Patrick McKenzie - How a Discord Server Saved Thousands of Lives

Today I'm chatting with Patrick McKenzie. He is known for many things on the internet he's known as patio 11. Most recently he ran Vaccinate CA, which probably saved on the order of high forefinger number of lives during COVID. He also writes an excellent newsletter called Bits About Money. Patrick, welcome to the podcast. Thanks very much for having me. So what was Vaccinate CA?

In early 2021, we were quite concerned that people were making 20, 40, 60 phone calls to try to find a pharmacy that actually had a dose of the COVID vaccine in stock and could successfully deliver it to them. I tweeted out randomly, you know, it's insane that every person or every caregiver is attempting to contact every medical provider in the state of California to find doses of vaccine.

California clearly has at least one person capable of building a website where we can centralize that information and send everybody to the website. If you build that website, I'll pay for the server bill or whatever. And Carl Jung took up the gauntlet and invited 10 of his best friends and said basically, all right, getting guys, we're going to open source the availability of the vaccine in California by tomorrow morning.

This is at like 10 pm at night, California time. And so I lurked down into the discord where of course all medical infrastructure is built and gave a few pointers on, you know, making scaled calling operations and then one thing led to another and ended up becoming the CEO of this initiative.

At the start, it was just like this hack plan project of a bunch of random tech people who thought, hey, we can build a website, make some phone calls, maybe help some people find the vaccine at the margin and it grew a little bit from there. We ended up becoming essentially the public private partnership, which was the clearinghouse for vaccine location information for the United States of America. That felt a little weird at the time and continues to.

Okay, so the obvious question is, why was this something that people randomly picked up on a discord server? Why wasn't this an initiative either by an entity delegated by the government or by, you know, the White House has or the pharmacies have a website you're going to sign up for an appointment? Oh, there are so many reasons and a whole lot of finger pointing going on.

One of the things was that there were almost no actors anywhere in the system who said, yes, this is definitely my responsibility. Very sparse of our nation's institutions, county level public health departments, governor's offices, the presidency to presidencies over this interval, which will become relevant. You know, they all said, well, I have a narrow part to play in this, but someone else has to do the hard yards of actually like putting shots in people's arms.

And someone else is clearly like dealing with the logistics problem, right? And the ball was just dropped comprehensively and no one at the time really had a plan for picking it up or didn't feel like it was incentive compatible for them specifically to pick it up right now would be great if someone could do this, but just not me.

Okay, so to explain the context and how important it was that people get vaccines at the time and how much these delays mattered, you can account for it, obviously, in the amount of life saved, you can even look at it in terms of what then vaccine news was announced, how much the stock market move move.

It was clear it was worth trillions of dollars to the economy, yep, that the vaccine to be delivered on time. And so it should be priority number one that people know where the vaccine is sort of met a question is, why are I kind of heard about this problem for the first time when I read your article about this. Why is this there's there's a bunch of controversy after COVID about people pointing fingers about masks or different kind of protocols.

Why was this not people are getting hauled in front of Congress, why were we not able to deliver the one thing that was needed to a rest of the pandemic as fast as possible. Well, if folks want to be 27,000 words on this, my article in works in progress called the story of X and 8C goes into some of the nitty gritty.

Broadly, I think a matter of incentives more than matter of people choosing to do evil things, although I will say we did choose choose to do evil things and we can probe on that if you want to. But the if you look at like the federal government specifically the federal government institutionally learned one. I believe wrong lesson, which has terrible consequences from the healthcare.gov rollout a number of years ago when Obamacare was first disputing.

And the thing which many actors in the federal government and the political parties came away from is that a president can doom their legacy of their signature initiative if those bleeping tech folks don't get their bleeping act together. And so the United States has cited like there is virtually nothing up to and including like the potential of national annihilation that will cause us to actually like put our chips behind making a software problem.

That is somebody else who does not have to deal with an electoral mandate or getting called in front of Congress or etc. Somebody else's problem. Unfortunately, software is eating the world and delivering competence in the modern rural requires being competent at software and the United States will tell you differently. And there are wonderful people in the in the government who are attempting to change this but.

Broad strokes on an institutional level. The United States federal government has abdicated software as a core responsibility of the government. I understand why they didn't initially want to pursue this project. I still don't understand the answer to the question of after everything went down now. Why is it not more of a news item that this was a problem that was not solved.

So I think we're memory-holding a lot of things that happened in the pandemic. I wish we wouldn't partly because of political incentives and we're approaching an election year and because of the quirky way that the American parties and the candidates bounce off each other. No one's real incentive to say, okay, I would like to relitigate the mask issue for a moment. We told people that masks don't block our boring viruses.

And we were quite confident of that and the entire news media backed us up on it and then we would like 180 to month later. No one wants to relitigate that. No one wants to relitigate California imposed red lightning in the provision of medical care. And that was wrong and evil. But the party that was in the case pro-red lightning does not normally like saying that it is pro-red lightning.

And the other party does not really consider that a hugely salient issue. And so there are no debates and no one is asking governor Newsom. So when you got on TV and said that you were doing geo-fencing for the provision of medical care, geo-fencing in that context was the same as red lightning. Can you explain your support for red lightning?

And no one has asked Newsom that question. Maybe someone should. But we're surrounded by the effects of incentives and the effects of iterated games and sometimes they don't play out the way we would ideally like them to play out.

Yeah. We can come back to this. I still don't feel like I really understand. So maybe the act was that everybody has the blood on their hands. And so that's so confusing. I think if you have other kinds of emergencies, like if you lost a war, I don't think you just brush it aside. The generals would have to come up in front of Congress and be like, what happened? Why didn't we get that battlefield?

Actually, we just lost the war. If one goes over the history of military conflicts, I don't know how many people, losers on either side of the conflict ever actually did that reckoning. And I was like, hey, could we attempt to win in the future? I think there was a broad lack of seriousness across many trusted institutions in American society in the government in civil society in the tech industry about really approaching this like a problem we want to win.

And I think a wonderful thing about our country and our institutions is like, I think that are truly important to us. We win and win out landishly because we are a rich in power formation. And yet, like this was obviously thing where we should have decided to win and we fundamentally did not approach it as a problem that we needed to win on. Okay, so going back to the object level here.

One would think that instead of different people calling different pharmacies and asking whether they have the vaccine. The obvious thing that people who have not read article would assume is that either there were just some company would build a platform like this, a government would build a platform like this, I guess you explained that the government didn't do it.

The pharmacies might build a platform like this. And I want to meditate on the incentives that prevented random big tech company or Walgreens from building this themselves. Can you explain that? Sure. So the federal government and the state government, the American governmental system is quite complex and there were multiple distinct supply chains with multiple distinct technological systems tracking where these vials were headed all over the country.

And there were many attempts at various levels of the government to say, hey, can we commission a consultancy to build a magical IT solution, which will get these databases to talk to each other. And those largely failed for the usual reasons like government software procurement projects fail. Why didn't tech build it? I'm constrained. I want to say and cannot say so I know a little more than this answer, but I will give you part of the answer.

The tech industry, that both at the level of like APA Mugu face soft, which is my funny, sorry, I'm going to refer to like some of the most powerful institutions in the world. And many other places that hire, you know, many number of smart engineers who can build the world's least impressive inventory tracking system.

But felt political pressure in the wake of the January six events in the United States. This is another thing that's gone down the rabbit hole, but in the immediate wake of the January six events, people in positions of authority very clearly tried to lay that at the feet of the tech companies and internally in the tech companies, their policy teams, the teams that supposed to make the company legible to government and avoid government Yankee and permission to do business.

And their communications teams PR departments told everyone in the company like mission number one right now do not get in the newspaper for any reason we are putting our heads down. And when people in those companies who work on public health and a thing that might not be obvious to most people in the world is that like APA Mugu book soft, they're literally like teams of people who their job is public health.

Because they are the like the operating system with the world right now and the operating system in the world needs public health care. The those teams said, hey, we've got this thing and other people in the company might have overruled them and said it would be really, really bad right now to have the tech industry saying we're better at the government's job than the government is. So shut that down.

Okay, so that's so insane. So it is absolutely the local incentives like it makes sense in the meeting when you're saying it and you are not in that meeting projecting I am going to cause tens of thousands of people to die at the margin by making this call and yet that call was made right.

Okay, so the there's two culpable actors or one you could say well the big tech companies for not taking the political risk. I think what is even more reprehensible is the fact that they probably correctly thought that appearing more competent at the government and saving tens of thousands of lives as a result will be held against them in a way that significantly matters for their ability to continue their other businesses.

Now, so okay, so suppose that they had built the software. Let's play with the scenario and then what would happen they would get hold in front of Congress and explain why they weren't delivered even faster because of the ultimate bottlenecks and the supply chain because you can only man what would happen like they build it and it's like better than the government.

This could happen one if you build a thing this is sometimes been called the Copenhagen principle of culpability. If you build the thing very sectors in our system will assume okay now your responsibility for not just the consequences of the thing you built but for the totality of consequences of everything associated with the American vaccination effort.

So you built the thing oh you big tech geniuses. Well, what did you do about localization you didn't do enough about localization yet you hate name group of people here like don't you see the disparity in death rates between the demographic and demographic be why haven't you fixed that yet you have killed so many people etc etc and no one in government.

No one who is making that moral calculation says I have responsibility for killing people by doing nothing the person who is doing anything has responsibility for killing people by taking up the burden of doing something and it is a absolutely more elite,

and it's a very vulnerable thing which you will see over and over and over again in our discourse is this okay they get hold in front of Congress but it's not just because they made a sin of co mission it's also because if you're right then after January 6th they would be held in. There's one answer where it's like they touched the problem and there's another where it's they did it they did it better than the government could have and those seem like two different right.

You touched the problem and so you've immediately taken liability for any number of sins of a mission because even at the scale of the largest companies in the world you've not allocated infinite resources to this problem and also the stealing of March on the government and embarrassing us will be held against you.

And so like you can point back to the camera channel it's like a shorthand for there was this one time back in the day where the news media in New York and the government in DC in places like it talk to each other a bit and convince themselves that a small team of people with a budget of approximately $200,000 have rooted the United States presidential election now rooting the United States presidential election perhaps on behalf of foreign power would be an enormously consequential thing.

Good thing that did not happen in the world that we live in however people believe very passionately in that narrative and as a result of that narrative they did like very aggressively attempt to clip the wings of tech and tech's core businesses like say advertising right.

There's so much that's crazy here OK one question you might have is we figured out that are we we couldn't delegate to big tech or any of the competent actors and that the Native infrastructure that we had that was specifically earmarked for dealing with public health emergencies was extremely competent to the extent that discord servers vastly outperformed them.

Supposing that public health is not uniquely incompetent among the different functions of the government is supposed to perform that are don't get tested until the actual emergency is upon hand how would we go about if the president cures this and is a concern that the new the people are running that nuclear.

Newlier bomb reaction aren't up to snuff or the earthquake reaction is there some stress that is test that you can perform on these institutions before the thing goes down that you could learn beforehand whether they're competent or not.

If I look at like the experience of the last 100 years and a little more back to the flu pandemic in 1918 if you read history says the flu pandemic a vastly less wealthy vastly less technologically sophisticated nation with many less people involved in the actual like fixing up this problem. Competently executed on nationwide vaccine campaigns and other various various measures and so in some fashion like we should be urgently concerned with what decayed institution in the interim.

I think one of the things that health departments specifically faced is that if you had just given them these kind of vanilla vaccination campaign maybe they would have been done better than they actually did I'm not positive of that I do think there are actually.

And here I have to stop for a disclaimer I think that people in county health departments did real important work I think they probably did work that saved lives on the margin I do not think that you and I should be satisfied with our performance in 2020 in 2021 we should be very dissatisfied and we should get better for the future and that requires like recognizing that we under perform by a lot.

There was a political decision made that the successful administration of the vaccine vaccination was not going to be measured solely by saving lives there the prioritization schedule came up which was Byzantine and complicated and routinely befuddled professional software engineers and health administrators and which I could not diagram out on a white white board even if you like paid me a million dollars to get it right on the first time.

And so it was down stream of the United States is political preferences and so schedule one a versus one B versus versus one C was like in the first five seconds of discussion dictated by medical necessity but immediately after that was about rewarding plums to politically favorite groups.

So the one of the complexities of this is that the you know pharmacies and health care departments are not set up to discriminate along the axes of whether one is political powerful and not because that is not a thing that they have to do in most vaccination campaigns and not a thing that they have to do on like the typical Tuesday providing medical services we asked them to do this like radically new thing which isn't part responsible for the failures that we had if we had had a much simpler tearing system for example we would have to do that.

We would have had more than 25% of the shots successfully being delivered in the state of California in January of 2021. Can you go forward and out of where what was the political a tearing system that you're referring to? Oh goodness. So this was different in different places and using the different places in the United States to use the same names for these tiers for different people but the in the state of California.

Tier one a comes before one B comes before one C comes before the tier two etc etc so one A was descriptively speaking at the start and this changed over time on like a day to day week to week basis sometimes mutually incompatible ways at the same time it was an entire mess but descriptively tier one A was okay health care professionals and a few others and people above the age of 75 note weight will change that to 65 tier one B was we're going to put a few favored.

Occupational groups here and some other folks and tier one C was people who doctors think will probably die if they don't get the vaccine if they contract COVID but who have not appeared in group one A or one one B yet and so who got one A well health care professional so like doctors and the vaccine that sounds like pretty reasonable also veterinarians.

Because veterinarians are like urgently required by society at the time not so much because the California veterinarians association is good at lobbying and that isn't just me alleging that they sent a letter out to their membership saying we are so good at lobbying we got you guys into one A congrats and go get your vaccine now. Have that on my website.

Okay so like tier one B school teachers were classified as a tier one B why because go figure teacher students have political power in the state of California and they said well we'll accept not being in one A but we are going no lower than one B and probably no one in that meeting ever said like I definitely think that 25 year old teachers who are currently

understated homeowners should be in chart should be like in front of the line of people who will die if they get COVID so so the like we made that choice so then the and your article you discussed that the consequence of that was not only the misprioritization of the vaccine but the bureaucracy around allocating it according to these tiers resulting in 75 year olds not having the capacity to fill out the the pages of paperwork that required to decide what tier you're in the state of New York commissioned a consultancy to administer

to 75 year olds a 57 page web application which required uploading multiple attachments to check for their eligibility and like talk with the technologist if you don't believe me we try to remove everything from a web page that people successfully get through it like if you can make it you know two to form form fields that's already

using people's patients and you are asking people who might be like suffering from cognitive decline or be less comfortable in using computers to do something which would like literally text the patients and cognitive abilities of professional

professional software engineer and that wasn't an accident we wanted to do that why did we want to do that because it was extremely important to like to successfully implement the tiering system that we had agreed upon why was it extremely important to implement the

tiering system because that was society's prioritization was that the correct prioritization hell no right okay so can we just count off everything it just before so it's in raging not only because obviously people died but because like nobody talks about it it's it was there's all kinds of

controversies about covid about whether I don't know of vaccination and side effect kind of things and whether the masking orders were too late to early whatever and then the main thing about whether we got vaccines if you will time on arms on time because of these political considerations so you're not allowed yeah we can jump in with one bit of

that yeah we achieved something incredible which was getting like the first cut of the vaccine done in two days as a result of many decades of science done by very incredible people and we successfully got that vaccine productionized in a year we should have got it productionized in far less than a year but the fact that we were able to do it in one year and not three was enormously consequential and so we should feel happy about that a little annoyed that we didn't have you know better

protocols at the FDA and places to get that vaccine that prioritized for testing much faster than was quite annoyed at the fact that like that was a political football and people probably made decisions that yeah pessimized for human lives and optimized for like defeating a non preferred political candidate or when the fact that the vaccine was announced the after the

election results or something right yes I'm basically sub tweeting that yeah and I strongly believe that was a political decision but what I don't I'm just a software guy so okay the particular kind of craziness that we had during this during the two at 2020 and 2021 about equity and

weakness how much was that uniquely responsible for the dysfunctions of this tiering system and geolocation slash right lining with basically if it was happened in another year where there wasn't a bunch of cultural craziness what have gone significantly better it's difficult to ask that question because like we were clearly in a unique time in 2020 and 2021 and yet like point to me in the year in American history in which American society was truly united and had no social

issues going on and if people like counterfactually like point to say world war two I will say like read more history but be that isn't me was it the case that like strong societal feelings in the wake of you know George Lloyd's death in 2020 and the racial and

reckoning like strongly dictated policy yes as a positive statement rather than a normative statement that is absolutely the case there's this thing we often say in the tech industry called bike shedding which is if you're building a nuclear power plant and

many people cannot sensibly comment on like what is the flow rate through the pipes to cool nuclear reactor but if you build a bike shed next to nuclear power plant it's very easy to have opinions on the color of the bike shed and so in the meetings about the

nuclear power plant you will have a truly stupid amount of human effort devoted into what colors you should paint the bike so it is very difficult for most people in civil society to successfully inject a vaccine into someone's arms to successfully manage a logistics network to successfully build a nationwide information gathering system to centralize this information and pass it out to everyone and we aggressively train the entire American professional managerial class starting at seventh

grade or earlier in decrying systemic racism which to be clear is a problem and so any discussion about what should we do with regrets with regards to information distribution which goes out to a broad audience in the American professional managerial class who essentially call all the shots in the US system will almost invariably get bent to I have no particular opinions on server architecture here and nothing useful to comment but you know what's our equity strategy and the equity

strategy dominated discussions of the the correct way to run the roll out to the exclusion of operation realizing it via medical society medical necessity yeah people brag about that fact that fact is enormously frustrating to me and if you say it with exactly those words and emotional valence people say no no that's not exactly what we meant but when they're talking to other audience they know this is absolutely what we mean yeah well

okay so I mean even on that point the maybe the culprit here is a scarcity mindset involved here with carrying more about the proportion rather than just solving the problem this is one of those few times where we were genuinely up against the scarcity constraint that like you know physical reality was there were a scarce number of vials and we needed to have a prioritization system and some people who urgently needed the vials were not going to get

them first everyone was going to get them eventually but the mad rush in our political system to dole out favors around the prioritization for those first files exceeded the actual distribution and successful injection of the vials as a goal again California reported to the federal government that it was only successfully injecting 25% of its allocation it had the most desirable object in the history of the

world yeah and rather than adopting any sensible strategy for getting it into people's arms was bickering over who should get it first we should be outraged about this and we're mostly not I don't even know what to ask the next because it's so obviously outrageous and the there's no clear answer at least to me of why there isn't more outrage about it also what the solution to it is I mean literally in the exact context so what we

would do in the next time there's a pandemic it's not clear to me that we've learned the lesson let alone the broader lesson of if there's a different kind of emergency if there's some isomorphic emergency what what what what our state capacity better and you mentioned the point about a hundred years ago we have maybe would be able to deal with this problem better so I don't know what what what changed one of the things

that America used to do is when the federal government lacked state capacity for something it would say who in civil society or private industry has capacity for this and then say congratulations by order of the president you are now a colonel in the United States Army like what do you need to get it done sir yeah and that was an option that was an option that was not taken but you know I will play no fights in either of the two

administrations that both individually made terrible decisions but you know plausibly some more enlightening counterfactual administration could have gone to Google and said who is literally your best person for solving the the data problem that we currently find ourselves in great will they accept a commission as colonel great here's an order from from the president you have a swearing in ceremony starting in 30 seconds

and like we you will present your like project plan tomorrow and again like the successful project plan was made by a bunch of like rank amateurs at this topic on discord in the course of a couple of hours and similarly like they're you know this is like one part of the huge overall vaccination effort but you could imagine going to Amazon and saying like hey Amazon we hear you're pretty good about getting

packages between a and b this package has a like a really hard thing about it it has to be cool as it's delivered that's like a totally unsolved problem in material science right and Amazon would say we literally do that every day back in December people were getting on the night in the news and saying this is going to be on unprecedented logistics challenge because the vaccine has to be kept at ultra low

temperatures which are the same temperatures at which milk is transported we understand how to do cold chain logistics so Amazon would correct that misperception they say oh you guys seem to know what you're doing

we have an absence of that here congratulations here's your colonel uniform in the United States military and now your job is we are going to give you a CSV file every day interface with this other kernel please from Google on like where this thing needs to go and you get it there on time

every time and if you can't get it there on time every time like call the White House and we will like find you political cover is what a functioning system would have done I'm granted the American system is dysfunctional its own way I think another thing that's been underdone

in the course of the last couple of years is like looking internationally I don't know if any country anywhere with vastly different political systems is happy with the outcomes that it got somewhere obviously vastly better than others but there are journals of like comparative international

politics and why are those journals writing anything but like who succeeded at what march and then who did not and what do we learn about like the proper functioning of political system civil society and like the United States consider it as one like hugely complex machine no that's a really

interesting point I actually asked Tony Blair Tony Blair Institute they were recommending to the British government different ways of distributing the vaccine and they they made the obvious recommendation that you should give everybody one dose now and then do the second dose later

you know obviously things like this which was saved lives any British government didn't do a good job there no I think it's actually a very interesting question there's governments all across the world which have very different political systems they have but hopefully I don't know different

infrastructure road you'll mix this why did nobody get this right so on the like you give people the catcher is for this was first doses first yeah that was not the procedure in many nations which have many smart people in that yeah and it was not the procedure in the United States until

I think you know first doses first you can like sometimes trace policy back to individual blog posts and so to the extent that one can be traced I think it was Alex tabarock on marginal revolution who is right this is very obvious and over determined if we want to win

at this like first doses first is objectively the correct policy and after you know this like ping ponged around the political system for a while and they you know talk to medical experts and etc they were like yeah yeah it turns out that you know this is the equivalent

of like saying you should probably consume calories at some point in the typical week that is better than not consuming calories well we checked with the medical experts and it took six years to get the right to eat and we're not eating but they definitely agree eating

beats not eating for living so we're going to do that now and on the one hand like it is a genuine strength of the United States that like you know he's not just actually some rando but relative to like the the topic in question some rando on the internet like wrote

we could have stopped doing the stupid things sooner yeah that is an answer to the question of why did like nobody got a right if you think there's something particular to the late stage bureaucracy that we have or something maybe the other countries fresher but even the

countries that have more authoritarian models who can just you know crack down or something they did a bit mainly as well they made you errors often in many cases that were worse in the US there's like so many countries Patrick why didn't none of them get a right I'm under

informed on much of the the international comparison partly because in 2021 I was sort of busy but I remember Israel for a variety of institutional reasons having a broadly functional response on this in particular round ended the day shots which yeah end of the day shots

are in the grand scheme of things a minor issue but they're a good like quick heuristic for do you have good epistemic on us at all okay you know physical reality of the COVID shots is there is a five eight or ten shots in a single file that single file is goes bad

after 12 hours that is a bit of an over simplification doesn't actually go bad but for for essentially regulatory reasons we have to pretend it goes bad after 12 hours can't be received okay so if you vaccinate two people then the other shots are on a timer and those

shots will decrease in value to zero after however many hours are remaining on the timer and then get thrown in the trash can so quick question to test if you are a rational human being at the margin would you prefer giving a shot to the most preferred patient in your queue of patients

who needs for medical needs or like the trash can you prefer the most effective way to get a test can you prefer the most preferred patient now follow up question would you prefer giving it to the least preferred patient or the trash can you still give it to the human

rather than the trash can and Israel adopted the policy of like if the shots are expiring forget the tearing system forget any forget anything else literally walk out into the street and say I've got the COVID shot I need to administer it in the next 15 minutes who wants it

and in the United States we had a policy ban on doing that we said no to protect the integrity of the tearing system to like you know embrace our glorious cause of health equity you should throw that shot out and that policy was stupid and it was announced by governors

proudly in December in in front of news cameras and then a couple weeks later reality set in and they were like people told them sps sir turns out that throwing out the vaccine is stupid and the governor did not go go on the nightly news again and say I gave a very

confident policy speech a month ago in front of this news camera where I said that I would prosecute anyone who gives out end of day shots but we literally said that he said he really said that that oh man this is almost a direct quote and you can see the actual direct

quote in my previous writing on this but I will not just prosecute people I will go aggressively to try to maximize the reputational impact to your firms and your licenses yeah like we were pointing metaphorical and when it came down to it literal guns at physicians in the

middle of a pandemic for prevent for doing unauthorized medical care crazy but what you know when the system corrected it did not do it did not correct all the way the governor did not go out and say hey that thing I said a month ago was a thing insane I take that

back and apologize you know it's like okay we're going to like quietly pass out the words that's no longer the policy but we don't want to own up to the mistake and people in say like the regulatory departments of pharmacies make rational decisions based on the

the signals that you're giving them and the rational decision of pharmacy makes is not okay we've been quietly passed the word that the old policy is persona on grotto but can we really trust the quiet word here one because like do we trust that this

actor is not going to change their mind in two weeks and consequence us for something we authorized today just throw out the shots and pharmacies did not cover themselves in glory a lot of pharmacists did some pharmacist did but pharmacies like institutionally we deliver

almost all the medications for almost all the diseases routinely in America we cannot blow up either that like position of societal trust or our business results over one drug for one disease and so throw out the shots and make sure we can still delivering medical

care in California tomorrow that I understand how that decision was made we should not endorse that decision we we there there were individual acts of heroism by particular pharmacists who said essentially and as many words to us when we when we called them

and said hey what's the procedure for getting the shot okay an individual like the one you just described cannot formally get the shot right now so I would tell that individual to go to the county website tell whatever lies are necessary to get an appointment with me

they come in for an appointment and I will inject them rather than verifying the lies that were on the appointment a appointment card because basically F-thruals I swore notes I honestly I don't know where to begin with some of these things well okay I want to understand a bunch of the first of all can we just go back to 25% of vaccines that were allocated to California were actually delivered in people's arms literally the entire world economy was bottlenecked on this right it's like

so if you want another funny anecdote and then asked some people in positions that might know so how real do you think that 25% number is and they said well the good news is in addition to being incompetent at delivering the vaccine we're also incompetent counting so it was probably a bit of an undercount I'm like oh so the good news is like the true count was like 100% or 95% or something well no not not nearly close to that but we got better at counting after the governor

yelled at us because he was embarrassed we were the 48 state and accounting the item which is a bottle like where are you where is the thing that is going to like rescue us from the thing that is destroying the world we had so like pharmacies generally speaking could today if you ask you know someone deep on the bottles of pharmacies accounting department could you buy the end of business today give us a count of like how many bottles of aspirin the pharmacy has physically

in the world by the end of the day they would have a shockingly accurate number for that it wouldn't be exact but it would be like shockingly accurate relative to that numbers like truly millions if you say like break down by

address please like where are they physically present in the world yeah easy problem you know like managing inventories of drugs that's what we do the United States could not do that like and did not perceive that to be an urgent problem to be solved I mean I do want to ask you like the actual

finance and software stuff at some point but I think this is like such an important I mean the world is watch or stand still we still haven't learned the lessons of I'm just gonna keep going on this topic because I still don't

understand the okay so here's here's here's another question that's sort of related to this you have many rich tech industry friends and I read your article and you're saying we're trying I'm filling out these grants for 50k her and that's like taking up all my time and I'm trying to raise you know

a couple hundred grand here a couple tens here and I'm thinking to myself how is this not a true as trivial a problem as hey XYZ if you give me a money that you can find between your couch cushions we will save thousands of lives and get the

couple world economy back on track how well how is raising money for this hard or why was it hard you know so again like trillions of dollars are on the line the United States is spending tens of billions of dollars or more on its covid response strategy like the true biggest issue is like why is it

come down to like Patrick McKenzie's ability to fundraise in the tech industry for us to like have a system here okay bracketing that like the tech industry underperform my expectations for what the tech industry should have been accomplished here there were some bright spots and less

bright spots are good regards to fundraising project and for those of you who don't know the total budget of this project was $1.2 million but it's not quite couch cushion money but is not large relative to the total amount of resources the tech industry can deploy on problems and in some

cases I looked at my email this morning refresh my memory I sent a CEO at a particular company and I'm not going to name people but they're welcome to claim credit if they want to claim credit email they see you at a particular

company hey I saw you like to tweet about the Sun Twitter I'm essentially raising a seed round except for a 501c3 charity and you know we urgently need money for this here's a two page memo and that I sent that email at 4.30pm and 4.30pm California time and he got back to me there was some

internally emails of like routers to this person routed to this person he run that by blah blah blah 9.30 the next morning he said I'm personally in for $100,000 out of my own pocket my banker is going to contact you as a wire clerk the same day so yeah for that I'm the like yes less EA

side like tech is not exactly a stranger to having bureaucracies and in some cases it was a matter of like oh indictivatively we want to support that but we have a process and that process went on for six weeks and by the time six

weeks it was over it was May and not to the credit of funders by May most people in the professional managerial class who had prioritized getting a vaccine for themselves and their loved ones had succeeded at that and they said okay so the vaccination supply problem pretty much solved right my

like no it is not solved right now it is solved for the people who are smartest about working working the system in a way it was not solved for even them back in January but there are many people who are not yet vaccinated and they say that's a vaccine hesitancy issue no it is not merely

a vaccine hesitancy issue it is still the case that there are logistical problems that is still the case that that people don't know that you can just google the vaccine now it is still the case that around the edges of the American medical system in places that are like underserved etc people

don't have it or they can't get transportation etc etc you should continue funding this team for the next couple months so that we can do what we can around the edges here and I was told again you know people can do what they want with their own money and I understand that charitable

founders funders rather have many things it's just like okay relative to the other places we can put money to work in the in the world as further investment in the American vaccine supply situation as of May and looking forward doesn't make sense for us could you do it in another

nation and we said like okay were the American effort we have some advantages here we would not have them the other the other nation we did talk to people there we we tried to see if we could help a team there or go or go there etc but we don't we don't see that there's a path to

like positively impacting the problem there in a way that there's manifestly a path positive impact here and we lost that argument we didn't get the money the last hundred thousand dollars in was my daughter's college education fund like oh my okay look I agree that it shouldn't

be up to tech to solve this huge society wide problem but given that nobody also solving it I still don't understand have you gone back to any of them or have any of them reflected on yeah maybe I should have just you know wrote you a million dollar check and saved

you all this assholes you could have got back to business so I you know ultimately I'm the CEO like responsibility for fundraising lies with me and so like I thought any number of things about how could I've done that better how could I have strategized that you know I did not stop fundraising

efforts but I stopped lighting up new conversations for a number of weeks as I thought okay we've got we've got the two million dollars that we need to run this till the end of August and that's my sort of internal target for the point at which it doesn't quite stop being useful but it starts like

actually being you know a question on the margins where it's not the question until the end of August so could I have done better probably the some of the folks in the broader effective altruist community I'm not a member but I've read a lot of stuff that they have written over the years and I

probably consider them positive they are the but four cause of fax and HCA but I asked me about that moment but some EA funders talked me after my piece about it to come out and said this is physically painful to read yep we wrote bigger checks with less consideration to projects

that had far less than success why didn't you just ask us for money and like the answer there was twofold one I thought I had high quality introductions and high quality personal network to people who were likely already going to fund it and so I didn't light up additional

funding sources and two like this is a true answer I'm a flawed human who has a limited number of cycles cycles in their day and was running a very very complex complex operation and it literally didn't occur to me hey maybe those people that have been like making a lot of noise about

writing a lot of money for pandemic checks would be willing to write a pandemic check which like that was not entirely an international belief for me because I had like reached out to people who were making a lot of noise about writing money for pandemic checks and they said not in

the United States not in May and I thought oh well it's you know if I light up a conversation totally cold with someone now it's likely to just get a know again I should try to like scream and say event break the piggy bank for my daughter's college education fund which by the way she'll go to

snow worries but it's a like how far down the list of like planning plan B plan C we were down to like plan C at that point I'm just to be clear I'm definitely not blaming you I it goes back to the Copenhagen but I should be a little bit because I should be rigorous about my performance I

think like you know you go back to the commission versus omission it's like the exact same reason that we shouldn't have blamed Google if they got involved I did that themselves and maybe made a mistake yeah I said come on to remove the bottleneck that was basically stopping all global economic

activity and for causing you know millions of debts you had to in your for the action you were taking about it take money on your work daughter's college fund it's it's so insane and I so can I say this and like there's a positive takeaway here so they're actually is a positive takeaway in

that there is one tiny actor who understands that he is unitary control over some decisions who is capable of like betting boldly on those without a huge bond process when it is important to bet boldly on things not to shoot my own horn here this is literally what happens so like on the first day

there are you know we're getting in discord together and there's a bunch of infrastructure we have to sign up we have to like you know get hosting the adiada and there's a like annoying mechanical step at this point where you have to put down a credit card for potentially unbounded expense and

people were like okay you know there there's a list of things that we want to do but since there is no money here you know like I'll take this one and you take this one and after I like heard this conversation go on for two minutes I said this is not a conversation we should be having here is a like a debit card for my business which have just spun up on the back end because like this is literally my job which has ten thousand dollars on it spend the ten thousand

dollars on anything that accelerates this project there is no approval process there is no don't get a receipt don't worry about the paperwork right now and why did I do that because we were like doing things like well you know okay

there's like a scrapbook like the information about where hospitals exist and what their phone numbers are is probably like scrapable from the internet for free or we could buy a commercial database but that's like a stupid amount of money it's like two thousand dollars and like

relative to the importance of this project two thousand dollars is a trivial amount of money spending like four hours writing a scraper and we don't think about that in government procurement and in charities we have some sacred virtues about like you must minimize waste you must minimize opportunities for corruption you must maximize maximize for like the the funders of the charities for their for there like you know line item uh support individual things the charities buys

and those sacred virtues conflict with winning and at the margins with they where they conflict we should choose winning we should choose human lives over reducing corruption like and one of the few things we are reflecting on is the uh the tremendous amount of waste and fraud that happened in the

like ppp loans and other uh grown stimulus things and like okay i'm not just saying this to be contrary in folks we should be glad there was waste in uh in like covid stimulus if there was no waste we were clearly not choosing the right margin to uh to focus our efforts on so by the way for the people who don't have context on how much money typically goes around in Silicon Valley they think oh one point four million how how hard should that be to raise if you right

now given your reputation like literally treated out i'm not going to tell you my idea but i'm raising 50 million dollar seed around or something i'm i would be like that's gonna get filled um and i think people don't understand like one

of our i have like friends who are at 16 years old who have some gbt rapper and they like they don't have to worry twice about raising one point four million dollars not trying to brag folks just telling you like three-quality of Silicon Valley and also the reality i put in a document i

um misapplied the like i have some knowledge of how uh seed funding would work if i attempted to raise seed funding for a for-profit company and i thought um originally like we're probably going to be charitable but i'm going to pitch this to people as

essentially like a seed investment which they expect to like spend all the money as quickly as possible and go to zero uh while driving the total adjustable market of the company to zero um but um promises and what passes for humor must be uh and uh so i told folks pretty

confident in the first couple of days i'm pretty sure i can get us eight million dollars and then uh like was actually able to deliver on one point two after far more tooth pulling and but like yeah descriptively if i was asking for a seed seed stage investment if i wanted to get eight million

dollars wired by tomorrow i think i could probably do that and that is a civilization and inadequacy because like can literally get eight eight million dollars for a blank check for something that has a profit motive behind it but if i write on the check uh

hey we want to fit to fix the manifestinability of the united states that figure out where the covid files are uh that that blank paper becomes less valuable by the fact of writing that so maybe on reflection i shouldn't i just shouldn't have told people uh and uh said oh the blank check

company was uh you know this thing and uh we're making it in 501 c3 which some ethics issues and that but the ethics issues are less bad than allowing people to die uh yeah um okay so i i the last episode i released at least one while we're recording this was

about within a i um a former a i researcher who thinks that the field is progressing such a way that you will need to nationalize the research in order to protect american national security and when i hear this about the inability of the government to

keep track of vials of covid vaccines or to get them in people's arms should for any other emergency that we might be worried about whether a i i don't know the fallout of a nuclear war or something should we just discount any government uh responds to zero and then just

if your plan requires some sort of um competent administration by the government discounted zero if it has to be something on the side so discounted to zero is like the opposite of wisdom here because we we didn't accomplish zero we accomplished a extremely impressive thing in aggregate which vastly underperformed like the the true thing that we were capable of and so have to keep both both of those parts of the equation in our minds at the same time um i think that people in tech

need to become radically more skilled than interfacing with government uh to the extent that it is uh you know we have some manifest competency issues in government right now we can't simply uh uh you know sit out here and gripe about this on podcasts and etc etc like we we've got to go

out and do something about it uh and there was a uh i think it's been reported that there was a meeting among like uh tech leaders uh in early in the vaccination effort where a bunch of people got in a room like this is going terribly i hope someone fixes it and like i hope someone fixes it is

no longer realistic alternative i think we have to be be part of that solution there um uh partly it's like having you know high-referentiality models for how Washington works then simply both are bad at everything um uh like it is important to understand

uh that uh the government has some manifest competence issues it's also important when working with the government to understand like telling the government to its face you have manifest competence issues is not the maximally effective way to keep getting invited to the meetings um

i was very religious about not criticizing anything about this Californian response effort in 2021 because we needed to be in the room where it happens um uh and you know that was a choice made and uh i'm 100% happy with this choice no but we we kept some relationships that we

really needed um the uh and i'm not saying don't criticize the government obviously but uh be be strategic about the sort of things like play like you are attempting to win the game uh and uh you know on the government side uh one like dispelling the massive hug field that's around software

this is going to be a part of the future whether you're in like it or not we need to get go to edit we can no longer accept incompetence at this as the like stand a routine standard of practice in Washington uh to um you know it is enormously to the United States credit that we have

a extremely functional extremely capable tech industry maybe we shouldn't treat it like the enemy putting that out there again this is the thing the United States has done before it it like there are laws in place there are decades of practice we could put

a kernels uniform on somebody like think seriously about doing that next time um do i think we have institutionally like absorbed all the correct uh lessons from us no uh when i see like after action reports they have to after after after action reports uh praise a lot of the things that people think are like very important for maintaining their political coalition which were either not productive very anti-productive and they fail to identify things that were the you know the true issues

and to the extent that they identify things that were the true issues uh the uh sort of recommended action is well i hope someone fixes this next time and there's no longer sufficient like that the default case is that the ball will be

dropped and goodness those of us who are involved in accidentate CA kind of dread what we call the pet signal where god willing there will not be another like worldwide pandemic killing millions people as long as we live if there is one like we know what numbers detects to get the band back together

society should not rely on us as plan a how did this happen i mean the the the the point about uh gripping a podcast that's that's definitely what i'm doing but i just i i think maybe you're um to humble to say this yourself but i i do want to commend you for there are very few people

i think who kind of you you tweeted it out there probably other other other projects that other people could have taken up that are not taken up in this case you tweeted it out you saw that there's a thing that could be done and you did it you like quit your job

and you did this full time you even what this and the reason you had to divin to your uh kids college one was because somebody who had promised a donation didn't follow up on it right so effectively every time that the uh we had you say a verbal green light with regards to money i would uh

advance the uh the companies that charity charities are companies bad the way folks i don't know if that as that is obvious uh it was called the shots incorporated so i would advance uh call the shots uh the money that was uh sort of soft committed uh before the money

would actually arrive in the bank and the theory that like this accelerates our impact we should always choose acceleration over other things like say minimizing credit risk uh and then uh you know some of the people who had like soft committed uh do not actually end up wiring

money at the end of the day uh i was like oh shoot well uh you know uh choices now are either don't run the last payroll or do run the last payroll uh and you know do not recover the money i've advanced the company well okay uh you know do run the last payroll

would you end up recovering it in the end or no uh end up being a donation of uh from uh me personally to the effort what the fuck that that is that is the least important part of the story folks uh sure but overall i'm just like like kudos isn't

obviously enough to commend uh to convey what i mean to say here but like i mean yeah i'm glad you did that um and i'm grateful like for figure of analyze you just like you it's hard to sort of plot that on a graph and make sense of what that means but if i can be pretty explicit about it

you know uh to the extent kudos are uh deserved to anyone you know carol yang for taking up to torts and finding like 10 people in tech industry who would jump into something at nine o'clock those 10 people uh the uh the other board members the hundreds of volunteers the team of about

12 people who worked out a full time uh for very full definitions of full time uh virtually ceaseless uh for five six months and uh there were other you know projects in civil society there were many people doing this is their day jobs like the american response effort is not one like small group of people anywhere it's the collection of all these things uh bouncing off for each other and uh i think like um you know i'm happy about our individual impact i'm happy

that if you uh like descriptively speaking if you googled uh for the vaccine at any point like vaccine near me after a certain day uh you know before a certain day there was no answer after that day there was an answer that answer came from us a little satisfied that that didn't come from

like people with you know the vast little immortability to have caused that happened much earlier uh but um like the ultimate takeaway is not about this you know a little tiny piece of the puzzle it's how can we make the total

puzzle better next time yeah so as you can tell by now patio 11 is somebody who loves digging into the weeds of how the financial system actually works and so it goes to figure that he used to work for this episode sponsor stripe stripe is how millions of businesses around the world move money

and accept payments and one of the advantages of stripe scale is they can invest in fractional optimizations which are not viable for individual businesses but add up to massive revenue and conversion increases for example last year stripe shaved

300 milliseconds off the render time for its payment links you can think of stripe as an entire company full of patio 11s dedicated to making sure they can figure out how to make the payment rails work smoothly for you and that's why technology companies like amazon and open a i

and even traditional companies like ford and hurts choose to partner with stripe now back to my conversation with former stripe patrick mccansey okay let's talk about some finance so you've right in addition this is you know saving uh thousands of lives for vaccinate c a

what you've been doing over the last year or two is writing this finance newsletter which is very excellent call that's about money and you explore the plumbing in the financial system my first question about this crypto at its peak was worth three trillion dollars or something

like that if you buy the cryptoscuptic perspective that you have how do we think about this number what what is it represent was it just the redistribution of wealth from savvy people or from dupes to savvy people or to the extent that the usual applications didn't come out as three trillion

what is the represent so i think i have two broad perspectives on this one and people often treat the market cap of some things like implicitly that's some sort of cost on society and i think the true cost society of crypto has been that anytime one engages in attempting to do productive

enterprise some actor in society has said okay i will stake you with some of society's resources which these resources are rival risk they cannot be applied to any other things society needs in the hope that you will produce something that is worthy of being staked with this how much if we

spent on crypto now on trading tokens around but on building infrastructure and spending rival risk resources that we can't get back whether that's you know GPUs or ASICs or electricity that could have gone to other things in china but went into mining or the time of talented and intelligent

people that could have been building other software products but was instead building crypto that number is in the tens of billions or hundreds of billions of dollars what do we have to show for that tens of billions or hundreds of billions of dollars i am very crypto skeptical and i could give

you an answer to that question i think crypto crypto like fans would not like to hear it from me so i prefer vitilic buterns articulation of this question from 2017 he asked at the time it was a 0.5 trillion true real number five hundred billion dollars market cap he said have we true

and i'm paraphrasing a tweet thread have we truly earned this number how many of the unbank have we actually banked how many distributed applications have a meaningful amount of value doing something which is meaningful and he has about six other meditations on this and i think

crypto folks certainly aren't accountable to me in some way you're not even accountable to butern even though he's a you know clearly like a leading intellectual in the community you're you're accountable to like producing positive value in the world but like what is the answer to

butern in in in 2024 how many of the unbank have we truly banked what is the best use case for crypto right now once crypto has a responsive answer for that that decides anything like proportionate to the hundreds of billions of dollars tens of billions or hundreds of billions of dollars

of resources that we've staked staked crypto with i think crypto people should feel enormously proud of that accomplishment in some future where it hypothetically arrives and in some future where that hypothetically arrives you have my sword i will love your your initiative however

for the last many years we have been saying you can still get in early you can still get in early you can still get in early because the value has not arrived yet and so that is my like capsule summary and crypto for 14 years in we've staked a group of talented people who are very good at

giving a sales pitch with tens of billions or hundreds of billions of dollars and look at what we have built this would be a failure in any other tech company capital F failure so either like radically pivot and unfail it or maybe we should stop continuing to stake you with money so two

potential responses if from the crypto optimistic perspective one i have people who helped me with the podcast who are around the world not that many but like the couple i have around the world i have a club editor in argentina i have a short seduitor in shri lanka and all of these people

have asked me i haven't prompted them i asked them how should i pay you and they say usdc and so maybe there it wouldn't be that much harder for them to set up a wise account but i think it's notable that all of them prefer the just how should i how should i get paid they they're the first answer

is a stable coin absolutely that is evidence yeah and you know like some tech savvy people have a good payment rail and well they have a payment rail that they do not have access to 15 years ago but like at the cost of tens or hundreds of billions of dollars you know like counterfactually

if one had thought like okay we really want to work on that payment rail specifically another way one could hypothetically have you know deployed ten billion dollars is on like the best funded lobbying campaign in history in the united states to work on like aml and kyc regulation to allow more easy

transfers money worldwide but why does it have to be compared against the best possible kind of factual use case it's a sense of commission versus omission again where it's like it's not margin it may things better don't judge it by like hypothetical rules just like keep in

keep in mind that hypothetical world's might exist judge it by like the actual realized utility at the moment relative to the amount of resources considered the second point is if you look at for example the dot com bubble literally close to a trillion dollars were invested in laying out the

fiber and the cable for this artifact that now you consider as the most valuable yeah i think that humanity has built and at the time reasonably people a lot of the companies that built this went past there was a bubble like dynamic where many investors who spent the capital to build out

this infrastructure weren't paid back didn't see immediate use cases from what they built and they just the bubble had sort of served as a showing point to that in the future get things rolling and that was hundreds of billions of dollars a trillion dollars yep tens of billions of dollars

if in the future something cool comes out of it and it's a useful use case that's probably worth it right cool at what point do we get to say that didn't happen a trillion dollars like at what date in the future do we do we judge like oh i see i hear someone has been right or someone has been

not with respect to we have created like you know people in crypto have very constantly stated in various places that this is the next iteration of the internet this is you know we'll revolutionize the the the world not just how payments are conducted but it will be like a fundamentally new

computing architecture okay like at what day do we compare notes on whether that claim was accurate or not this 2030 seem like a reasonable year or too far it seems like reasonable to me can i make a prediction of what is said in 2030 you can still be early crypto has created like

huge amounts of things but it's not achieved anywhere near its true potential please invest our new crypto start and like let's shift back in 2030 folks like please you know you know uh apt-tweet me if if if i'm wrong in 2030 i will happily eat crow i want to eat crow like

uh you know crypto people are like how couldn't you be interested in programmable money i'm like i'm interested in programmable money obviously money is programmable money but like my friends who were trying to sell me on this since like 2010 weren't wrong which should like totally smash my

interest based on uh uh what i usually find uh like intellectually edifying and i don't not find crypto intellectually edifying i actually think there are some interesting things that have come out the movement um but like i find a you know computer built in Minecraft out of

redstone to be intellectually edifying and it's a wonderful like educational advice for people who don't understand how a CPU works and i'm not proposing to use the like mind stone uh sorry redstone emulated computer in Minecraft to be like the next computational infrastructure for the

world uh because that like fairly obviously will not work very well um so another answer of what the value here is listen we want some sort of hedge against and i think this is actually kind of regional argument that i actually don't buy the capabilities that have been unlocked by crypto but

i do by the argument that we want some kind of hedge against the government to going crazy and k-o-i-c-a-m-l leading to state surveillance all the compliance departments in the banks just like start seeing if you've been to political protest and debanking you and it may seem unlikely but

it's good to have this alternative rail which keeps the system honest given that there's an alternative and if things go off the rails this is a worthwhile investment ten a couple of ten i mean well society as a whole can't even count that low in terms of the other resources it spends so

it's a good hedge against that kind of outcome so i'm actually much more sympathetic to crypto people in this focus than they expect most people who have a traditional financial background to be i think it is descriptively accurate that the banking system and all companies which are

you know necessarily tightly tied to the banking system which might be all companies uh well let's come with a central example so that's a second set first are a policy arm of the government and i think uh uh you know whether people articulate that in exactly those words or not uh

varies a little bit but when you have your mandatory compliance training you'll be told that no uncertain terms that you are a policy arm of the government and i uh i feel for crypto folks that say that uh uh things like this feels like you know warrantless search and seizures

of people's information and it's like very undirected dragnet fashion and uh some some of complicated thoughts about this so the modern edifice of uh know your customer KYC and AML anti-money laundering dates back to the BSA bank secrecy act in the United States which was late

on 1970s early 1980s and at the time uh the uh federal government in the United States was like strictly rate limited and how much attention it could give to KYC and AML and so maybe because we thought we had very limited state capacity at the time uh like the government would make rational

decisions and maybe it will go after like ten or a hundred enormous white collar crooks and uh drug trafficking cartels a year and not surveil down to literally everyone's society but the regulations we wrote and have continued right and have continued tight non over the years uh

do effectively ask for like transaction level surveillance of every transaction that goes through a bank and so um it is the actual practice and this is not a conspiracy theory i'm making nothing up folks this is like acknowledge that the actual practice and banks is that they have uh

descriptively about as many intelligence analysts as the american intelligence community has who get this scrolling feed of alerts that are generated by automated systems and for each alert they either go don't worry don't worry don't worry don't worry don't worry don't worry don't worry

millions of these alerts every day and then for some tiny percentage they say oh dear this one might actually have been a problem i'm going to write a two page two to four page memo uh and uh file it with the financial crimes enforcement network and in all probability no one is ever actually

going to read that memo but we have like intelligence community-sized operation running in banks to write memos that no one ever reads right because some tiny portion of those memos will be useful to law enforcement in the future and if you had explained that trade and like presidential debate

in the in the 1980s i find it extremely unlikely that any part of the american polity would say yeah yeah i want to buy that could we perhaps spend tens of billions of dollars on it but we did that and so to the extent i'm like extremely copacetic with crypto folks on this point uh a like this

thing factually says in the world i agree with you that it does uh be in an ideal world i don't think this thing would exist i think i agree with you there are very real like uh you know privacy first and then however uh crypto has this uh habit and uh you know people who are good at sales

uh have various sales pitches that they give to various people and crypto will uh actors within the crypto ecosystem will talk an excellent game about privacy as long as number goes up and when you say uh but you can choose between like being tied into the banking system which is necessary

for number go up for you can choose privacy they will say excellent i choose number go up and so but there's different protocols you can use the ones that allow privacy if you care more about privacy um right so yeah and scriptively that is a very tiny portion of crypto also to refine what you're

saying about the analysts they uh that number as many as would be an intelligence agency these appourashics who uh of uh we were connected to the government's policy just analyzing each transaction as soon as the government to get the competence to run an LLM across each of these millions of

queries right this is like a legitimate worry because as we yeah this is funny in the ecosystem like we have uh extremely low state capacity for this thing that we didn't think was important which was you know successfully administering vaccines but we do have extremely high state capacity with

regards to uh running the security state and uh if they successfully managed to like get their technological dexanover uh in order which there are plus and minuses there but they have like built something that are extremely impressive technologically uh and then just run it on this data set that

we've possibly been been producing the sort of uh like implicit ongoing invasion of privacy is much worse than we kind of baked into the system in 1980 when it would have been people going down to archives the look of things in microfeesh to try to do this and I mean I'm not even necessarily

making a point I've recripted here but I think it's worth meditating on the fact that the default path with this technology is that a very smart LLM is going to be looking at every single transaction that is electronically aka every single transaction ever um and it's it's intelligent enough to sort

of understand the implications how it connects to your other transactions and what's the broader activity you're doing here yeah and maybe this is just a broader point about the how to step back from crypto and finance for a moment sure uh I think this is this is one of the least understood

things about the tech industry where we have this uh uh this like societal level question that is not being addressed directly but it's being addressed by misunderstood proxy questions on taking as written that the finance industry is a branch of government in a meaningful sense

it should the tech industry also be a branch of government and we don't ask that question directly we have asked instead things like should the tech industry be responsible for minimizing the spread of misinformation etc etc and there was the uh an injunction issued in court case

last year on the 4th of July which I find oddly aesthetically motivating the court case is uh Missouri at all versus Biden at all but the argument made in the court case uh which the judge accepted which is extremely well supported by the record in front of him is that various actors

within the United States government uh uh uh poppeted the tech companies and used them as cat's paws to do frankly shocking violations of uh uh uh constitutionally protected freedoms like the freedom of speech uh and uh that there were like not on the level of we've built this you know

unaccountable hard to inspect system of l alums and heuristics and uh uh we started like turning off a lot of people's feeds and Facebook but like no like there was an individual person in the white house who was sending out emails like when we are you gonna address behind this

tweet guys we can't have things like this anymore etc etc again you know a feature of the United States we are very good about like keeping records and transparency and uh having a functioning legal system and the record before the court is like I was following along this is as this

was happening and uh what was happening was much worse than I understood to be happening um an example of something like as we were growing up as children would you ever think that the United States federal government would tell uh I believe it was the state of Missouri uh hey you have townhalls

where like citizens can come in and speak their mind and advocate for their uh policy preferences and you probably have a civics class and talk about like the first amendment of and things yeah someone said uh something we don't like in a particular town hall take down the recording from youtube

that happened yeah that is a violation of the constitution of the United States that is against everything in the traditions and laws and culture of the United States that is outrageous and yet it happened and we have not repudiated the notion of using teccus cats paws or using um in some cases

uh this is like literally written in the decision by the way which i would urge everyone to read there was an individual and a non-governmental organization which was collaborating with the governmental governmental organizations that doing this which said um uh to get around uh uh I'm not

quoting exactly uh to get around legal uncertainty comma including very real first amendment concerns comma uh in our ability to do this rather than doing it in the government directly we are outsourcing it to a bunch of college students who we have hired under the auspices of this program

like what like one just as a dangerous professional here uh you've violated the um uh the character from the wire stringer bell stringer bells dictum on the wisdom of taking notes on a criminal conspiracy but you literally wrote that down in an email the outrageous part is not

that you wrote that down in an email the outrageous part is you like with full knowledge of it engaged in something that is outrageous like unconstitutional immoral illegal and evil to the applause of people in your social circle and everyone involved in the story thinks that

they're the good guy in it if you write that email you are not the good guy in the story I okay so uh on that by the way so what is your sense of what the judicial and result of deliberations on this will be uh I think there will be a limited hangout and walk back of some

particular things and do I predict that uh and probably you know there does exist an injunction I predict that that continues to happen in the future um what do I know I'm just a software guy but do like people want to achieve power the tech industry descriptively has power because it is

good at achieving results in the physical world this is certainly not going to be the last time that someone desiring power uh things like okay can I force you to give me the power that you have accumulated uh and like that is you know ultimately like this is fundamentally a political decision

about how we construct our democracy and uh we should make good decisions about that well I mean that maybe that's the point the crux here which is that through the story you illustrated the vaccinate CA and the lack of accountability that showed in institutions the idea that you're

going to go back to congress and get them to pass some law that says oh the K we're KYC AML we realize that without alums it's going to be a bad deal with regards privacy we're going to rule that back we don't like that the collusion between tech and whoever's in power and it being

able to dictate book and get taken off the platform and that we think about history speech we're going to pass laws to take that back there's no sense in which there's um society comes to a consensus and here's the privacy concerns we have here's the free physical concerns we have

so that if at least one argument goes you the solution has to be that you just go off a real you start a new rails for these kinds of things that cannot be constrained in this way and it's not a matter of just changing the KYC law or that's not that's implausible given the

the manifest so it's not going to take a pass if we've talked about yeah I don't accept that that is the only thing possible for us I don't accept that the United States is incapable of doing nice things we can't accept that we have to be optimistic about the future otherwise what are we doing

here and you know in the tech industry like we know it is not like a physical law of reality or of large institutions that one cannot make systems that work like making systems that work is the job we have a few existence proofs like we should increase our engagement with government

on you know like hey uh state capacity we can help you build some of that stuff um also you know constitution of the United States is a document we feel like kind of attach to that document uh we understand like like again in Sanchez rule everything around us tech industry

uh was in early 2021 very concerned about being told and no uncertain way about people in power uh if you embarrass us we'll end you and uh the one thing in the in the record uh judicial record of this case is that the White House routinely um White House and other government

actors routinely overreached and ask uh the tech companies we would like you to censor this and this and this and this and uh the the tech companies said no in a bunch of cases and so like like continuing to negotiate for the right outcome rather than the one that people in power merely want

uh is important um there are some things that will feel unfortunate and maybe a little bit uh outside of the uh uh like our true sweet spot of what we would want to be doing on Tuesday in the tech industry where like maybe we have to ratchet up the amount of uh public policy advocacy that we do

lobbying is dirty word in the tech industry it probably shouldn't be uh maybe we uh you know not just lobbying but uh like when the do not embarrass us or to jump down uh and uh we're getting very quiet about the fact of uh feeling constrained by this uh maybe we should have spoken out more

and spoken more boldly about it uh maybe when uh it was like the routine case that the White House was uh you know uh telling Facebook Twitter etc etc everyone knows the names uh uh companies like on a tweet by tweet communication by communication basis and also with regards to broad rules that

affected uh the entire of the citizenry of the United States and residents of uh the United States and also everyone else in the world because these are the operating systems of the world like giving direct orders on there's a certain kind of uh free speech uh rather there's a certain

kind of speech act which we uh find vexatious and we would like you to stop that everywhere uh like very plausibly should get on the nightly news and say I receive the following email from the White House that uh it says uh we should uh uh stop this everywhere uh like if you point a gun at me I will

comply with this at the point of gun that is what it will take uh but this uh almost requires civil disobedience in the sense of if you're right about the earlier statement that in 2021 there are going to be serious political repercussions on the tech companies so uh okay so say that that's

right and then they publish this email like here's what the White House just sent me to take it on the tweet and now uh Twitter's market cap is just collapsed because people realize the political implications of why Jack Dorsey just got up and said at the time um

it so then the solution is that you need uh tech companies to basically sacrifice their um uh capacity to do business in order to I mean maybe that is a solution but like that's not a story about like optimism about the validity of the US government to solve problems this way.

You need to have a risk tolerance right like we every business everywhere including the financial history including the tech industry is like balancing various risks and uh the risk tolerance was like poorly calibrated uh the um you know one can achieve results in the world by

doing things like embarrassing government officials uh and uh you know like embarrassing a person in a position of authority is uh not a zero risk behavior it is relatively low risk in the United States relative to other places that was like extremely important for vaccinate C8 people

taught at the at the beginning are we going to get in trouble for uh you know publishing true information about vaccine availability that will embarrass the state of California and I said I have a very high confidence that no matter what we do views the state of California that you cannot get

in serious trouble in the United States for saying true things uh you know that the the first amendment exists we have like backstopping infrastructure uh infrastructure here and if push comes to shove we will shove back and we will win uh uh and like this is just me as a guy who like took

the same civics course that every that that everyone took and does not have like a huge amount of resources relative to say like the entire tech industry yeah uh like maybe we you know need to have a certain amount of infantestinal fortitude like a okay uh you know you've asked us to do something you've you've threatened us with that uh taking away all the wonderful toys and the great business models that makes this an extremely uh lucrative area to work in uh uh and to sacrifice a value that

is very important for us to continue to do that no we're going to fight you on this one uh and uh and you know the comms trained part of me it's like don't use the word fight is we were going to collaborate with stakeholders across civil society due to to achieve an optimal outcome balancing the

multiple uh disparate and legitimate interests of various arms of the government and civil society and blah blah blah blah sometimes that requires fighting we should fight when it does yeah um on Tyler's podcast you said something like America doesn't have the will to have nice things

and Japan does but if you think about in some ways yes uh if you think about euro and essay about working as a salaryman you're working 70 hour weeks and you're killing yourself to get that marginal adornment on the products you're making is isn't it more efficient isn't it better that we have a

system where we put in 20% of the work to get 80% of the results we spend the rest of the effort on I don't expanding the production possibilities frontier and uh it's it's good that we don't have the will to have nice things we just get it done I don't think these trade off against each other

through relevant margins um I you know nothing about cultures monoclesational um also I don't think culture is a uh like sufficient explanation for some of the differences that are achieved in the United States versus the uh Japan for example there's a great book making common sense of Japan by

a person whose name I'm looking at at the moment um an argument he makes in it persuasive lean at length which I don't think is 100% true but is more true than most people in uh well informed on either side of the Pacific belief is that uh when people say um they do this because it

is Japanese culture uh what they're often saying is uh you know I usually have a model for why people do things driven by incentives and I understand this incentive this incentive this incentive and then there's some error term in this equation that I don't understand I'm gonna call that error term culture I think culture is the real thing in the world uh to be clear uh but I often think that we that we reach for that error term far faster than we should so uh as my minor observation

about culture uh with respect to uh uh you know there are places and pockets of the United States that have the will to have nice things and often they they discover sometimes surprisingly the only thing

you need to to do nice things at the relevant margin without spending more money without uh having people like killed themselves over 90 hour weeks for the entirety of the career you can just choose to have nice things let's choose to have nice things let's not be embarrassed about choosing to have

nice things so you understand all this financial plumbing if you were an investigative reporter what is the thing you're looking at that the average reporter at some newspaper wouldn't know to look at to investigate a person or company or government institution I have an enthusiasm for the minutia

of banking procedure in a way that few people have an enthusiasm for the minutia minutia sometimes banking banking procedure causes like uh physically observable facts to emanate into the world and uh if you know that those facts are going to emanate then like you can have a claim made

about a past state of the world like I did this thing or I did not do this thing and that claim will if it is true cause metadata and other places and you can look for the metadata this is actually how a lot of frauds are discovered because the fraud is fun fun uh like basically the definition of fraud is you're telling someone a story the story alleges the fact about the world the story is not true and you're using the story to extract value from them most frauds will allege facts about the

physical world as the physical world gets more and more mediated by computers as uh it gets increasingly started between different institutions there will often be institutions who are not under control of the fraudster who have information available to them which uh will like very dispositively answer the question of whether the um uh the like alleged fact happened or not and as a reporter understanding how you know institutions and society interact with each other and the physical

reality of uh okay if this thing happens as alleged then these papers will be filed then these API calls will be made etc etc and then you know like doing the core job of reporting and like finding people at the institutions who will tell you the truth as an example of this uh mount

ox many years ago was uh you know insolvent and that fact was uh uh widely rumored but not reported presumably because the um the uh you know global financial global financial news industry uh didn't find it convenient to uh have someone call into the Japanese banking system ask the

right questions in the right way the CEO of mount ox alleged on Bitcoin talk that uh the reason that they were not able to make outgoing wires was because they had uh uh caused to distributed denial of service attack on uh their bank's ability to send foreign currency wires

that bank was Misoho Misoho is the second largest bank in Japan many people at say well regarded uh uh financial reporting institutions in New York City find it incredibly exotic and difficult and maybe in some ways kind of unknowable to extract

facts from Misoho which there are addresses FedEx will deliver letters to them they have phone lines we also have facts machines we love our facts machines like could you send a facts to anybody hit Misoho and say hey quick question are you sending like wires today and Misoho would like

received the facts get it kind of quizzically and say in response to your facts earlier yes we are still sending wires because we are the second largest bank in Japan do you have another easy answer questions for us uh uh you know like financial reporting dropped the ball on just asking

like individuals let Misoho simple questions about reality uh maybe you should do that next time uh and uh like to the extent that you understand like uh okay uh like one understand the CEO is giving out gold on Bitcoin talk under his own name where these are like obviously reportable

statements the statements of alleged facts about material reality and maybe like chase down the truth value of that that's hard it's so much easier to look just like repeat what he says on Twitter and say as said by this person on Twitter and then like quote the Bitcoin price feed

but reporting is hard like be good why aren't shortshelers doing this because they should have an economic incentive to dig to the bottom of this right and so we should have a deluge of financial information from shortsellers who called banks and trace through the API calls yeah uh that is a

uh and ongoing interesting question and I think short-sellers provide an enormous service for the world uh in like being essentially societies uh best solution financial fraud uh I um and yep they fail to detect lots of them uh like they're uh you know uh uh and not just throwing short

sellers or reporters or anybody else on the other bus I failed to you know detect uh SPFs various uh uh craziness despite having like sufficient information available to me as a well-read person on the internet to have detected that like wherever the freaking loss everybody like assumed someone

else was looking at it uh essentially so that's one reason like uh shortsellers often assume like okay uh you know I need to find a like first get put on the the paths of something and have a differentiated point of view and uh and then like another issue for shortsellers is you have to find

an instrument and you have to find another side of the trade uh to successfully do that and there was um uh without being expert on Bitcoin micro mechanics it was like difficult in size to make make the trade uh mountain cocks is in solvent right now other than like pull money out of mountain

cocks which people were definitely trying to do I got a number of interesting business proposals in uh the 2012-ish timeframe from people who said uh uh hey uh you're an American and you could really understand like international banking and you live in Japan could I like cause you to get

some yet and have you wire that uh to me in America and you can take a percentage and I said I really don't like where this is going and they said well there's this company and I've got some money over there and they can send you and but they can't send dollars and I'm like is that

because they don't actually have the money and uh they're like no no no it's a Japanese banking thing I'm like no it's not uh uh you know Japanese banks are very good at sending wires and they said no no no it's it it's really this thing this is totally clean I'm like you would not be having

this conversation with me if it was totally clean you need a money launcher I will not be your money launcher how hard is money laundering if um on one hand you mentioned earlier the state capacity that banks have where our every transaction is analyzed and the flag then if it's notable enough

they write a report about it how sophisticated does the cartel need to be in order to move around seven-figure amounts of money let's say so uh the definition of money laundering is like extremely stretchy and like taffy and there's a spectrum of people um much like there's a

spectrum of sophistication and financial fraud there's a spectrum of sophistication and money laundering so um if you want to look at uh probably the most sophisticated money laundering in history uh he's currently a guest of the US government but wherever sbf is staying uh he was

sophisticated oh this is this is a disagreement I have with a lot of people sbf was extremely sophisticated it's like a person at not just sbf think people uh like identify him uniquely where they they identify the uh the inner circle uniquely as being a fault here there was an entire power

structure there which was extremely adept at figuring out how power worked in the United States and exercising it towards their own hands and then it blew up but until then goodness uh like um you know they decided we need uh regulatory licenses uh they're called money transmission licenses

in the United States and those are done on a state by state basis they got 50 regulators to sign off on it etc etc like there are many objective indices of them being very good at their jobs until they lost all the money so it but it was more about uh politically getting people to look

the other way rather than we figured out how to structure the wire in a way that won't get flagged and it's not merely a matter of getting them to look the other way but uh if you go back to the the original sbf uh interviews where he's telling the founding myth of alimita he says like very

loudly uh you know the reason why I got this opportunity to do Bitcoin arbitrage between Japan and the United States is because I was able to do something that the rest of the world wasn't I was able to he doesn't say this in this many words I will say it subordinate Japanese bank uh because you

need that as like one of the pieces to run the run this Arab and then I pulled tens of billions of dollars out of this uh I don't think people like really listened to what he was saying there and he literally says in the interview on Bloomberg if I was a compliance person this would look like the

sketchiest thing in the world this looks like it's obviously money laundering because it is money laundering um and then uh uh interestingly michael luis retails the story and he locates the story in uh south korea rather than in japan and some people who are in valse we tried to in south korea

in japan which people would like pull on more threats there like they still lots of that story that we don't know but anyhow house fiscal you have to be to launder tens of billions of dollars route sbf did that so uh like that is a bar for sophistication he was eventually caught he was not

caught for laundering tens of billions of dollars route he wasn't even under suspicion for laundering tens of billions of dollars round sbf was tether's banker alameta uh research you know one of the parts of like the corporate shell game that they at they were playing moved tens of billions of

dollars of cash around the financial system largely under like full color of law uh on behalf of tether to move it from wherever tether had it goodness knows or wherever their uh buying customers had it too i think at the moment it's mostly at counterfeit sterled

some shoe has to eventually drop there i i will eat a lot of popcorn but be there isn't me there's many other ways to launder money you can like do things like um uh say i uh i establish a shell corporation and i buy a piece of uh real estate in new york city and then i rent that real estate

out to people and i collect a stream of uh uh rents from that and that that money looks clean because there is an ex-coup business it's my shell corporation that is renting this real estate that really exists to a totally legitimate person this money is clean and the money that i like put into the

system to buy uh to buy this on behalf of the shell corporation i'm just gonna like wire it to a lawyer and the lawyer is gonna answer any question from the bank with i don't know where it came from i don't have to tell you i'm a lawyer it's a real estate transaction what do you want for me

in one sense that's money laundering uh if the like original you know uh money was the proceeds of crime in another sense that's how every real estate transaction goes down at those scales uh and so like uh uh often like skill facility at money laundering is one facility at operating the economy

plus you know willingness to do that to hide the proceeds of some other crime um i think i would be really good at money laundering i'm glad i haven't done it professionally uh but uh uh that it it's fascinating intellectually uh previous communications at departments i worked at

probably uh with like explicitly anti-indulatory sense uh sure what can one do it's uh we are really confident that you're not with laundering money i i would be much wealthier if it was uh well uh uh it's a separate topic but when you look you you emphasize that people tend to undercharge

for the products they serve if you have identified somebody who actually does charge for products what they can get away with what psychologically do they have that the rest of us don't end so i think interest in here here is one of those places where culture is not necessarily

merely there are term but is actually descriptive in some ways um uh without pointing fingers at particular examples because it gets contentious uh there are uh like some cultures in the world that uh like institutionally have adopted more of a um how do you put it pro capitalist pro merke

merke and talistic etc uh like uh less of an ingrained skepticism regarding like uh earning money and accumulating resources as goal and there's other cultures which have an extreme ingrained skepticism about earning money and accumulating resources as a plausible goal and those

cultures generate people who have very different negotiation strategies and when you like impact people with different negotiation strategies against like the reality of a well operated i don't know google for example uh they arrive at very different numbers um uh what's the

the so in the 12 who wrote uh market dominant minorities uh uh peace about a book about that that subject etc like one of the one of the things in that is that uh you know uh uh like all people are equal in the eyes of god and hopefully in the eyes of the law but uh like uh

not all cultures like physically make the same decisions with regards to the same fact the same facts on the ground and that uh causes some disparity outcomes uh and so that that is one tiny part of that thesis which i don't uh i've received a lot of books i don't necessarily endorse every word

in every book that i read but i i think there is something to that i think another thing is that uh uh you know there's a certain personality type cluster or i guess you would say if people look out into tech and many of us uh uh it is over advanced that's the tech industry and the

pathologies of the tech industry are caused by the nerd versus jack distinction in american high schools heavily over advanced amount of truth to that not zero uh and uh like many of us were you know we came up we feel we were largely getting beaten down by the system around us we were not

worthy yada yada and then we have uh carry uh those issues into our professional lives and uh some people uh work their way out of it quickly some do not um some people working uh you know they for class and etc. reasons go to institutions like stanford and here from

i don't know who you hear things from if you go to stanford because i certainly didn't go there but i don't know an elder fraternity brother that says oh bro this is the way the world works you really got a negotiate when you get in the offer with when you get in your discussion with

google i've talked to so many brothers and they don't negotiate and so the ones that do make a whole lot more money you're like wow good for that most people don't like get that talk from their elder fraternity brother say uh do not go to stanford or don't have an elder fraternity brother

and so like until vex nc a the most important thing i'd probably done professionally was writing uh a piece on the internet about um salary negotiation i think it's subtitled make more money and be more valued which is just at exhortation for uh descriptively mostly young people who had some of the issues i had when i was young and growing up like hey you're allowed to negotiate that's not a moral failing if you you have no less right to the marginal dollar than a company has to the marginal

dollar like go get it and then you can put it towards all sorts of interesting ends um 500 000 people a year read that piece and it's now 12 plus years old i use i keep a folder in gmail about who is written and said i got twenty five thousand dollars two hundred thousand dollars per year more as a

result of reading the piece i used to keep spreadsheet i stopped keeping the spreadsheet after it ticked into the eight figures and like keeping the spreadsheet was just an ongoing source of stress for me eight figures yeah per year like you would assume that five hundred thousand people read it

per year some take the advice most who take the advice probably don't write me to say hey i took the advice thank you and maybe i miss some emails yadda yadda so like the true economic impact is probably larger than that uh there are probably people who have like the inverse of that spreadsheet

where it's like darn it we got quoted patio love against us again but uh like because you know at least numbers and there's only like a few firms in the tech industry that do have higher and scaling it and you know scale hiring anyhow okay um there's less people today who are in their

20s who had prominent software businesses than maybe 10 or 20 years ago having been in the software industry less 10 i don't know how when you started exactly is your sense that this is because the nature of software businesses has changed or is it because the 20 year olds today are just less good

i've met many young and talented people over the course of 20 years in the software industry and young and talented people continue being young and talented i think one thing that is partially explanatory is that when there's a new frontier that opens up the existing incumbents both in terms

of institutions and in terms of people with you know deep professional networks and personal resources and similar like do not immediately grab all the value in that new thing it's tyrannova and so to the extent that tech is no longer tyrannova i think you would expect less people

who are less resource to are younger etc to rise to the heights of prominence in tech and to be clear i'm not as right as a prominence in tech and when i ran companies i was not running companies like some other guesses podcast run companies it was bingo card creator i was making bingo cards

for elementary school teachers while living next to a rice paddy in central japan but that's kind of like my dominant hypothesis there are you know some things that are affecting the youth that i think are negative i think some products that the tech industry has created do not maximize for

the happiness or productivity of people that consume those products tiktok etc but you know i continue to be bullish about the youths and i have two children who are not gonna would will accomplish things in their lives and so i'm intrinsically skeptical about oh the kids these days they're just

bad kids how much do you worry about video games as a method as a sort of wire heading that somebody like you but twenty thirty years ago or twenty sorry now it has access to factorial and we'll just wirehead themselves to that instead of making a really cool software product how much should we

see this in the productivity numbers oh goodness i don't know about the product of eight numbers generally i do know that steam keeps the counter of like how much i am like video games in a year time and the knock on wood effort accomplished a few things in my career and also like against that

what was my steam counter up to so steam didn't include world warcraft world warcraft was at least a thousand hours for me in fact or your recently was 750 and then if you like some over 20 years i've probably played video games for four thousand six thousand hours and so that that's you know

two to three years of professional effort if one thinks that it trades off directly with professional effort but do you because if you then include every single young guy who's a nerd and often they you know how how much we worry that there are a bunch of their productive time is going to

give it your game since that of making the next offer business and we're at least about a little bit about it for myself one of my so i recently started working for an executive assistant and one of the first suggestions that he gave was that hey Patrick will you friend me on steam so that i can

that see how much you're playing any given week and so if you're like not making your priorities happen we can have an honest discussion about priorities who you've got a very that's really good advice given that i spent far too much time rat rat holding a factorial relative to my true preferences

you're going to really confident d a go sammy go the uh hey boss can we go we have a honest conversation to bite i don't know if i'm inserting those words into his mouth but the suggestion was genuinely his and he he heard uh you know on the one hand factorial wonderful game actually think factorial

matters far more to the world than most video games do that's an entirely different piece that i'm trying to write at the moment be that isn't me have you read burns piece on this the factorial minds yes i love many things spurn writes i think i luckily have a different

point of view on this one so i will hope to get it out to the internet someday but um uh you know on the one hand i loved it i think factorial space exploration mod specifically was the best video game i ever played uh and yet i spent 750 hours on that and over the course of a

year and i was you know unsavailable and recharging from six very hard charging years at strike and also running the united states for location information effort uh but uh you know there's a question of like at relevant margins are you maximizing for your true values and i was

like a little worried about that and so now my ea checks on me um do i worry about it for other people i will say that that when i was young and a world of warcraft raid guild leader uh who spent a thousand hours on that that it was a substitute advancement ladder for me the actual job was

working salaryman in central japan uh gave me no scope of control over things and i thought if i was a startup CEO i could make decisions right now i could build something awesome but i don't have that ability and i don't see myself as being the kind of person who could become a startup

CEO so um if i if i can't be satisfied in my nine to five nine to five in terms of making things happen in the world at the very least i can make sure we kill the dragon in two hours get don't stand in the fire come on uh team leaders you need to make sure that people are equipped with the

resist gear before they get there uh oh we're having like internal spats about uh allocation of resources like we need to have a better dkp system um by the way world of warcraft raid guilds and all other uh uh places where intellectual effort comes together in the video game community are much

more sophisticated than people give them credit for um uh when i started uh vaccinate c a i told people my sole prior leadership experience is having sixty direct reports in a raid guild and that's true and also like we don't rat hole in the subject but like there are parts of x and

eight c a that are very very definitely downstream of the uh like intellectual efforts about managing raid guilds specifically uh there are multiple people internally we're like yep like we are run in the raid guild playbook right now um but um uh be that as a me uh like you can do something with

your life like choose to do something something with your life and then if you want to play you know a reasonable amount amount of video games then play reasonable amount of video games and then like with respect to individual people i sometimes worry that you kind of get into i think i've struggled

with depression at some point in my life many people struggle with under diagnosed under treated depression i think sometimes you get into a uh a self-destructed spiral measured against like your true values and similar values and preferences where uh due to depression and other factors you

aren't making as much progress on the true goals you do you use uh video game systems as an escape from that and not just video games books television etc etc uh there there are many poisons available life uh you pick your poison use that uh to escape the amount of effort you put

into the poison uh it causes you to have less effort available to do the thing so you get less good results than thing and so helping people out of the self-destructed spirals uh is uh something that we as a society could stand to get much better at i have a speaking of bird by the way i noticed

that a bunch of my theory writers are finance writers there's you burn matlavine is there some reason why finance is hogged all the writing talent i think there are many good writers in the world uh Derek Thompson for example has read some uh uh he's a chemical engineer

and he's written uh some things which i barely understand i have enough of an engineering degree to appreciate uh half of the chemistry and i can't appreciate uh like the full totality of why what do you mean he acts of fluoride or whatever is a terrible substance work with and he has

some excellent writing and why that is a terrible substance to work with the broader question being why does finance have a greater concentration of writing talent and not just about current bloggers but you know uh finance histories are some of the best history books out there the

the Bethany McLean's and so forth and i'm curious why this is is just an intrinsically more interesting subject or there's some path dependence if i had ended up uh working in a water treatment plant i'd be writing about water treatment plants because i like writing and uh i'm positive i know i know i know enough about myself to know that uh a discussion about how alam works and water treatment plants which is something i read when i was like six uh that could totally captivate

me for multiple years on end and i would write about that if i was captivated by it um i agree with point net living made ones which is to have to finance and the tech industry have uh for a while been a relatively reliable way to turn intelligence into money many good writers are very intelligent

not all people who are very intelligent are good writers and i think it is a skill that more intelligent people could learn but uh simply if we uh you know create an incentive system which will uh tend to allocate not yours truly but descriptively like a lot of the come uh the

countries top brains until like particular fields where they will be come experts at those particular fields i would expect also a lot of the writing talent to be there because good writing is good thinking that's a program quote i think but uh is broadly true uh speaking of which so

you you went to japan because if i remember this correctly you thought that after the dot com boom that the programmer alone um demand will diminish and it will require some combination skills separate from what and you weren't the only one there were many other people who thought this way

the wall street journal said in the wall street journal had never been wrong i experienced that a 19 year old didn't know anything about anything um but separate from the object level predictions that you might have gotten wrong about the software industry at a meta level what what what was

a mistake you made did you just not into how how do you characterize that sure uh so i had a whole lot of rigor chasing a decision that had no basis in fact so believing in the wall street journal that uh all future engineers would be hired in places like india and china and not the united

states and so there would be no future engineering employment in the united states uh i made a spreadsheet of like okay here are the languages my university teaches here's my best estimate of the number of uh uh people in that country who speak it uh americans who speak it uh the uh amount of their

software they can sold here amount of us software that sold there blah blah blah blah multiply these together sort by column age uh descending and this is like larping is having rigor here but it felt like a good decision making process to me in the time uh now that the meta discussion is like

don't like with having rigor actually have rigor like but what would that look like in this context what what was your done differently ultimately happy with the decision decision might i made although like as presented as the wrong decision uh the uh i'm happy about it for other factors about life

working in japan as a as a young engineer there are some very rough parts about that but like on a level maybe this is an early opportunity to trust institutions less and trust like systemically viable reasoning patterns more like okay the wall street journal has asserted

uh assuming i'm remembering the surgical rate and i'm pretty sure i am because it was a selection point in life for me the wall street journal has asserted that no future americans will get hired as software companies assume this is true what happens in the american software industry and

maybe i did not have enough knowledge to like confulate predict at the moment but i can't confulate predict some things now like software companies are going to start to break as uh older engineers age out of the engineering population and they have no one coming up to replace them etc

like the industry uh institutionally must hire people every year and hiring freezes are necessarily temporary a temporary as a result of that now that's uh you know as close to the law of physics as one can have um so like if you are telling me uh something which is uh which says

the law of physics has been suspended and will be in the future like don't agree to that how would i learn the law of physics like uh i did not know anyone in software engineering at the time which is partly why i was getting my advice from this from the wall street journal but if i had uh been

slightly more agentic about it i was at a research university in the united states i could have found someone who knew someone who who was in the software industry to explain this to me i couldn't use that same logic to say that the journalism jobs won't go down because senior journalist will

have to be replaced by a new journalist and that's true but that doesn't take that many people to study journalism and it actually would have been a bad call to major in journalism and personally that is a career but the like fundamental thesis was that uh for journalism is that the

like total size of the pie is decreasing in journalism due to structural factors and the wall street journal thesis was not uh simply that uh uh the size of the pie would decrease in the lake of the dot com bust uh which i don't think they even got as far as articulating in that although it's been

25 years but was more like uh oh you know companies will maximize for cost of labor etc and therefore ship out all the jobs i see i see um um you've emphasized that uh a founder should do more ab testing that's like one of the main themes of your blog if you go back through it um so they should over

uh addition they're under optimizing on this what do they tend to over optimize on so interestingly i was the marketing engineer earlier in my career and really thought that that was important and uh in terms of like high level advice i would give a founder uh i would probably tell them a little

bit about marketing engineering but when spend and 95 percent of my time talking about that unless that was explosive with they brought me in on but founders spend too much time on playing house and chasing status is uh are both uh two sort of like well-known pitfalls where you can get addicted

addicted it just not quite the right word your incentives will draw you into playing the role of a the CEO of a successful company uh before your actions have earned the company its level of success like the fundamental nature of early stage businesses is that investment in you

is not a vindication of what you have achieved it's an advance on your future accomplishments and you need to like rigorously pursue actually making those future accomplishments and there's many ways to rigorously pursue it like uh talk to more users write more software make something

excellent get more people to use it get better at selling it etc etc that's an important strain of Silicon Valley culture i'm i'm glad we have it i'm glad we are popularized again to as many places in the world including to me and central edgpan uh and yet you know uh there there are always

other games that that are going on and those other games are less important but they are very very attractive games uh not video games here but uh why don't you go to a conference why don't you meet more interesting people why don't you uh show up at the best parties etc etc showing up at the

best parties does not at most margins uh increase the number of users you talk to it doesn't write functioning code like do those things that actually matter and uh and uh and some distractions like proudly wave i'm a distraction from everything that matters and some don't some definitely like

say i'm real work i definitely feel like real work uh and uh they're they're just not and so don't do the things that don't matter uh which sounds vacuous and yet um i i i i i want to go back to vaccinate cia and i want to close the loop on one question that i had that i don't know if we got

uh good answer to it that i think is important um which was suppose you're the president in the united states maybe you're a new one so the this one's gonna replace and you're looking back on what happened if you personally were president what is it that you're doing to

bring accountability to what happened in making sure that in a future crisis which might look different than covid things are ready to snuff um maybe you like fire the right people but beyond that well there's a lot of different things that could go wrong how do you make sure that we're ready for

them one cultural practice of the tech industry that i think it would be more uh salubrius for the broader civil society to adapt is the concept of blameless post mortems we talked about uh earlier about uh who to blame for various uh failures etc etc i probably believed that um

there is some amount of blame which performs useful societal purposes uh and then beyond that like the diminishing return set in pretty quickly and we are um you know the magic word in Washington is accountability we want accountability for failures etc etc people are terrified of

accountability uh and uh that uh causes there to be fields of distortion around things that actually happened mistakes that were actually made opportunities that were not pursued um and similar and so changing our general practice about how we accomplish accountability towards the direction of

okay first let's get a dispassionate record of what actually happened it's less important that it was a you know this name beneficial it's less important uh that uh it was under this legislative authority etc etc what did we do okay now how did what we do

lead to the outcome that we got given that what we did led to this outcome yeah what could we have done better okay what are the like given that there are these things that we could do better how do we uh like inject that back into the currently running system such that the next time this happens

we don't do the mistake sometimes that will involve in uh someone losing their employment I'll do uh hopefully not that frequently um a non-zero amount that's important to say uh but um there's many things that we post more of them at the experience and I don't know if we have uh

like several thousand hours of time to go over all of them uh you know there should be an inquiry it's an easy thing to say like let's set a minimum like ask all involved parties hey uh can you write down the history of the COVID experience just dispassionately like record dates times actions

taken we we wanted to be to be truthful and comprehensive and highlight what you think is the most important part about this hmm like that is step one like maybe we ask for step one and then try to get to step two yeah final question we're gonna work on next I don't exactly know what will be my

next big professional uh uh a splash in I've been on semi-subalucleos year I've been writing bits about money but uh bouncing between like 20 and um domestically 80% productive relative to what like 100% productive looks like to me um I might do a software company next I might raise a

small VC fund uh not entirely decided by do something entirely different at the moment uh kind of focusing on uh uh family oriented things and our family immigrated from Japan to the United States uh and are going through uh you know all the fun adjustment issues and I'm uh partly I focused

very much on career and other things over the course of the last eight years and I'm you know rebalancing that to uh help them on this adjustment and then figure out whatever happens the next for the next chapter of life excellent fat trick thanks so much for coming on the podcast

thanks very much for having me hey everybody I hope you enjoyed that episode with Patrick McKenzie as always if you did the most helpful thing you can do is just share it send it to your friends group chats twitter wherever else it's also helpful if you can leave reviews and ratings on

apple podcast, Spotify, YouTube wherever else you listen and of course as you can tell I'm doing ads on the podcast now so if you're interested in advertising go to thwarkeshpatel.com slash advertise other than that I'll see you on the next one cheers