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...
00:45:21 · Casey Handmer, Ty Morse
Basically, any country on earth one day will get will develop until they're rich enough that people are no longer dying young, which is a great thing. It's a great thing that people your age, my age, aren't dying of preventable disease, but that just means sooner or later we like your description of New Zealand. And everyone around there is old, and everyone has health problems, and everyone has dependencies, and everyone... Like, children are, like, crazy dependent and relatively expensive for a few years at the very beginning. Then they're relatively independent, but they're not economically productive for another decade or so, then they become economically productive. But for old people, you know, there's no, like, economic productivity ahead of them. There's just spending down whatever the the society has managed to accumulate, which is not... Like, it's it's it's a socially worthwhile thing to do, but at the same time, it is not compounding. Right? And and sooner or later, everyone's old. You can walk around, you know, Germany right now. The median age is 48. 48. Right? And the median voter age is older than that, obviously, because children don't vote. And you wonder why it is that these these societies... Why Europe is is kind of in its own death row. Well, why wouldn't they be? They don't they don't... Like, the the the median voter is is past the point where they can vote for a future they wanna be part of. [00:46:39] S0: You think that this outside of, like, a major war, is there any ability for us to downregulate?
00:46:44 · Casey Handmer
[00:46:44] S1: That's a good question. Some people say, well, you know, the regulations get cleared out in a major war, but it's pretty clear that a major war in 2026 would be extremely different from a major war in 1941. Basically, what happens in a war is you end up with this like... Well, we're seeing this in in Iran right now. This kind of extremely kinetic exchange of explosives and and weapons that the net effect of it is you're killing people who don't wanna die and in many cases uninvolved civilians. The number of people involved in this... In actually fighting these wars is collapsing. Right? Even in Ukraine, the number of people involved in active combat is minuscule compared to World War one and World War two. And so instead, what you're doing is blowing up infrastructure, and you're just making money expensive and destroying wealth. Right? So it's just pushing us back in the stone age, and you say, well, we need to rebuild this stuff maybe. It seems to me that the forcing function for improving regulations is more likely to be competitive pressure. So you end up in a situation, actually, we're already seeing this, where the Anglophone West is relatively economically non dynamic compared to parts of Asia, for example, particularly South Asia, and has a lot of homologation in their regulatory setup. So for example, if you're an entrepreneur in England and you don't like the fact that the English government has a certain policy, you could say go to the EU and work there. But how different is the EU? They have all the same structural problems and much of the same laws. And despite Brexit, it's pretty much the same deal. You can go to United States, and you get a better deal because capital... There's more capital here. It's more permissive environment and so on. But if you're Japanese, right, you're a young Japanese guy and... Or woman, and you wanna you wanna start a company and and build a new business and build wealth and help the economy grow, nope. You have to you have to learn a new language, go to a new country. And so what I would like to see is it would only take one of these countries to defect from the current consensus that we just have to, like, increase spending, increase taxation, increase the size of the public sector by, like, three or four x the size of the overall economy on an ongoing basis.
00:48:44 · Casey Handmer
I wrote a blog post a couple months ago pointing out that Australia, for, like, fifteen years now, has been locked into a future where it becomes fully communist, essentially, like full government control of the economy because the private economy, the economy that actually generates net wealth and takes taxes, is shrinking. But you only need one one of these countries to, say, face an existential problem, realize it's facing an existential problem and undergo massive reform. So, actually, Patrick Collison and Mario Draghi recently announced the Rine Group, which is of a think tank whose efforts are around restoring European dynamism. I find it's an interesting or useful thought experiment to think of Europe as a as kind of a a successor civilization to the civilization that built all the infrastructure that's kind of living in the ruins of that infrastructure, but isn't capable of building it again. And we're talking, like, not 1700. We're talking, like, 1960 kind of thing, like, only a few generations ago. I think a lot of it was driven by energy scarcity. Right? So, like, big big economic shock in the nineteen seventies when, basically the Saudis nationalized Saudi Aramco and and then formed the OPEC oil cartel. And we were able to find, like, a modicum of economic growth in the intervening periods through capital deepening, improvement in public health, kind of a little bit of cold war nonsense and and kind of elevation of of the developing world. And then more recently in software, consumer software, which is a really great way of improving productivity without increasing energetic inputs particularly. Although now data centers have grown to the point where they're, like, pushing double digits of total energy consumption and, like, we're starting to rub against those limits again. And so it's really important, I think, for us to grow to to break these constraints on energy availability. So our friend Isaiah is working on this, for example, on on nuclear energy, and and, obviously, solar is a key way to go that direction, you know, and then bring back permission to do things. One things the Japanese do do nicely, and and it has its own proclivities and weaknesses, but they they they normalize construction. So they're actually constructing things all the time. And part of the reason they've got an extremely powerful steel cartel, basically, with...