00:37:32 · Ty Morse, Casey Handmer
[00:37:32] S0: I I great. [00:37:33] S1: When you start a company, if hypothetically one were, you wanna find an area where you have ideally persistent differential advantage. And so, for example, when I was thinking of starting a company, was also thinking of working on drones. But it's very clear that, like, Soren and Co, like, they're just gonna do a better job than I am. Right? There are some areas where I would have insights because of my background and knowledge that would help me, but it would not help me enough to clear the hurdle, which is that this is already an obvious thing for capitalism to work on, and capitalism is already reasonably effectively allocating capital, human capital and money capital towards solving this problem. And that was before the Ukraine war, like, popped off. And now it's, like... This is six years ago, seven years ago. So now it is extremely obvious that, like, if you don't have AI and drones, you don't have national sovereignty, and a handful of countries have even got the memo on that. So for me, I wanted to find something that I was interested in enough to actually work on for a long time, where my particular interests and skills would give me any kind of advantage, and where capitalism was not currently doing a very good job of allocating resources towards solving the problem. So it has to be, like, kinda on the frontier. And synthetic fuel actually works quite well for that. [00:38:56] S0: If you had to, you know, plot or put synthetic fuel on that one foot to 10 foot bar, where is
00:38:56 · Ty Morse, Casey Handmer
[00:38:56] S0: If you had to, you know, plot or put synthetic fuel on that one foot to 10 foot bar, where is [00:39:03] S1: it? In terms of, like, raw difficulty? Sure. I'm not even sure yet. It's it's higher than I've seen. It's really ridiculously difficult. It... It's not as hard as orbital rockets, I think. But actually doing doing this as a successful business that makes money no one's ever done. Yeah. [00:39:21] S0: Is it currently in the science projects phase?
00:39:25 · Casey Handmer
[00:39:25] S1: I think we're mostly past the science project phase at this point. Like, the technology... Like, the science has been around for a hundred years or or longer, but, like, basically, the scientific processes legible to a manufacturing process that has more in common with kitchen appliances, for example, or consumer consumer electronics appliances is just ridiculously impossibly difficult. And we were just talking over lunch. Like, I I made a list the other day of of, like, hardware companies that have taken a crack in this direction, not just synthetic fuel, but but a few other things in the same area, carbon capture, hydrogen, a bunch of others. The field is littered. Evolution, like capitalism in general, is a system that actually does a pretty good job of recycling talent after ventures fail and you can discharge debts and all the rest. It's a good system. But I I feel like this particular field is littered more than most with the carcasses of, like, very respectable attempts to to, like, experimentally discover if a particular business model would be capable of generating net value in this space and finding out 10 or 100 or 1,000 million dollars later that, no. No. It can't. But to kind of misquote Timothy Chalamet in in in the next Dune film, There is a way. I can see a way. It's rather narrow, but we're on the right track here. We figured it out. But it's it's... Like, at the time, was like, this is incredibly obvious. And then I went and explained it to a 100 people, smart people who know what they're talking about, and I realized this is not obvious at all. It's one of those things where it seems extremely obvious to me, but it is not in fact obvious at all. And even now, if I try and put it down on paper in like a thousand words or so, why it is obvious, it is extremely difficult. In in much the same way that I think probably SpaceX had difficulty motivating reasonable rockets when they first started doing that in 2014 or 2015. And you had highly compensated professional CEOs of rival rocket companies with technical backgrounds themselves, like that Arianespace guy, stand up and say, that's bullshit. It's never gonna work. And even if it did, it wouldn't be a good idea. Why is anyone even thinking about this? And, of course, turns out, as Elon says, he's he's right more often than you would... Than chance would would would allow for.
00:41:38 · Casey Handmer, Ty Morse
His intuition is correct. Actually, I think I'm I'm reasonably confident now actually that that a lot of Elon's advantage here is that actually he is very intuitive and his intuition is is correct rather than him, like, sitting down in some, like, secret chamber full of spreadsheets and, like, deriving some weird thing that no one else saw. [00:41:57] S0: Why do you think he's so abrasive publicly? If most... Like, if he's got a good intuition in predicting human behavior and... [00:42:06] S1: Not human behavior, technical stuff. [00:42:08] S0: Really? [00:42:09] S1: I mean... Because he kind [00:42:10] S0: of does predict human behavior with his companies. Like, he's saying, like, people [00:42:14] S1: Maybe like a Harry Selden kind of way. [00:42:16] S0: A car. [00:42:17] S1: Harry Selden kind of way. I think he's got a good feeling for product. [00:42:20] S0: Okay. [00:42:20] S1: Yeah. But, like, he's obviously not the sort of person who would go out and win an election. Put it that way. [00:42:27] S0: Is he not? [00:42:27] S1: I don't think so. [00:42:28] S0: He's kind of doing that as companies. [00:42:30] S1: He's too unguarded. No. I mean, he he owns owns a business and he's... Controls the board. It's not a popularity contest. He'd never win a popularity contest. Just wouldn't. I mean, we saw that in in in Doge. Like, he was... He's too easy to hate. He's too easy to make fun of. He's too easy to misunderstand. He's he's too easy to take out of context. He's too unfiltered, which are all good things for us overall because he'd be wasted as a politician.
00:42:30 · Casey Handmer, Ty Morse
[00:42:30] S1: He's too unguarded. No. I mean, he he owns owns a business and he's... Controls the board. It's not a popularity contest. He'd never win a popularity contest. Just wouldn't. I mean, we saw that in in in Doge. Like, he was... He's too easy to hate. He's too easy to make fun of. He's too easy to misunderstand. He's he's too easy to take out of context. He's too unfiltered, which are all good things for us overall because he'd be wasted as a politician. [00:42:52] S0: This is something that's happened since last we talked is he left Doge. And the way that I think about Doge is it is one of the only things that Elon... You know, organizations or situations that Elon's ever come in contact with and been like, this is too hard from what I can tell. Or it's like the reward for trying is just not great enough.
00:43:15 · Casey Handmer
[00:43:15] S1: Well, Doge did a bunch of different things. Okay? And I think it's not very well understood in general what they were doing. But one of the things they did was assemble a whole bunch of programs that should be cut, and the congress voted on it, and they they voted against it. You know? And at that point, you could you could continue working there day to day, doing the other things that DOGE working on, particularly things within, you know, your executive control or things to do with the modernisation of government services and systems. But actually, lot of that work has continued without him. And you also have to wonder, like, what's the opportunity cost of his time? It's probably like millions of dollars per minute, and he is a officer of multiple publicly traded companies. So you can't just, like, abandon those companies to go and fill around with the government, especially when I think... Well, I think I said in the last podcast, like, it was it was weird to see for me, you know, a bunch of my, like... You know, I have I have friends on all sides of the political spectrum, but, like, you know, team left, you know, the the ultra woke kind of deep state types team up with the the ultra right deep state types to kick this newcomer out, which is what they did, essentially. So, anyway, we'll see. But, yeah, I think, you know, it was... As a society, we're better off with Elon on the outside trying to outgrow the spending state than on the inside trying to trying to prune it. I do worry about it, though. And I think as I said last time, it seems to me highly unlikely that that our political system can survive its long term structural challenges without solving solving the problem of old age dependency through radical extensions in longevity and also radically increasing growth. You have to either smash through these regulatory barriers we discussed earlier or build new kinds of economic growth that can exist in places that are not yet regulated to death so that you actually have, like, permission to grow the economy faster than dependency, which is a tough a tough ask these days. You know, when FDR put in place the new deal in the thirties, it looked like it could be sustained for, you know, fifty plus years, and that was long enough to solve the problem it solved at the time. But, you know, the...