Chamath Palihapitiya Says A Reckoning Is Coming For Big Tech

a good push, that's safe to say. But it is June eleventh. We just had this market volatility. Nonetheless, even with the volatility, there is this sense that people have and maybe it'll change by the time people are listening to this episode. Is that the sort of the most intense periods of the crisis at least, you know, it's not as intense as it was back in early April

or late March. Yeah. Absolutely, I think that's true. And certainly earlier this week we did get another alert, which was so I guess sometimes you do get good alerts, but the alert was smid regains all its losses for the year and basically went back to the highs that

it was seeing before the coronavirus. So we do have a sense, and I think a lot of people will attribute it to either the federal Reserve or some of the fiscal stimulus measures by the government, that these have combined to at least save the stock market, if not the real economy. Right, it's still very tb D on all that. One of the things, and you and I have talked about this tracy, is that in the middle of a crisis. One of the things that makes crises

interesting is it new ideas can emerge. And so often when things are growing, people don't want to rock the boat. But in the middle the acute phase of a crisis, it always feels as though there's openings for sort of new ideas, new approaches, and a sort of wide range discussion about what the future should look like. Yeah, I think that's right. It's funny how there's nothing like losing

money to make everyone reevaluate their capitalist model. But yes, there does seem to be an opportunity in crisis for people to start thinking about deep seated issues in their respective markets, or the way the economy works, or even the political system which is something that we're sort of seeing now. Yeah, that's exactly right. So today we're going to be talking to a guest who actually got a lot of attention. He had this interview when totally viral.

I think it was back in early April. That had to do with Bailouds, and it was very opposed to Bailouds, but it was a sort of good example of how in the most intense period there is this sort of yearning for people uh to offer different ideas than the sort of standard approach where we just sort of try to u put everything back together again. Yeah, and can I just say that this interview was so viral that even I in Hong Kong without access to US cable

TV saw clips of it exactly. So today we're going to be talking to Chamath Poli Hapatia. He's the founder and CEO of Social Capital. He's the chairman of Virgin Galactic. I think he owns a steak in the NBA team,

the Golden State Warriors. I think there's our there's our second time now we've talked to someone who owns part of an NBA team, Having talked to Mark Cuban, as you mentioned back in April, he uh did this interview on CNBC talking about the airline bailouds it's been very critical of share buybacks bailouts that, in his view, prop up the rich while failing to protect everyday people. Things are a little bit less severe right now than they were back then, but nonetheless, I think there's still a

lot of space to be talking about these ideas. So, without further Ado Chama, thank you very much for joining us. Thanks guys, thanks for having me on. So let's go back. I mean, I remember that interview. It absolutely blew up all over social media. What was your main message, like, what was the thrust of what you saw we were doing wrong, both in terms of an economy and in terms of the political approach to addressing the crisis that,

in your view is misguided. Well, I mean, I think that we've probably known for a long time that the tools that we give politicians to help society function probably

have never been duller. They typically have a lot of unintended consequences, and so my commentary was more of a frustration in realizing that this thing was going to meaningfully exacerbate what was already a very very skewed economy and that the people that needed the help wouldn't get it, and that you would see the emergence of a lot of perverse incentives that wouldn't really fix the system properly, you know, just to know that now we're going to

deal with the tail many years long of the activity of Treasury and the Fed over just you know, what was basically four to six weeks of a of a drunken binge will play out in ways that will have

just a lot of unintended consequence, I think. So I'm going to declare an interest here, which is that my dad is a former pilot, and he was a pilot for Southwest Airlines for a long time, and I remember distinctly in the early two thousand's after the nine eleven attacks, when a bunch of his competitor airlines were getting bailed out, he used to get really annoyed and say, why are

his taxes going to pay his competitors. Of course, fast forward to now he's retired, but he still takes a big interest in Southwest and of course Southwest Airlines is one of the airlines getting a bailout. But what do you say to people who will argue that this is a short term cash flow problem, and just because people have been ordered to stay inside for you know, the foreseeable future revenues are drying up. That shouldn't mean that

companies that are essentially viable should go out of business. Yeah, I agree with that. I just think that the incentives that the government creates to make sure that those things don't happen can be very different um them just giving a hand out. And the reason is because that the handcuffs that we put on companies when we give them

these handouts are very brittle. And so what happens in the case of airlines specifically, is that, you know, we made them sign a pledge that essentially said that they wouldn't lay anybody off until I think September, and I think what you're going to see is a wave of layoffs, and I think American has already announced that it's going to happen essentially October one. And so, in no event did any of this capital do anything other than just dilute the actual problem at hand and confuse us all

into thinking what the problem was. Because you create a problem where you've inflated the money supply, you've you know, created more debt all of that debt. It gets spread across every single American citizen, and none of us are

necessarily better off for it. So I think the better question to ask is, actually, what could we have done to actually help Southwest Airlines or American Airlines, or United or Delta and the panoply of other companies that needed help to bridge the time between the coronavirus and a

normal resumption in business. And I think you would have come up with a whole bunch of different answers than the ones that we came up with, which which is essentially was here's a check, Please at least don't do anything until near the election, so that we can at least look, you know, semi competent. Well, what does that

look like to you? So we've kind of as a if you look at the Federal Reserve and the Treasury combined, we've sort of taken a dual track approach, which is, provide a lot of liquidity loans to small businesses, loans that could potentially turn into grants to keep the corporate

infrastructure alive. And then for the layoffs that have happened, is sort of expanded unemployment insurance so that households can maintain their income and buying power during the acute phase of the health crisis, and the idea in theory is that as the health crisis phades, the businesses were kept alive with access to sort of cheap financing, households were able to keep their buying power, keep their homes, keep paying their rent, keep putting food on the table during

this period, and then ideally go back to their old jobs. And we sort of do that bridge from the past to the future. Well, so what is what is the ideal of what would the idea of approach been do? So, you know, for you and your listeners, how I would imagine this is a two two dimensional grid and the X axis is something that says short term and long term,

and the y axis is bottoms up, top down. Look, for the last forty to fifty years, we've always believed that, you know, a top down reallocation of wealth was the only way trickle down economics that was really you know, started by Reagan and frankly hasn't changed very much since in any presidency thereafter, to be completely honest, um, and

we've never believed that bottoms up actually works. What I would have advocated for was a lot more short term bottoms up help, and I think what that looks like is guaranteeing wages for basically a lot of individual people that would have been put out of work and making sure that they have complete financial security to at a minimum pay their ongoing repeat bills and at a maximum to actually be able to pull forward some amount of

spending that they would otherwise not do. And the reason is because you know, we are not a country that relies on government spending to drive the economy, although now after these last four or five weeks, you know the government is responsible for probably fifty of GDP, which is you know, a little crazy. So in the short term I would have done something that was a lot more

bottoms up. Some people would call it u B I I don't think we need to label it, but I do think that hand money in the hands of consumers would have been a much smarter strategy. And then over the long term, I do think that top down really

works and long term change. Top down is all about incentives and tax policy, and I think the right thing to have done there would actually be to make it uh much more profitable and credible for companies to spend on things like R and D to you know, not fritter away the cash profits they have today via buy backs. You know, all these idiotic basically activities, which is the

tool kid of the dumb CEO. And if you actually force some intelligent long term planning and thinking at the board level and at the CEO level and tie compensation to things that are truly long term versus EPs, you

would change those incentives as well. So if I was the government, I would have spent trillions of dollars on giving money to individual citizens, and then I would have spent several trillion dollars of tax incentives that told companies, hey, listen, I'll give you a short term loan, but in return you must sign up for the following idea. You must spend at least fifteen or twenty percent of your profits on R and D. You must actually say fifteen in

a rainy day account for the future. You must guarantee the pensions. There are all these things that you could have done. None of those things were done. You know two thirds of the SMP five hundred do have an R and D budget. How is that possible? I definitely want to talk about the idea of the idiot CEO manufacturing short term EPs growth, but just before we do. When it comes to government policy, it did feel like there was a sense that in the worst of the crisis,

people were trying to act relatively fast. And when people like that are trying to act relatively fast within a very defined political system, they tend to reach for things that already exist, or they reach for fiscal tools that they've used before. How would you encourage politicians specifically to think, you know, slightly more creatively when they faced this sort of time sensitive crisis and start thinking about new ways

of tackling the idea or tackling the problem. Well, the things that we did were actually completely novel and new. U b I wasn't a concept that existed until you know, we decided to give to every uh, every American. You know.

We we had no concept that the FED would be impowered or to basically use a bunch of cash, lever it up and enter the capital markets and by debt of all kinds of maturities to be able to pick off you know, debt that's actually you know, degraded in quality and credit worthiness to buy e t s. These were all new things that none of US had ever seen before. So I think that they know clearly invented things.

I just wish they would have invented smarter things. When I ever I saw your your interview a Railian against the bailout, I tweeted something kind of cynical, but I also kind of wonder what the deal is. So you're

the chairman of Virgin Galactic. The ticker is SPC, which kind of sounds like space, except that you've said in the past that the sort of at least medium term likely business model is something that can heat's not actually going into space, but terrestrial travel that could be like a much better version of business class, much faster, potentially

more economical than traditional business class. Do you feel that you have a incentive or that you the company of which your chairman is a competitor of these companies that you were calling out against their bailout. You know, we we have a lot of work to do before we build a hypersonic airplane. And just to give you a sense of it, um, a hypersonic airplane is something that flies at nine to a hundred and ten thousand, hundred and twenty thousand feet. The spaceship that we have today

flies up to three fifty feet. So we're in the business of spaceships, and we will be for a very long time. It's just that when you're in space, the physics are such that flying from here to Beijing is not nearly as troublesome as when you're flying at thirty thousand feet. And so obviously long term, you know, we can enable a different form of travel that's not possible by basically going so high into the into the atmosphere that a lot of the practical difficulties of traditional planes

are not the problems that we would face. But I really do firmly believe we're in the business of spaceship. It's just that those spaceships can be used for a whole host of different applications, including point to point what you call that. I guess we can get sonantic and call it an airplane if you want. So you are kind of in I mean in theory in terms of like a revenue model, they would be your competitive Maybe just on one more cynical note, but you're talking about

government policy. Sorry, sorry to throw this all out at you at the beginning, but um, you're talking about government policy and central bank policy distorting economies and potentially distorting markets. A lot of people would say that venture capital has benefited enormously from the kind of central bank liquidity that we've seen in recent years, and that because of it, you've had a lot of money that can continuously fund a lot of loss making tech enterprise. How do how

do you respond to that? Yeah, you're right. I mean there's there's no point putting lipstick on a pig. Like let's let's be honest about what's happened. You know, starting in two thousand and eight and two thousand and nine, we printed an enormous amount of money. The United States government stepped into financial markets and basically told investors, listen, I'm going to take the things that you have and

give you U S dollars in return. Those investors, in turn took those US dollars and said, well, I can do three things with it. One is nothing, two as I can buy bonds, or three as I can buy stocks. And what has happened is we've had the most incredible market that we've ever seen. Along with that, what that gives investors is an enormous amount of confidence because they

will conflate luck and skill. They think that they were geniuses in picking stocks, and we don't really you know, take into account is we we have this huge behemoth behind us, you know, giving us a massive tail wind in that. What happened was a bunch of you know, um investors decided that they needed more liquid exposure to get even better returns, and so they pumped enormous amounts of money in private equity. Now what did those private equity companies do. They went back and issued more debt,

bought companies, fired people, you know, pillaged balance sheets. They also then decided that venture looked interesting, and they tripled and quadrupled the amount of money that's gone into venture. What do venture capitalists do? They respond to those market dynamics and they raise larger and larger funds, doing dumber and dumber things so that they can get the money

while the getting is good. I mean, this, this problem of people very quickly reverting to lowest common denominator behavior in search for money is tried and tested and true and has been true for hundreds of years. And you know, I don't think venture capitalists are any more virtuous than anybody else. And so that's absolutely what they did. But if you trace it all back. How did it start? It started with the United States government deciding to print

trillions of dollars. Now, ask yourself, what happens in two thousand and twenty five when you look back at two thousand and twenty and realized that, you know, we printed eight, nine, ten trillion dollars. When it's all said and done, almost

fifty of a year's worth of GDP UM. So, whatever has happened in the last ten years, I suspect in the absence of some cataclysmic market realization, um, we are we are going to go to heights that you didn't think were possible from you Well, let's talk about right now. So obviously you have a lot of different purchase via which you see the economy. Early June, most people would say, okay, things are not as dire looking as they were in uh,

early April. But how from your various businesses and your various roles including sports and so forth, what's your assessment of the economy me and its trajectory? And you feel like we're on a path regardless of the incentives that policies created towards something resembling the pre crisis economy, or were still a long way from that in your view. So the first thing to remember is that typically the way that markets behave in the face of a recession is can be can be sort of seen over about

six quarters. I'm just gonna make the math simple. Six quarters. And in the first two to three quarters the markets trade down, and they trade down because people are trying to figure out when the bottom is, and you know, the economy is contracting, and then it's contracting a little bit more, and then it contracts yet a little bit more. But it's that last quarter where we have been taught as normal traditional market participants in the middle of a

recession to buy and that's the term. And then you get the next two or three quarters of massive ripping equity prices, and then the economy returns to normal and then you get back to judging companies based on normalized elearnings. If you had said a priority this event, how would people react to our session, That's what they would have said. They would have said, Okay, we are in for two to three quarters of a draw down and then uh, you know, the markets will turn and rip back over

two to three quarters. Instead, what we did was shut down the economy and we took it to zero. So from a very basic level, it actually couldn't get any worse than the first quarter. And you know when then you again supercharge it with all the money that the Fed gave us. This is why we've had such a such an indiscriminate rally going into early June. Now all of that said, my large and more broader market framework still applies, which is at their thrip, typically three phases

of a market. And the way that I think about it is, at first, you reflect the worst and everybody assumes the worst, and you have to basically manage to the absolute worst case scenario. But that's all psychological, and in all of that, what happens is people realize that

they overreacted, as they always do. And then what happens is you start phase two, which is you priced the news, and what that means is you become a little bit more sober, you become a little bit more thoughtful, You take a little bit more time, and you try to really understand what's happening and try to really weigh the balance of things that are happening and be a little

bit more judicious in your decision making. And then you enter the third phase, which is then you harvest profits, and you can be harvesting profits for a year, for ten years. You know, you could wait till the last month of the tenth year. But the point is that then you're really in a position where markets are trending higher and you can safely be a holder and a net seller and make money. I think where we are is we're in the middle of phase one and two.

We reflected the worst in March, and what we're still trying to find is our version of the truth, and so we're testing theories in the marketplace right now. We're pricing the news, trying to see how people react. So we just spent the last six weeks pricing the news, which is that there's a v shape recovery and everything

is going to be great. Uh, then you know, George Floyd happened, and it's unlocked a level of discomfort in the in the again, the real world, we've had a spike in coronavirus cases in the last two to three weeks, and I think now the market is going to price a different kind of news, which is that this is going to be tumultuous and that it's not going to be a clean recovery and that there's a lot more

uncertainty to come. And I think that over the next probably two to three weeks, we're going to play around with that model of how the market should work to see if that works. In general, my perspective is that unfortunately for us, the amount of money that the Fed is printed mutes and masks any of these things, and so the tendency will be for the markets to trend higher going into the fall, into the election, just zooming

out from markets. Uh. In one of your investor newsletters, you were talking about how you were viewing a sort of parallel with with what's happening now and a moment in time from US history, which was the Gilded Age. Can you walk us through that parallel, because I think it's really interesting, Um, you know, the Gilded Age? Uh. And basically this is the late eighteen eighteen hundreds, turn

of the turn of the nineteen hundreds. What we saw was a handful of industries really represent all the success in the world, specifically the railroads, and a handful of industrialists that were personified with both greed and villainy in many ways for being at the center of those industries and it's not dissimilar to how tech is viewed or

has been viewed going into this pandemic. But what really happened was, you know, there was there was pushback against immigrants, there was pushback against women's rights, there was pushback against labor organization. But eventually what happened was there was a pushback against trust busting. There was you know, a movement for labor rights, for women's rights, for immigrants, for high schools. You know, organized high schools didn't exist until the late

eighteen hundreds, etcetera. All of this is to say that, you know, we sort of had a short term bottoming in the pure form of capitalism that had preceded it, and we layered capitalism with a lot more social consciousness.

And I believe that we're in that progression right now, and I think that you know, in the next four years, it really irrespective of which whoever holds the presidency between is the bottoming of the top down, trickle down economic process, you know, largely defined by a gerontocracy who will eventually recede into the you know, annals of history and will be replaced by young progressives on both the right and the left, and so by four and beyond through I

think we're gonna see a rise in progressive ideals and arise in social consciousness, a more responsible approach that looks at every human inside of the United States as roughly equal and asks ourselves what we have to do. A lot more trust busting of big companies, higher taxes for companies. All of those things I think are in there are sort of like, you know, what I expect to happen

over the next five to ten years. Let's talk about that further, particularly from the perspective of the tech world. You're at Facebook for a long time. Facebook is in many ways at the center of a lot of these a lot of these tensions because so much information flows through Facebook. There's tension with inside Facebook, different views on how it should regulate itself and regulate speech, or how much it should just be a completely open platform. There's

also you mentioned trust busting. I'm sure I know there's a lot of people who want Facebook to be broken up. But give us your take on Facebook's role right now and how it should first of all, how internally, how management should be in your view, addressing some of these thorny issues about what it should allow on his platform, and then also perhaps your view on what a policy standpoint, the rest of society, politicians and I trust experts should

how it should go about regulating placebook. Let me answer it in the context of all of big tech, so Google, Facebook, Apple, Amazon, Microsoft. To my answer is that these guys should, um try to continue to build the most value for consumers and try to give as much of that away as cheaply or as freely as possible, because it is the only path to maintain consumer loyalty. Um. You know, the tech sector has largely been responsible for a decade of deflation.

You know, they have taught consumers not to spend money because you get great things for free, and tomorrow you'll get even more great things for free. That's an inherently deflationary set of behaviors and dynamics that that largely the tech the tech industry has created. The other reality, those that governments, I think have two very practical issues. The first is that big tech threatens their ability to govern, and the second is that big tech is collectively more

economically viable than most governments. And so what you see now, for example, if you look in Australia, is a much more aggressive taxation and policy regime in Europe, a much more aggressive taxation and policy regime. Um, we've heard that the fifty A G s plus the federal dj who seemingly couldn't agree on anything, has agreed to try to trust Bus Google. You know, in France, they tried to tax Amazon or they're going to tax you know, the

dollars that they make their through Amazon Prime. So this is the beginning of this trend. You know, local, state and federal governments all around the world are the poorest they've ever been, and these five or six companies are the richest they've ever been, and so it sets them on a collision course. That's pretty obvious, and what I think the markets are doing right now is trying to

fight the obvious. If you look at, for example, the the weighted SNPI market cap versus the unweighted, what that means is every company is worth the same versus every company is worth what their market cap is worth. The weighted market cap has completely dispersed from the unweighted, which is to say that, you know, the big five tech companies have completely ripped and the rest of you know, the four other companies in the SNP five have been

kind of sitting on their hands. And the reason why that lollygagging is happening in the capital markets is that market participants don't want to believe that it's true that the future profitability and long term profit capture of these businesses will stay intact. The practical reality is that when you look at what's happening, just by reading the news, you can see that, you know, there's not much recourse for these companies over time once the government decides that

they're going to get their pound of flesh. So it's pretty obvious from my perspective. I don't think that it's the consensus you um, but if you know, if you had to basically trade that news, what I would tell you is that you're over time, especially as we rally, you'll see more dispersion of these five companies relative to

the rest. And that's when you want to get short, because that's when the the spread will collapse at some point, when enough of these lawsuits basically you know, trigger a realization that a bunch of these things will get broken up and taxed and over taxed, and it's just going to be an ugly position I think for big tech overtime.

So you're talking about obviously inequality in society, but also inequality in companies, you know, between the big ones like the Thing stocks and some of the others, And you think eventually a lot of that is sort of going to get worked on or worked out in a similar way to what we saw I guess during the progressive era after the Gilded Ages. That sort of the thesis UM in some ways. Yeah, I mean I don't think. I don't think it's going to look exactly the same UM.

Like I said, I think that you know, at that time, these were all domestic companies with domestic motives, and there were fewer actors to really manage. This time around, you're talking about global companies with um you know, global balance sheets and hundreds of regulators you know, up and down the value chain at the federal, state, and local level all around the world that will want their pound of flesh.

So it's just inevitable. From the internal side, How do you think Mark Zuckerberg or some of these CEOs who are trying to wrestle this very strange role in which they're sort of de facto governments unto themselves, who have to set norms and their own lines of what they think is appropriate speech. How should they go about adjudicating these questions, because of course there are a lot of people inside Facebook that would love to see it. Depends on the lens in which you want to view it.

But if you're running a big tech company, you have two options. Option one is um to hold on for dear life um and and basically, you know, wait until they come knocking. Or option two would be to do it yourself so that you can control the outcome better.

For example, if you take Amazon as an example, you could make a case that Amazon could spin out a WS into its own entity right now and have some kind of an agreement that they define between them and and Amazon Retail, versus having it done to them by the d J. You know, you could make a claim that you know you could spin out Skype from Microsoft, or that you know, Gmail and the Google Ads business and YouTube should all be three separate entities, each individually

traded um where you know the agreements and the bilateral sharing or trilateral sharing agreements of data are defined by them themselves. Or you can just wait and have it done to you in the absence of anything else. UM. I think it makes all the sense in the world to wait. It's not necessarily what is the moral answer, and it's not necessarily what the companies or employees may

want you to do. But it's absolutely the thing that maximizes market cap in the short term, because that also maximizes your influence in the short term, which then probably gives you a sensation that maybe you can change the outcome if all this were to happen, if you saw some of the big tech giants start to get broken up or reined in a little bit, how how harmful is that for their business models? I guess I'm asking how much of their business model is predicated on having

basically a monopoly over certain sets of data. Yeah, I mean I think that you probably see a whole host of other competitors. Look you, you know. The thing to keep in mind is that the UM technology ecosystem typically has swung, you know, as a pendulum between these two poles. Poll number one is, you know, a few companies highly integrated, and then the other the other spectrum, the other end of the spectrum is a highly highly fragmented ecosystem of

many small players. And we've done this twice already on the Internet. I think in general, a smaller set of five or six large tech companies just means that there will be you know, hundreds of smaller businesses that sort of more cooperate nicely together and you know, have very clean interfaces and very clean data sharing rules, and you know, there's a little bit more transparency and how you're you know, how individual consumers are being tracked, and there's you know,

there's there's better interoperability. That becomes very important when you have a fragmented ecosystem. But in general, I think it's better for innovation, it's better for consumer choice. It's just not good for you know, market cap of a few folks and then the holders of those businesses as well, because then they have to go and you know, figure out where to reallocate that capital. Jamal, you mentioned a little bit ago the killing of George Floyd and the

tensions that we've seen since then. You yourself, I've seen on Twitter have been very critical of the police state and how we do law enforcement in this country. I'm curious if you could talk a little bit more about what tech of Silicon Valley can contribute to accelerating change, because I think you hear a lot from tech leaders about the importance of diversity, and more companies have published

diversity numbers and things like that. But from your perspective, in terms of putting things into practice that would make a difference both internally and for society, where do you see tech falling short still and what more of substance could be done. Look, um, this is a very delicate topic, and UM, I don't exactly know how to address it, to be quite honest. It's something that I've been thinking about.

You know, it's really caused me a lot of anxiety actually the last couple of weeks, because when you see that stuff, both the Amy Cooper video and then the George Floyd incident back to back. You know, for all of us that are minorities, it triggers, you know, all the many slights and inconsistencies and behavior that we've observed and you know, have been done to you and have accumulated, and you you normalize them because that's what it takes to live a normal life and be a participant in

society without sort of seeing you know, embittered. But I think the real the real change isn't necessarily for a company, but it's for the majority, you know, ruling class, and those are to be honest white folks. You know. The analogy I made to a friend is if your child came to you and said, you know, I'm being bullied, is that the child's responsibility or the parents responsibility to

do something. If you had a very close friend and she said to you, you know, I've been sexually assault to is it her responsibility to fix it or is it our society's responsibility to actually, you know, educate people and train folks to be more respectful. And I think this is sort of what it comes down to to kind of like point to an industry and say, folks need to do better. I think MS is the mark. This is a societal issue that's that's kind of been

left unaddressed for a long time. And um, I think people feel very sensitive about it on both sides. If you're a person of color, you know, you feel at points shame, anger, resentment. If you're not a person of color, sometimes you feel grief, shame, resentment, fear, discomfort. And I don't really have a very good answer. I wish I could give you an articulate sense of what needs to happen.

Except that it is up to the folks who recognize that it's wrong, but who are not the ones on whom these injustices are put on to do something about it. I can tell you one story, which is at after nine eleven. You know, I hated getting on a airplane and I still do because people look at you like

you're going to blow the plane up. I mean literally, and you know, knowing me and knowing who I am, you can imagine it's the furthest thing from the truth and on my mind, and it's it's just it's just a very very simple example because it doesn't really even come close to the magnitude of what black people deal with in America. But it's just an example. And I used to have S S S written on my boarding

pass and it was there for years. I could have been flying business class, first class economy, domestically, internationally, one way return, it didn't matter. And uh, I would always get these guys that were kind of like very kind of like physically patting me down, and you know, it just would delay me for hours, it seemed, and you just feel so helpless and targeted. And what happened was I told a coworker at the time of mine who work today. Oh well, white guy, And what's so sad

about this incident was I was not ashamed. I was just I didn't know what to do. He was so angry he wrote the same letter that I wrote to United and then all of a sudden, the SSS was gone from my boarding past. It's a very simple example, and it's not to take away from the severity of

of what the real issues are. But my point is in that example, like you know, people of color sometimes feel helpless, and it's the non people of color that have to do something because you're just more credible at times, and you're taking more seriously in a way where it doesn't seem like we're complaining. And I don't feel like I've ever complained in my life. But it makes you feel pretty worthless, you know. You know, you get pulled over by the cops ten times. I remember, like, I

have a driver now, and I told somebody. They asked me, like, why do you have an Asian guy as your driver? And I said, well, if it was another person of color driving me, we would get pulled over in my car. If it was a white person driving me, people would think that, you know, maybe I had sort of car jacked this car, and I've found through iteration of not getting pulled over that this is the sequence that allows me to do it. And I I did that. The reason I did that was because I was so ashamed

of getting pulled over. So off. These are all these little things, These are the things that accumulate rust in a person's mind, and it's hard to overcome that stuff. And it's hard to explain it to guys like you, because I'm sure you never understand what that means. You know, when you talk to when I talk to my black friends, it's it's not a if, it's a when was the first time that a policemen pulled a gun on you?

Can you imagine? I can't imagine that. So, you know, what I just told you was a one on the scale. What they're dealing with is a thousand on the scale. And so I think it's up to you guys to solve that problem. It's not a tech industry problem. This is not an industry defining thing. This is a racial problem. I think, Uh, it is a great spot to leave it there, and I really appreciate you joining us. Appreciate your perspective, appreciate your outspokenness. I enjoy following you on

Twitter and Chama. Thank you very much for joining us. Thank you very much. Thanks take care of yourselves. So I really like that conversation. I mean often, you know, what would first catalyze the discussion or wanting to have him on was the whole question about bailout. And I'm often pretty cyndical about the sort of some of the old let's let it go no bailoud nobi allouds for the rich discussion, because I often get the impression that it's sort of this desire among people with money to

um buy assets on the cheap or implicitly. But I really don't think that that is that's his angle anyway. No, you definitely don't get that sense. It is interesting to see a venture capitalist piece so thoughtful on a number of these topics. So he's talking about inequality and society as well as between companies like the Big Bang stocks and others, and also trying to decide, trying to think about, trying to parse ways to fix a lot of societal

and economic issues. You don't see that very often. I feel like you see a lot of like you see a lot of venture capitalists who like to talk about making the world a better place, but not necessarily in these terms and with as much sincerity. No, exactly right, And often there is this view that it's sort of like, I don't know, it's a sort of quasi libertarians, sort of like leave us alone and let us build, right,

let us build this thing. And I think it's interesting that he's specifically talking about the need for, or the likelihood of more aggressive taxation. There is reincredible constant right rating tech in from a sort of like very substantive way, taking the money, and it's gonna in his view, I mean, people have been predicting it for a while. Maybe it won't,

maybe it will happen. But the tension that he sets up, especially state and local government that are already sort of stretched on cash and are gonna it's gonna be much worse due to this crisis. This idea that this um this tension is coming, or this class this inevitable clashes coming,

I found to be pretty compelling. Yeah, and I can kind of see it going either way, because, of course, in a crisis, like we were discussing, sometimes people want to preserve whatever the industries are that are actually making money, and tech, as we've seen, has still been doing reasonably well because it's insulated from the coronavirus quarantine measures and

the stocks have been doing really great. But on the other hand, because of the social discord that's been sparked by everything that we've seen in the past month the or so, you could also see a lot of the public anger eventually aligning on big tech. So again, it's

gonna be really interesting to see which way it goes. Yeah, and I feel like that's like, you know, we've been doing a number of episodes that are kind of about this question of like do we return to normal or do the events of are they so profound that they meaningfully reshape policy? And we've talked about it with trade policy, we've talked about fiscal policy, but I think this sort of question of whether we really as a society go after huge power centers is another really big aspect of

that question. Yeah. Absolutely, you know, it will be fun in ten years or so if we listen to a bunch of old All Thoughts episodes from and just see how a lot of these issues eventually got resolved. That'd be fascinating. We have to get Laura, the producer, to schedule those and out in so we could do the ten years look back. Laura, please make us a time capsule of All Thoughts episodes and bury it somewhere in the Bloomberg office so that we can find it in

dig it up and listen to everything. Of course, not a problem at all, Thank you. Ally. Should we leave it there? Yeah, let's do that. This has been another episode of the All Thoughts podcast. I'm Tracy Alloway. You can follow me on Twitter at Tracy Alloway and I'm Joe Why Isn't All? You could follow me on Twitter at the Stalwart. You should follow our guest Chamath Polly Hapatia on Twitter at Chama. Follow our producer on Twitter,

Laura Carlson at Laura M. Carlson. Follow the Bloomberg head of podcast, Francesca Levi at Francesca Today, and check out all of our podcasts at Bloomberg under the handle at podcasts. Thanks for listening to