantly dampens growth. The counterfactual matters—markets surviving the disruption is not proof of success if tax cuts and deregulation could have produced a much stronger economy without it.
India’s proposed combined 50% tariff captured the mixed objectives: 25% for alleged unfair trade practices and 25% for buying Russian oil. Japanese and EU investment agreements were still described as handshakes rather than fully papered commitments, while litigation could return tariff authority to Congress.
Gavin declined false precision but emphasized that Trump “looked into the abyss” in April and changed course; the critical question is whether he remains responsive early enough to brake before the cliff.

14. The tariff experiment is milder than feared, not yet proven

David Sacks’ constructive case was that the early damage and foreign retaliation have both been smaller than expected. That supports the administration’s claim that access to the American consumer gives the US leverage, especially where other countries have long imposed higher barriers.
He still preserved the economic objection: reciprocity sounds fair, but comparative advantage can make asymmetric tariffs desirable. The value of the current policy may simply be empirical—after tariffs animated both parties for 30 or 40 years, the country will finally know more in 12–18 months.
Sacks said he likes “running experiments” and would use tariff receipts to reduce direct taxation, but only alongside a smaller government. His largest fiscal concern is that a new federal revenue stream becomes “another crutch to keep spending up,” converting a trade tool into a permanent expansion of the state.

15. Chip leakage is manageable; Apple’s capital allocation is the bigger indictment

US authorities alleged that ALX Solutions routed advanced GPUs through Singapore and Malaysia while receiving payments from Hong Kong and China; the felony charge carries up to 20 years. The Financial Times estimate discussed was at least $1 billion of NVIDIA chips entering China over three months at roughly a 50% black-market premium.
Gavin expects smuggling to persist because chips are too valuable to exclude completely, just as the US cannot eliminate illegal drugs. Yet $1 billion is not comparable with the $10 billion–$20 billion Blackwell clusters being built by US hyperscalers or with Colossus; selling China restricted H20s and a “despecced Blackwell” could also reduce demand for illicit frontier parts.
Apple, by contrast, spent $700 billion on buybacks over a decade—more than the market capitalization of all but 12 S&P 500 companies—while Jason counted AirPods and perhaps M4 chips as its leading innovations. Gavin said buybacks are valuable but asked why even $200 billion was not redirected into AI data centers: “It almost feels like they’re trying to lose.”
Gavin refused to count Apple out: critics ridiculed the iPad before sales rose from 10 million to 100 million, and he would be surprised if Apple did not deliver the best AR glasses within three or four years. Friedberg extended the upside to energy: 30 million EVs by 2030, each with 80–200 kWh, could represent 2,400–3,300 gigawatts of moving storage whose charging, discharge and aggregation need an operating system.

I just want to let Freeberg know. He told me to stop taking my nicotine pouches because I had brought too much energy. Freeberg, you see what I got here? >> Nick, blur that out. >> See what I got? >> We're not doing We're not doing promotions. >> We're not doing any of these promotions. >> What you need to know is he sent me my own flavors. >> Jason, just so the rest of you guys know, Jason's trying to get paid side hustle. I have no He's trying to turn the show >> into an infomercial and he's trying to get paid personally. >> I'm selling this on eBay. If anyone wants to know about eBay site, [Music] >> we'll let your winners ride. [Music] >> We open source it to the fans and they've just gone crazy with it.

Jason Calacanis

We were supposed to take off this week, but your independent moderator said no. Scrati taking a week off? No weeks off. So I told my besties, “We’re out gallivanting. We’re doing a show on Friday with or without you all.”

Of course, David Friedberg showed up. How are you doing, Davey?

David Friedberg

I’m here.

Jason Calacanis

You’re here? But you weren’t going to come at first. You were a little frustrated that the other boys took the week off.

David Friedberg

I was annoyed. We were going to record yesterday.

Jason Calacanis

Yes.

David Friedberg

I had gotten a docket, which we’re supposed to do. What are we going to talk about? I read it. I mentally prepared. I drank some coffee, got dressed in a T-shirt, and got in front of my computer.

Jason Calacanis

And then your co-hosts bail. They’re like, “I can’t talk to your co-host today. I can’t. I’m in this country. I can’t. I’m on this boat.”

How many minutes of notice did they give us? It was like 5 minutes before we were supposed to record.

David Friedberg

It was 90 minutes before. Ninety minutes before the show.

Jason Calacanis

That’s true professionalism. But Friedberg, a consummate professional, is here. We’ve got a full docket for everybody.

Also with us today, my guy Gavin Baker. He’s at the beach, I’m sure, enjoying a little recreation. But you decided, “Hey, let me get in here and help JCal. Let’s lock the show down, take a little time out from the beach, and do an episode of All-In.” Thank you for doing that, Gavin.

Gavin Baker

Always happy to help. I should say that I’m working hard at the beach.

Jason Calacanis

I mean, it was supposed to be an easy, breezy summer. We’ve had a busy couple of years, but we’re post-election. Everything was supposed to slow down. We were going to get into a groove. It’s never been busier, right?

Gavin Baker

Well, we’re still in the thick of public-company earnings, which is always busy.

Jason Calacanis

And, of course, for those who don’t know, Gavin is the managing partner and CIO of Atreides. He invests in public and private companies, so that makes you a crossover fund.

With us as well today, my guy and fellow broadcaster Ben Shapiro, host of The Ben Shapiro Show and co-founder of The Daily Wire, which makes a mountain of money. He has a new book coming out in September, Lions and Scavengers: The True Story of America and Her Critics.

You gendered America, Ben, in your subtitle. A bold move. What’s the book about, and why are you writing it?

Ben Shapiro

Basically, the concept of the book is that we’re watching civilization break down between people who want to build and people who want to tear down. You saw that pretty clearly, I think, in the last election cycle, but you’re seeing it all over the world.

You have people who actually are innovators, people who want to build social fabric, and people who want to defend civilization. Then you have people who are interested in getting rid of borders, people who want to destroy businesses, and people who are not interested in the foundations of Western civilization and see them as fundamentally bad. That’s really the contrast.

Jason Calacanis

I knew that you had something you wanted to say, because the book business for a podcaster—or especially one as successful as you are now—is a net loser in terms of your productivity and time when compared with doing your daily show and all the other things The Daily Wire does.

You’re right behind us, number 2 in the rankings. There, I kid—he’s ahead of us. We’re manifesting. We’re right there with Ben Shapiro and true crime. That’s you and Bill Simmons: NBA, true crime, Ben, and us.

Ben Shapiro

Yeah, for sure. It started off because, honestly, things have been so pathetic lately that I became pathetic and started journaling, which is not a thing that they really should do.

As I was traveling around and going to Oxford University a month after October 7 and debating people who were telling me that October 7 was fine and dandy, I was keeping almost a diary of what that was like. Part of the book is that it’s a much more personal book than the other stuff that I write, which honestly is not usually my bag. But I felt like putting it out there.

Jason Calacanis

It’s interesting. If I’m reading into this correctly, you probably had some dismay, anxiety, whatever—hand-wringing over the state of affairs—and decided to use journaling just to get it out of your system.

Hey, no shame in the journaling game, Ben. I think it’s fine. It’s better than popping some pills.

Ben Shapiro

It’s in a Trapper Keeper, and it’s got a little heart lock.

Jason Calacanis

Oh, you went with the Trapper Keeper. You went with the My Little Pony Trapper Keeper, just like when you were in high school.

Ben Shapiro

Exactly.

Jason Calacanis

But yeah, you get it out of your system. I, too, have been journaling and meditating because making sense of the world is difficult.

As Gen Xers here—all of us, I think. You’re a Gen Xer. Maybe you’re a millennial. You’re on the bubble, I think, Ben.

Ben Shapiro

Yeah, yeah, yeah.

Jason Calacanis

It’s just weird to see everything be topsy-turvy.

Rounding out the fivesome here today, we have a full complement: my guy Phil Deutsch from NGP Energy Technology Partners. This is the smartest guy I know when it comes to energy. He’s my rabbi. When I have a question about energy, I just text him, and he explains to me why I’m right about solar batteries being better than clean coal. But we’ll find out today. We’re going to do a deep dive on energy.

Phil Deutsch also has a pedigree that Chamath would be in awe of today. You come from a family of politicians, right, Phil?

Phil Deutsch

Government employees, I think, is better than politicians. “Public servants” would be more—

Jason Calacanis

“Public servants” would be the way to say it. Yes, public servants would be the way to say it.

All right, ChatGPT-5 just broke. Large language models continue to drop, just 4 weeks after Grok 4 took the crown. Friend of the pod Sammy the Bull Alman dropped GPT5 and 2 open-weight models. They’re not open source. We’ll get Gavin’s thoughts on that in a minute.

It was a bit underwhelming. I’m assuming you all saw it, gentlemen. It was a messy presentation for GPT-5 yesterday. This wasn’t your classic Steve Jobs keynote. The charts were flat and wrong, with miscalculations, typos, and all kinds of stuff.

The model did top some leaderboards, in fairness, including the Chatbot Arena, but many people were disappointed. They said the performance was underwhelming, especially because when ChatGPT-4 came out—and obviously GPT-3.5—those were major jumps.

Part of it might have been Sam not managing the hype. He tweeted, “Fellow Star Wars fan Ben Shapiro will get a kick out of this.” He tweeted the Death Star. I think this is a Rogue One shot where the Death Star is coming up.

Don’t get triggered, Ben. I don’t want you to get into a sequels rant. But you loved Rogue One, correct, Ben?

Ben Shapiro

I did like Rogue One.

Jason Calacanis

Rogue One—

Ben Shapiro

It’s exceptional.

Jason Calacanis

Exceptional. Rogue One.

Ben Shapiro

Rogue One is the last good Star Wars movie that’s been made.

Jason Calacanis

Okay, so let’s do it. The Empire Strikes Back is my number 1. Then Revenge of the Sith, then Rogue One. What do you got, Ben? What are your top 3?

Ben Shapiro

I go Empire, then A New Hope—

Jason Calacanis

As everyone should.

Ben Shapiro

—and then probably Rogue One.

Jason Calacanis

Wow. Okay.

Ben Shapiro

I like Rogue One a lot. I think it’s really good.

Jason Calacanis

Me, too. It’s a perfect film.

Gavin, what do you got in your ranking? I know you’re going to rank.

Gavin Baker

I 100% agree with Ben, but The Empire Strikes Back is just so much better than all of the others.

Jason Calacanis

Yes. Friedberg, what do you got?

David Friedberg

I remain adamant in my point of view that the entire Star Wars franchise is built around an anti-technology, anti-utopian view of the world—anti-progress. The Death Star is the ultimate manifestation of technology.

And of course, it’s used for evil. That’s kind of the main message of the series.

Jason Calacanis

Wow. Way to bring the show down, Dave. Way to ruin all our childhoods. I did like the last one.

Jason Calacanis

We just had a Gen X moment. He’s like, “Yeah, I did like the last one, though.”

Jason Calacanis

I’m terrified to ask you what you think of The Wizard of Oz, but I’m going to go with the original.

David Friedberg

It was a dystopian gender take on free will.

Ben Shapiro

That was the first Epstein Island.

Phil Deutsch

The original, yeah. I remember my mom taking me to it when I was a kid. It was awesome, so I’m going 1. 1.

Jason Calacanis

Okay, there you go. Anyway, Sam did this tweet. It built a lot of expectation that this would be otherworldly. It wasn’t.

Did anybody get a chance before we go on to the open models—or the open-weight models, I should say? Anybody get a chance? Gavin, I think you’re at the tip of the spear here. Any thoughts? Are we hitting either the trough of despair or maybe diminishing returns in the LLM space, where it’s feeling incremental, not groundbreaking, when we release these iterations?

Gavin Baker

Maybe for OpenAI, but if you look at Grok 4 versus Grok 3, that was a pretty giant leap. I think what was surprising to me is that this is the first time OpenAI has released a new model that was not decisively the best.

Here’s Grok 3. It comes out. It’s the purple line. This is from Artificial Analysis. Shortly thereafter, maybe 6 to 8 weeks later, o3 comes out, and it is clearly significantly better. It’s that black dot, and they’ve had that flex any time they’ve been surpassed in the past. Google and Grok have surpassed OpenAI at times, which shocked me on the next slide.

I do think some of the loss of talent may be beginning to weigh. A big problem in AI is what’s called benchmark saturation, which is just that these models are getting so smart that benchmarks optimized even for human graduate students are not sufficient to measure their intelligence. So we’ve developed these new benchmarks. There’s Humanity’s Last Exam on the left, and you can see—

Jason Calacanis

Can you explain what that is to the audience? It’s got such an evocative name. What does it mean?

Gavin Baker

It’s a list. Everybody, you could just Google it, but the questions are ridiculously hard. They’re extremely hard questions from a wide range of disciplines. You can see Grok 4, when it came out—and it has improved since its release roughly a month ago—was at 44.4%, and GPT-5 was at 42%.

Similarly, ARC-AGI-2, which is another benchmark, measures what’s called the jagged frontier in AI. Things that are very easy for AIs, like maybe math, are really hard for humans, and vice versa. ARC-AGI measures tasks that are relatively easy for humans—you could almost think of it as a lot of geometric puzzle-solving—but very hard for AIs. Here again, Grok 4 is significantly better than GPT-5.

In fairness, and to be balanced and accurate, it is narrowly—very narrowly—ahead in Artificial Analysis on the right. But this is the first time OpenAI has not released a model that was decisively better. The progress for Grok 4 was exceptional. Grok 5 is coming soon.

My firm is a shareholder of xAI, so as much as I try to be objective, I am biased because I am human, and to be human is to be biased. But they have the largest Blackwell cluster, so I’m optimistic for Grok 5. We’re waiting on Gemini. I would expect there to be a very impressive new Gemini model, and we’ll see how that lands relative to both Grok and GPT-5.

I do think it’s significant that this is the first time OpenAI has not been able to clearly beat a competitor on all metrics a month after a new frontier model was released from one of its chief rivals.

Jason Calacanis

Friedberg, let me ask you a question. Have you played with it yet, Dave? Have you gotten into ChatGPT-5? I’ll get your initial thoughts, if any, but I’m interested in leveling up the conversation to this concept of why they would release it if they weren’t a definitive winner.

Sam Altman—Sammy the Bull—is pretty competitive. He knew that this was going to be the reaction, that it wasn’t definitively better, but he released it anyway, which means maybe he’s having a hard time making those innovations, and there has been a brain drain. So, sort of a 2-parter there. Take whichever one you want first.

David Friedberg

I don’t know how much this brain drain is affecting things, but I think one of the big milestones realized with this upgrade is that it’s kind of multimodal. If you remember, a couple of weeks ago, if you were using ChatGPT and had a Pro account, you had to select the model using the dropdown: Which model do you want to run?

If you were doing a research task or a very simple search task, you would choose the right model to increase speed or increase depth. Part of what I think was a big upgrade with this system is that it recognizes which underlying model to call and which underlying path to draw from.

I actually tried asking a very complicated research question, and then I asked a very simple information-retrieval question. For the information-retrieval question, it very quickly pulled the answer. For the deep research question, it said it got into thinking mode. It self-selected.

I think this is really important from a user-experience perspective for AI to work. You don’t want users going in and technically choosing which model to use. No one understands what those letters and numbers mean. You want a very simple, clean, basic interface where the model figures out on its own which underlying set of models to pull from and which reasoning process to follow to give you your answer.

From a product-experience point of view, this was actually a pretty big upgrade for ChatGPT, and it’ll give them a real advantage as people start to access it. It’s also why they’re making a lot of the research functions more broadly available on a limited-use basis to the wider population, so people can start to see the depth of what’s possible. That was the key milestone for me—less about the actual performance of the underlying model on the benchmarks and more about this big UX upgrade.

Jason Calacanis

Kevin, I don’t know if you feel similarly, but—

Gavin Baker

I do. In all fairness to OpenAI, the router that auto-selects the right model was apparently broken for the first—

Jason Calacanis

12 or 16 hours of the model’s release. It wasn’t working.

Kevin Ryan

Yeah, it was not working consistently for all users. The one thing about OpenAI is that they have a very good product.

Jason Calacanis

Just really, really good. I always go back to the statement from Eric Vishria, who’s a venture capitalist at Benchmark—a brilliant man. He said on X that it might be that, if OpenAI never releases another model, it’s still a really valuable company because it has so many users, it’s so good at product, and it has a lot of distribution.

Phil Deutch, what inning are we in here? How much of your research do you rely on, or can you rely on, these language models now that you’re in a very specific vertical every day studying energy and those opportunities? Has it made its way into your workflow, and did you get to play with ChatGPT-5?

Phil Deutch

For investing, we use it all the time, and it really is very efficient. One thing I’ll cite is NVIDIA’s Climate in a Bottle, cBottle. NVIDIA has done a climate model of the Earth and put that out there.

I would say we’re in the first half of the first inning when we start seeing AI really help us with the thorniest problems and the trade-offs around energy. For us, it’s very early, and we’re using it just like any other investor would.

Jason Calacanis

Ben, has it made its way into your workflow at The Daily Wire? Are you monitoring this as a business owner? I think you have a couple hundred employees. Do you see a bifurcation between the people who use these tools and those who don’t?

Ben Shapiro

It’s definitely bleeding into the workflow in terms of being able to gather information very quickly or even using some editing tools via AI. We put out Jeremy’s Razors commercial 2 months ago that was entirely AI. It still had the AI-slop feel to it a little bit, but it was doing a thing, and it was obviously a lot cheaper than having to shoot something.

I kind of want to ask a general question. I’m the dumb guy in this part of the conversation, for sure, as I am in many conversations. Do you think the productivity gains are going to bleed over fast enough to justify the investment? That’s the dumb-guy question, right?

So much money is pouring into this. I’m looking at the valuation of these companies, and I’m seeing that 60% or 70% of all S&P 500 gains are happening in the Magnificent 7. I’m thinking to myself, when you look at the internet, the internet was working by 1999 or 2000, and it took until maybe 2006 or 2007 for all that productivity to really enter the marketplace.

Is this stuff going to hit fast enough to justify the amount of investment, or are you going to see a crater here?

Jason Calacanis

I think that’s a good question for Gavin. Just to set it up, we are now seeing hundreds of billions—low hundreds of billions—per year being deployed, and we’ll see $1 trillion or $2 trillion deployed, I think, in the next 5 years, on data centers and this infrastructure.

I put the TAM last week just for business at about $50 to $100 per business user. There are 1 billion business users in the world. That’s going to put you at $1 billion in revenue, which would be a $5 trillion to $10 trillion TAM just for the business side.

How do you calculate it? Gavin, do you have a back-of-the-envelope way to answer this question? And if we catch up—or do we even need to catch up—is there enough capital in the world for them to be patient?

Gavin Baker

I think estimating the TAM this early is hard to do with any precision. I think your methodology is as good as any, but we can measure the economic return on these investments. Most of the companies investing these big dollars into AI data centers are public, report quarterly financials, and you can calculate something called return on invested capital. It’s actually gone up since they started making these AI investments, and at first a lot of it was maybe through opex savings. But that is what you would expect with AI: silicon to replace human opex.

More recently, you’re starting to see some really significant accelerations in revenue growth. Meta just reported a quarter with revenue significantly ahead, and I think a lot of that was due to AI—AI making people spend longer and AI improving the quality of their ad-targeting systems such that advertisers get a better ROAS and spend more. But the economic return thus far has been here.

Even Microsoft—I don’t think Copilot is the best product—but even Microsoft, on their call, shared some pretty astonishing stats about Copilot uptake. So I do think the economic returns are here thus far, and that is a good sign because this early in the internet, the economic returns weren’t there.

I think maybe the biggest difference between this and the internet is that a lot of the capital that went in during the internet era, which is often called the tech bubble, was really a telecom bubble. It was deployed into something called dark fiber. That means exactly what it sounds like: fiber optics that people spent tens of billions of dollars laying, and then it was dark because it was not utilized, but there was an expectation it would be utilized.

It’s completely different here with AI, where one of the biggest problems with GPUs and AI data centers is that the GPUs are used so intensively that they melt. So all of the dollars that are going into the ground are being used. We’re not building ahead of demand. In fact, we’re clearly still behind demand.

Jason Calacanis

Which is a really interesting observation, Gavin, because this idea of training a model has no analogy to that in the dot-com era. It’s not like you had to upload all these video files and needed all that dark fiber to do it. It’s a silly analogy, I know, but that also did lead to the dot-com bust.

David Sacks

Ben, the other side is the energy side of this. I think the energy implications of AI are probably bigger than the Inflation Reduction Act and certainly will be longer-lasting. Just to give credit where credit’s due, I think all the stuff we’re seeing on small modular reactors at some level owes its renaissance to AI and the energy demands of AI.

The focus on energy that we’ll get to later really wouldn’t exist except for the hyperscalers giving very specific, concrete, and immediate demands for energy that have changed the energy landscape—probably bigger even than the legislation under the Biden administration. Give an example of what they’re asking for, because you are active and investing in these projects. What was a pre-AI-boom project versus a post-AI-boom project in terms of scale, footprint, and investment?

Ben Shapiro

Well, a quick way to say this—and Friedberg knows this stuff as well as I do—is that Anthropic just released a paper this month saying, “We want 50 gigawatts of power for AI in America over the next 3 years.” That’s about as much power as was added in all of this year. So you’re talking about huge amounts that, in our lifetimes, you’ve basically been able to say electricity-demand growth has been zero in the United States. Now it’s 2% to 3%.

A data center needs continuous power in specific locations, and it’s relatively price-insensitive. The hyperscalers want carbon-free power. They’re willing to pay for it—not because of the government, but because that’s what they want for their workforce. So when you hit the market with 50 gigawatts of demand, much of it clean, that changes a lot in a very exciting way.

For reasons we may get into later in the pod, it’s a real pleasure not to have to rely on the government, be it Democrats or Republicans, as we think about those things.

Jason Calacanis

Fifty gigawatts—that’s a small town. Gigawatt, gigawatt—you say gigawatt?

So what is that? If 50 gigawatts is—

David Friedberg

That’s 5% of the total U.S. electricity production.

Jason Calacanis

My lord.

David Friedberg

I think it’s about what you add a year, right, in new capacity in the U.S.

Jason Calacanis

Yeah.

Ben Shapiro

Meanwhile, China is adding 1 terawatt—a thousand gigawatts—every 18 months.

Jason Calacanis

Well, okay, I want to say one thing about that, David. Where is China getting its gas and coal from? That’s being imported.

Ben Horowitz

It’s imported.

Jason Calacanis

So I get the stat on China increasing things quickly, which I think you’re right on, particularly on the nuclear side, but on the gas and coal side, unlike us, they are looking to others for their source of fuel. I think their biggest add—isn’t their biggest add in hydro right now?

Ben Horowitz

Well, I’m talking about imports versus adds, but the hydro and nukes presumably are non-import-dependent. But the coal and gas—it’s not a great story for them on that side of it. David, by the way, my understanding was that by far the biggest source of China’s incremental electricity was solar.

Jason Calacanis

There’s an interesting chart. This is China’s solar surge. This comes from Bloomberg. China added more panels last year than any other country has in total.

In other words, they added more than the U.S., India, Japan, and Germany added in 1 year. That’s a 2023 number. I think 2024 took a massive jump.

Ben Horowitz

I think you’ve got to be a little careful when you say where the electricity is coming from and what the additions are. The U.S.—our additions are something like 80% solar and wind, but the installed base is under—

David Friedberg

Oh, no, for sure. It’s additions, for sure. But they’re bringing on a lot of power every year relative to the installed base in the United States, and a lot of it is solar.

Ben Horowitz

So here’s the question, David, Jason, and Friedberg. Here’s the question that I would have asked Secretary Wright: Do you care about that slide? Because if you care about that slide, then you would have done different things than the One Big Beautiful Bill. You might not care about that slide, but we’re certainly not attacking the problem on that slide as well as we could be.

Jason Calacanis

Right. And they’re also putting in 150-plus nuclear reactors in some state of deployment. We’ve talked about that here countless times. So, circling back to you, Ben, winning in AI: Do you consider that existential for America? As somebody who’s not in the industry, when you hear this discussion that we had in D.C. last week, and when you hear technologists like ourselves, who obviously are investing in this—this is our book of business right now—do you think we are in an existential race for humanity to win the AI race with China? Or do you think that’s a construct? Maybe everybody wins, and it’s not an existential race where one person wins and the other person loses.

Ben Horowitz

Well, as you might imagine, I’m definitely in the existential-race category. I just look at how China has utilized TikTok as a SCOP weapon in a myriad of ways, gathering data and putting out its own propaganda at scale. Think about how they would do that with control of the tools that everybody uses in all their businesses. That’s putting aside the military connotations.

I was talking to my friend Mike Gallagher, who was a congressman on the subcommittee on China and who’s now over at Palantir doing policy. He was pointing out, correctly, that China’s capacity, if they win the AI race militarily, is going to explode. That’s going to mean an awful lot for things like freedom of the seas, for our allies, and for America’s economic dominance in the world.

That opens up a whole can of worms as it relates to the Trump administration’s policies with regard to Nvidia and what kind of chips we should be allowing Nvidia to ship over to China.

Jason Calacanis

Which we’re going to get to on the docket in a moment. Interestingly enough, did you gentlemen see the Luckin Coffee announcement in New York City and the socialist reaction to it, by chance?

Nobody saw it? Okay, so people are not spending too much time on TikTok. TikTok has a bunch of young socialist New Yorkers in communist T-shirts going to Luckin Coffee and talking about how Starbucks are capitalists, and that they’re glad the Chinese company Luckin, which does $2 coffees, has come to America to destroy the American companies Starbucks and Dunkin’, because communists know how to do capitalism better than Americans. That is the central position in my hometown of New York City right now.

Here's the TikTok. It's hilarious. Watch this. Pull this up for a second, Nick. It's a worthy diversion. There's some red meat for you guys.

Guest

“Get a $2 cup of communist coffee. So this specific coffee shop has more locations in China than Starbucks does. Okay, I'm going to come back to make a video there later. But no, this company went through a $300 million accounting scandal where they faked their profits because capitalism sucks. And then they started paying their workers and putting the money back into the coffee and what actually matters. And now they are more successful than Starbucks.

“Back in SoHo. Of course, this location is right by the NYU campus. Should have paid your workers.”

Jason Calacanis

All right, I think we get the idea. I have a new theory, Ben. I do agree with you on the existential threat of that competitor. They're going to try to beat us on capitalism and then use brands like Apple and Google to defeat us.

BYD is producing cars now for half the price of American cars, and they’re shipping them on their own shipping containers. Luckin Coffee is infecting the U.S. now. And I had a third example. Oh, and TikTok—the example you just gave—competing with us and using that. What do you think of my theory, Ben?

Ben Horowitz

No, I think that that's totally right. And the truth is that what you're talking about in China obviously isn't communism. It's state-sponsored corporatism. You can pour extraordinary resources into one path-dependent part of industry, and you could outcompete in coffee if you decide to subsidize that at extraordinary cost and then undercut the rest of the market.

This is one of the things President Trump is totally right on when you talk about the tariff wars. I've always been in favor of tariffing the living out of China. I think that's actually quite right. My problem when it comes to the tariffs—I know I'm jumping ahead in the docket here—is that if you're going to do it, what you really ought to be doing is boxing in China with free-trade networks with literally everybody else and excluding China from that network.

You have to do all the preliminary steps before you box in China. Otherwise, China is able to sort of climb out the window, which is, I think, what they've done on everything from Nvidia chips to TikTok to their actual tariff rate, which I believe is now lower than the tariff rate we have against Canada.

Jason Calacanis

Let me bring it to you, Friedberg, because I think this is a super interesting discussion. Our bestie Bill Gurley has a position that, hey, everybody can win. It's not an existential they-win-or-we-win. I mean, obviously, it's a competition, but there could be many winners. What's your take on all this, Dave, if any?

David Friedberg

Well, I'm in the place, like I've said before, that it's kind of like, who's going to win the internet if we said that back in 1996? No one, quote, wins the internet. It's an open standard. It's a platform. It's an evolution of access for markets and productivity for the world. I think AI is very similar.

I don't think that there's this concept that you end up in some sort of state of superintelligence that perhaps reigns supreme and creates superiority, but there are many vectors of competition. So within drone warfare, as an example, there's going to be a massive vector of competition. It's pretty clear that remote autonomous devices are going to be the front lines in battles going forward, and China has both a manufacturing productivity and materials advantage over the United States on that front.

So it's not about having the best model; it's about having a supply chain that can support their ambitions in warfare. And similarly, in economics or in business, there are many dimensions upon which we're going to have an advantage over China, and China may have advantages over us that are going to be enabled, accelerated, and magnified by tools and AI. Actual models, I think, are going to be this continuously evolving set of systems that it's unclear where things are going to head.

But to bring up your point, I do think that the CCP has a unique ability to throttle up and throttle down entrepreneurship to drive productivity in that nation. When they throttle it up, you end up seeing massive gains in individual capital accumulation, which is counter to the Communist Party's intentions. And so then they throttle it back.

As you can see in this image from the Financial Times, this shows the number of companies founded in China by year. It peaked in 2018, which, by the way, aligns pretty well with the peaking of venture capital investment in China from the United States and from VCs around the world. Then it began its rapid decline because there was a set of policy changes, and you guys may remember Jack Ma disappeared and these other sorts of things happened around that time.

And so there's this challenge to the CCP that resulted in them throttling back entrepreneurship. I don't think you can have massive, true, natural-market progress without having entrepreneurship, without having a more free market. And so they are, I would say, rate-limited at this point by this particular chart in terms of their competitiveness.

We can argue about their resourcefulness and their ability to do central planning and central command of the economy, but at the end of the day, much of what brought the Chinese—there was a great podcast on this by the guys from the Brookings Institute years ago, where they talk about what got China out of poverty, where their GDP per capita went from whatever it was, $3,000 to $30,000 in a very short period of time.

And it wasn't the government's central planning. It was the entrepreneurship of the peasants and their ability to self-organize and self-mobilize, build businesses, and create better productivity from the ground up. It was the individual Chinese citizens that drove that economic boom, not central planning. Central planning had some enabling factors, but that was really important. And so I do think one of the challenges ahead is this entrepreneurship suppression that's manifest.

Jason Calacanis

And I'm sure you have a point on this.

Yeah. Well, I was going to say, Gavin, the East-West Conference that our friends at KOTU do was named after this really amazing boom period we had 15 to 10 years ago, before Americans were not allowed to invest in China. And not only that, American companies had to basically divest. They shut down in China all the education companies that were venture-backed and nationalized those. Jack Ma went for painting lessons, et cetera.

He's an incredible painter right now, by the way. Some of those oil paintings, I think, are going to be much bigger in their impact than Alibaba. But Gavin, you would—I think—agree that we had an investment in China. We were on a really great track that got shut down.

Do you think when superintelligence comes, that that is the race? Because we're looking at general intelligence—a lawyer, an accountant, a developer—but superintelligence, I think, is where people get to the existential piece.

Gavin Baker

Yeah. Well, they for sure believe it's existential. I have it on good authority that if you work for DeepSeek, you are not allowed to be in the same room as an American while you're in China, and you have a kind of CCP minder with you most of the time. And that's astonishing.

They believe it's existential. The second thing I would say is, I do think they are making an effort to throttle it up. Xi Jinping had a dinner with 20 entrepreneurs. I think Pony Ma from Tencent was there. The DeepSeek CEO was there, but they kind of gave pride of place to the people who were making physical goods plus DeepSeek and maybe deemphasized some of the social networks.

And the last thing I would say—just a stat that builds on what David just said about how entrepreneurship amongst rural Chinese is what jump-started China's economy: I think towards the end of the Soviet Union, they could not produce enough food using socialist systems. So they let 2% of the acreage in the Soviet Union be more entrepreneurial and self-organized, and that 2% of the acreage produced a majority of their food. It just shows the superiority of capitalism to socialism in a world in which there are resource constraints.

Jason Calacanis

What's better, Phil? Capitalism and democracy, or capitalism and communism? Long-term, I think we would all agree we have the winning combination. I hope. But in the short term, this sounds like an incredible advantage to put your finger on the scale and say, “Hey, BYD cars can lose money forever. We just want to kill the American car industry. We want to kill the German car industry.”

Phil Deutsch

Well, first of all, nothing can lose money forever. But the one thing I think is implicit in what Dave and Gavin said is you need rule of law. You can't just have innovation. You need rule of law. And it's yet to be shown that China can do that in a way that will create long-term success absent the government propping it up.

I'll give you an example. We've had factories in China, one making wind blades, and basically every day was a renegotiation on terms, no matter what you wanted to do. And if you didn't control the chop—the thing that made the stamp—you didn't actually control the factory. That is not a long-term recipe for success.

I think eventually, no matter how strong the centralized government is, you've got to have rule of law if you really want to see decades and decades of innovation.

Jason Calacanis

Okay, Gavin, go ahead.

Gavin Baker

I 100% agree.

David Sacks

You need rule of law. It's essential for any system of government, and particularly for capitalism. In some ways, capitalism is the rule of law with private property.

Going back to 2018, which was kind of the glory days for China, these internet entrepreneurs were working. They did create the only internet companies that were capable of challenging American internet companies, not just in China but globally. Obviously, most American internet companies aren't allowed to participate in China.

But the problem was that those CEOs became so powerful that they started to feel comfortable challenging the CCP. Jack Ma made some comments in 2000—I don't remember exactly when—that were just vaguely critical, and that was it. Then he disappears.

Jason Calacanis

Okay, Gavin, can we stop with the—hey, wait. Hold on a second. Pull up my—hold on. Pull up this picture.

You keep saying he disappeared. He opted to oil-paint this beautiful painting, which went at auction for $5.4 million to an environmental nonprofit. I mean, he didn't just disappear for saying that the old people in the government were a little old and didn't get it—I think the quote was something like that.

Ben, you've been a little quiet here, but politics is your wheelhouse. Question for you: We've seen a centralization of authority in the federal government, and we're sitting here talking about how central government plus capitalism doesn't work as well as rule of law.

Do you worry sometimes that Biden wanted to use executive orders to do the student-loan thing, and Trump obviously has taken tariffs? There's a big question—my understanding is that tariffs are supposed to reside with Congress, and there's a lawsuit about that. Maybe that goes back to Congress. Trump has been centralizing; Biden was centralizing. Even Obama was centralizing and consolidating power.

Is that necessary for us to compete? Because we're seeing overtures like that. Even at our AI summit 2 weeks ago, there was this point that Sacks has made on this podcast and the president made, which is that we have to have federal AI legislation. We cannot allow the states to have any say in AI, the most important technology in the world. I'm kind of torn about that, so I'm curious what you think of centralization occurring here, and then the bigger picture with China.

Ben Shapiro

Yeah. I think that when it comes to the bigger picture, the temptation in politics is always to look at corporatist states, which always get out of the box really, really quickly because they look good. You mobilize an enormous number of resources on one target. What capitalism does, of course, is allow you to mobilize extraordinary resources across a wide range of targets. Corporatism allows the government to put all of its resources toward one target and one target alone. If you're just looking at that target, it looks great at the very beginning.

This is true for Italy when Mussolini took over. This is true, actually, for Hitler's Germany at the very beginning. Economically speaking, when you're seeing extraordinary rates of growth, corporatism starts to look really good, particularly in a messy democratic system like ours, where the human beings at the top don't have full control.

One of the things that's frightening to people like me about AI is that you're seeing such a consolidation of AI. There is extraordinary spending, but that extraordinary spending is relegated to a relatively small number of companies. Not just that, but you're seeing so much spending going to one thing.

In the race for superintelligence that you're talking about, China clearly sees this as adversarial. Gavin is totally correct: If they get there first, then corporatism wins. The temptation is to imitate that from our side. Maybe you do have to imitate that. Maybe it's more like the Manhattan Project for AI than it is like a market-driven thing if you actually see it as a true existential threat. We should treat it more like a military program than like anything else.

I think the temptation is to extend that across the rest of the economy—to industrial policy, to steel and copper tariffs, to everything else. As far as the federal AI versus state AI thing, I think that may be slightly a red herring, just because what you're really talking about there is not the federal government usurping state authority. What you're talking about is the federal government trying to preempt state authoritarianism.

I think what David is pushing is the idea that the federal government ought to prevent the state of California from filling the field with some really bad AI legislation that essentially destroys competition among all the various players.

Jason Calacanis

Go ahead, Friedberg. Get in there.

Phil Deutsch

I have a question as an investor, not a policy guy. I don't quite get the Democrat versus Republican debate on how they give support to the private sector and what counts as picking winners and what doesn't count as picking winners.

When I look at this administration and the previous one, I think they're both very activist. They both seem to pick winners and losers, and I feel like that distinction has been lost a little bit. One had the IRA, but the other has rare earths or this or that. When they switch like that, it's very hard to know where solid ground is as an investor.

Ben Shapiro

Listen, I totally agree with you on that. I do think that the centralization of power in the federal government and the choosing of winners and losers over the course of the last several decades has actually been really denigrating for private industry.

I would prefer that nobody was picking winners and losers, but if you basically are now relegated to a choice between the winners picked by the Trump administration and the winners picked by the Biden administration, from a political point of view, I'm going to pick the winners picked by the Trump administration. I think they're doing a better job picking the winners.

But on a principled level and at a general market level, I prefer that nobody be doing these sorts of subsidies. I don't like industrial policy. I don't like centralized planning and central industrial policy this way. I think I would agree with you almost 80%.

David Friedberg

I disagree with both of you a little bit. The subsidies, while they may have benefited those 2 particular industries, created a financial disincentive for investing in nuclear. So there's always a loser, and the loser isn't always necessarily the target.

The target was oil and coal—or oil and gas and coal, or whatever it was—carbon-based energy systems. The target, when there were subsidies for solar and wind, was to accelerate these deployments and get this market to start moving.

It does 2 things. One is that it doesn't force a natural market dynamic where you ultimately have to get the cost of solar, or the cost of wind-turbine production, low enough that it makes economic sense from an ROIC basis that investors would natively want to make that investment. They're making the investment because the government is paying half the cost.

The second thing is that it then makes nuclear noncompetitive. Therefore, the R&D investment dollars that were supposed to go into nuclear, which would have allowed us to accelerate to Gen 4 systems—which, by the way, China has now done—went away. Now we are several decades behind where China is with respect to nuclear, which is ultimately the most scalable energy-production system we have.

Jason Calacanis

Friedberg, go ahead, and then I want to get through a couple of the charts you took the time to put together here as we wrap energy. Before we go into energy, I do have a politics-related question I would love to pose to Ben, if that's okay.

David Sacks

Yeah, please.

Jason Calacanis

My parents were visiting me for the last week, and we had a lot of lively political debates. This trend of the imperial president in America, which I think really accelerated with Biden and now is further accelerated with Trump—my parents' hypothesis, which I think is correct, but I'm curious for Ben, is that this is a function of the fact that Congress, by and large, can no longer effectively legislate.

Every once in a while, they'll do the IRA or the One Big Beautiful Bill, but by and large, Congress is not doing its job. So for 30 or 40 years, a lot of the governance was done by the judicial branch. If we have to choose between being governed by the judicial branch, which is unelected, and the executive branch, which is at least elected and accountable, I would rather have an imperial president whom we can judge and vote out of office than an imperial judiciary.

Just curious for your thoughts, Ben.

Ben Shapiro

Yeah, I obviously think that's true, but I think the trend goes back more than a few decades. If you're really going to go to the deep roots of this, you have to go back to the roots of the administrative state in the early 20th century, because the reality is that the reason you have an imperial presidency is because the federal government just does way too much.

The federal government is just way too big. They're way too intrusive. They're way too powerful. Once that becomes a giant grab bag of cash, whoever controls the federal government wins. If you're a legislator and you can kick all responsibility for your policymaking over to some unelected bureaucrat in the executive branch, that's precisely what you're going to do.

The founders planned for ambition checking ambition. They never really planned for people trying to kick responsibility from one branch to the other. They thought Congress was going to defend its own prerogative against imperial overstep by the presidency. Instead, thanks to the administrative state, congresspeople and senators started to realize, “Hey, what if I just pass a very vague omnibus package and then kick it over to a bunch of regulators? The regulators do all the work and take all the heat, and I can go back to my hometown and tell them how much money I brought home.”

Jason Calacanis

Yeah, it's fascinating. And when you kick it back home, I don't know if you guys saw this town hall that went explosive. There have been a number of them. Ben, you must have covered it.

Ben Shapiro

While you're pulling it up, I do want to say that I think we don't want to throw the baby out with the bathwater. That is to say, the government, and a number of government employees and career civil servants, are doing God's work, whether it's on safety, defense, or intelligence.

What I don't love is the tone of criticizing lifelong government workers when none of us would really do that job at the pay they're taking. I don't mean to make it—let me not say the people on this call, because I don't know you as well, but many of my friends and I do think there needs to be a beat for those people who are doing incredible work for little or no recognition or pay. We can't paint with too broad a brush.

Jason Calacanis

I'm not blaming you about that. I just say we don't hear enough of that. I'm not blaming the bureaucrats who are there and are given responsibilities to do a thing. I'm blaming Congress for having kicked them the authority in the first place.

If you're going to place blame with somebody, you have to give it to the branch that actually abdicated its duty and decided to construct an entirely different branch, then threw off all accountability. What's the solution there? Is it the America Party doing what the Tea Party did, getting a couple of Senate seats and a couple of House seats? The America Party, I guess, is what Elon calls it—not the American Party—saying, “Hey, you know what? Forget about the presidency.”

Elon did that, and it worked pretty effectively. I think we'd all agree he had a significant, if not the deciding, factor in getting Trump reelected—probably also something to do with the other candidate the Democrats ran. Putting all that aside, if the America Party or another party were able to secure a couple of Senate seats and a couple of House seats, could that reverse this trend, where maybe the House takes back a little responsibility? In your mind, Ben, is that a strategy worth pursuing for moderates?

Ben Shapiro

I think this is not going to get solved at the federal level. I think what's actually going to happen is that the federal government is going to lock up, and it's going to be essentially rotating elected quasi-dictators until the end of time. Except that the American people are going to be unhappy with that, and you're already seeing more authority being taken up by state actors, which is why you're seeing a necessity for things like federal legislation on AI to preempt the states.

You saw this over the course of the Biden administration. I moved from California, which is obviously a very left-governed state, to Florida, which is very right-governed state, but the differences in governance are massive. You're seeing governors pick up the mantle and say, “Okay, well, the federal government is unworkable. They're not doing what we want them to do, so we're going to do our own thing down here. We're going to challenge the federal government in a wide variety of ways.”

I think that's actually the proper solution. That's a reversion to what the founders wanted in the first place, when the federal government was essentially so small that you could walk into the White House and just talk to the president, and state governments were the ones with the vast majority of authority.

For the America Party, what I would love to see is, instead of trying to take over the federal government, trying to take over some state legislatures. That's actually an easier lift in some ways. Try to win a governorship. Try to actually do some of these libertarian-minded policies at the state level, which is where most of the power resides, and then bleed that up into the federal government as an ethos.

Jason Calacanis

It seems to me like nobody's happy. If you missed it, there was this crazy town hall. It occurred in Nebraska, and everybody was upset. Friedberg, I wanted to make sure you saw this. I should have sent it to you earlier. I'm not sure if we talked about it in the group chat, but you had people who were at once upset in Nebraska about the government spending too much, then about the Medicare cuts and Medicaid cuts. People were universally, on both sides, absolutely infuriated at the state of affairs. Nobody's happy now.

Friedberg, your thoughts on this? You kind of predicted the socialist side.

David Friedberg

It does feel like my prediction will ring truer than any of us hope. Socialism will sweep over this nation, I fear, and I think it's a cancer. It's going to be worse than what we saw with woke stuff. It's going to be just like, “I'm losing out on everything.”

People are seeing stagnant wage growth. There is no one in the United States, including wealthy people, who hasn't taken significant notice of the increased cost of groceries and the increased cost of buying home goods. Jason, I'm assuming you must have noticed as well how much groceries have gone up in price. Everyone's rent goes up every year.

There was this TikTok rant that went viral this week about a woman who's like, “Why does my rent go up every year? My salary doesn't go up.” We're in this really difficult moment because of what Ben pointed out, which is that we've basically funded the government to do everything for us.

By my calculation from last year, I think nearly half of Americans are employed directly or indirectly by the government at this point. As a result, because of the inefficiency of government allocation of capital, everything inflates in cost. We're entering this era where some people make the joke that the train has left the station.

Chamath Palihapitiya

I just want to say one thing to David. I still think when it comes to innovation, rule of law, capitalism, and freedom, we are the best at it.

Jason Calacanis

There's still gravity, Friedberg. At the end of the day, arithmetic is arithmetic. When Jimmy Carter lost the presidency, there were 12 years of Republicans, and then there were Democrats.

It may be that the left—let's say the left side of the Democratic Party—wins for 12 years, David. Maybe. I don't think socialism ever takes over the United States. I don't see that, but if you want to see that, you can. It will swing back. This country is incredibly resilient, and I have complete faith in that resilience. I love the optimism.

Hold on. Let me just get these 2 charts out of the way real quick. Finish up the energy charts here, and then we'll continue the discussion as we pivot over to tariffs, which is obviously related to all this.

All right, all right. So, Dave—David—

David Friedberg

Yes.

Jason Calacanis

I want to go back to this because I can't emphasize enough how much I love you and think how smart you are. I also think the last argument regarding the idea that the subsidies that went to wind and solar were at the expense of nuclear is nutty. Let me tell you why.

The issue with nuclear—and you say this so wonderfully on China—the issue with nuclear is regulation. What Ben was saying is that we're stifling innovation there, and we've got to figure out a way—and I think the secretary of energy and the president have done a great job of this—to rationalize the regulatory framework around nuclear power.

What bothers, what hurts nuclear, is not its cost-per-kilowatt-hour subsidy; it's the massive amounts of bureaucracy around it. If you were to give the nuclear power industry 5 or 10¢ a kilowatt-hour, that doesn't help them with their big problem. Wind and solar, that's what you gave them.

The sizes are different as well, and one is a distributed resource and the other is centralized. So I guess what I'd say is I don't think we have to treat them the same. I'm 100% with you that we should be subsidizing nuclear power. It's clean, it's baseload, and it's reliable. We could do small modular reactors. They can be used for data centers. All of the above.

We don't have to pit our children against each other. In this case, they really aren't against each other. And the chart you're showing—explain the chart you just showed.

Sorry—why should we? And then I have a second question for you, which is, why should we subsidize nuclear when we have hundreds of billions of dollars being spent by the most powerful megacompanies in the world and sovereign wealth funds that want to invest in it? Why do the taxpayers have to pay for that? You can get to that in a second, but walk me through this global electricity generation chart you pulled up here, just real quick.

David Friedberg

So what this chart shows is how quickly electricity has come on from solar—the growth rate of solar. Actually, Jason, there may be a ChatGPT chart on the uptick in AI, but what you see is the yellow, the hyperbolic growth of solar.

This goes to the fact that it really has been a success. Costs have come down about 80% or 90%, and it’s beginning to grow. And I agree with David: eventually, you have to have storage with solar. You can’t quite match gas to solar, but we’ve had incredible success reducing the costs of solar and wind, and incredible growth. That’s what the result of those incentives has been. It’s been successful that way.

Jason Calacanis

Now, the second chart here, the OBBBA chart.

David Friedberg

Yeah, the OBBBA chart. This just goes to show that when you take away incentives, you lose some generation. The point of this chart is that if we really need all the energy we can get for artificial intelligence, and if the race in artificial intelligence is the race for national security and dominance in the world, this is saying we’re taking a step backward on this supply.

Again, it’s not either-or, David. I would say, do as much solar and wind as you can, as many SMRs as you can, and do as much energy as possible to make us a dominant player in artificial intelligence, as well as in other things.

Jason Calacanis

Your response?

David Friedberg

Sorry, that’s what I’d say.

Jason Calacanis

No problem. Sacks, your response?

David Sacks

So again, I think the point I was trying to make, Friedberg, is that by driving private-market capital into solar and wind because they’re now subsidized, you get a high rate of return by applying your capital there. You’re not likely to put that capital into the development or extension of nuclear technology.

The lack of investment in improving nuclear technology—yes, you could argue there are regulatory burdens and so on, but it’s largely been inhibited because there have been these other subsidized paths to market with energy. As a result, we missed a window to catch up to Gen 4.

Just so everyone understands what that means, these are very clean, meltdown-proof nuclear energy production systems that are being deployed at scale in China now. The U.S. doesn’t have any, and we have no path to getting these deployed.

Secretary Wright is going to speak at the All-In Summit. He has said at the Department of Energy that, in the United States, we are likely going to have a Gen 4 reactor deployed, or start production, in 18 months. But we’ll see.

We are so far behind because no capital went into it, and that’s because the capital was redirected into these subsidized markets. That’s the disincentive that arises when the government gets involved in markets. The government creates financial incentives that, number 1, create bubbles in those markets and, number 2, take away the incentives for capital to flow to the best path for long-term returns. That’s what’s happened in energy in the United States.

David Friedberg

Yeah. So, in this small modular reactor, Gen 4 space, we, as well as others, have investments there. There’s a great company we like called X-energy. Talk about the bull case there, Jason, but I think it’s fair to say that the money flowed into those sectors when the hyperscalers committed to them and showed they were serious about the demand side from the private sector—and they have been.

There’s also been a catalyst from the administration because it’s had 4 or 5 executive orders trying to get rid of the bureaucracy. So I guess I would say, David, in my experience as an investor in the space, the dollars flowed when the market spoke and the hyperscalers said they wanted and were behind the SMRs. Second, it was further invigorated when, as Ben says, the government took a step back and stopped being a yoke on the industry.

Neither of those things have anything to do with subsidies to solar and wind.

Chamath Palihapitiya

Can I just say one thing about socialism? I thought it was a really important thing that David said—that it’s inevitable. I would just say, to me, so much of it comes down to Mamdani. I disagree with every one of his policies.

Jason Calacanis

Well, admittedly, they’re dumb.

Chamath Palihapitiya

They’re dumb, but, yeah, I mean, they’re obviously stupid. But if you have not watched him, he is an incredibly charismatic, effective politician.

David Sacks

As has been every socialist revolutionary leader.

Chamath Palihapitiya

For sure. But I think the key question will be: unless Adams or Cuomo pulls out, he’s almost certainly going to win. And then, if he wins, does he go through with these policies? Because if he goes through with them, they’re going to be epic failures.

We know what happens when you defund the police. There is a government-run grocery store somewhere in Kansas, and it’s a disaster. These policies won’t work, and I think that’ll be a quick end to socialism.

David Sacks

I disagree with this. I mean—sorry, I’ll finish.

Chamath Palihapitiya

No, no, no. Please go ahead.

David Sacks

Here’s the problem: it’ll take a year or 2 for those policies to actually hit and destroy all of New York. It’ll be like the end of Planet of the Apes, and we’ll all be wandering on the beach, looking up at the Statue of Liberty, asking why we blew it up.

Jason Calacanis

You did it, you mad men. You did it. Shut up, crazy bastards. You did socialism in New York City, the financial capital of the world.

David Sacks

But the bigger problem right now—and this is why this does go to tariffs, it also goes to crypto policy, and it goes to AI—is that the kind of normie in America who doesn’t know that much about AI, doesn’t understand how crypto works, and doesn’t even understand how financial markets work, is right now willing to stand back and say, “Okay, well, I trust President Trump. I trust the administration. I don’t want full-scale redistributionism and government control because things are kind of okay. They’re kind of okay.”

If things take a downturn, the backlash is going to be a lot stronger than anything that any of us can say about the failures of Zohran Mamdani. What it’s going to be is, “Look, the rich got richer and we got poorer,” and it’s going to be a redux of 2007–2008, but with a much further turn to the left than Obama ever was. I’m deeply afraid of that.

Jason Calacanis

So if the market crashes and unemployment goes up, then this exacerbates the problem and makes the point. For a socialist, all you have to do is say, “Don’t you want free X, Y, and Z?” Whatever the popular thing is: a free phone, less rent, free buses.

Chamath Palihapitiya

Cheaper food, free food. And if you fall for it, it takes a while to self-correct from socialism, too, right? This idea that we immediately flip back after we see Zohran Mamdani fail or something—I mean, San Francisco has yet to have a Republican governor. They’ve been trying this crap for several decades.

I’m from L.A. I spent my entire life in L.A. The last Republican mayor of L.A. was Richard Riordan. You can always blame those crazy financiers who got rich and all moved down to Florida to avoid our tax rates, and that’s what’s really cleaning out the tax base of the rest.

David Friedberg

To follow up on Ben, I’m sorry to interrupt, but something that’s really important about what you just said is that it’s not a binary switch that gets flipped: you’re socialist or you’re not.

What happens is that these policies, where you have big-government policies that provide greater and greater economic, financial, and social support to the population, are slow-burning policies. The big policies in the federal government started 50 years ago, and they’ve gotten bigger and bigger.

It’s a snowball effect because, when they’re not working—if I’m not getting enough money in the food stamp program, for example—the solution isn’t, “Hey, let’s cut the food stamp program.” The solution is, “Let’s make the food stamp program bigger.” When rent control didn’t work in San Francisco to bring housing prices down, the solution was, “Let’s get the government to start building housing.”

The solution is never, “Let’s reduce the government’s role.” The solution is unidirectional: get the government to do more to solve the failings of the policies. So whatever policies he does enact, if they don’t work, the answer and the response from that socialist-type movement will be, “Let’s do more. Let’s have the government do more.”

Then you increase the burden on the people because you end up increasing taxation and regulatory burdens. As he said in one of his interviews, ultimately you seize the means of production, and that’s the end goal of his government.

Chamath Palihapitiya

It’s so simple to solve this problem. I hate to make it too difficult here, but if we had super funds like in Australia, and people had direct ownership, and Social Security got retired in favor of people actually being in the market, and we just cracked open the regulations on housing and built much more housing, this would change everything.

The housing issue is so oppressive to this generation, and the cost of their education is so oppressive now. They’ve opted out of education. They’re starting to look at it and say, “I’m going to UT. I’m going to be in a state where I can pay $50,000 in total for my degree.”

So young people are getting smart about this, thank goodness. They’re going for trade degrees, where plumbers and electricians are making $150,000 a year.

Jason Calacanis

But you have to solve housing. I have watched this so acutely in my move to Austin. I suppose, Ben, when you moved to Nashville and Florida, you saw the same thing with your teams. When people don't have to spend 60% of their nut on their housing, their anxiety level goes down massively. And when they feel they have ownership in a home, it goes down massively.

Why can we not fix this problem? Why doesn't either president just say, “I am going to make housing my thing when I run for president”? PresidentJason.com: “I am going to just make housing my thing. We're building 10 million homes, and the government's going to build 2 new cities, and we're going to make housing affordable.”

Ben Horowitz

Although I have to tell you, one of the things I think this goes to is a deeper malaise, actually, and this is maybe just a human problem. One of my favorite charts—it's a sad chart, but one of my favorite charts with regard to the American populace—is geographic mobility over time: how much people move. What you actually see is that this has wildly decreased in the United States.

There's this impression that everybody, now because you can get on a plane, can go somewhere and get a truck and all, but no one moves now. People basically—I think one reason is because originally people were moving from rural areas to cities, and now they're in the cities, and so they sort of stay in the cities. But I think part of it is also, again, because of those government-dependency programs.

Once you feel like the government is going to step in and solve your problem in New York, as opposed to you having to go across a mountain and live in a cabin somewhere, then you tend to stay. And you do that enough, broadly speaking, on a federal level, and what you end up with is people who really believe—I think the vice president has said a lot of things, but he made a statement in his RNC address that really forcibly struck me—which suggested that the American dream was to live and die where your grandparents lived and died.

And I thought to myself, that actually is not traditionally the American dream. That's kind of a European dream, actually. The traditional American dream for most people was to cross an ocean and go to a place you don't know. If that doesn't work, cross a mountain and build—I mean, de Tocqueville talks about this in Democracy in America—that Americans were famous for basically building these kinds of ramshackle huts, trying to set up shop, and, if it didn't work, they would just abandon it in the forest and then move on to the next place where they could build a ramshackle hut and try it again.

And so that sort of innovation and entrepreneurship, and this idea that you have to move in order to succeed, and that you might actually have to move from the city that you grew up in and go find a job somewhere in North Dakota—

I was asked a question by one of my listeners recently, and they said, “Well, you know, you're always talking about this stat that there are more open jobs than there are people applying for the open jobs, but what about me in my industry?” And I was saying, “Well, yeah, but it doesn't apply to every single industry. That's an aggregate statistic.”

So when you talk about job mobility and people being able to stick and move and change what they're doing in the marketplace, if the American people don't keep up with that, and if they're unwilling to move to places where the real estate is cheaper, then you are going to get more expensive real estate. Maybe you can build your way out of that, or maybe you can't. But it used to be that if you had a problem with the housing prices in New York, you moved somewhere else.

Jason Calacanis

Yeah. You went to San Diego or something. You pioneered a new area. I'm seeing that among a lot of young people, and they're getting the benefit. Let's talk about tariffs. We'll get into the more specific, granular ones that we've been dealing with over the last 10 days, but big picture, here's what's happened.

It seems the Trump administration has done what they said they were going to do, and we'll talk about the ramifications of this, but tariff revenue was up to $30 billion in July, $127 billion so far in 2025. Obviously, this is 3 months of data, basically. Here's your chart: in June, the trade deficit shrank to $60 billion or so, and that's the lowest since June 2023.

Now, by doing this, of course, inflation, which is a trailing indicator, could pop up at any time. We've seen a small tick, like 10% up in inflation, and if we cut rates in the September, October, November time period, and maybe 50 bps comes off this, inflation is definitely going to go up. People have more money; more investment goes around. We'll probably see a 3-handle again. So we're going to trade one for the other. Thoughts?

And here's your Polymarket. We made a Polymarket here on the pod. How much revenue will the US raise from tariffs in 2025? Right now, it's looking like the number is $200 billion to $500 billion. 86% of people believe that will be the case.

And then here's ours. I had said, “Will tariffs generate greater than $250 billion in 2025?” We're sitting around 15%. Maybe this is free money in this Polymarket. That was one I created. Gentlemen, who has an opinion on the tariff policy and the revenue it's bringing in?

David Sacks

Well, it's going to be hard to get to that number just because the tariffs only really kicked in in the middle of the year. $30 billion—that's $360 billion annualized, right? Bang in the middle of the estimate, but you didn't have a lot for the first 6 months.

Jason Calacanis

Yeah, maybe you hit the low end of that with $30 billion or $40 billion for the last 6 months, but for 2026, that does seem reasonable: $250 billion. We're halfway there. We're at $125 billion. So we'll see if they can keep it up and then what the impact is. Phil, what are your thoughts on this tariff policy and the revenue it's bringing in? Is the juice worth the squeeze?

Phil Libin

Well, I assume the president would say he already hit it because he got 500 from the Japanese.

David Sacks

Reports have come out that the Japanese perceive that as a loan, maybe, or that they're going to invest in it. So maybe—and none of that has been officially papered. Both sides in the EU deal were also handshake, so let's keep that in mind. These things still have to be papered. And then there's this potential that tariff powers could reside in—

—the House, and Trump will not be able to do any of this, and it all gets reversed in our very polarizing time.

David Friedberg

So I'm just going to speak about the part of this that I have a little bit of understanding on. Let's say you tariff solar panels coming from China. You could do that for a variety of legitimate reasons—equalizing playing fields, et cetera. But you are, at the end of the day, increasing your energy costs.

So to me, what I struggle with is that globalization, throughout my lifetime, has been a net plus to the world and the United States. We've now increasingly focused on supply-chain security at the expense of globalization. I don't know, and I'm not smart enough to know, whether that's a long-term good trend. And so that's what I can't quite play out of my head.

Jason Calacanis

Well, no, in fairness, nobody knows. This is a complete reversal of what we've done. Ben, your thoughts?

Ben Horowitz

Yeah, I think there's a lot of triumphalism a little bit early on this policy. Give it 6 months and see where we're at. I think one of the indicators that's fascinating is the lack of inflation, because obviously a lot of people were expecting inflation to pop as soon as the tariffs hit, and it hasn't. There hasn't been a lot of time.

But one of the problematic indicators is maybe inflation didn't pop because demand dropped. And so what you're actually watching is a temporary spike in the kinds of revenue that are coming in via the tariffs because it's almost a 1-time expenditure, and then demand is going to drop. What you will see is the tariff revenue coming into the country go down, demand dropping, inflation coming down, and that's when you will see the Federal Reserve step in and lower those interest rates in order to artificially juice the economy.

I understand, I think, kind of what they're trying to do. I think they're trying to do multiple things at once, some in conflict with one another, because you can champion the amount of revenue we're raising off tariffs, but you can't do that at the same time that you're championing reshoring. If you reshore, then that revenue is going to go away, presumably, right? You're not going to be buying product from overseas. You're going to be buying product domestically, and then no one is going to be shipping anything here in the first place.

Those 2 things are eventually mutually exclusive. And then if you're doing all of that while attempting to also either box in China simultaneously, but kind of not box in China, it seems very confounding. The thing that I'm getting from most of the investors that I'm talking to is just confusion at this point.

It's just a feeling as though we're kind of riding in choppy waters, and there's no sort of stability or stasis. I'd like to see something—anything—sit for a few months so we know what the hell is going on.

Jason Calacanis

Why is Trump so sure this is going to work, then, in your mind? What's the most charitable interpretation of this, or is he living in a different paradigm, one might say an older paradigm of manufacturing in the US?

Ben Horowitz

I mean, when it comes to President Trump and the economy, he's always been more of a zero-sum thinker than a grow-the-pie thinker. And so when he looks at tariffs, he says somebody's winning, somebody's losing. This is why his tariff rates are based on trade deficits as opposed to actual tariff rates, right?

He was saying, “We're going to do reciprocal tariffs,” and then we looked at that big board he was holding up, and it had literally nothing to do with the tariff rates that Vietnam had on the United States.

Jason Calacanis

It had to do with the trade deficit that we had with Vietnam. It’s why we just hit the Swiss with a 39% tariff, when all they produce, as Orson Welles famously says in The Third Man, is cuckoo clocks. What exactly are we doing here? It has nothing to do with—

Phil Libin

I think they have some chocolate. I’ve never had it.

Jason Calacanis

Swiss watches and cuckoo clocks, right? I think Swiss Miss is made here. If you have that cocoa, you’re the target. So, Phil, you’re in the tariffs. You’re the target.

Phil Libin

Yeah, exactly. But not just nailing the Swiss here. I think one of the things that he thinks is, “Okay, we’re getting back what’s fairly ours. We’re forcing other countries”—and you can see how other countries have picked up on this, which is why you’re getting Japan saying, at least rhetorically, “We’re going to put a bunch of money into the United States,” so he can get a headline and a win.

But it’s not a systems approach to the economy. It’s more of an ad hoc approach to winning individual battles, and I think that’s maybe conducive to short-term headlines. I think there are basically 3 systemic changes that he’s making. 2 of them are good, and 1 of them I have a problem with.

One of them is ensuring low taxes, which, of course, I’m very much a fan of. The second is deregulation—again, big fan. I think both of those are pushing investors to feel some sense of solidity with regard to his approach to business. And then the third is the tariff war, which I think is actually creating a pretty significant dampening effect on economic growth right now.

We’ll say things like, “The stock market is at record highs.” I mean, effectively, the S&P 500 right now—or the Dow, the Dow Jones Industrial Average, anyway—is currently riding at almost precisely what it was when he took office. We’re essentially flat since January.

One way to look at that is to look at all of the insanity—or, to put it kindly, heterodoxy—that’s been inflicted on the economy, and we’re still sort of flat. The other way to look at that is: What if he hadn’t done that? Where would we be if we weren’t in the middle of a gigantic trade war, and he had deregulated and done differential tax cuts? The economy would be ripping—more jobs.

Jason Calacanis

You saw Stephen Moore do this, right? Stephen Moore got up in that presser yesterday and held up a chart showing how President Trump’s economy did in the first term versus Biden during his term. He was saying that median wages were exploding under Trump and weren’t doing anything under Biden. I think there’s a reason why it was not a chart for what’s going on in this term so much.

That’s the big difference between term 1 and term 2. We did lower taxes and deregulation. We did not do a gigantic, historic trade war.

Additionally, India was hit with a combined 50% tariff that’s going to take effect later this month, if it does. A lot of this is fluid. As Ben says on his podcast a lot, Trump says a lot of things. That’s kind of Ben’s rule number 1. Mine is always, “Wait 72 hours and see if it’s still something he cares about.”

25% of that 50% tariff is for what Trump called unfair trade practices. I’m trying to figure out what those unfair trade practices are. It’s not specifically noted. And then 25%—this is super notable—as you know, Trump, Ben, and I, all 3 of us, are in sync that maybe Russia shouldn’t invade democracies. That is a punishment for India buying Russian oil, which is interesting, because he’s now basically taking the Biden playbook: We’re going to provide arms to Ukraine on a lend-lease basis, they’re going to have to buy them, and we’re going to start penalizing people for buying oil from Russia.

I’m curious, Phil or Gavin, what you think of the tariffs overall. Are they confounding to you? Are you in favor of them? Are you willing to see what happens a year from now? And what happens, Phil, if it doesn’t work? What will this do to Trump’s second-term legacy if we’re sitting here a year from now and it doesn’t work?

Or, conversely, if we’re sitting here a year from now and he’s printing money, we’re getting all this incredible investment, maybe some of this money goes to pay down the deficit, or we’re neutral—which is kind of their overall plan. They think these tariffs can help us become neutral in our deficit accumulation.

I’m clearly not a tariff expert, but I would say he does.

Phil Libin

I think one thing about these tariffs—and this goes to David’s point on government and socialism—is that seeing a president take action in a way that’s never been done before, whether it’s DOGE, tariffs, or tweeting, I think, even for a die-hard Democrat like me, is refreshing. And, David, maybe it goes to show that the inevitable creep of government doesn’t have to happen. Even from a Republican, I find that part refreshing. It’s a refreshing thing to see.

The flip side is that sometimes it seems like there’s spaghetti being thrown against the wall, or positions are reversed very quickly, and we don’t know what the long-term effects are. You say, Jason, of course we don’t know. But there are a lot of people—some of your co-hosts—who aren’t willing to concede that we don’t know.

If he’s wrong, and if the economy is in terrible shape in the latter part of his term, the whole world is going to be upside down. I mean, Gavin, I almost think of it as an out-of-consensus view on where this stock could end. If we have a low stock market, high unemployment, and high inflation, then things don’t look as good for J.D. or Marco Rubio, and we’ll be in a different world.

I hope, David, not in a world of socialism, but that’s what’s at stake here. I think, Jason, if it doesn’t work out, then—

Jason Calacanis

Handicap it. Give me the chances it works out and the chances it doesn’t. Give me a percentage, Phil, and then Gavin, you’re giving a percentage.

Phil Libin

I’m going to say 50/50, which sounds wimpy, but it’s pretty damn scary that it’s 50/50 on such big things. I just don’t know what the unintended consequences are. I’m not smart enough to see them.

Jason Calacanis

Well, Gavin, your thoughts? I mean, we are in uncharted territory. We haven’t had a tariff war like this in, I don’t know, 50 or 100 years. When was the last one?

Gavin Baker

I’m sure Ben knows, but it’s actually a higher average tariff rate than Smoot-Hawley now.

Jason Calacanis

So, more than 100 years. Yeah, 100 years. To say we’re in uncharted territory, there’s nobody on the planet who was an adult when that happened. We literally have nobody with firsthand experience here.

Gavin Baker

Gavin, chances this blows up? Chances it’s brilliant? Handicap it on a percentage basis. You’re being forced. You’re going all in. You’ve got to state a specific. I’m not letting you off the hook.

Predicting the economy is a really hard thing to do. I would just say he showed his hand in April. He looked into the abyss, and if it is clearly not working, he showed that he will change it. I think he also learned that other countries—specifically China—do have leverage, especially with these rare earths.

I just worry that business, capitalism, and economic growth do best with stable policy. I think he really enjoys headlines, and something is definitionally not a headline unless it’s a change. I do think, for this to be a success—for his presidency to be a success—at some point we do need stability.

And this goes to what Phil says. It goes to my point about it being better to have an imperial president than an imperial judiciary. If his policies work, great. They’ll be continued. If they don’t work, we’ll try something else.

Jason Calacanis

So, what do you think? 50/50? Are you in the 50/50 camp? Is this going to work or not work? Is it a coin toss for you?

Gavin Baker

I’m inclined to think that he is much more sensitive to the market than he lets on.

Jason Calacanis

So, hold back. I mean, I don’t want to do the TACO thing, because I think that’s used to provoke him.

Gavin Baker

And that’s not smart to do with him.

Jason Calacanis

For sure. I think, just to say, he is thoughtful. I’m going to say—

Gavin Baker

He’s flexible.

Jason Calacanis

He’s flexible. He’s responsible. Thank you. He’s thoughtful about the market reaction.

Gavin Baker

He’s responsive. If it’s not working, he’ll change. The question is, if it’s not working, does he change quickly enough?

Jason Calacanis

Got it. So, you’re speeding down this highway. Can you not go off the cliff? Is there enough room to brake?

Friedberg, your thoughts on this? I’m going to wrap there, and then we’ll go on to our next topic. I’ll give you a final word.

David Friedberg

I’ve spoken a lot on tariffs. I’m good.

Jason Calacanis

You’re good. What is your general sense of the state of it now? It feels like we’re in the endgame.

And then there was one thing I’ll bring up, Friedberg, for your reaction to. He did say, when he was giving his keynote 2 weeks ago—I don’t know if you guys saw it, the one where he thanked me—

David Friedberg

Thanked you by name.

Jason Calacanis

Even “Jason Calacanis, a good guy. A good guy. Meant a lot to my parents.” So I’ll give him credit there. He knows how to work the room.

David Friedberg

Can I say 1 last thing on tariffs? I think it’s actually good as a country that we’re trying them, whether they work or not. It will just be nice to know, you know, and it’s nice.

Tariffs were traditionally a Democratic policy position. Clinton ran on them. Obama ran on them, too, maybe to a slightly lesser degree. They’re generally talked out of them by their Treasury secretary, who generally came from Wall Street.

David Sacks

But they've been an animating feature of political discourse for 30 or 40 years. Now we're trying them. We're going to see if they work, and we're going to see if they don't work. I would say that thus far, they have probably been less damaging than a lot of people expected.

The core reason you don't want to do tariffs is that retaliation was expected. We have not seen retaliation, which I think in some ways validates some of their points of view: We do have a lot of leverage, and we are using it. Other countries are charging America much higher tariffs than we are charging them. Maybe that made sense 50 years ago, so maybe we're achieving reciprocity, which we could all agree on. But he's not abusing them, which shows that the American consumer and the American market are worth maybe getting to reciprocity.

Chamath Palihapitiya

The funny thing about reciprocity is that it sounds good to everyone, but the whole principle of comparative advantage is that maybe you don't want reciprocal tariffs. Nonetheless, we're trying them, and we're going to see. The early returns have been less damaging than people would have expected, because maybe he backed off some of the more extreme things. He's flexible, so we'll see.

Come back in a year, come back in 18 months, and one way or another, we'll have run this experiment.

Jason Calacanis

Friedberg, did you notice that in the speech he gave, he said, “I don't need to know the 180th country”? Maybe we just—it’s the top countries we need to worry about. I kind of felt like—I don't know if you caught that in his talk, Dave—he said, “I don't even know the name of the country. Maybe I don't even know the name of it.”

To me, that seemed like he was signaling an endgame, like maybe he's—I don't want to say bored, but he's milked this one as far as he needs to. What do you think? Did you notice that quote?

Like I've said in the past, he's proven—which is his game-theory-optimal way of negotiating—to be unpredictable. So I'm not going to sit here and predict.

David Friedberg

Okay.

David Sacks

Okay. I think there's a lot of gamesmanship going on that we're not privy to. Again, let's see what happens. I do like running the experiment. I like running experiments in general.

I would love to reduce direct taxation on the American people, but I would also like to reduce the size of government. The thing I most worry about with respect to tariffs is that if they create a new revenue source for the federal government, they give the federal government another crutch to keep spending up.

Jason Calacanis

Yeah. Sovereign wealth fund. Here we come. A little slush fund there.

All right, speaking of trade, NVIDIA GPUs are getting smuggled into China at an alarming pace. According to reports on Tuesday, the DOJ arrested 2 Chinese nationals in California, accusing them of illegally sending tens of millions of dollars’ worth of GPUs to China, which actually isn't that many.

The press release didn't name H100s from NVIDIA, but it mentioned that they were shipping the most powerful GPU chip on the market. So fill in the blank. The 2 were charged with violating the Export Control Reform Act, a felony with a maximum penalty of 20 years in jail. One was a legal permanent resident. The other was an illegal immigrant who overstayed his visa.

Here's how the scheme worked: They operated a U.S.-based company called ALX Solutions. They would buy GPUs in the U.S. and ship them to Singapore. I think Chamath pointed this out back in the day on this podcast. They got a little pushback on it in Malaysia; they were shipped to Malaysia as well, where they would be rerouted quite easily to China.

According to the DOJ, rerouting through countries is common when smuggling chips to China. Despite sending the chips to Singapore, ALX was getting paid by Hong Kong- and Chinese-based companies. These guys aren't the sharpest knives in the drawer.

The Financial Times reported that at least $1 billion worth of NVIDIA chips have been smuggled into China in the past 3 months after President Trump tightened U.S. export controls. The FT says there is a rampant black market for these GPUs in China, and they go for a 50% premium. Gavin, you're in the chip business. What's your take?

Gavin Baker

A couple of things. First, I think it's going to be hard to stop it. We can't keep illegal drugs out of America, and we're trying really, really hard to keep them out. China is doing everything they can to bring these chips in.

When something is so valuable and so important, it's hard to stop it completely. Secondarily, I would just say that $1 billion worth of GPUs is not enough to really move the needle. Even if they are Blackwells, the latest and greatest, it's better than having none if you're China.

It's not like a $10 billion or $20 billion Blackwell cluster, like the ones being stood up all over America by hyperscalers. So I think it's going to be hard to stop. I think it's happening at a scale that is—

Jason Calacanis

It's not comparable to Colossus.

Gavin Baker

Yeah, it's not comparable to Colossus. It's just not going to be decisive in this AI race that China certainly believes we're in.

As I said the last time I was on, I do think it was very smart to resume the H20s, and whatever they're going to call the de-specced Blackwell, letting them be sold into China. The theory is that if you legalize drugs, it reduces the drug trade. That's exactly what we're doing here. We're not sending them our best, and we're not sending them the high-potency stuff.

Jason Calacanis

It's actually a hilarious analogy. It is literally like the H20 or the B20, or whatever it was called. It's like legalizing marijuana.

Gavin Baker

Yes, exactly.

Jason Calacanis

Grand gummy. How about it?

Gavin Baker

Yeah. I just think it is what it is. You'll see these articles, and it's going to be hard to stop, but I don't think it's all that dispositive.

Jason Calacanis

Yeah. Not a—anybody else have thoughts on it?

David Sacks

Seems like a minor story.

Jason Calacanis

All right, we'll end on this. Apple has bought back—let this sink in—$700 billion worth of shares over the past decade. The most innovative product in my mind that they've released in that time is AirPods. Maybe their M4 chips.

This user on Twitter, Charlie Bilello—you know him—tweeted this crazy chart here. We'll pull it up. Here it is: Apple buybacks, Apple shares outstanding. You get the picture. They've bought back almost $1 trillion. Let that sink in: $1 trillion. It's at $700 billion now, and it's not stopping.

That's larger than the market cap of all but 12 companies in the S&P 500. I famously, or notably, said maybe 10 years ago that Apple should buy Tesla for $50–$75 billion, back when Tesla was in dire straits. That was 3 times more than the next-closest company, Google, bought back: $190 billion.

For that money, they could have bought Disney for $150 billion, Netflix for $150 billion, Tesla for $100 billion in 2020, Uber for $100 billion in 2021, Robinhood for under $10 billion in 2022, and BMW, Steve Jobs's favorite car company, for $70 billion in 2020—and still had $120 billion left over.

What would have been the better move: to do all these buybacks, Gavin, as a public-market investor, or to invest in R&D and actually release a car? They had Project Titan. Gavin, what do you think of this Apple strategy?

Gavin Baker

As an investor, buybacks are great, and I think there's often a false dichotomy made between buybacks and R&D. Apple certainly could have afforded to do both, and maybe it would have been better.

What was the stat? It was $1 trillion. Maybe they should have bought back $700 billion instead of—

Jason Calacanis

$700 billion, and it's trending toward—

Gavin Baker

Okay, so maybe they should have spent $200 billion less and spent that on data centers and been a real competitor in AI. I continue to be baffled by Apple's inaction and ineptitude in AI, and by how bad the products are from a user perspective. They're terrible.

Jason Calacanis

They're getting worse. Siri's worse. Siri's worse. How is that possible?

Gavin Baker

Yeah. At the limit, incompetence is indistinguishable from malice, but it almost feels like they're trying to lose.

Jason Calacanis

Literally, if you said, “Here's a playbook on how to lose,” they would have written it.

Gavin Baker

Yeah. They would have thought it was a joke, right?

Jason Calacanis

Yeah. It's astonishing to me, their lack of execution on—

David Friedberg

This is what happens. I mean, if you put Tim Cook in charge and he's a supply chain guy, he's going to do the optimal thing for that.

Ben Shapiro

Yeah, I mean, I'm with you guys. I'm waiting to see when they're going to make something cool again. I'm just an ignoramus on this stuff, and the last time I saw something from Apple that was exciting was many years ago. It's been many years since they brought out anything that excites me as a consumer.

I'm looking at that, and the only headlines I see are about Tim Cook trying to cut a deal with the president to shore up his own supply chain. If he's a supply-chain guy, then I guess that's his mandate: to shore up the supply chain with the president of the United States vis-à-vis the iPhone.

Jason Calacanis

But yeah, if that's the best you're going to do, then I don't know. Things don't look great over there from the outside.

Phil Deutch, any thoughts on Apple and its ineptitude? Is it time for Tim Cook to start thinking about hanging it up and putting a product person in charge?

Phil Deutch

Not my area, Jason. I have to pass on that one.

Gavin Baker

I would say, in fairness, I do think it would shock me if they do not have the best augmented-reality glasses on the market in 3 or 4 years. It plays to their strengths, and maybe they feel like that's what they're focused on. Eventually, they'll cut a—

Jason Calacanis

When was the last time you heard them bring it up, though, Friedberg? When was the last time Apple Vision Pro was even brought up in a keynote, or you saw a demo? They seem—

David Friedberg

Those are VR, not AR. I think—

Jason Calacanis

But their eventuality is to be AR, right? You can turn them on to see through them, I guess.

Yeah, and that's actually an interesting point, Gavin. You and I are sitting here like, is it AR or VR? Because they're just not talking about it. Where's version 2 for developers? Go ahead.

Gavin Baker

Rumors of Apple's demise are 30 years old. This is every year: the same story—lack of innovation, copycatting. Where is it? The iPad came out.

Jason Calacanis

Somebody said that under Steve Jobs there was a lack of innovation when Steve Jobs was running the show.

Gavin Baker

Even during the Jobs era, when the iPad came out, I don't know if you remember how controversial it was. They were making fun of Jobs: “He's lost his luster. What is going on with this guy? Total flop.”

They made fun of the iPad. They called it the Maxi Pad or something. You remember all that stuff? It was like, “Who the hell's going to use this thing? It's a total disaster.” All of a sudden, they sold 10 million units, then 100 million units, and everyone's like, “Holy—” I would not count Apple out. There's a system there that's built unlike any other in corporate history. Let's see what happens.

Jason Calacanis

Yeah, I think that's right. They have every right and ability to win. They just need to start trying.

I mean, the fact that you're not even in the running and they're losing talent—they're losing talent.

I tried Apple Vision Pro in February 2024, and that's literally the last time that I tried it. There was that hot moment where everybody was like, “Let's try this thing out.” It's like, “This is pretty cool.” And then you're like, “Yeah, but I'm also wearing a medieval helmet.” We've got to—and we all agree it's got to be sunglasses.

I bought the Ray-Ban Meta glasses and used them on my recent trip to New York. It was quite compelling to wear them and livestream, or to wear them and take pictures and video of the kids. We took the ferries. It's a really nice ferry system in New York now that they've kind of brought back, and we took the ferry around the island and did a couple of things. It was really nice not to have people pose when you're doing a video.

If you have kids, I think it's the must-have product because it's so elegant to just boop. And then, if you look at something, it will tell you what it is. So the AI plus these glasses is going to be phenomenal when you're looking at a monument and you say, “Hey, tell me about Ellis Island. Tell me about Governors Island,” and it just starts reading you facts. I think it could be magical. But—

David Friedberg

Jason, the one thing is, if you take your ranch, you may have a backup generator, solar, Powerwall, EV, grid—everything. Eventually, someone's going to want to control all that, make it easy for you to control it, aggregate it. There's going to be a whole infrastructure in the U.S. around this, and that's something you could see Apple coming to. Absolutely. Apple Home.

Jason Calacanis

Yeah, that's actually a brilliant one. I don't know if you saw this, Phil. You must have, Phil. There are smart panels, circuit breakers. Have you seen these, where you put it in and then you take out an app and each of your breakers is in the app, and you can see, breaker by breaker, your energy consumption? You can turn them on and off.

That felt to me like something that should be in the Apple wheelhouse, as well as Sonos, but they just don't like to buy stuff.

Well, one thing is, when you take the number of cars that are going to be in the country—the electric EVs—and then you multiply them, you say there's going to be, let's say—I think the estimate is, in 2030, 30 million electric vehicles, let's say.

David Friedberg

Yeah.

Jason Calacanis

And they're 80 to 200 kWh in them, Friedberg. That is something like 2,400 to 3,300 gigawatts of storage that's moving. And if you add autonomy to that, that is a lot of flexible distributed power. So whoever controls and thinks about that is going to make a ton of money.

David Friedberg

So you're saying you could take a fleet of 1,000 Cybertrucks and send them to a natural disaster, plug them in, and power a city or power some homes, which is how that is constructed currently. You can use your actual Cybertruck to feed into your home and keep it awake for a couple of hours, right?

Maybe in the short term, just think about the parking lot of Meta. Having all those cars there, what you charge and discharge, the control of that, the management of it, the operating system, if you will—that will be very valuable.

Jason Calacanis

All right, we're going to end on this: summer reading. Everybody likes to read a book in the summer, I'm assuming, and one of us likes to write a book this summer. Anybody got a book they read over the summer, or a series they consumed, for our dear audience? Ben, you got a show or a book that you're obsessed with?

Ben Horowitz

We can do a show. I'm trying to remember—

Jason Calacanis

A Broadway musical for Ben. I know you love your musicals.

Ben Horowitz

I do. Although no good ones have come out recently, which is unfortunate. Shows—have you guys seen this Dept. Q show on Netflix?

Jason Calacanis

No. Not enjoying it?

Ben Horowitz

It's a fun one, though. It's called Dept. Q. It's like a sort of detective—cold cases. Exactly. It's well written and it's a fun show. I'm enjoying that one. I like that one.

Jason Calacanis

Any books, Gavin, on your shelf that you decided to break open at the beach while you're working, or are you just too busy?

Gavin Baker

No, I am enjoying post-apocalyptic fantasy. Empire of the East by Fred Saberhagen, but a relatively new series is called Moonfall by James Rollins, and I'm enjoying it. I will just say it's a slow start, like a lot of great fantasy and science fiction, where you have to do a lot of world-building, but I've enjoyed it.

Jason Calacanis

You ever think about writing your own sci-fi fantasy? You ever dabble?

Gavin Baker

Ideally, but I have yet to dabble.

Jason Calacanis

Friedberg, anything on your plate other than running and doing these incredible All-In events? You look exhausted, my brother. And babies. You got a lot on your plate. I wonder if you had the time to read a book or watch a series.

David Friedberg

I've been reading Andy Weir's Project Hail Mary because I never read it.

Jason Calacanis

Yeah, it's awesome. So good.

David Friedberg

I am disappointed.

Jason Calacanis

I like Andy Weir. I interviewed Andy Weir.

David Friedberg

Yeah. Halfway through, I got disappointed with one of the core assumptions. We'll discuss another day, but—

Jason Calacanis

I give you permission.

David Friedberg

Yeah.

Jason Calacanis

To just go with it. It's fake.

Gavin Baker

Yeah, because I do like Andy Weir.

Jason Calacanis

Yeah, I like Andy Weir. He's a cool cat. I literally, when he was doing The Martian, I asked him to be on This Week in Startups years ago. And he's like, “Yeah, if you come down to my condo in San Jose or somewhere in the South Bay.” And literally, he's got this modest little place. And then he's like, “I just sold it.” It's going to be like a major actor is going to be in The Martian, but he was broke, and everybody in our industry was talking about it. It was really, really charming.

And he's like, “I think I'm going to move to L.A.” I was like, “Oh, you totally should move to L.A. They'll be buying everything you do. They love sci-fi. Your shit's brilliant.” And sure enough, here we are.

Phil Deutch, your thoughts? By the way, Phil Deutch, when I go on a plane ride with Phil, he's got 6 newspapers with him.

Phil Deutch

You have to read the paper every day. Every day. I mean, 4 papers, 3 to 5 minimum a day.

Jason Calacanis

He's like the Charlie Rose of news consumption.

Phil Deutch

The Garmin says I'm in Truro, which is the middle of nowhere, and there's so few papers out here I have to get up at 5 to go to the Cumberland Farms to get the FT, the Journal, or the Times before anyone else does. So I love reading newspapers. I was a newspaper boy. Read papers.

I'm late to it, but I just finished the Musk book, which was phenomenal. I thought—

Jason Calacanis

The biography? The one?

Phil Deutch

Yeah, I know I'm late, but it was great.

Jason Calacanis

I'm reading a book on the making of the King James Bible, which is a tough slog but well worth it to sound pretentious and smart. I watched Superman, which I highly recommend Ben Shapiro's review of because he's got it dead-on.

What did you say, Ben? No, give us a teaser. People can look it up later. You didn't like it. Why didn't you like it? Was it too woke, or did you not like the Gaza or Ukraine references?

Ben Shapiro

I didn't think any of that stuff was there, honestly. I just thought it was super meh. The whole thing is just James Gunn being very, very James Gunn. As somebody who likes the legend of Superman—the grandeur of Superman as part of the American iconic landscape—that reduction of Superman to slapstick comedy, surrounded by a bunch of other characters who I don't care about, was disappointing.

There's a part where it just turns into James Gunn doing Guardians of the Galaxy, but with iconic characters.

Jason Calacanis

It was a little derivative, I will say. My kids loved it, though, which I was happy about. Continuing with film, F1 was a tough one because it was a fun date night, but I thought it was a little B-plus-ish.

Ben Shapiro

Could have been better.

Jason Calacanis

And then my winners: I thought The Penguin was a fantastic series, and The Pitt series and Dope Thief are very good too.

Ben Shapiro

I would just add the second season of 1923. I think it's also very good.

Jason Calacanis

Interesting. I used to be in the magazine business. I haven't subscribed to a magazine in well over a decade, and I just subscribed to Monocle.com, which is a bunch of designers. They have a print newspaper they put out once over the summer, and they actually have a bound magazine. It's an incredibly curated look at the world of design, hotels, restaurants, art, and fashion, and it's kind of uncompromising. They're just like, “Hey, we like things that are incredibly well thought out.” I've started taking some of their restaurant recommendations, and they don't miss. Monocle.com.

You guys know I love biographies, and I went biography-crazy this summer. All About Me by Mel Brooks—amazing. He reads it, so it's a great audiobook. I'm almost finished with Who Knew by Barry Diller, who, at 24 or 25 years old, was running Paramount Pictures.

Ben Shapiro

Yeah, that's great.

Jason Calacanis

It's incredible. Did you read it yet?

Ben Shapiro

I gave it a little skim. Plus, I heard him talk about it, but—

Jason Calacanis

Yeah, I know him. I've met him one time.

Ben Shapiro

His career is unlike anybody else's.

Jason Calacanis

At 24 or 25, he's running Paramount Pictures, and the bench he has there is incredible. He hires Eisner and Katzenberg as his assistants. It's the most amazing story of young people running amok, running these media businesses. We have to do a Barry Diller interview for All-In.

Ben Shapiro

That would be incredible commentary. Wait, did he do The Godfather Part II, Jason? Wasn't he?

Jason Calacanis

He did The Godfather Part II. Yes, and he basically took over for Bob Evans. If you ever see the documentary The Kid Stays in the Picture, or read the book, both of them are incredible.

Comedy Samurai by Larry Charles—I just finished it a couple of weeks ago. He's the guy who did Borat and Brüno. He also collaborated with Larry David.

And finally, my fourth pick for biographies of the summer: I Regret Almost Everything by Keith McNally, who is the restaurateur. He had a stroke, and he has an Instagram where he's pretty spicy. He did Balthazar, Pastis, The Odeon, and all these incredibly iconic places that I hung out in during my youth. To hear him do it, it's the most self-deprecating biography ever, in a sort of British tradition.

I love biographies. There are so many lessons in there. If you're a young entrepreneur, I highly recommend all of those. I would love to have all those people on the pod. It's been an amazing summer episode. I really appreciate y'all taking the time out of your schedule. Ben, are you going to come to All-In Summit in September? You're our guest. We got to have you there. Come out. >> Yeah. I'd love to see if we can make it. That'd be awesome. >> 7 8th or 9th. Uh bring the wife. Uh I don't know. I don't know how old the kids are, but we'll get you backstage. We'll give you the VIP pass, the whole treatment. Okay. >> I don't think you want my 11 95 and 2-year-old there, but yes. >> No, they can't come. No, but actually, I take it back. We have a surprise for one of the parties that they would love to come to, but I'm going to leave it at that because Dave hasn't given up. Dave loves doing the parties and he has a blowout spectacular party that will be unrivaled. Oops. The um scholarships are open. If you're young and a fan of All-In or young in your career, I should say, and you can't afford the normal ticket, we let a select group of upandcomers buy a discounted ticket. So, we keep uh you know, the the vibes really fresh and we like to have as many people as possible. So, go to the website and you can apply. Don't apply if you can afford the ticket cuz we like to give it to people who really can't. Uh and those uh scholarships are there. you'll hear in a week typically because we get so many scholarship requests. It takes us a little while to get through them. Shout out to the team Kimber and John Hal and the whole team over there Nick for putting so much into the amazing amazing uh all-in summit. And um yeah, thanks to my friend for sending me my new Dave is freaked out right now. >> Nick, it's not even funny anymore. Just bleep it out. >> See you next time on the number one podcast in the world after Ben Shapiro. Love you besties. >> Thanks everybody. Bye guys. We'll let your winners ride. >> Rainman David and >> we open sourced it to the fans and they've just gone crazy with it. >> Queen of [Music] besties are my dog taking your driveways. Oh man, my habitasher will meet the ugly. >> We should all just get a room and just have one big huge orgy cuz they're all just useless. It's like this like sexual tension that we just need to release somehow. >> Your feet. We need to get merch. >> I'm going all in. [Music] >> I'm going all in.