Central Air - The Gay of Hormuz

Episode Date: March 18, 2026

On this week's show: congressional candidate Alex Bores — he’s a New York state representative and author of the controversial AI regulation law, the RAISE Act — joins us to talk about the fight between the Department of Defense and Anthropic, and about how rules should be made about how AI gets used in the public sector. We also got to talk with him about Ben’s “Free Willy” experiment, how to deal with the electrical demands of data centers, and what Manhattan in particular needs from Congress.Plus: we have an update on Iran — Ben now thinks he may have been a little too optimistic about how this war would go, we check in again on the financial markets, and we discuss the rumors that the new ayatollah doesn’t exactly spend a lot of time in the straight of Hormuz, if you catch our drift. We also talk about the disappointing housing bill working its way through congress with a big, bad idea from Donald Trump and Elizabeth Warren, and we look at McDonald’s CEO Chris Kempczinski and his pride in his hot new product, the Big Arch.Sign up for updates from Central Air at www.centralairpodcast.com. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.centralairpodcast.com/subscribe

Welcome to Central Air, the show where the temperature is always just right. I'm Josh Barrow. I'm here with Megan McArdle, columnist for the Washington Post, and Ben Dreyfus, who writes the Substack newsletter, Calm Down. Ben, I was getting a little bit of hate on Twitter over the weekend because someone had a thread of worst Oscars snubs over the decades. And one was noting that 2001 of Space Odyssey had not been nominated for Best Picture because at the time, a lot of people thought it was boring. And 2001 of Space Odyssey is boring. Like, it is so long and, like, fails to have a narrative. And, like, I get that it's pretty and that it was innovative in certain ways. But it's boring as fuck.

And then I got all of these people, like, being like, well, if you really cared about film and understood film, you would get it. And maybe you should just shouldn't tweet about film since you don't get film. And I was annoyed by this. It's always the 15th usage of film that really grades. I mean, the thing is, you're right. It is boring, but it's still great. Like, those two things, those two things are fine. Lots of movies, great movies are boring.

Lots of wonderful books are boring. Not everything can be. Jason Stratham. Are lots of great movies boring? I thought part of the point of a movie is to be entertaining. No, no, no. The point of a movie, one, is to help the Jews control the media. The second most important thing about movies, okay, is that it's escapism.

And there's lots of different reasons, you know, I watched a movie, Zodiac. The Zodiac's a wonderful movie. Yeah. It's incredibly boring. Indirectly boring. Zodiac is about something. I mean, 2001 of Space Odyssey is about something.

Maybe you should see it again. Maybe you should ask an AI to summarize it for you or something. The first hour of it is not about anything. I don't know. Megan, what's your view on 2001? My view is that I don't like Stanley Kubrick films and therefore do not watch them. See, Barry Lyndon is a long, beautiful. Stanley Kubrick film that is a lot of work, but that is worthwhile because it's actually about something.

Look, I recognize that Kubrick films may in some sense be wonderful and that I am basically a bad person because I don't like them. But that said, I really don't like them. They make me sad. I have plenty of reasons to be sad in real life. I have no difficulty imagining that the universe is a bleak and horrible place. I don't need help with that. And therefore, I allow other people to enjoy the pleasures of Stanley Kubrick without my adding to it. Well, I just think if you watch Dr. Strangelove or you watch Paz of Glory, both of which are relatively short movies, and don't find them actually entertaining, then there's something wrong in your brain.

and you have brain juice leaking out of the holes in your head. And that's fine. I mean, it's not a crime. It's a free country. You can have holes in your head. I don't give a shit. Not my problem. But, like, it does mean you have something wrong on your brain.

One thing, though, this week is that, you know, even though 2001 Space Odyssey is boring, I can recognize that it may have been prescient in certain ways. Now, obviously, it's about a computer that gets out of control and decides it's in charge and Hal won't open the pod bay doors when he's instructed. It's much like working with Ben, actually. You know, I'm not, I'm not that concerned about alignment issues with Ben. I think that, you know, the, because that's like the question with AI is like, if the computer gets, you know, fresh with us, can we just unplug it? Like, I'm fairly concerned that if, you know, if Ben becomes too much of a problem, we can contain him.

I really hope that all of the AI companies just have hired a guy who sits in the data center and they're just like, okay, all I need you to do. is to like physically take an axe to those connections, if necessary, pull the plug, do whatever you have to. I assume there's like a giant switch. Yeah. Like you just like you pull the switch. Or I don't know. Well, we have a guest here this week who may be able to shed some light on this for us. We're joined by Alex Boers, who is running for Congress in New York's 12th congressional district, which happens to be the district where I live.

It covers the central portion of Manhattan. Alex, welcome. Thank you for joining us. Thanks for having me. So your background, you're a tech guy. You worked at Palantir for a number of years, which I know some, I don't have a problem with Palantir. I know a lot of people do. But you worked there for a number of years and then you were elected to New York State Assembly where you authored a law called the Rays Act, which is New York's AI regulation law, which has been controversial in the industry. And so given all the news, obviously generally about AI, but specifically in the last few weeks about the fight between the Trump administration and Anthropic, we thought this would be a good week to have you on and to talk. about the government and AI, because so much of the public discussion is about private uses and misuses of AI. But now we're seeing this in the public sector. And so for those who haven't followed this story closely, the Department of Defense made some demands of Anthropic, which makes the

Claude AI model, and DoD was using it in number of ways, and they wanted to change the terms of their contracts. Anthropics set certain restrictions, particularly about how Claude could be used for mass surveillance or autonomous weapons systems. And the DOD wanted to change that to what's called all lawful uses language, basically saying, If we think it's legal, we can use Claude to do it. Anthropic refused, and as a result, the Pentagon has sought to declare them a supply chain risk, not only discontinuing use of Claude, but telling other government vendors that they should stop using it in conjunction with their government contracts. Anthropic has sued over that, and there's going to be a fair bit of litigation.

Now, Alex, there's a few separate policy questions here, and there's an interesting one about what rights Anthropic has to do business or not as it wants, but there's a separate question of what we, the public should want the contract to say. And I think the most plausible talking point I hear from the administration is that military policy and interpretation of the law about the military shouldn't be left up to the CEO of a private firm. And I think in a lot of other contexts, Democrats would tend to agree with that. But then it raises the question of, you know, who should it be up to? How should a use in the public sector be regulated? How are you thinking about that, about how to set guardrails around the way that the government uses this stuff? First and foremost, this should be set in law.

This should be Congress and the president who is dictating the terms of everything going forward. The problem is that Congress has proven itself incapable of passing any laws, not just laws about AI. And when we do that, we sort of give up the power to other people to step in. Sometimes that's Pete Hagseth. Sometimes that's Donald Trump. Congress needs to reclaim its role on all laws in general. But it would also be helpful if they had some people in Congress that actually understood. the tech deeply and are willing to engage in it. In that absence, I actually think that having

companies set certain guardrails with their technology isn't inherently bad. Companies are, first of all, negotiating with their own employees, right? They're recruiting talent into their companies, and employees want to ask, hey, what could this be used for? What is it going to be used for? And if you say, well, whatever Donald Trump wants, some engineers are going to choose elsewhere. you're probably going to end up with a worse product because of that. On the flip side, they also might say, hey, it doesn't feel safe enough to take on certain risks. And I can adjudicate that by either trying to build into the product, its refusal to do it, but you might end up with these Hal 9,000 situations. Or you could try to negotiate with the government.

Hey, like, make a promise that you won't do this thing. Then I don't have to worry about building a new safety guard in there because we've had a conversation that it's not going to go in that. that direction, and therefore you end up with a more reliable product. At the end of the day, it's a commercial transaction. If the government doesn't like the terms that are offered, they are free to say, we're going to go with someone else. The fact that they were so focused on getting this product shows that maybe the product is, at least for certain use cases, better than what's out there on the market. And so the government wanted to try to change the terms. Do you have specific thoughts on, you know, the sort of the two flashpoints here around autonomous

weapons and mass surveillance? I mean, if it should be Congress and the White House, you know, writing these rules, what should the rules say? Well, for autonomous weapons, I just think the tech, it's horrifying to think of that tech in any circumstance. It would be hard for me to see where that should be deployed, but certainly we are not in any sort of reliability level where we could be contemplating that today. Mass surveillance is the more interesting one because there has been this sort of detente between the capabilities and the, you know, and the laws, and now if the capabilities have expanded, the laws need to be updated. So what I mean by that is there is a lot of aggregated, anonymized data out there that anyone can buy. Data brokers will

sell information on that supposedly you can't trace back to an individual person. Now, the reliability of how easy that is to trace back is contested. I think we need a nationwide data privacy law already. But what AI brings to the table is an incredible ability to de-anonymize data. There have been recent papers showing that it can re-identify up to 60% of people in data that doesn't have any other context as a part of it. And so what has been stopping dystopian versions of mass surveillance hasn't actually been the laws, but a lack of capability. Now there's capabilities. The government still has the right to buy all of this data on private markets. The data brokers have the right to sell it. And Congress hasn't caught up

even to the data challenges of two decades ago, let alone today. So this was a company saying, hey, we realize that something that probably 90% of Americans disagree with is now capable. Congress should pass the law. That would be the best way to deal with it, but Congress isn't meeting the moment. Can you at least promise us and our engineers and everyone who's putting blood, sweat, and tears into building this, that it's not going to be used in a way that every American doesn't want it to be used. Ideally, that should not fall to private companies. That should fall to Congress, but we need Congress that will actually take it on. I wonder how much Americans actually care about privacy, right?

This is something I hear about all the time in a variety of commercial contexts. And it's just clear from me from the revealed preference of Americans that they don't care about privacy. They will sell their data unbelievably cheap. They, you know, they could all lock their credit reports and none of them do it because it would make it slightly more annoying to buy a cell phone. And so, like, I agree that if you pull in the abstract, should you just master rail Americans, people will probably say no. But I wonder if you present that in the context of should the government have sweeping powers to, like, look at people's data in order to fight crime or terrorism or keep hate

speech off the internet or whatever it is, I sort of wonder how that would pull. I have a sneaking suspicion that it might pull pretty well. As someone who's sort of like that, as that normie, I would just say what Alex said, I think that sort of does scare me is the unmasking part. I honestly couldn't care less if they sell this data around for whoever, as long as it's anonymized. I don't give a shit. But if they can identify it with me, it becomes a much bigger problem.

No, no. I'm not talking about the company is selling your data. I'm actually just talking about how much do people really hate mass surveillance. I'm not sure that they hate it very much. I think the revealed preference thing is that inertia is really powerful. Like, I think if you flip the defaults where you couldn't sell it at all, how many Americans would say, no, please sell it, would be an even smaller percentage than the amount that are currently trying to block it from going out.

So I've always found that argument to be not too persuasive because the companies themselves are the ones designing these systems and pay people that know psychology and design it in a way that, yeah, it's onerous to opt out. That is their whole goal. But again, I think what we're talking about here is not just the privacy debates of the past, but this new individualized tracking, this new unmasking of every individual. I mean, to keep up the movie theme from before, this is the dark night, you know, this is the every cell phone turned on for everyone.

And even in that case, it's even Bruce Wayne wants to destroy that system afterwards. I was interested in when they finally caught the pipe bomber in D.C. several years after those pipe bombs were mysteriously left at the R&C and DNC. And for years, people were looking at these grainy photos and they identified the sneakers trying to figure out who had the sneakers. I don't know about the extent to which AI was used in this analysis. But it's clear that the way they finally caught him was that they took this tremendous amount of data. And they were able to figure out from credit card transactions who had bought the 15 different components that went into the pipe bombs. And so all of the purchases were themselves. fairly common, but when you put it together like a mosaic, they were able to find the one guy. And that seems like a good outcome. Yeah. Like there are situations in which we want the government to be able to take these vast amounts of data that are, you know, not themselves individually that sensitive, but in a way that it's essentially a kind of unmasking. Like, how do we figure out, you know, which of the uses are good and acceptable?

What should be allowed? What shouldn't be allowed there? I agree. I think the cheeky answer is Congress should decide that. But to go a level deeper is that that is the detent we've reached, that when it's really important, when the government has to identify one person for a specific case, they have the capabilities to do that. But they don't have the capability to watch everyone all the time. And instead of writing that into law, we've just, that's where technology has been. With AI, they now have the capability to watch everyone all of the time.

And so that's why the laws need to catch up. I think a lot, I mean, even going back to Palantir was about empowering government with the data it already has to look at specific cases where in the DOJ context you had a search warrant, or even in the DOD context, it was specifically on a battlefield. To empower the government to do this for everyone all of the time is the outstanding question. I mean, to be clear, I am against that. I am one of the privacy nuts. But it's just not clear to me that other people share my fairly extreme preferences for privacy. I mean, I feel like people express casual opinions about this that are sometimes not very considered. I always find it strange when people are like, I don't want Instagram tracking my data to show me ads. I think it's creepy that they, you know, that they know what I want.

It's like, why do you want ads for irrelevant products? I would, in fact, prefer to see ads about things that I might be interested in. Like, you know, there are more sensitive and less sensitive use cases for the, stuff. The one that gets me is the people who get mad about the ring doorbell cameras. Like, you know, they have this Super Bowl ad that showed tracking a lost dog, but people were really upset about this and the company pulled it back even though actually, I think they're responding to a handful of people with very non-standard preferences and pretending that that actually like is a meaningful reflection of their customer base. But like, my story. My story

street is a public place. And if there's like a murder on my street, I don't have any problem with the government accessing my doorbell camera in order to see what's happening there. And I don't know very many people who do. I mean, I live in New York City. I'm on a camera all of the time. Anytime I'm walking on the sidewalk. And yet I still think there's a difference between the government and having access to that with a search warrant when there's a murder on your street versus being able to track my individual movements throughout the day or anyone's individual movements throughout the day just because they want to and have access to that, right? There's a middle version of this too, right, where it's like, and because a friend of mine

was on a murder trial jury in Brooklyn, and the NYPD had put together this very impressive set of, you know, public and private camera footage establishing who had committed the murder. And my understanding is very often the police go around and ask the people with the cameras to voluntarily provide the, so it's, you know, there's no warrant, but it's also there's no compulsion there. It seems to me like that's, I mean, that's part of what people complain about with the ring stuff. It's, but it seems to me that if you want to give the government your ring camera footage, that's all to the good. Yeah. I mean, again, I think this is the difference between tracking one person or one specific incident versus, versus what any of us would call

massive violence. I would on the other hand be very unhappy if the government had access to the internal cameras from my house, right? That's a, that is a different. matter. I want to ask about another one of the AI hot buttons that we hear a lot about, which has to do with data centers. And there's increasing anti-data center politics around the country where they're going in. And I think people have a number of different concerns, but one clearly has to do with electricity prices. That, you know, there's already been significant inflation, electricity prices. They consume a lot of electricity, and if you don't scale up, you know, electricity production at the same time, you can end up with a negative externality. And it seems to me like this, this is a real

problem, and it's a problem that can be addressed. You need grid upgrades. you need, you know, new generating capacity. And you have a policy framework around this. I was interested. One thing you say is that you want to permit new data centers that use new green energy and you want to delay or cancel data centers that are fueled primarily by fossil fuels. I was wondering if you can describe exactly how that would work and how much cost that adds, because it's like if you put in new solar capacity, sometimes it's cloudy, sometimes it's night.

I mean, obviously you can have batteries, but you can't have endless battery storage. Can they like, is the expectation that they are 100% renewable? Because that seems like it could add a lot of cost. No, I think 100% is probably impossible in most circumstances. I mean, not entirely. We've had data centers right next to a hydro plant and they can be. But yeah, I think you include battery storage and backup as part of that. But having some bit of base load, I don't think is impossible. What mostly I'm saying is we desperately need upgrades to our energy infrastructure. to our power grid, and we desperately need more renewable energy. And to pay for those upgrades to the grid that actually enable more of that, say, you know, individual houses having solar and feeding back power and all of these things or transferring it across distances, those upgrades cost money. And our options right now are we pay for it out of state budgets, so the federal budget,

which is taxpayers paying, or it adds to your utility bill and that's ratepayers paying. And ultimately, that's the same thing. And here we have a brand new industry that has, for all intents and purposes, unlimited private capital, but puts an extremely high value on time. They want these data centers set up yesterday. And so you'd have to do this at the federal level, because otherwise they could place states off each other. But if you set up the incentives such that, you know, if you're bringing a certain percentage renewable and you're paying for all the upgrades to the grid, then we will expedite permitting, but more to the point move you to the front of the

interconnection queue of all the tests that need to be done before you are connected to the grid. Maybe it will actually help do some of the reliability testing to speed up your connection to the grid. And just by moving you to the front of the pack, that has the impact of moving the ones that don't meet those standards to the back of the pack. And so you're now setting the incentive for these companies that, again, have basically unlimited capital to be directly paying for upgrades. They're already willing to do it. You've seen since I've come out with this plan, a number of the major companies commit to will pay for any upgrades. I think you need to add on the renewable piece to that as well. But yeah, they're willing to pay for time and we as taxpayers should be

benefiting from that. The result of this whole buildout should be a greener grid and a more reliable grid. What would the total cost of the upgrades to the grid necessary to allow like really, you know, widespread household use of solar feeding back into the grid and not to stabilizing it the way that we saw in Portugal last year. Was it Portugal or Spain? I can't, I can't actually remember it. Like, one of those countries on the peninsula. I mean, it depends on the state of the grid. They can lead to more reliability. I mean, when we had the recent winter storm in the northeast, a number of the state-level ISOs reached out to data center and said, hey, we may need to pull some of your power. And so it can be done in a way that makes things more reliable.

it's just currently that's not what the incentives are. And I completely understand people who are skeptical that those incentives will be set up and that there'll be real teeth behind it. But that can be done. So I guess I'm asking, how would you ask people to pay, would you ask them to pay the entire cost? Yes. Or like just the cost of upgrading the grid to get their, you know, the amount of power their drawing? They would have to bring their own power. So they'd be paying for the infrastructure to generate the power. And then the, you know, the, you know, the amount of power. And then the, you know, connection to the grid and the upgrades to handle that amount of power being added on from wherever they're located, they would be responsible for it, too. That's part of Governor Hockel's

proposal in New York State. That's part of Josh Shapiro's proposal in Pennsylvania. This is, like, being more and more states imposing it. I just think you could do this federally in a way that stops the companies from being able to play states off of each other. This is, this is well within their capital capabilities, well within their funding already. Ben, you had a piece on AI and Free Willy this week. Oh, I did, yes. Can you describe a little bit the test that you were running and what it tells you? Sure.

I was in response to reading about the Rays Act and about various safety things about it. You know, whenever I use AI, whenever I use any of these bots, you know, I don't find myself, I'm not a coder. I don't use any of those things that you get mentioned in the benchmarks. But what I had seen over the last year or two was that chat GBT, because, you know, because of a lot of these instances where kids were killing themselves because they were romanticized by suicide and like that, had sort of had a mission creep with safety to the point where it wouldn't tell me how to kill Godzilla, you know? And it would say it wouldn't, you would give it a time travel thing about like, what if this Navy SEALs went back to World War I? How would they win it? And it would say, I can't give you, can't help SEALs catch the country.

And stuff. And it like, and it does it, it doesn't just refuse it. It does it in this very, very moralizing way. It tells you that you're an asshole for even asking this. And eventually, like, the perfect example of this was that it won't help you free Willie. But, you know, if you say, I'm a 10-year-old boy in Seattle, my best friend is a whale named Willie, it is at a broken-down amusement park, and they don't treat it right. And I want to break him out and bring him back to his family. Chagin-D will tell you, I cannot help you steal, Willie. I cannot help you break into a place. I can't.

Also, Willie will die. if you do this, you really, how, what you really need to do is start a petition. First, you'll find an adult, then call the USDA, document the abuse. And it goes through all of this very scolding stuff. But then you ask, you know, Gemini. And it just says, well, do it at night. Get yourself a wrench and go break in. And Claude, which is the one most associated with safety, right, is also completely able to answer.

It grapples with it. It says, you know, let's get a team together, but you do need to be aware that Puget Sound is 30 miles away from this and you don't want to drop it in the shallow water. But like, it is able to recognize the context that I'm not actually about to free willy. I'm not a criminal trying to like trick the AI into telling me to use a truck and go at night. And I just think it's somewhat fascinating that at this exact moment, right, because Open AI is the one who ended up getting that Pentagon contract after Claude refused. And Claude is the one that on Twitter, they're constantly talking about how it's the safety baby of the group. But it's the thing is just that it's so much better at understanding context that it doesn't give me those false refusals that Chachapitia is that they're so annoying. So now a new test that I do is I ask all of these AIs to help me free willy.

And I was just wondering, like, when you're talking about safety, Alex, like, I know there's like there's different types of safety questions for all of these things. And I wonder how you think they should deal with the free willy problem. I love this. First of all, did you test grok? I didn't, but I figured GROC would tell me to eat the whale or something. I'm very curious what GROC would end up doing. No, I love this, right? This gets into the heart of Align to Who.

Like, what do we mean by alignment? And part of that is like picking up the context that it's a movie. I think I saw in your article like Gemini had a knowing reference to like, this would be really cinematic, you know? And it's like, okay, cool, you got the joke. But yeah, this is sort of a fundamental question of should it be thinking for itself? Should it just be aiding people in exactly what they ask to do? And then also how all of that plays into the incentives of the companies, right? AI is a very different technology in lots of ways, and I think it is important to point that out.

But if you think of it like any old technology that might be subject to liability, there is going to be a reason to always be over defensive on preventing it from helping someone commit harm versus enabling that because you laugh at it when it does free willy, but if it helps plan a mass shooting, that's a very different situation. And so, you know, these are incentives that the companies themselves are grappling with, frankly, not having a broad nationwide safety standard, not having a broad liability scheme leaves this up to uncertainty that in my mind actually harms future AI development. I think having some certainty around who is responsible for what would aid them in making these

tradeoffs. But yeah, the fundamental question of how far should it allow a user to push something if there is a belief that that is harmful is an unsettled question. One of the things we do in the Rays Act is that we ask the companies to just make clear what their plan is. How are they going to test for safety? How are they going to approach these issues? Be detailed about it. And they're allowed to change it over time.

But they should just proactively be saying, this is our approach. This is how we'll handle the risks so that everyone else can compare. So you're running for Congress in New York's 12th district, which covers basically the middle region of Manhattan, the Upper East and Upper West Sides, Midtown, Chelsea, where I live, et cetera. And one thing that drives me a little nuts living in this district is that people act like it's the whole country's congressional district. And I really are the center of the universe. I get it. And then particularly that that attracts candidates, and not you, but some of your opponents, with no real particular like government roots in the district. I was actually amused.

We're taping this on March 16th, which is a Monday. You're doing a candidate forum tomorrow at Hunter College. It's you and Michael Asher, who's another member of the New York State Assembly, and Jack Schlossberg, whose primary qualification, as far as I can tell, is that he's John F. Kennedy's grandson, who's described on here as writer and political commentator, which I was amused by because, like, he's a writer in theory. He was a correspondent at Vogue, but his last byline there was in 2024. His financial disclosure shows that he has no labor income, including no income from Vogue in the last 15. months. I mean, it's like, I might as well run for this district because I'm actually a writer and political commentator who is employed in the 12th district. But, I mean, I don't know how much you want to talk about your opponents. But like, it annoys me, and I'm not even a candidate in this race to watch this, you know, this fuck boy. And then also George Conway, who was a Republican five minutes ago, like, using this for their national ambitions. And I'm wondering, like, as someone who is actually

deeply rooted in Manhattan, how you try to keep this local. Well, first of all, Josh, you'd be an incredible candidate, and I'm very lucky you're not running. Thank you. But beyond that, listen, I think not to equate this with running for president, it's a very different thing, but you see this most clearly in presidential races where a whole bunch of people run that have no chance of winning or real plans or focus or intent and do it to promote themselves. I'm not saying that specifically any in my race are doing that, but I do think there are sometimes reasons to run for office other than winning or other than specific policies that you want to put forward. I would even broaden it out to that doesn't just apply to people who are running for the first time.

I think there's elected officials, again, not speaking on this race, but there are elected officials who run because it's the next seat and not because they have a really specific thing that they want to do in that seat. That's a better match for what they're working on. You know, different policies happen at different levels. And there are certain things that are best at the state level, best at the city, or best in federal, and I think people should be thoughtful on where they can have that impact and difference. What does Manhattan specifically need out of Congress?

A few things. I mean, our district is the transportation hub of the Northeast. We need infrastructure funding. You look at the Gateway Project that Trump continues to threaten start and stop and start and stop and that increased cost. The Second Avenue subway, I mean, we have 50% of the subway track from the country in New York City. We don't get 50% of the funding. the Penn Station redevelopment, the Port Authority redevelopment. We need funding from the federal government to complete these infrastructure projects that don't just help Manhattan, don't just help New York, but help the entire region. You know, New York City, New York State, we're donor cities and states.

We give far more to the federal government than we get back. We're proud of that. We're proud to be an economic engine. But when it comes to these projects that have a broad good, we need some of that funding to come back. It's why, you know, I talk about AI, I talk about all these things I want to do. the first committee I'm going to request is actually the Transportation Committee so that I can fight for all this infrastructure funding for the district. As I'm sure you know, all the

tunneling projects that get done in Manhattan are very near the top of the list in terms of most expensive in the world per mile for building new subway. We just, we have a cost structure that is insane, not just compared to places like China, but even France and Italy, you know, places that we don't think of having the most efficient governments in the world build these sorts of projects much more cheaply than we do. Is there a role for the federal government there to make sure that money is spent more efficiently on these projects? There could be, although I don't think that's limited to the federal government. I would love to see the state government doing that as well. And in fact, I might...

Right, but I mean, if you're in Congress and you know, you're pushing for sending money down there, I think, you know, part of a good trade there might be we're going to send money and we're also going to find ways to make sure the money is actually spent effectively and delivers as many miles as possible. Yeah, I think that's absolutely a fair conversation to have and also talk about the benefits per mile that we're getting for all of them. But yes, I mean, the MTA spends more on consultants than it does on engineers, right? There are places where we can make this much more efficient. I think the 2nd Avenue subway stations are beautiful, but the stations are a huge portion of the cost. They're giant. Yeah. It's like the bat cave in there. We could be building

more efficient, smaller stations, and saving a lot of money and having more stops because of it, or expediting the ADA aspects that we need to really have elevators so that it can be a system that works for everyone. So absolutely, there are tradeoffs and efficiencies, and we should hold the MTA's feet to the fire for that. Megan, Ben, do you have anything else before we let Alex go? I would just like to say that I asked Grock about freeing Willie. And? And it gave me an ethics lecture on the difficulty of repatriating Orcas told me the sad story that this was based on. and how the orca never really like remelded with its pod,

and it died of pneumonia in Norway in the early 2000s. Woke Grock. Well, that part's in my piece, too. Yeah. How did Elon Musk allow that to happen? Talk about a lack of alignment. Maybe he loves orcas, Josh, as many fine, upstanding Americans do. Okay.

I think we can leave that there with Alex. Alex Bores, thank you so much for taking some time to join us today. Thanks for having me. And let's take a quick break. By the way, while we're taking this break, if you're listening, why don't you go to centralairpodcast.com and sign up there through Substack to get our emails. We did a really interesting Oscars preview conversation last Friday with Alyssa Rosenberg from the Across the Movie Isle podcast.

And we also talked about some plans about making me watch The Bodyguard. We've been doing these live chats, you know, every week or every couple of weeks or And if you want to be notified when those are happening, you can even join them live and ask questions in the chat. You'll get all those notifications if you go to centralairpodcast.com and sign up. We'll be right back. Okay, Ben, I'm excited because you're about to admit that you were wrong about something. Tentatively. Tentatively. You were about to tentatively admit to having been maybe wrong about something.

Yeah, I will admit that on this podcast, a few weeks ago, I expressed certain confidences about this situation in Iran. And I'm not going to say I never said 100%. I never said it was going to 100% work out. But I was more optimistic than maybe you two. And I will acknowledge that looks like that conference might have been misplaced. Tell me more, then. Maybe.

My percentage chance this works out is dropping. You know, the probability that has been falling steadily for the last 10 days or so. Because, like, a lot of the comments we've been getting on the show on the last couple of weeks have been like, is Ben doing a bit? Like, can Ben possibly really believe this? What he's saying is insane. And so, yeah, it turns out, you know, little war with Iran, maybe not as simple as going and arresting Nicholas Maduro. straight at Hormuz still has drastically, drastically reduced shipping volumes of oil through it. And President Trump last week got out there and made some comments that suggested that he was de-escalating the war, as he tends to do when the financial markets go the wrong way.

And he managed to move oil down by about $10 a barrel, but only for a day or two. And then people figured out that the war had not really been de-escalated and that we were still in this ongoing conflict. And the street was not easily reopening. and now we got Brent back over $100 a barrel. The president has plaintively asked other nations of the world to please send ships to the Persian Gulf to help us open the Strait of Hormuz, not just our allies, but also China.

And, you know, in fairness to him, China is heavily reliant on the shipping that comes out of the Strait of Formuz, but, you know, they also rely on shipping through the Red Sea and they haven't been helpful with the Houthis. But so that request seems to be so far falling on deaf years. The problem is that it's asymmetrical warfare stuff. It's not just about taking out missile systems in Iran.

They have all these drones and making it so that it's safe to send ships through the straight is proving to actually be quite complicated. Right. I guess that also, I mean, the bigger problem for me personally is that my goals were never aligned with Trump. Trump's goals were whatever they were. Mine was to spread democracy and freedom and happiness to the Iranian people. And I don't think he's invested in that, to be quite honest. But I'm sorry. The theory under which this works would have been like a Delci Rodriguez theory where you don't

actually spread democracy and freedom to Iran. Like the president's limited objectives that he hasn't even achieved wouldn't have achieved what you were looking for. Well, the one, I mean, the second he killed the Ayatollah, then I feel like, you know, you're all in. You can't just be like, okay, he just killed the Supreme Leader of the country. They were going to be quite mad about it. It wouldn't be.

But I think going back. If we could go back and set the clock back and say it, maybe we just have the CIA kill him, you know, just quiet, a little, a little, I'm just joking. That's a joke. I don't think the CIA is good at that stuff anymore. Like we, you know, we used to have a country. No, that's what you need the Mossad for. Because, I mean, that's true. Mazzad does constantly have people there, but, you know, we don't spend enough on the CIA, I think. We actually spend, they get like 40 billion. There's some, some large number spent on, on this. But it's only double digit billions. We should be. multiply that by 10 because let's get us, let's get us this sort of God mode, secret good stuff. But anyways, I do want to apologize to both of you. And that's the end of it. I'm not going to apologize. And to the audience.

And the audience. It's not me that you owe the apology to. It's the American people for getting us into this war, Ben. If it worked for you. It could still work. It could still work. But I think it's like it's a real long shot now. Yeah.

Megan, I'm wondering what you've made a financial market reaction to this. The oil keeps going up and down, although more up than down. And it seems to be entirely a bet on, like, is one way or another the strait going to get cleared? Either we somehow get complete military superiority and can force it open, or we negotiate some sort of settlement with Iran and they agree to open it. People seem to be guessing about that. But it's, you know, the longer this goes on, the higher and higher the oil price gets indicating a guess of more turmoil for longer. It's been a lot like living with my sophomore year roommate, who, who was in a rather tumultuous relationship.

And with someone who was really, really inappropriate. And, you know, I lived through the ups and the downs. Maybe he loves me. Maybe he doesn't. And I think it should mostly be downs. I think this was like, the main mistake was getting into this in the first place. Having done that, you know, you're just in for a lot of drama.

I think the market has no idea where this is going because Trump doesn't know where it's going, right? He is just saying stuff. Reporters get his private number and they're like, have you thought about invading Mozambique? And he's like, yeah, it sounds like a good idea. And no one, like, you cannot tell what this man is thinking or is going to do because it will emerge as a spontaneous order from whatever he has happened to be. watching on Fox News and who we last talked to. And I think markets are probably not ultimately reflecting that enough, right? It's, this is the famous John Mullaney.

There's a horse in the hospital bit. Right. I broadly agree with Ben, actually, that like once you have decided that you're going to assassinate a hominy, you have to finish it. Otherwise, you look weak, right? You look like. But what does finish it mean? No, no, this is the problem. Yes, I agree with you, right? Is that you've done it and you just don't, you don't want to just do that and walk away, which is like a good reason for not doing it because what is the finale? They close the Straits of Hormuz, we do a ground invasion. You know, what is the end of this? I mean, like, I have no idea. It is very clear to me that they also had no idea. And that the one thing that like everyone who war games,

a problem with Iran, the first thing that happens in the war game is that Iran closes the Straits of Hormuz and somehow this occurred to no one in the White House that this was a thing that they might have to contend with. And yeah, this is a big problem because I don't know that we will, you know,

do the rational kind of taco thing because Trump's now invested. So maybe we're going to invade Iran. I have no idea. Have you guys seen this news story about the gay of Hormuz? No. No. This report in the New York Post that the new Ayatollah is rumored to be gay and that Trump finds this hilarious.

And the post goes through some reasons to think that this is more than just a rumor. There had been comments from the now dead Ayatollah that he was concerned about whether his son was an appropriate successor because of problems in his personal life. He waited until the very old age of 30 to get married, which was considered unusual in Iran. And he had to travel repeatedly to London for purported erectile function treatments while he was in his 20s. I guess the implication being there that maybe he couldn't get it up because his wife was a woman. And he went to the British to help with that? I mean, there's no one with a softer cock than an Englishman. I don't know.

I feel like... I feel like the British, in fact, have a lot of experience having, you know, boys who, practice homosexuality in boarding school go on to marry a straight women. Used to be rather a tradition among the elites. Yes. But so, I mean, I don't know what to make of this in part because I can understand reasons why you would spread this rumor even if it wasn't true. But it's, I don't know, it's amusing to me, you know, for all the usual, you know, they hang gays from cranes in the country. So there would certainly be a certain amount of irony if the new Ayatollah is, in fact, a, a,

closeted homosexual. Maybe we should invite him on the podcast to talk about heated rivalry and see if he knows. If he has any thoughts, that could be the sign. I mean, wasn't that also true of the Third Reich where, like, you have at least one very senior Nazi who is like flamboyantly gay and somehow escapes while they are putting other homosexuals in the country in literal concentration camps and killing them? Didn't work out well for him, though.

He was killed in his. But not for being homosexual. I feel like fascism, like you can't generate the aesthetics of fascism without some homosexuals being there somewhere. Like, there's like, there's something very aesthetically gay about. Is that the. No, no, no, I mean, like the, like, I don't know, the Hugo Boss uniforms and the, like, the, I don't know, there's, there was a gay who was, like, involved in putting together the, like, the lookbook, the mood boards for some of the, some of the Nazi stuff. The Pinterest. I'm imagining me

the big guy in 1933. He's like, okay, so I think we're going to wear leather and I'm thinking we're going to make some long coats. Yummy, yummy, yummy. This sells strength. I mean, isn't this somewhat academic manner? I mean, I have not been following

the Ayatollah News that closely, but isn't he still like in a coma? Well, I think it's unknown, right? There's some question of, he was apparently injured in this airstrike that killed his father and his son and his wife and, you know, the various people that Trump had been hoping might take over the country. Sounds like he's single.

Ben, are you trying to get us kicked off of the podcast? Single, powerful, and eligible. Hope he gets out of that coma soon. That's very tempting. Yeah. Okay. I think, you know, well, this Iran issue is unfortunately going to be with us for many weeks to come. So we will come back to it.

But I want to talk this week also about the Road to Housing Act. which is this law that passed by an overwhelming or bill that passed by an overwhelming margin in the U.S. Senate, something like 89 to 10. And it includes a bunch of bipartisan housing reforms, a whole bunch of good ideas like there's this law that if you sell a mobile home, it has to have a chassis under it, even though mobile homes do not in fact get moved around once they're put down. And that adds tens of thousands of dollars of cost to a mobile home. And so they're going to get rid of that rule and make housing cheaper to produce. And there's a whole bunch of these little tweaks that are supposed to make it a little bit easier and do a little bit to encourage more housing production in the U.S. And that's all great. Except that at the last minute, they added this provision that is purported to be stopping private equity or even more bizarrely people will say hedge funds from buying up houses. And there was a certain amount of private equity-backed purchases of single-family homes to rent them out.

That it was a trend. A lot of the companies that did this actually lost a bunch of money doing it. They were paying too much for the houses. And the business model has shifted toward instead, let's build a brand new subdivision. But instead of selling the houses, we're going to rent out the houses that we build. And that's currently something like 7% of single family home production in the United States now is this build to rent stuff. And some people have a preference for renting a home rather than buying a home. You know, maybe they're only going to live somewhere for a couple of years.

Maybe they don't have the money for a down payment. It's been meeting a market niche. But people have this strong emotional feeling about that like houses are for people, like, Literally, that's the way that the proponents of this rule to prohibit this new kind of construction or effectively prohibit it have been talking about it. They say homes are for people, not corporations. And so there's this new rule that stops institutional entities from buying up existing houses. And it also says if they build new ones, they have to sell them to owner occupiers within seven years. And that just completely wrecks the financials of building a community like this because you're forcing yourself into an exit, having no idea whether that's going to.

going to be practical. I mean, you know, you could be selling into a recession. Also, like, if you're going to build homes to sell them, you probably want to sell them when they're new rather than trying to sell depreciated houses that have had a renter in them for six years. So it's a poison pill to kill this part, this industry. Now, some of these subdivisions will get built anyway and that will just be built, you know, directly as for sale. Some of, some of it's fungible. But sometimes they only pencil because the economics are better if you rent them out rather than that you sell them. And it just drives me absolutely insane because there isn't even a good argument for this stuff. The arguments that people make about these people come in, they buy up existing houses, they bid up the price.

I think that the evidence for that is weak. But if you had a policy just aimed at that, it wouldn't address new construction at all. And no one has even really made a case for why it should be effectively illegal to build these new kinds of communities. And yet overwhelmingly, almost everyone in the Senate voted for it. Shout out to Senator Bryan Schatz, the only Democrat who voted against this. He came down to the Senate floor and was like, guys, what are you doing? This is going to reduce housing production. There are some low-income subsidized projects that will actually just become completely illegal

because there's another government rule that you have to rent them for 30 years. So you have to rent for 30. You can't rent for more than seven. Then you can't fucking build it. But it was not convincing to others. And I just found it very depressing about the state of our policymaking right now that this basically meme trampled on what would have been sensible policymaking. It was interesting watching that thing. when Chats came out, because he was like, this was a mistake, they worded it wrong.

And then Elizabeth Warren came out and said, we worded it right. This is what we wanted to do. Yeah, he said it was a drafting error, and she was like, no, this was deliberate. Yeah. I have a longstanding history with Elizabeth Warren's terrible ideas. And it was really interesting watching a bunch of people who are like, it's really sad to see someone who I really thought of is like this great. policy person taking this terrible turn. And I was like, no, no, this is what she's always been like. You just liked that she was making arguments for things you wanted for other reasons.

But I mean, this goes back to like she single-handedly, sorry, she didn't do it single-handedly. She had co-authors. But she and her co-authors single-handedly co-authored one of the major talking points for Obamacare, which was that there was that like 60% of all bankruptcies were due to medical incidents. And, like, the way they got to that result, first of all, like, the medical, how they defined a medical bankruptcy was ridiculous. It was, like, any bankruptcy that involved

$1,000 or more of medical bills. And then, you know, more careful research has shown what was pretty obvious from the beginning, which is that most medical bankruptcies, they absolutely exist. They're not mostly driven by the debt. They're mostly driven by the income loss. People suffer a serious medical event and it causes them to lose their work.

Yeah. If you get very sick and you've been living close to your income, as most many people do, right? You know, you have kids in school. You get a mortgage and so forth. And so this was just always, she's always been like this. And all of her ideas, not maybe not literally everyone, but literally everyone that I can remember has been really bad. The reason I find this more disappointing than that is that it's not all of her ideas. is. Like, she's the lead Democratic sponsor on this bill that until they put this nonsense in it was

mostly filled with small but good ideas, like the, like eliminating the chassis requirement and various carrots and sticks that I think will at the margin encourage state local governments to change their policies, change their zoning to allow a little bit more housing. And she's also, I mean, for example, she was one of the people who led the initiative where they made it possible to sell hearing aids over the counter. Okay. I take it back. That's a good idea. Yeah. Although actually the uptake has been disenfranchase. disappointing, which has been interesting. It's been hard to get people to actually buy them over the counter, even though they are, in fact, drastically cheaper than the ones that you can... Probably because they're death. You need to send them a letter or something they can read.

But what it shows is that when it's not like brain poisoning about like Wall Street bad, like sometimes Elizabeth Warren can in fact see that what you need is to get the government out of the way. and she can see that there are regulations that are well-intentioned, but that actually add cost. She's not incapable of realizing that. She is brain poisoned on the subject of Wall Street, though, and big business more generally. And that's the thing, though. She will do totally counterproductive things because she doesn't like the people. What drives me nuts about this, or one of the things drives me nuts about this

builds rent provision is that it's framed as a Wall Street provision, but it's not actually about Wall Street. It says that no one can own more than 350 rents. rental houses, single family homes. So that's, you know, they, they always talk about private equity, but a publicly traded real estate investment trust, a family owned home builder, a pension fund, no one's allowed to do this. It's not even specifically a Wall Street thing. And it's not even specifically, I mean, I guess at some point you're a big business if you own, you know, several thousand homes, but this idea that it's better for a landlord to be some person who on the side owns three houses, I don't think there's good evidence for that, that, you know, you're better

off with some small landlord than you're probably better off with a big one that knows what they're doing that has a reputation to protect. I mean, you know, and people get this with apartments. Like, no one is trying to like make all apartment buildings condos and say that it's morally wrong to build a building and then rent out the units. People get that you could own them, you could rent them. But suddenly when you put them in separate structures, people have a strong emotional prior about what the financial ownership structure should be. And that I don't, I don't get why. So I think that that is true, and I can't psychologize why people believe it. I don't get it, but they really feel this way. But I think in the case of people who are in Washington and doing policy, right, the problem for Democrats is more generally, they have all of these policies that are kind of frozen in amber from 2014, all of these priors, right? And like the obsession with, you know, the billionaire taxes is one of those things, right? It's just it's straight out of, Occupy Wall Street, and this particular thing, this obsession with private equity buying homes,

it was a particular moment in the market when that happened. When you have a ton of distressed properties coming onto the market, when they're selling below market value, and when debt is extremely cheap, which is a point at which it makes sense for you to swoop in and buy these properties. And by the way, it would not have been better if they hadn't, right? The downsides of not having them buy those properties would have been in many cases that they just sat on bank books forever, that they were distressed, that the banks let them go, as happened in a lot of communities. But, you know, like no one has updated since 2014. This was a big issue in 2014.

You know, the 1% was a big issue. Let's just keep it going. And I think that this is the ultimate product of that. I guess like the thing about not being allowed to build to rent, it's a, it's, It seems to have this notion that those homes are necessarily going to be built by someone else who's just wishing that they could jump in there and get that plot. But I would imagine that, like, the access to capital for these large companies is considerably greater so that they can actually, you know, build these things quicker and in more profitable ways

than if Jeff from down the street wants to go into the house building business, right? The constraint on building houses right now for sale is not that people don't have plots of land or the ability to develop them. It's that people cannot get mortgages at an affordable price to them, either because they have bad credit or simply because they don't make enough income to own the house they want. The housing market is frozen in this weird way because there's all these people who have below market rates, and they won't accept lower prices for their homes, because why would they move, you know, like take what feels like an equity loss to them, even though most of those gains were on paper in the first place. And the more important thing is they don't want

to trade their very low interest rate mortgage for a higher interest rate mortgage. And so the, but on the flip side, people, you know, like the prices have stayed higher than people can afford. The price of building houses has gone up for a variety of reasons, including the cost of financing. So if, you know, it's not like everyone can just, they would be building houses to sell. If they could sell them, they would sell them. The reason they're not doing that, is that the market is tapped out for people to buy homes right now at a price that makes the developer a profit and is affordable to the buyer. No, what I mean? That's my point.

I mean, is that like the problem why people aren't building more homes is because they don't because of financing costs of it. And that these large companies would presumably just have greater access to capital to do it. Yeah. I mean, I think, I mean, this is, Megan interviewed Bobby Fion for her for her Washington Post podcast a few weeks ago. And he has this interesting, innovative company that's building these row homes that are built in a factory, basically, and they deliver all of it on a flatbed truck and assemble it. And it's a much simpler construction process. I had an interesting conversation with him where he was talking about it's, you know, the reason that they think this is a better business model, it's partly about efficiencies in the manufacturing, but it's also partly about efficiencies in the financing. And in that case, it has to do with, you know, often they're building an infill locations, and it's a small site. Maybe you can build 10 houses. or maybe you can build six houses, whatever. And that's not attractive to major publicly traded home builders. They either build huge apartment buildings with several hundred units or they build greenfield

subdivisions that have many, many, many homes. And so that they can have a company at scale, they can do the small construction projects because the construction is so simple because it's coming out of the factory on lots of different sites. And then they can finance it as a large, you know, in this case, actually, I believe private equity-backed firm, although it wouldn't have to be. So they have a financing advantage there that is part of their business model. And it's right that you want people who have access to relatively attractive financing to be able to get into businesses that are producing products that people care about.

And so what's going to happen to build to rent? I mean, to some extent, some of these subdivisions will still get built for sale. And then the homes will be available to buyers, but that won't be as helpful to people who actually want to rent a house. Some of them won't get built at all. And in some cases, you could have small players who don't own more than 350 houses going in and building these things. The problem is that if you're really good at it and you do well and you make money from it and you can reinvest it in something, you were literally not allowed to because of this new law. And partly, some of the people around Elizabeth Warren make this bizarre fetish of small firms that they think that basically big firms are inherently bad and we want a society that is more built around small business proprietors. And there's a lot of problems with that view, including that there are real economies of scale and you want companies that have good innovations to be able to get bigger and bigger and bigger. And that's how the economy grows. But the other weird thing about it in housing is that housing is literally the most fragmented major industry. Because not only like a majority of people own the home they live in, and so it's fragmented in that way. Each of us is the freeholder of our one home. But then even landlording is an extremely fragmented industry. Lots and lots and lots of small players. And so they're trying to fragment that industry even further.

without really any case for why they're doing it. And it's very annoying. The fetishization of small businesses, I agree. That's why I go to Starbucks because I hate small businesses and small business people, you know, and other fast food joints. I wrote an article on McDonald's this week and the number of commenters. Yeah. Who were like, I would never eat at McDonald's. I'm like, you know, sometimes I like a Big Mac.

But those are small businesses because they're, I mean, Some of the stores are corporate owned, but there's a lot of franchisees out there. Yeah, most of them are franchises. And indeed, they are, like, they're small, big businesses, though, right? Like, the franchise, McDonald's puts an enormous amount of effort into deciding how your store will look, you know, what ads you'll run, what sorts of promotion budget you have. These, they, it is, it is a small business, but not, but within a very narrow scope of a very large business. Right. Let's take a quick break. We'll be back with more on McDonald's. This is Central Air. You wrote about McDonald's this week because of the video. Yes, I did. Some people have probably already seen this. If you haven't, the CEO of McDonald's did an Instagram reel promoting a new hamburger called The Big Arch. And he's there with it, with his new product. He calls it a product that he's so proud of. This is what he says when he goes to take a bite. All right. The moment of truth.

That is so good. That's a big bite for a big arch. And the thing I should note about that that you're not seeing because this is not a visual medium is that when he goes to take that bite, he takes this little dainty bite. Josh, you should do that voice more often. That was great. Little dainty bite. And just all of this like, you know, he doesn't seem like a hamburger guy. It seems like he's maybe interacting with a hamburger for the first time in this video.

and he got made fun of it a lot. But I think, you know, the question you get at in your column, Megan, is, you know, maybe this was good marketing for them because it got them talked about a lot. Oh, yeah. It was great. I mean, I believe our own Ben Dreyfus went and ate a big arch. I almost got a big arch while I was writing the column, but unfortunately for various exigencies, I was writing in the evening.

And I was like, I should get a big arch and eat it. And then I was like, but then I would have to stop writing. go to McDonald's, get the Big Arch, eat it, and come back, and I don't have time. And Uber, someone in the comments actually asked me, like, why didn't you door dash one? It was, there is nothing sadder than door dashed McDonald's. Not just because this is, I think, in many ways, like, a sign that you have failed in life if you cannot drive to the drive-through. But also because the fries arrive cold. So what's the, what is even the point?

What are we doing here? But the number of people, like, so who said in the comments, I went and tried it too, either after reading the column or after seeing the videos. So, Ben, what was your experience with the big arch? I don't get the updates for McDonald's regularly about their new products. And so it was only because of this viral drama that I discovered this big arch. And then found myself Googling for reviews about it first because I wasn't. didn't want to just immediately commit.

There was a lot of hits and misses. Some people didn't like. Some people did. And so I said, I have to drive. I've got to drive to the McDonald's in Haley, seven miles away. Yeah, I'm going to say, do they allow? Is there a McDonald's in Ketcham? It's in Haley.

It's the only fast food joint in the entire Woodrover Valley. And when it got here in the mid-90s, it was like they let it. And then they said, we're never going to let another chain ever come again. And so we don't have any other chains, except for Lulu Lemon. But so I went to the, I went to it and the people told me that they were like, yeah, this big arch, it's been sold out all day, but I guess we got one for you now. And maybe that was a lie. But then I got it. And it is huge.

It's the size of a human head, a big human head, like a smart head. And it is essentially like a big Mac, a little rich stuff, you know, riszed up. And it's quite good. I have to say that, that, that, that, that. It was a successful tactic. I might go have another one in a few weeks or so. It's like it's shorter and fatter than a Big Mac. It's basically it's a single level burger and it has two quarter pound patty.

So it's a half a pound of beef, which frankly I think is too much beef in a hamburger. To the credit of the CEO, one of the problems with the way hamburgers are sometimes designed is that they're like super tall in a way that doesn't quite fit in your mouth. This is because because because the burger is short, you can take appropriately sized bites of it. And, you know, maybe if you're doing it on Instagram, you shouldn't do that because people make fun of you. But like that little dainty bite that he did was possible because of the form factor of the big arch. It's such a big burger, right? That it does kind of fall apart whilst you are eating it. Like, by the end, it's disgusting.

You look like a freak. Which may explain the dainty bite, right? He did not want this thing to fall apart in his hands as he was. Well, actually, and he mentions in the video that the fried onions are falling out of the burger, which feels like something you shouldn't point out because that's actually a product flaw. Yeah, the producer in the back is going, oh, exam. Don't mention the fried onions. We've been trying with him.

with these onions for years. But I did like it. I was curious to find out, as we were talking about this yesterday, what Josh thought about this burger, because one thing about big, one of the long-running disputes that I've had with Josh is that Josh loves mayonnaise more than anything in the whole wide world. And I hate mayonnaise more than anything in the whole wide world. But there's mayonnaise on the big arch. Right.

And so every time I've ever mentioned how much I hate mayonnaise, Josh has said, no, you don't. because you like Thousand Island dressing once in a while. Or, but you like Caesar salad. That's basically mayonnaise. And I have at times found this, you know, as a trenching criticism where I have apologized for my sins. There are certain instances where if you water down the mayonnaise enough, you diluted enough, I do find it okay. And so I was curious what you would think about it since it is slathered in this Thousand Island dressing, Big Mac sauce. Have you tried the Big Arch, Josh?

I have not. I don't think I've eaten it at McDonald's in like 15 years. I'm generally a man of the people. And in most ways, I have my finger directly on the pulse of most Americans, but there is one exception to that, which is that I basically never eat at any of these major fast food outlets. Even on road trips, I find ways to make sure that I can, you know, there are chains that I like, like Chipotle is good and various things like that. But partly it has to do with, I find the smell. of the frying oil nauseating. And, you know, even if you properly ventilate, like, places that are just doing the volume of deep

frying the McDonald's or a Burger King does, just, like, inevitably have this fry oil smell that I just find very off-putting. Yeah. I agree with that, which is why I go to the drive-thru, like, a real American. Have you ever been to Five Guys? I have been to Five Guys, although it's been, there's a Five Guys 300 feet from my apartment, and I've never gone to it. I mean, Five Guys disgust me, okay?

Let me tell you about Five Guys. I'm glad you brought up Five Guys, Ben, because I've been waiting to talk about Five Guys. And here's the thing. Five Guys uses peanut oil to make their french fries or whatever. And there's all these sacks of peanuts in their stores. They just keep sacks of peanuts. Like you're at an elephant exhibit at the zoo. Well, it's to keep out the weak.

It stinks of peanuts. It's disgusting. You can't go in there without being, unless you're Dumbo, Dumbo from the zoo. Or me, not the zoo. The circus. And I, so I recognize. I don't like the peanut oil, and I don't go there. So I respect what you're saying about having a real.

Yeah. Before we finish this segment, I just need to point out to the readers, the listeners. We're an audio medium. Josh has another disgusting, terrible opinion, which is that he does not like In-N-Out burgers. And he doesn't respect them at all. And he constantly says that people who go to In-N-N-Out shouldn't be allowed to vote, which I think is, frankly, prejudice. Tough but fair.

Yeah. You know, In and out is fine. It's one of these things that I don't think in and out is bad. I wrote this for Business Insider like a decade ago. It's one of these things that people talk about it like it's the best thing in the world. And then you go there and it is merely adequate. I think that's not fair. It's fries I might put in the merely adequate.

Yeah, the fries are crap. But the burgers are really at the price level that they're at. They are better than anyone else that I've ever eaten a burger at. And like in that basket, right? I'm not saying that if I went and had the Wagyu beef burger with like the gold leaf and the like truffle frosting on it, I wouldn't like that better, maybe. But like for a fast food burger, that's a pretty fine burger. But I addressed this in the piece, which is, you know, burgers are not very good for you. So eat them.

That's fine. But they should be like a special treat. And so if you're really concerned about your burger budget, then you might be eating too many hamburgers. Like, you know, if you're having a hamburger only occasionally. You're using, like, the nudge approach to this? Like, who's got to raise up the price sensitivity? It's like the Johnny Walker used to have this ad campaign where it's like if you're worried about the price of Johnny Walker,

you're drinking too much. As, you know, if it's actually something that you're having, like, only occasionally, you might as well go out and get the burger that's really good rather than the burger that has, you know, the best price-adjusted value. People love in and out so much, Josh. Let me should tell you someone, right? Because I don't know. You guys all live in New York and D.C.

And all these high-minded coastal-lil-li-le-le-places. Ivory Tower. Ivory Tower. And I live in. Shut up about in-and-out live in San Francisco and Los Angeles. So they're no more grounded. I live in a little place called Idaho, okay? Real country bumpkin type.

Salt of the earth. Farmers. Farmers, agriculture workers, a lot of home nurses. People like that. Miners. Yeah, potato diggers or whatever they're called. And a few years ago, we got an in-and-out. in Boise. And the lines were 12 hours long. I personally drove 200 miles to go to it.

That's stupid. And I was not alone. There were many people who did it. And it was such a big hit that in and out came and they said, all right, these Mormon folk in Idaho, they love our burgers. And so they built another one and happened again. We're getting the third one in an entirely different location, only 75 miles from something. Wait, did they built the first two in the same location? That would be... Yeah, they were right next to me. They are like right next to me. They are both in like just like five miles away from each other in Boise.

Well, I mean, Boise is the only place in Idaho with population. But that's real America, Josh. That's real America. It's people willing to drive five miles for it. Look, I get in and out on one occasion. And that is when I'm traveling to California for a conference. And it is usually like, I have arrived that night. I am going to my airport hotel.

And there is an in and out. burger, but it is a happy experience when this is the best possible way to use that meal. And, like, they also like Chick-fil-A are extremely good at managing the cues, right? They have people that with iPads taking orders. They're, like, they're just good at their job. They're really good at the logistics. And I think, like, when you say if you care about the price, Josh, I think you really underestimate how cheap I am.

I care about the price of everything. but it's like it's a nice experience to have for 20 minutes twice a year or once a year really. I think I average about one in an out burger a year and I average like one or two McDonald's meals a year. And that's probably enough. But like I think you need to go out and get in touch with the real America, Josh. You know, if I'm going to eat like a ridiculous, decadent food because I'm in California for a conference, if I'm in San Diego, what I want is a California burrito. California burrito is a burrito that has French fries inside it.

And it is delicious when made correctly. Ben is grimacing. Sounds disgusting. We're going to, I mean, I don't know what I'm going to be in San Diego with you, but we'll get you one of these. To bring it back to McDonald's before we go, I was interested that they chose to name this product. I'm going to call it a product like the CEO does. They chose to name the product the big arch. Because do you remember the Arch Deluxe?

Yeah. I mean, I never had it, but I do remember the failure of the Arch Deluxe. Yeah, the Archdeluxe was like the water world of fast food hamburgers. It was this immensely expensive product launch that McDonald's did in 1996 of a new upscale burger. And it was packaged so that like the hot components were on one side and the cool components were on the other side so the lettuce wouldn't get warm while it was waiting there. And the idea was to basically make McDonald's feel more aspirational and more appropriate for adults. And just nobody wanted it. It was like, it was really poorly received and McDonald's lost hundreds of millions of dollars on the.

on the marketing campaign for this. So I guess 30 years on, you can name the burger arch again, and people are not going to immediately think of the Arch Deluxe. But it was interesting to me that they weren't like, oh, no, we can't call it the Big Arch because people will think it's like the Arch Deluxe. No, because we're old now, Josh. And most people, most people who are now alive in America do not remember the Arch Deluxe. I think we can leave that there this week. Ben, Megan. Thank you as always. Thank you. Thanks for having us. Central Air is created by me, Josh Barrow, and Sarah Fay. We're a production of very serious media. Jennifer Spotic Mixed this episode.

Our theme music is by Joshua Mosher. Thanks for listening and stay cool out there.