Pirate Wires - Our Government Is Broken: Charter Cities & Fixing Infrastructure w/ Kelsey Piper & Patri Friedman

Episode Date: May 30, 2025

EPISODE #94: Welcome back to the pod! This week we have special guests Kelsey Piper & Patri Friedman joining Mike Solana to chat about our government’s inability to build anything today, and the solutions that are being built. We discuss the history of seasteading, the evolution of charter cities, build vs. exit, the “Abundance” movement, Trump's 'Golden Age' and if we’ll ever be able to fix the legislative branch.Featuring Mike Solana, Kelsey Piper & Patri FriedmanWe have partnered with AdQuick! They gave us a 'Moon Should Be A State' billboard in Times Square!https://www.adquick.com/Sign Up For The Pirate Wires Daily! 3 Takes Delivered To Your Inbox Every Morning:https://get.piratewires.com/pw/dailyPirate Wires Twitter: https://twitter.com/PirateWiresMike Twitter: https://twitter.com/micsolanaTIMESTAMPS:0:00 - Welcome Kelsey Piper & Patri Friedman To The Pod2:00 - Charter Cities & Economic Freedom8:20 -The Origins and Evolution of Seasteading12:55 - Shenzen & Notable Seasteading Projects and Challenges21:15 - Charter Cities: Esmeralda, California Forever, Prospera in Honduras.28:50 - Ezra Klein & 'Abundance' Movement - Will It Work? 34:00 - Freedom Cities & The Trump 'Golden Age'42:00 - DOGE Failures47:45 - ADQUICK - Thanks For Sponsoring The Pod!48:50 - Exit vs. Build - Regulatory Reform#podcast #technology #politics #culture

We are going to be the best we have ever been. Better than ever. Better than Abraham Lincoln. Like, on one hand, wow, that's a really clownish thing to say, but on the other... Wouldn't that be great? Wouldn't that be f***ing awesome? Charter cities, seasteading,

we can no longer do anything inside of our current government. Almost like a side effect of peace and wealth. How hard have we tried to fix Congress? It seems just broken. Why are the buildings so ugly in San Congress? It seems just broken. Why are the buildings so ugly in San Francisco? It's like soul-crushingly ugly. What's up guys?

Welcome back to the pod. We've got an exciting conversation for you today. Kelsey Piper, senior writer for Vox, and Patry Friedman, GP of Pronomos Capital, but also the co-founder of C-Setting and ephemeral. Patry was a huge part of my own personal career. I was an intern at the C-Setting Institute, very briefly at age 23, through which I met Peter Thiel,

and so began my journey into tech. I have a lot to sort of thank him for. Also, Joe, I mean, just like an admirer of the way that you think about the world. And a big part of today's conversation is going to be rooted in the C-studding stuff. That's what I wanted to get you guys both in here today to talk about. We're in this sort of interesting moment where there's cross political appetite for regions of the world or a country specifically that are free of regulation, free of laws, I think that we're sort of, and I would like to get both of you in on this kind of question pretty

quick to see if we kind of agree on the problem. But I think there's a sense that we can no longer do anything inside of the context of our current government. There's a whole long list of things here. I think the most obvious is building new shit, building housing, especially building infrastructure. I just saw the New York Times wrote a piece on the Pacific Coast Highway. They just reopened 11 miles near the Palisades

where the fire was, But something like 90 plus miles of it are still closed around Big Sur and it's been over two years. They're blaming global warming. I don't think it's entirely that. It seems like we have this broad inability to do stuff that we used to be able to do, which is to me frightening. And one of the major themes of my own work is discussing that. And it's stuff that you've both hit. So first of all, is that, do you think,

the problem that is being addressed by the sort of charter cities, special economic zone, I don't know, freedom hub or capital progress, whatever it is, is that where this stuff is coming from before we get to the sea-studding of it all? Yeah, economic freedom seems like a big half of the story here, and I do want to pitch as the other half of the story, like political freedom.

Like in particular, one of the big appeals to me of a charter city is if I wanted to host a conference there, I don't have to worry about how many smart cable people I know are actually able to get visas to attend that conference about like whether they are able to work, you know, come to our thing for a week and work remotely, that is often illegal and it shouldn't be. And if somebody's coming to the US from another country, I think right now they unfortunately do have to give some thought to what's on my phone that might be searched at the border and are there like things I might want to say that I shouldn't say, you know. And so economic freedom is a big part of the story for me. And the other big part of the story is like political freedoms,

which also seem to be like something that's under threat right now. So you're saying that is what's fueling. The push, I wonder if that's what's. This is in my heart, a big part of why I feel invested in this stuff is political freedom. I think the economic freedom is you're completely right to identify it as the main thing fueling the push. And that's always gonna be the case because you can make money with economic freedom.

Yeah, I mean, the way I think of it is that governance is a technology, meaning there's many different parts of it that can be improved differently. There's not like one pure theoretical answer. And we've had the opportunity to improve our governance technology in the past when the world was more violent, when it had more frontiers, when there was more revolutions, like, you know, I'm not saying that revolutions are a good thing,

but they have a positive side effect of allowing for experimentation with different social and legal forums, look at the American Revolution as a great example that produced what is currently the industry standard form of government, like constitutional representative democracy. But we live in an age with far fewer revolutions with fewer frontiers, like a richer and more sedate age. And that's great, but it's lost us the ability to do the experiments we need to move things forward. And so I just, you

know, I see it as like almost like a side effect of peace and wealth and stability is that our governments are stagnant. And so of course, there's a desire to improve that. One model I've sort of been toying with there is that because we are so rich and stable, we can tolerate a lot more bad governance. Like in California in particular, like people will keep living there no matter how badly you govern the place. And so, yeah, you need more active effort to start something better because, well, it used to be the case that if the government did a bad job, people would start starving. You have a bread riot that very year. Like you have a lot more leeway to do a bad job

and the cops are mostly invisible. California is like when you are playing a game like if you're like doing a world builder on Civ or something and you just like shove it full of all of these resources and put it in the most like goaded land ever, like you just cannot lose. I was, there was a conversation just today on X or yesterday. We were talking about sort of unrelated, maybe tangentially related topic of of debt. And they were like, well, what even have no one ever tells me like what to do? How do you prepare? What if we can't pay it back?

What if we default? What if we start not paying? What if we can't afford the interest? I guess, does that just end the global economy? Like where, how would you prepare for that? And I just thought like, I think that you wanna be somewhere with like a lot of arable land and clean drinking water, at least close to it.

It seems like probably still not great. Like, I don't know, why would people be farming? But it seems better than like, I don't know, Arizona or something. So probably California. Like I think California can't lose. Like almost unfortunately, like that's, I agree. It seems like that's why the government,

maybe they're so bad is cause it's so- California, home of the apocalypse. Like the best home for after the apocalypse, but it's funny because it may also be the source of the apocalypse. Yeah. Yes. Yeah. Yeah. Especially now it's back.

They're so back. And I do think there's this forcing function of not having it all handed to you. Like when I look at, I don't know, governance in like Latvia and Lithuania and Estonia, they're always overperforming. And I think it's cause like they don't have the luxury of being fine, whether they overperform or not.

And it doesn't always work out that way. Sometimes you don't have the luxury and you fail and that's catastrophic and an enormous number of people die. I don't wish the United States was poorer. And on the whole, I think it would make us worse off to be poor like pretty obviously. But you do sometimes see this kind of like clarity and efficacy and getting stuff done in governance in places that don't have the luxury of messing around. And every time I see that I'm like, wow, that's not how it works here. So interesting. And Avery, there's something I've thought about America

generally for a while. We have this ethos of not really being pro-government, right? And I think a lot of maybe, like, why is the French public services sort of better than the American? I think part of that is cultural. It seems like that's perceived as a good job. It's a little higher status. We really seem to degrade, even Libs, I think,

sort of degrade work like that. Like the average lib would never be like, oh, I'm so glad my daughter's gonna be a bureaucrat in the whatever office doing whatever, whatever. Maybe that's also just a matter of like, are we free because of our, like did our philosophy create the country or did just our goaded like resources

create a more free like environment that hates government? Because we don't need it as much. I mean, I feel like it's the combination, you know? Like people free to unleash their productivity in a place with lots of resources is a hell of a combination. And you can screw up quite a lot if you have like some outlets where people can go and do really productive stuff.

Well, I want to talk a little bit about seasteading specifically before we get into the broader sort of evolution of that, which I think will be really interesting to just sort of talk about how that conversation has changed over the last 15 years now. I read about seasteading for the first time in a piece of Peter Thiel's called The Education of a Libertarian. And so I think importantly, and we'll come back to this in the conversation, it is like super this concept is super rooted in anarcho capitalism, libertarianism. It's definitely like to me, I experienced all of these ideas as as right of center,

not left of center, where maybe some of them are becoming popular now. And in it, Peter talked about a bunch of things. One of them was the frontier thing, Patra, that you mentioned. But he talked a lot about sea studying. That's how I met you guys. That's why I reached out to you guys and wanted to volunteer for you,

write for you for free. And then you suggested meetup groups, which is how everything really started for me. My sense of it then, it was sort of like, it was just this exciting idea that you could, you know, be out there on the ocean building countries. It was not something that I'd ever considered before. And I don't know that I was thinking about it maybe strictly because of like, wow, there's

something I want to build here that I can't. It felt more, I don't know, I was young. It was like, almost a spiritual thing, I think, a calling. I was like, I've got to meet these people. What were you thinking about when you launched it, when you thought it up, sort of like what got you there? And then I would love to talk about what's happened since. Sure. I mean, you know, like most entrepreneurs, I was a frustrated consumer where the product that I wanted didn't exist. And the product I wanted was a decently run libertarian country to live in. And that didn't exist. So I got curious and tried to figure out why. Came up with these ideas of looking at law like software, looking at governments like

businesses. And I realized like, well, okay, the quality in this government industry, meaning how happy are citizens with their governments is like super low and super bad. But that's actually not surprising because the firms in this industry are like massive, like there are companies bigger than small countries, but it's but it's rare. And customers are super locked in, like it's it's hard to move. It's expensive and you often need, you know, you're away from your friends, your family, work if you don't work remotely. And, you know, also, there's not like an R&D lab. Like, in the world of tech, people are always like

spinning off, they're always like, exiting from current things to start startups to make the new things. And we don't have that for government. And so I was like, well, what we need is some way to like try out new legal and social and political systems on a small scale on an opt in basis. And back then, you know, I started exploring this stuff in the early 2000s, countries weren't open to like delegating regulatory authority in the way that charter cities work. And so I looked at the at the ocean and, you know, people often think it's like, well, it's the ocean because on the high seas that you can do anything. And that that's not true at all. The way that

international law on the ocean works is that each ship needs to register with the country and fly its flag. And they're then a little bit like a floating embassy, like they're franchising that country sovereignty when they're out past 12 nautical miles. And so it's not that you can do anything, but the cost, this market of flagging ships is much more efficient because the cost of switching is low. Like if you have a business in a country,

you can't easily just pick up and move. But the flag is like a virtual registration. And so all of the countries in the world have the legal right to open these flagging registries and franchise their sovereignty. So it's actually like the different, and the only reason this exists is because the ocean is this fundamentally

different physical environment where, you know, these ships as big as skyscrapers move around to different jurisdictions all the time. And so you can't just, you know, use the old methods of like fixed borders. But this legal difference is actually incredibly promising if you're trying to do startup jurisdictions. Unfortunately, the economics of building on the ocean, which is very difficult and expensive, make it really hard. I didn't realize that you had looked into charter cities at that time.

It wasn't charter cities, but it was like the overall philosophy was like, we need startup jurisdictions. We need R&D labs and startups for governance. And C-STEDing was like the method that seemed the most promising to me then to go there. There is this history, obviously, before C-STEDing as well. You have Shenzhen, you have China doing a version of this, apparently, you know, all over the country starting in 1980, I think. But I have, I had no, that was not a part of the discourse at all is I'm not even sure what the pop,

I think the population had to have been half of what it is, at least at, at that point, it's grown so, so rapidly. What were you thinking about in terms of other things that had happened? Obviously Disney, which I wanna talk about a little bit later, is like our example, I think here in America, where we've come closest to this. Was there anything else in the stew for you

that you were looking at and you were like, oh, maybe something like that could work? Now in the charter city's age, I've learned a lot more about zones, about Shenzhen and Hong Kong, Dubai and their financial center are irrelevant. But in the 2000s, I was more looking at micronations. And I was kind of like, okay, these people are doing this as like a LARP, like as a game. But like, what if it was real? And, you know, I looked at things like Sealand, Rose Island.

I'm a citizen of Sealand now. They gave it to me on the reticent. I'm a Duke as well. They gave it to me. Yeah, they gave me a title. You know, they struggled for literally decades to find a profitable business model after the prior radio era ended in the early 70s.

They tried a bunch of things. My friends did this Havenco, attempted it like a Data Haven. They tried hosting bunch of things. There was like, my friends did this Haven Co. Attempted at like a Data Haven. They tried hosting like extreme sports there. And nothing worked for like, from the mid 70s until like 10 years ago. But this like selling like the noble titles and the fun citizenships is like actually a successful business for them. It's wild. It reminds me of naming stars.

Absolutely. No, it's very similar. Very related. But then it's like, but kind of it's it's like doubling down on the LARP of it. And this is the thing about like Seasteading versus Charter Cities is that I feel like Seasteading is way more fun and exciting. And there's like way more like memes, but it's just kind of not as matched to the nature of the world as far as what's possible now. And this is why I like exclusively focus on charter cities, but like, but it's fun.

Kelsey, is that kind of roughly your feeling about it as well? Or when did you maybe first get into the topic generally? So I think I am like a fair bit younger than you guys. And a lot of the C-Satetting stuff like happened, you know, when I was in middle school or whatever. And so I mostly only encountered it as a cautionary tale, which did only piss me off to be clear.

So the thing is, if you're thinking of governance as like businesses where we want to iterate and find a good thing, most startups don't fit, don't succeed. And every like investor knows that that's completely fine because the returns if you do hit on the right formula are just so high. And people will say like, oh, like the first five things we tried in this space failed when they're talking about charter cities or like experiments in governance in a way that's like, and that settles the matter.

And it's like that does not settle the matter. But that was the attitude about seasteading when I sort of like started getting into politics was like, yeah, we tried that. And I think you're right that the economics are just very difficult and the physics are just very difficult, at least until you can build like nuclear reactor powered cruise ship type stuff, which like I would love to build. I mean, Roko suggested he swears that build. Rocco suggested, he swears that material science has progressed in such a way as you could do it with ice. It's not that the physics doesn't work for ice setting.

It does. It's that it's really hard to get people to move to a beautiful tropical island like Roatan, where Honduras Prospera is, with one of the best reefs in the world. That's hard. And now you're trying to get them to move onto an iceberg. Yeah. Yeah, I guess when you put it that way. Well, that brings up a point.

I guess maybe before I get to... No, yeah. Patry, what would you say from Seasteading, what is the history until present day? I guess what are like the sort of very small handful, let's give it maybe the three or four projects that led us up to the current era that you think are notable?

Yeah, I mean, there haven't been a lot because it's really difficult. I mean, there haven't been a lot because it's really difficult. You know, the two groups that are building stuff now are mainly ARCPAd in Southeast Asia and Ocean Builders in Panama. Ocean Builders is building basically like it's a spar, so like a narrow pillar with like a platform and a home on top. And then there's like an room down at the pillar and flotation down below that they're manufacturing.

But a lot of it was research and movement building. And you naturally put energy into the things that go the best. And getting clicks, getting people excited worked really well. So we had a lot of successes in that. Honestly, for me, one of the C-setting highlights was when the Colbert Report did a segment making fun of us. It was called Wealth Under Siege. And it's like, you know you've made it when they're making fun of you on the Colbert Report. So that was huge. We've had flag registries, you know, I mentioned the flagging

system. And so you can make use of it with a CSTED just as the flagging system exists today in terms of there's kind of an expectation about like what the, like what you're allowed to do on ships. And so without an explicit agreement, you could start that way. But even better would be an explicit agreement that says like, oh, here's the delineation of like what the CSTED has control over and what the, you know, the state that's franchising their sovereignty has control over. And so several flag registries have approached the Institute about that. They're doing a fundraising campaign for that right now. It's funny because a lot of the things like with Kelsey's point about failure and learning from failure being the Silicon Valley way, I feel like a lot of the points that come up are like in 2019 when Chad and Nadia of Ocean Builders were being hunted for arrest

by the Thai government for treason, which is a capital crime, for building a Seastead. So for those who don't know the story, Chad's an American Bitcoin guy, Nadia is his Thai wife, and they decided to build this in Thailand because Thailand had the manufacturing know-how and things were cheap there. And they were just testing this engineering design of the Spar Seastead and Seesing Institute had a documentary team out there. And they were just testing this engineering design of the spar sea stead and see seeing institute had a documentary team out there. But you know, and they'd asked for permission from the Thai Maritime Authority who said, Sure, whatever, we don't care, build a thing. But then the Thai

Navy found out that they've been talking about like, we're sea stodders, we want to someday live free and sovereign on the seas. And they were pissed. It's important to note that while this was the other coast, one coast of Thailand is on the South China Sea, the most contested area of water in the world where China like pours concrete platforms on rocks to build them up and put people living there because like islandness and habitability

are criteria for claiming like oil and gas resources. So they're very, very touchy about this. And they put a treason charge on Chad and Nadia who got wind of it and escaped and went into hiding. And they had to hide for weeks before they made a daring sailboat escape to Singapore, where at first they tried to go to Malaysia. And Malaysia's like, we're not taking you in, we won't even let you resupply. And eventually they escaped to Singapore, everybody lived, they chose Panama to relocate to, they're building platforms. But it's like, I was making PowerPoint presentations and getting people excited about my ideas

and it's like, dude, when you're messing with states, like people can die. Well, messing that brings us perhaps to, I guess, the evolution of this stuff. In my opinion, I mean, you could be maybe push back on this, but it seems to me that the entire conversation is all evolved in into charter cities of one kind or another, probably. I think maybe I'm wrong here. The most notable one would be Prospera and Honduras, but then also you have really, I think,

important attempts in California forever, which has land, at least, they've bought it. It seems like they're stalled out fighting a war with regulators, which is like- As I predicted this. As a outfall, who did not think that this was gonna be an issue? Yes, exactly.

It's like you're in California and you bought a bunch of land to create a great city, a great place. And it's just like, that's not how they do things. When I think about the amount of goodwill it takes to get like a country to pass national legislation, to enable charter cities, it's like if you come in really warm with great introductions and a great value proposition for the country, you have a chance that maybe if you do a bunch of these, like one of them goes through. And California forever is like, we're just going to keep it secret, not going to roll any local support. You know, like it's hard enough to build in California, like with support.

Like I like to contrast their approach with our friend, Devin Zugal of Esmeralda, where she enrolled the local municipality and county like from the very beginning of the project and included them and everything along the way. She gave a herediton talk that was just about her heredical idea was like, working with the government. It was like, what if we just work within this? What if what if we just work within the system? What if he just worked within the system? In our crowd, Michael.

In our crowd. I was like, daddy's shocking. I was clutching my pearls. I was like, what did she say? Kelsey, would you, Kelsey, where do you use, what is the project that you're looking at and you're saying that's the one that's kind of closest to something that I'm excited about?

So I have been watching Esmeralda, very curious, because it's both like in my area and because I think like if Devon's solution works, it is obviously way easier and like, you know, that you can find a local government that is possible to work with even if 99% of local governments aren't. What is she trying to do exactly again for the audience who may not be familiar? Yeah, so she's been hosting a pop-up village called Esmeralda in Hildesburg, which is like two hours from the core parts of the Bay Area where everything is outlandishly expensive.

And she wants to build an actual city, a like well-designed city, Esmeralda on undeveloped land in that area with the cooperation of local authorities. And it would be under US jurisdiction, it wouldn't do a lot of the innovative stuff that Patry is excited about. But there is still a lot you can do just if you are planning a city from the start to be beautiful and engaging and a good place for people to live and attract a great crop of people to live there. Even if you can only do that, doing that would be amazing. And so is that the one maybe that's your go-to of like, this is the way forward? It is certainly like, if it can be done, I think Devin is the person to do it. And if it can be done, I think it is like a much more viable immediate term way forward,

just because it doesn't require solving any of these really hard problems. I also watched Prosper pretty closely and it's gorgeous and I'm excited about it. But fundamentally, like Prosper tried with a lot of, and Patrick can maybe speak more to this, a lot of work to ensure that future Honduras governments wouldn't be able to just say, never mind, we're out. And future Honduras governments have still been like continually threatening to say, never mind, we're out. And so as much as they want to be like not dependent on the goodwill or like willingness to adhere to the rule of law of future Honduras governments, I don't

think they fully escape that. And if you're going to be reliant on some governments like rule of law, you know, America is better on that than a lot of places for all its other downsides. A tough pill to swallow for a man who was once a young anarcho-capitalist, who genuinely liked the idea of escaping the government. I think something I had to just accept was like, that's not that's probably not going to happen. So the question is, like, is there a way to work?

What is the way? What is the model that could work? And like, which government is it? It does not. For me, I'm wondering now about America. Like that's where the flag is planted for me. And it's like, how do we go about this? What are we even gonna ask for? Sounds like you wanted to add something, Patrick, go ahead. Yeah, I mean, how do you break a cartel?

You work with the weaker members who aren't making as much to disrupt the cartel and governments, it's like a cartel. It's this like collection of like a small, mostly fixed number of like giant firms who control everything, like all land on earth and the rights on the ocean. So, but there's plenty one who are willing to break the cartel if it brings their people benefits. But all of these ideas are so American also, I think, like, I wonder how much of that or just misunderstanding that, yes,

it's frustrating to be interested in this kind of idea. And let's just give it some words. The idea of a place that is freer inside of a country where you can build what you wanna build with your own property, et cetera. It's like frustrating as an American to have that goal and feel like, man, there's nowhere here I can do that. But then I don't know that I would have had that idea if I wasn't an American. That's something that feels...

Yeah, more American than America is sometimes why I describe this movement. It's true in the spirit of the revolution. America was defined by having a frontier, right? Like there there was a long time when the answer was go west young man. Look, we basically don't have the rule of law there. Build your own thing. And like a lot of I think the profound nostalgia for the closing of the frontier, whatever it was, well, we still have this national ethos. and now like the physical geography is just different. And yeah. That's how we define ethos. Well, then we found other places.

We we found other places to put it, right. We put it in the Internet. We put it in virtual reality. We put it in our fiction, Star Trek, The Next Generation, or Star Trek, period. I would talk about the final frontier. And it's like we would always dream of it. And these are things that I always I don't know, it's something maybe I'm like, we would always dream of it. And these are things that I always, I don't know, it's something that maybe I'm reflecting on now, I'm wondering, like, these are things that I feel like-

But we lost something. These things are important and powerful and people worked on them and SpaceX and that's amazing. But none of them are like the control over the operating system that applies to a given geographic area. them are like the control over the operating system that applies to a given geographic area. And like, it's great that a bunch of the people worked on a bunch of important like new frontiers to advance humanity. And having like the like the governance frontier become like closed off and have governance become stagnant. Was this like that still

mattered? Something about like touching grass being a like important step in the loop by which we develop better governments. I feel like there's a phenomenon where if you're building something crypto runs on the blockchain, even if you're successfully not having to deal very much with US regulators, and in fact you had to do a lot of dealing with US regulators, but even if we set that aside, because it's all like in the world of ideas, I feel like there's like something missing from the feedback loop, which is just not missing from

the feedback loop. If you're trying to like build a small town on the railroad, like just being routinely checked by real physical limitations, weeds out the grifters really fast, like you have to actually do stuff when you're building in the real world. I want to take it to stuff when you're building in the real world. I want to take it to something that you've talked about. I've seen before Kelsey, the abundance stuff, the abundance Dems, the abundance Libs,

the abundance movement, shall we say. One of the things that struck me as, well, I'm just going to be honest. I'm going to say it struck me as quite grating about it in the very beginning was maybe this idea that people were discovering something very new. And I felt like, wow, this is stuff that I've definitely talked about for a very long time.

And it's stuff that, I mean, even the idea of like, like the words, like there were like super abundance or post-scarcity were things that I encountered many, many years ago and really inspired me. And we're also decidedly like, I would call them like weird, right ideas ago and really inspired me. And were also decidedly like, I would call them like weird right ideas, like weird right, the weird right wing, the sort of like the freaky Burning Man right,

the like libertarian right, the pottery right, like truly is what we're talking about here. And so to see sort of center leftists pick it up and be like, look at this cool thing that we invented, one frustrating, but two, once I got over my own weird shit, kind of nice. Like, could there perhaps be some weird bipartisan support for some of these ideas? But as we get into this conversation, first, maybe, how would you characterize, you know, their interest in these ideas right now? Like, what are they excited about? Yeah. Ezra and Derek are coming from a classic big government lib.

Obviously, we would like to build high-speed rail and green energy and a bunch of stuff like that. When we try to do it, we spend astonishing sums of money and the thing doesn't get built. This is incredibly embarrassing. The state of California is incredibly embarrassing. We need to figure out like, what went wrong, roll back a bunch of rules that aren't serving their intended purpose.

Like sort of starting from very lib premises, you've still got just a catastrophic failure to accomplish your goals. And maybe if we tried this other thing where we like actually build stuff and prioritize like governance and regulatory strategies that let we actually build stuff and prioritize governance and regulatory strategies that let us actually build stuff, then that would be way better. This is, yeah, I think only radical if you're on the center left because the government regulations get in the way of building stuff is not a new observation on the right at all. I think a lot of what Ezra and Derek are trying to do is they are trying to say to a group of people who like don't care very much if the government stops private companies from building things like, hey, the state of the government actually does still impinge on all of your priorities. So you actually do want to be on the team that fixes this because it is standing between you and everything that you care about.

And that seems super valuable. Like. You can quibble. I think we're about to get into a lot of quibbles, but I'm excited about the general project of saying to people to to my left or to your left, certainly like, hey, even the stuff you want is going to require us to learn how to build. There is an interest in trying to work within the broader system here. It's like, what can we do at the state level, maybe in

California? How can we change the whole thing, right? It's less like how do we escape it? It's more like how do we reform it? And I guess I'm wondering if you think that the whole system can be reformed. If they think that if you think if, I mean, what is your sense of that? Yeah. So what is politically possible, like within the Democratic Party or within the United States is like kind of the whole question, right? Like is Devin's thing possible? Can we build Esmeralda in California? Is like a big rethinking of the Democratic Party possible or is everybody who's spending their effort there just wasting

their time when they need to, you know, go do their own thing? I don't know. It does seem to me like we have under-tried the, like, change the system approach somewhat over the last while. Like, the Republican Party has changed extremely dramatically in the last 10 years. The Democratic Party also changed extremely dramatically, I think mostly in a bunch of bad directions, and then realized a bunch of those were bad and is now pretty adrift. And it seems to me like that is a pretty good moment to try and say, okay, is there space in the system now for the stuff I care about? Is there a place we can carve something

out for it? And if people are like, the center left is going to try and carve this stuff out as a vision for the Democratic Party, not really a vision of the electoral pitch of the Democratic Party, but the thing that all of the staffers are excited about and the enormous technocratic, bureaucratic energy on the left, which there is certainly a lot of if the thing it's pointed at is the abundance stuff, that seems really good to me. I would be like pretty happy. So I'm less saying that's definitely going to happen and more like that is such a valuable bet if it pays off and it doesn't look impossible to me. I'm putting a lot of chips there right now.

Before this administration, I'd never had hoped that America would reverse its decline. I have some hope now, not like a lot. You know, I agree that like getting some people pointed in a better direction is great, but I still think we need to be building the new alternatives to these systems. Let's talk about the Trump of it all.

I felt similarly very, very, very, very, very mildly like, oh, over a specific piece of verbiage, the Golden Age. It is interesting to me how rarely people say something in politics to the extent of we are going to be the best we have ever been. Better than ever. Better than Abraham Lincoln.

Like on one hand, wow, that's a really clownish thing to say, but on the other, wait a minute. Wouldn't that be great? Wouldn't that be fucking awesome? Wouldn't that be amazing? Like why don't people aspire to that actually? So I love that. I think that Trump is kind of weirdly open

to almost anything. Like he just reads the culture and picks things up and drives forward with them. And what I would love to get on his radar is the concept of like a sort of regulatory free zone, a special economic zone. I don't know if I'm economic, but like a progressive. Let's call it a Trump zone. I'm happy to call it whatever he wants. Like, let's go. I mean, you want call it a Trump zone. I'm happy to call it whatever he wants. Like, let's go.

I mean, you want to go a golden zone. Freedom is the term. Freedom cities in California would be great to have one there. One of the things specifically that I think maybe could get on his radar is something like rare earth metal processing and mining. Like we I think extremely place to do things like that. The idea with the freedom cities is to have different industry clusters for things that are strategic for the US and rare metals is a great example.

But maybe I'll just briefly describe the what the program is. Sure. Yeah. Yeah. So Freedom Cities is something that Trump mentioned once pretty early in the campaign and then again like late in the campaign and it's the idea of building new cities on federal land. So there's a couple different reasons for this. One is that there's lots of federal land and it's often in the case where that land is near cities it's often not going to its highest valued use and so putting that land to work for America would be great. And the other side of things is the regulatory difference. And so if you're on federal land,

you're not under like municipal, county, like zoning. You have your own policing. Think about how there's park rangers in national parks and not state police. Yeah, the Presidio has a lot of weird rules in San Francisco because of this. Right, yeah, yeah, that's Presidio and Golden Gate Park in San Francisco are great examples,

the Alameda Naval Base as well. And so you actually got a bunch of regulatory advantages in places that are too like NIMBY and we're zoning as a problem just by being on federal land without changing any laws. Now, there's a lot of work involved in this, right? Like municipalities and counties and states do a bunch of useful things, you know, besides slowing down innovation. And so the federal government would need to like set up parallel institutions there. And then, you know, the degree to which it could become a little bit like a special economic zone is and there's two main organizations, there's the Frontier Foundation, who I'm working with, and the Freedom Cities Coalition, who are pushing this stuff forward. But there is the potential to

have, you know, very small, like regulatory easements within these, you know, where, for example, for rare earth metals or semiconductors, or, you know, the easiest example would probably be a longevity focus where you got extended right to try like they just passed in Montana. And so sort of like the federal government is legally allowed to grant regulatory carve-outs. And so picking a few sectors that are strategic for the US, there's the potential for some degree of regulatory experimentation within these. Now, it would still be a really small percent of regulatory change. As a software

engineer, one way I look at these systems is in a charter city or something else, what percentage of the laws and institutions that govern this area are the same as the enclosing area and what percent are different. And so this is where a special economic zone is really different from a charter city in that it might be like 0.01 percent or even less, 0.0001 percent of the laws that are changed, but they're very carefully chosen to have impact and make the zone succeed. In a charter city like Prospera it's more like 90% of

the regulations are different or created locally. So Prospera is under the Honduran Constitution and treaties and Honduran criminal law, but they write all commercial law, which is like the vast majority of law. And so from that standpoint, these freedom cities, it would only be a fraction of a percent of change. but a small change in the greatest economy of the world is pretty exciting. In an example, I would look at this Montana right-to-try law as a great example. So passing, there was like a federal right-to-try

in the 2010s, and Montana passed something a couple of years ago, and they've just passed something else that kind of puts in the plumbing so that Montana can approve specific clinics to give treatments that have passed FDA phase one safety trials, but not FDA later trials. So they're actually making Montana into this sort of experimental medical regulation zone.

And the last thing is like the Frontier Foundation, we're mainly focused on a legislative approach. The Freedom Cities Coalition is looking at an interstate compact. And people have been asking me for years, like, how could you use something like charter cities in the US? I'm like, well, there's only a really small number of ways that a geographic region of the US cannot be under federal law. There's native reservations, which are still mostly under federal law, but not completely. Obviously, an act of

Congress can, you know, change where regulations apply, or an interstate compact. And interstate compacts are in the Constitution, they allow a group of states ratified by Congress to have exceptions to federal law and have different, you know, just have different institutions that serve them has a long history in the US. There are several hundred of these. So there is the potential, you know, this, you know, opens up the whole question about like what there's a political will to do and what would work. Congress specifically? Like Trump's got to kind of, first of all, he has to be really excited about something enough to drive forward into it. And then he has to get Congress sort of on his side. Yeah, but the like for ratifying an interstate compact, I think it might be like a sentence. Like it's not, you know, it's the some congressional act just has to like mention that they like

noticed this interstate compact to like, kind of formally approve it. So not necessarily a lot of political capital. Whereas if you're doing a legislative approach, then you know the law is longer and it's harder to get done. That sounds like so you're one of that's that's maybe let's call it the approach on the right. And then there's another approach which is inspiring the Democratic Party of California to become an anti-regulatory party in a certain sense, like to be suddenly excited about killing a lot of regulations. Kelsey, where do you see, what do you, I know that you have a lot of coins in that camp, but what do you see as the more likely path?

Yeah, so to be clear, if Freedom Cities happen, I would be excited about that. It is desperately needed. If the federal government has the will to try and get stuff done, I'm certainly not standing in the way of that. My big hesitation comes from observing Doge, which seemed to me like a great idea, like the kind of thing that in principle could like be massively excellent, like just the very short posting to policy pipeline was exciting to me. It was like, okay, we can notice stuff, it can get acted on right away. In fact, I think it has not only like not done any of the things that I was like hoping that it would do. It has also like poisoned the well for a lot of the things that I was hoping that it would do. It has also poisoned the well for a lot of those things, and it has also destroyed a lot of capacity to do those things that I

was previously valuing and planning on. The US Digital Service, that was actually a really good department that was slowly, not fast enough, but fixing a bunch of problems I had, and I wanted to build on it And now there is like less there to build on you're in a worse position than you started So if freedom cities happen, I'm certainly not going like no don't do freedom cities but like my baseline expectation about what will happen is that it would be a

remarkably bad implementation that like somewhat poisons the well and pisses everybody off unnecessarily and is not done through Congress to an odd degree. Where like here, to be clear, the main concern is just that if you want the longevity that investors need in order to invest, doing everything by executive order and then repealing it the next time the other party is in power is just stunningly irresponsible. We have to cut that out. We specifically have to cut that out if you care at all about business and manufacturing investment in America. And the Trump administration controls Congress, and you would think has a fair bit of sway with

Congress given Trump's power with the Republican Party, but they have been so disinterested in. You were saying it'd be easier to get one sentence sentence through and it would be easier to get one sentence through. But like why are we in a situation where the party that controls Congress, like it would be really hard for them to get actual legislation through. And without that actual legislation, I just, I hope I'm wrong. I hope it works, but I'm kind of like, I expect it to not, to them to do too much for executive action and too much, you know, like confrontational and destructive way. I expect it not to work. I hope

I'm wrong. I've sort of been seeing all of the, the president sort of, not just Trump's executive order blitz, but of course, you know, Biden famously constantly and I'm not Biden, I'm sorry, Obama famously constantly. And we have a kind of long history of this in the country. And then the sort of constant question of what the role of the courts is on both the left and the right every time there's a decision. I always see the not always, but maybe now especially. I'm looking at this and I'm thinking like. I am always saying things along the lines

of why can't we be doing this through our legislative branch and it's because that branch is totally broken and is that not actually the high level problem facing our entire country? It seems just broken. I mean this is the original thing right is like I mean I think that like democracy like if you look at governance as a technology, like as a computer scientist, I'm used to looking at like scaling properties, right for algorithms. And I think that democracy just it, it it's scaling ability is limited, where like the larger the country is, the more diverse it is, and the further removed, you know, Kelsey's point about that, you know, people like it's

easier to build a village because you actually get market feedback, right? Like, like in a huge democracy with 100 million plus people, like the lawmakers are so far away from the people. And so you know, it's not like a philosophical, like I think, democracy, like I'm trying to make some argument to take down democracy. I just think if you look at it's like performance by scale, it has a lot of weaknesses at the high end. And we are like a large democracy. And like,

large democracies don't work very well. So like, let's find some new tech. I don't know if I'm quite that pessimistic. But Congress is catastrophically broken, and it's doing enormous damage to the country, I think is like totally uncontroversial. And the only reason I'm less pessimistic is because I'm like, we have tried nothing to fix this. Like I see a lot of people attributing some of the modern brokenness of Congress,

some of the ways it's like worse than it was under Clinton, which I think is like it was substantially less bad at that point, to like specific rules changes by Boehner when Obama was in charge that made it harder for Congress people to individually introduce bills and like get prestige by getting their bills through Congress. And I've said to a bunch of people, okay, repeal that day one.

And they're like, well, that wouldn't fix everything. A lot of it's downstream. I'm like, yeah, I am sure. But if we know that things got bad when one specific change happened, change that back. And then sure, there's lots more we need to do, but like, how hard have we tried to fix Congress? How hard And then, sure, there's lots more we need to do. But like, how hard have we tried to fix Congress? How hard have we, like, if we think that the most powerful economy and the

biggest, not the biggest democracy in the world, the coolest country in the world, if we think that it is having trouble because Congress is dysfunctional, like, how do we have 10 people thinking full time about rules changes they can demand that would make Congress not be so dysfunctional? Do we have one person thinking full time about that? So maybe Patrick's right here. I'm certainly not like confident he's wrong, but I'm kind of like, how much have we even tried to fix this?

And a big part of my like agenda right now is like, OK, if Congress is broken and this is bad, what if we try just throwing a lot at the wall in terms of fixing Congress? And then maybe that would have a lot of good downstream effects. I want to talk about basically you're kind of leading me into my next topic, which was exit first build, like the question of whether or not the reform is possible versus like whether you need to leave. And I do really, while it frightens me, I do want to talk more about democracy. What maybe could possibly be the end game of democracy. You know, we're a very young country and this is a very sort of new experiment.

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life with AdQuick. Sigh of angels. Thank you, AdQuick, sigh of angels. Thank you AdQuick. It's interesting. This is something, Kelsey, that you raise, the question of whether or not anyone is even working on reform that I have struggled with for a really long time. I started in San Francisco in 2019. I started to think about these ideas.

And then 2020, locked in my apartment alone while like whole cities were brought to their knees. I started thinking more seriously about local government because it suddenly seemed like it didn't really matter who my president was. It mattered who like the psychopath on my school board was. And that just like really reframed the way I think about politics almost completely. It's like one of the interesting things about this Trump presidency is. I don't know. I just didn't think the executive could even do. I just I was really pilled on blackpilled, maybe on the concept of the executive. And and so I've been focusing on, yeah, there's the question of like,

who is doing anything, who is thinking about fixing this? I guess what I'm wondering is if we're talking about the reform camp the the stay camp the remain the builds camp Not the exit What is the path to reform in let's say, California look like I when I dipped into the politics just for some, it was like a lot, we're talking, it's not just people who are ideologically wrong. They're significantly dumber than the average person in media or tech. Like that, it's a very stupid sort of person.

It was like Lorena Gonzalez sort of accusing me of being a billionaire type stuff. And like, they're not bright people. They're not sending their best. So what does reform look like in that realm? As I guess the representative of build in this philosophy, like, okay, why don't we have a civil service exam? That like, cause I think there are a bunch of smart people

and this is maybe to the discredit, but there's a bunch of smart people. That's maybe to the discredit, but there's a pause though. That's because of yours. That's because of the left. There's no way the left would ever tolerate an exam, an intelligence test to enter government. Right? I don't think there's anyone on the right who would be like, this is outrageous. I think veterans are another complication here.

I agree that one complication here is an allergy to testing-based job assignment and stuff like that. But I think the other answer is that we currently use the government hiring process to do veterans preference. And I am libertarian enough to be like, just pay them wildly more money and then stop it. But most people aren't. And you sound like such an asshole if you're like, I think we should stop hiring disabled veterans and just hire more Harvard grads or whatever. But yeah, I feel like fixing a lot of this stuff

certainly requires the left to get more comfortable with. We really, really want people in government who are extremely capable and extremely impressive. And that, you know, if you can't win that fight, then yeah, it is hopeless to try and within the Democratic Party, like, reform everything because I think very fundamental to my ideal of America is that we attract the best people from all over the world, people who sort of see the stuff that America stands for and are like, yes, I'm in. And they get to do stuff and they have a fair bit of latitude to do really cool stuff. And even though only some percentage of it works out, the result is all of the really cool stuff.

And if that's not a vision of America that you can get the democratic party on board with, then like, I think that would just be a failure of my project. But I'm like somewhat less pessimistic than a lot of people that you can get the Democratic Party on board with this because, OK, people got very into DEI. And the theory was that if you got very into DEI, then at absolute minimum, one thing you would see was like the like groups that you were trying, the like Black and Hispanic Americans would be like, great, you're doing DEI. This is not at all what happened, right?

Like all of those groups move towards Trump. I think it's because like Americans mostly have American values, which are about meritocracy and fairness and hard work. And a lot of people are going to go, yeah, it's not what you're doing. I'm not not cool with that. Part of it is like unrelated stuff, like they also move left on the culture war. And those those are more socially conservative voters. Some of it is like if you scrub the economy, then like that is going to magnify any minor sins because nobody likes it.

It seems like it's immigration to me. The black vote especially, it seems like very animated by immigration. I remember seeing videos up in Chicago which was dealing with that problem and it was like that seemed to, the videos of the town hall meetings. It felt really aggravated by, yeah. So it's a huge combination of factors. But I think even before Trump won, I was seeing a ton of backing off from stuff. I think just on a cynical level, your analysis here can be, a lot of this stuff was done in the belief

that it would be popular with black and Hispanic voters. And then if it wasn't, then you stop doing it. And I think a less like cynical account is something like, okay, here's how I thought about affirmative action like 10 years ago. Two kids of equal like grit and determination and like intelligence are like starting school in America. And one of them is like from a rich family, from like a background where nobody's ever going to question their right to be in the room, whatever background, you know, you used to hypothesize that is, and they skate through everything. They do fantastic. The other kid, like, you know, doesn't get, I had teachers when I was a kid

who tried to keep me out of advanced math class because they were sexist and like they, they didn't feel like I belonged to it. So I had no trouble believing that a black kid was not put in the advanced math class because the teacher just on some level, even though their math scores were good, didn't see it. And so that kid maybe gets to college with still impressive scores and grades and stuff like that, but lower. But you would like the admissions process to look at that kid and see that like they had a serious handicap and they played like extremely well from that handicap and like extrapolate their actual ELO score, taking into account the handicap and put them in a good school and like put them on the trajectory

that lets them achieve a ton of stuff. And I still believe in that. I still think that if you know someone is playing for a handy from a handicap, it is just a good idea if you're a school admitting students or if you're an employer trying to look at resumes and hire someone to hire someone who clearly played well despite handicap. But to the extent you're doing stuff beyond that, you're just like, we are going to take people who are weaker candidates because of what group they belong to. That was never popular. That was never popular with Black and Hispanic Americans any more than it was popular with white Americans. And I genuinely, I think this is because we have a bunch of shared values about fairness and like, you know, not being racist and those values are just correct. And so I think there has been a

retreat on the Democratic Party's part from some of their worst ideas. And it's like very hard to disentangle this from the election and from losing and like I am temperamentally an optimist and talk to a filtered subset of the left so I certainly talk more to people who are like yeah that was a huge mistake we should be backing off from it than to people who are like yeah that was brilliant we should keep doing it there are certainly a bunch of the latter but I think there's a backing off I think there's room for a backing off and I think there's room for saying like the services we want to provide to Americans are better provided if we hire people who will be really good at providing those services. The like programs that

bleeding-heart liberals care a ton about and I bleeding-heart liberals like describes me to a T you know I only don't cry about dead kids because I did an analysis a couple years back and was like, that doesn't have dead kids. It is very much possible to my mind to sell in order to do the incredibly important work of making stuff better. You need to make sure that you are picking people who can do that work well. I think you can sell this. I think it's true.

I think it's important. It just seems like the bet then is that the Democratic Party will care about merit. And I am not convinced. I see that- Maybe this is heresy, but can we get them jealous of China and feeling like inadequate? I mean, you're trying to reproduce the Mandarin system

of Imperial Civil Service exams. This was pioneered by China. So it's like, hey, like we're on the left. OK, we want capitalism. We want like a more like socialist, like communist capitalism. Well, look at the experts in the world. How do they do things?

They give exams and they hire good people. There was a lot of this on China right before covid, obviously, when the entire paradigm switched, like where there was like, oh, China is the future. Look how they do things in China.

There was a bit of a change in 2016 under Trump, especially in tech, I noticed it, and where people were much more willing to say, China's fucked, we gotta get away from China. But there was still a lot of sort of like heroic, this is the future type thinking, which I thought was really wild because 2017, the height of Me Too, all we're talking about in tech

is feminism, and then you have like, we're talking about the height of Me Too, all we're talking about in tech is feminism. And then you have like we're talking about the rise of Chinese tech where it's, first of all, everybody is Chinese. It's one race and everybody is male. And I remember reading an article once where it was just they would have the only female employees at this Chinese company were women who would come in and give the engineers back rubs. And I just thought, wow, are the libs really ready for this? Is this like, what is,

and how is it not really like more of a part of the conversation in China? People like are certainly way more interested in how other countries do things than like, yeah, it's much easier if you're trying to just pitch, we should have a civil service exam to be like, like all of these places that have a civil service exam. And to me, I always feel like a little disingenuous. So I try not to do that because I'm like, I don't actually like those places. They're

there, you know, but but to the extent that they are doing that right, then I think it's fine to pitch them. I think, you know, a lot of people have extremely limited historical and geographic knowledge. I bet most of them just do not know what you just said about sexism in China. Well, you keep seeing young people who like seem to genuinely be under the impression that China is a socialist paradise, like I think based on about three TikToks worth of information. But the fact that people don't know a lot about what's going on, like, you certainly have to persuade them.

But it makes me think that a lot of people assume that coalitions and positions are much more set in stone than I think they are. I think almost everything is a challenge of like figuring out a pitch that resonates with people and also getting results, right? Like maybe you don't run on a civil service exam. Maybe you run on things that like people actually do. You put it on the platform, you're not lying, but you don't like run any ads where you're like, and we'll do a civil service exam. But then when you are in power and you're doing a ton of things like you, you put it in place and if it is good, like congestion pricing, it was super unpopular. Then they put it in place and became popular.

If I can meme it into Trump's mouth, would you support it publicly? Yeah. If there's a civil service exam and it is a genuinely like good civil service exam that will like find genuinely good civil service exam that will find us good people in government, I will say that that is a great policy. We should have that policy. And I think anybody who wants the government to successfully deliver goods and services or to stop doing human rights abuses and random shit, I think people underestimate how much of the egregiously bad stuff governments do is because, because the people who are doing it are like, not very competent.

Like if you're mad about police, like misconduct, it seems like the police are often not very competent is like one of the problems you want to solve. Yeah, it's probably we just need if there's just sort of put a cap on the reform thing. It's like you need probably way smarter people who are paid a lot more and have a higher status associated with their jobs,

if that's a project that could work. And for that, I kinda wanna argue you need the left because they're the ones that hand out the status and have a lot of the underemployed smart people. They have historically. I think that- Maybe that changes. I agree that they have,

I agree that they maybe even still do. I wonder. I think I was extremely embarrassing. And you ended up saying extremely not you personally. I think the work like the left started saying crazy things. But, Patrick, I want to I want to make space for the question of whether or not democracy is doomed, which is sort of something that you alluded to moments ago,

and I found super captivating, and is something that I worry about myself. I guess just the question of like, I don't know, it seems that things have just been getting worse forever. There's never been a moment, I looked back more into Reagan after Trump won the second time, and I thought, man, he really didn't do much

in terms of like slimming shit down, and he's remembered that way, but to be remembered so heroically for so little in my opinion is kind of shocking and if that's the best that could ever be done really since maybe the New Deal era really when we built up all the machines that then were staffed competently then and now are staffed by incredibly stupid people who turn the machines against us. I don't know. We've never gotten this far in the video game, I guess, is what I'm trying to say. Is is this just not a winnable game? Thoughts?

Yeah, I mean, I guess I if if you think that like democracy is the be all and end all and like the savior and the one true system, then I think the reality is very depressing. But again, to me, like, it's a technology, right? It's like, I don't know, like a single threaded versus a multi-threaded operating system or having virtual memory or something is like, it's a technology that's really good. I mean, there's a reason it's taken the world by storm in the last few hundred years. It doesn't work everywhere for everyone, but it's like, it's the best that we have.

And then, you know, there's all kinds of details about how you implement it, like Kelsey was referring to with like small legal changes that affected how Congress works, right? So when it's a technology, there's not just the big ideas, but like the devil is in the details, you know? And it was the best for a period of time. But, you know, the nature of the world, like from a technological perspective, you

know, from a physics perspective, with the heat death of the universe is kind of like an end to complexity, right. But like, for now, at least, we're in a period of flowering complexity. And, you know, I And I don't think that governments are outside of this realm of like tinkering and experimenting and using new science and new technology to redesign things. Like I think governments are in that too. And so democracy is doomed because like,

just like if you just forget everything that you think about it and just say, given the technological changes that have happened in the last 250 years, the last five years, right. Or the last five years, like what are the chances that the political system that, you know, was pioneered in 1787 is still the best one today? Like it's zero. Just from a pure simple outside view perspective, like so much has changed. Like we have all these new technologies for getting information about people's preferences, for organizing ourselves. And like surely the optimal form of government is going to be one that leverages those. And so like, of course, democracy is doomed, just like every technology is doomed to eventually be replaced by something better until we reach

the hard physical limits that we're not close to yet. It reminds me of the kinds of stories that you can tell are sort of shaped, let's just rip off of McLuhan right now, shaped by the mediums that exist at the time. And so the printing press kind of gives way to our current form of government.

The printing press is super dated at this point. It was dated years ago and now it's like, now we're entering the world of AI. So I don't know what I agree, I agree with what you're saying. And I think I find myself wondering, what does AI mean for representative democracy? What are the ways in which it impacts that? And I don't, I don't know. But that's so much of the AI conversation for me is like, if we're talking

about fundamental change, paradigmatic change, then I don't know how to predict that. It seems like everything will just be very, very, very different. And that certainly includes democracy, whether or not it is culturally considered sacred at this point. It's just not. And it will definitely pro not. It seems just not. And it will definitely pro... It seems like it has to change. I don't know, Kelsey, do you agree that the technology itself, it seems hard for the government not to fundamentally change

if the technology has changed or progressed so immensely? AI in particular feels to me like a little bit separate from everything else. If AI weren't happening, I think I would be like, I think we can get like another hundred golden years out of like the fundamentals of the American system with a series of technocratic fixes. I think you can get quite far with that. And I think like democracy is not just the system, it is also the system for changing the system. And it can also work as that. AI, I do think, changes that picture. AI is really fast. Policymakers have a terrible time making any decisions about it because the timescales they operate on are just

not the timescales AI operate on. It is the first massive technological and social change that is basically being incubated entirely in private industry and not even with all that much government money or involvement of any kind. The implications are pretty staggering. The timescales are pretty staggering. And I think having voting rights over what happens in the United States becomes less relevant if by far the most important thing is what is happening inside like one of a handful of private companies. I'm not totally sure that, you know, exit rights change that very much. Like, if a scenario that you're interested in, and certainly one that I'm interested in, is like, open AI successfully automates almost all knowledge work. Then, like, you know, that is a pretty bad situation for almost all knowledge workers to be in. And if they own stock, then no,

they're not fine because open AI is not public. Maybe they are indirectly fine because Microsoft does well. But like but our theory of how they benefit from this is kind of sketchy and runs through several steps. And I'm not sure, maybe Patrick disagrees with me here, I'm not sure it solves anything if they have total freedom to live and work under any regulatory structure they like, if the fundamental situation is one where we just overnight automated almost all knowledge work. Yeah, it's not really in the scope for charter cities, right? I mean, charter cities are way of like experimenting.

Like if you want to figure out like how to incorporate AI into governance, like charter cities are a great tool for a bunch of people to do a bunch of experiments with that. But it's not going to address some kind of- Well, AI dictatorship has got gotta be the only way. I will say that- It's impossible. I think I've heard-

The dictator good AI I'm in. Yeah, I mean, that's all we all, the question, I mean, the question with dictatorship is just like, how do you have a perfect one? One who's good, genuinely, and makes all the right decisions. And it's like, well, that seems impossible

because we're human and we all are totally fucked up and it has never happened in history So probably it can't happen. But now maybe final like famous last words. Um, but on you were just describing something. Uh, it sounded like The end of government via ai, you know, there's this question of well Is there a positive case for ai in government and then immediately it's like well You're talking about what happens because of AI. And then there's just a democratic reality.

If everybody's out of work and furious and they don't have enough money and it's like, well, the government's going to change. We'll no longer be a democracy for very long. It's like, we're going straight to communism, I think. And, or I guess whatever the things were when they tried to be communism. And it's just, it seems like pretty ugly.

So we are in this, maybe it seems super intellectual or too intellectual, nerdy, boring, beside the point. But I actually think the question of what our government is going to be is, it's a good time to ask that question. And I think it's a good time to be thinking about, and like, I don't know for sure what's gonna happen or when it's going to happen. But since like 2019, the folks at OpenAI have been saying, yeah, we are going to automate

all knowledge work. And since then, they've been making like pretty steady progress on the amount of knowledge work that they automate. And so far, I like it is, yeah, it's a productivity multiplier, as you would expect from the basic economics and stuff like that. But I don't, like, I can pretty easily see a world where that stops being true, where like the future perfect newsletter it writes is just better than the future perfect letter

that it writes with my assistance. Like there are some smart people that I can't actually be helpful to. And I do think that if we're not thinking ahead about what is the plan, then yes, the default is massive social unrest, various redistribution efforts, which are like some combination of appeasement and like threat and like reaction, none of which like is a good outcome sort of for anybody, or at least like is very far short of the best possible outcomes for everybody.

I guess we don't we have a comp though. We have a comp in the oil countries, Qatar and shit, where they pay all their citizens and it seems like they're, they're living kind of what tech people talk about on UBI. It's like tons of money from the government and it's not that hard and maybe there's some version. If you cleanly transition to something like that, I don't have a better plan than that. I feel a little bit of like grief or alarm or something because I like want purpose. Yeah. Well, one purpose and I'm like somewhat skeptical that like the thing that most people will do if you're just like, well, we automated your job, but here's a big paycheck. Like if they spend that doing stuff that's meaningful to them, like cool, awesome. I kind of worry that a lot of people like do a lot of drugs and like not much.

Definitely. Well, yeah. Do like we have a massive crypto sports betting explosion and like hyper interesting algorithms that like play you the absolute most compelling TikToks 24 seven. You do a lot of drugs and, this could happen consensually, this could happen in a democratic framework. It would still feel to me like a fundamentally tragic outcome for the human race.

Well, we did see some of that during COVID. We saw an explosion in- Oh, that's the future. The wall-y future feels like kind of disturbingly plausible at this point. Patrick, do you have thoughts on that? Cause I want to get to my last one, which is sort of a petty point and very different from this.

No, go for it. Well, it's just aesthetics. My question is, I want to kind of pick on abundance. It feels like I guess I'm seeing a movement rise up and it's a combination of several things. It's like the, the Yimby, let's call them the Yimby center left because the socialists left in San Francisco is very opposed to it. Oh, yeah. Yeah.

So let's let's say that the Yimby center left like the abundance libs, the new we just discovered that Joe Biden was senile for four years, libs under the banner of Derek Thompson's not Derek Thompson. I'm sorry. Alex Thompson's new book. And maybe to a certain extent, the people, maybe you guys are like the priests there, like for some of them, the Nate Silvers of the world. They're all in this sort of group. You're definitely pointing at a very real group on the center. And so for me, so for that group of people, which I see as the emerging make, hopefully that becomes the Democratic Party rather than Hassan Piker, Luigi Mangione left, which is kind of what I suspect is going to happen.

I do worry. Yeah. But if it's the other guys, the sort of I don't know what you want to call yourselves, but you need a name. You got to brand it. And it's definitely under that umbrella. If it's that. Why the fuck are the buildings so ugly? And I have a lot to say about it. Why are the buildings so ugly in San Francisco?

It's like when you eke out a massive victory, for example, what happened recently in San Francisco, the socialist stuff was furious. So I of course, double clicked to laugh at their tears. What is it about? And it was about this building that was built, which sounds great. It's like, oh, we just greenlit a bunch of new housing.

Phenomenal, of course the communists are mad. But the building is so hideous. I'm talking soul crushingly ugly. And I'm not even coming at this from like I go to. I want to compliment France right now. I go to Paris and I look around and I think this is the most beautiful city in the world. It's totally centrally planned. This is not coming from a weird libertarian place where it's like, you know, I don't know, whatever.

There's no culture worship here. The buildings in America that we're building right now are so ugly. And I think that the Yimby people should care more about it because if you want to convince people that what you're doing is important and beauty is the path to do that, why are they so disinterested? I mean, does it bother you?

Do you think I'm valid? Like what is going on with the ugly buildings? And Matt, pull up a picture of one of the ugly buildings so we know what we're talking about here. I mean, relay this point about how distant are people from like their customers or users. There was like a great study that went around on Twitter recently where like the more years somebody has studied architecture, the more their tastes diverge from that of a regular person. And so we're like educating people away from like what people actually like.

Well, that's even like, so that would be like the sort of brutalism defenders, which they seem to me like a broken group, but I will acknowledge that there are many experts who are pro brutalism. What I'm talking about is like the Lego shapes that I don't know that there are many elitists who are like, this is the peak of aesthetics. I think they're just doing it and they want you to just eat it.

And they're like, it doesn't matter. All that matters is housing. I don't think that that's all that matters personally. But so I do think a lot of people have kind of become very hardcore. All that matters is housing because housing matters a lot. And because any other criteria you admit onto the table become excuses to delay. So there was a lot of like just I will bite any bullet you throw at me. Like you're like, it will shadow my vegetable garden. Great. I love shadowing your vegetable garden. It's hideous. Great. I love how hideous it looks, which is not healthy. You just like generally, you don't want

to have an adversarial attitude about trade-offs. You want to have a like, yep, trade-off acknowledged. We're doing it anyway attitude. But I think there's some like you log in, I do this to Oakland City Council meetings to discuss whether something can be built. And there's so many objections that I think there is an attitude of like, yep, yep, we want to build anyway, we want to build anyway, we want to build anyway, we want to build anyway. And it takes like unusual like virtue and carefulness

to go of all those objections, which one is largely shared by the largest percentage of people and is there a good way to accommodate it at like a tolerable cost? Beauty, I think there is often a good way to tolerate it, to do it at a tolerable cost. And when there isn't, it is like often a thing where we could use technology to close the gap. Like I'm very excited about the people who are trying to like automate stone carving so that we can have cool stone carving at low prices everywhere. A pet thing of mine, anybody of your listeners who knows botany is going to tell me this is impossible because I don't actually know anything about botany, but big old growth like oak trees and

redwood trees make everything beautiful. The problem is they take hundreds of years to build. Do they have to take hundreds of years to build? Do we have really fast growing trees? Yes. I talked to a guy for Gabriel Lycena for a podcast I did. It was one of the seasons of Anatomy of Next when I was still doing the podcast back at Founders Fund. And he was doing what he called aggressive AFAR station. He was genetically modifying flora to take over cities. He's a biohacker.

And this was part of it, to get things, to get things to grow faster. So I don't know, maybe it's possible, but I agree, I see these pictures of Mexico City and people say, this is the most beautiful city in the world and I think, I think there are just plants in this picture is what you're actually talking about. People love trees.

Like if you compare identical, like boring subdivisions and one of them has like old growth trees that are like almost making an arch over the road and one of them doesn't, the trees like they lift the human heart. The other thing is insurance companies despise the trees because they will fall on your roof, branches will fall on your roof. When our insurance inspector last came by for the micro school, he was like, honestly, 90% of my job these days is telling people to like stop having trees that are going to cause their insurance company to have to make expensive roof repairs.

And this feels like some kind of market failure, right? If everybody values your old growth tree, but your insurance company that has to pay for your roof repairs is like, I am losing money on your old growth tree, please stop having it. I don't know. I think beauty matters. I think reasonably often the right place in our trade off navigation would be making places more beautiful. And even when like we can't afford to like, okay, let's figure out how to afford to.

I think it's really important. For me, it is enough to oppose everything that you stand for, to be honest, because, and again, I don't mean you personally, I mean, like, I mean the new group. And it is really, because I think about what we're all having a conversation right now is like, what does what should the world look like? And if the best that you have to offer me is the Lego building everywhere, that to me is a sign of and you could say, well, it's because of the regulations and the pricing and all this. But all but all I hear is like Chinese skyscrapers full of blinking lights inspired by Burning Man going up and down.

Like Salesforce Tower. Salesforce Tower is beautiful to me. What if the truth is like this is VR, can we convince you to just wear glasses that make San Francisco beautiful? Oh my God, you guys are just bumming me out. The real world still matters. I am getting it from both ends.

I mean, from your end and then it's like, everything should be Tokyo and like, come on guys. I reject the San Francisco thing. Like, I don't think we want that either. Like, I don't know why we're trying to if we just lifted San Francisco up another five stories, the whole city problem fucking solved. Like, we're good. We're good to go.

And it's like, let's just make it Paris. We don't have to reinvent the wheel here. We can save San from Tokyo all over America for when we actually need that, I think. And hopefully we won't because I don't know. We was never, right? Because populations are actually gonna start falling. We are kind of like at peak need to build housing

in some ways, although I think that's bad. That would be crazy though, if the entire conversation just ended because honestly, sadly, baby boomers slowly on their way out, does the market just open up all of a sudden and then people are just losing money in the house in the housing that they bought, which is super possible. I do kind of think that a ton of medium-sized, like San Francisco has a bunch of reasons why

people want to move there, but I do think a ton of medium-sized cities are going to, some are already crumbling and some are going to crumble as a consequence of just like the population shrinking and like people concentrating even more. I don't know what to do about that. Reasonably often I'm like, well, AI is probably going to completely change this entire picture sooner. But yeah, it does seem like a world that's just going to be very different, you know, by the time we are baby boomer aged ourselves. But Patrick, we brought you to the negative aesthetic thing.

It's just like a market. It's a market fundamentalism. You just think that things should, right? It can maybe you just tell me what you think there. Market mechanisms are imperfect. And like what we see from this, like, the more experienced the architect, the worst buildings they design is that for whatever reason, the feedback loops aren't working. So I'd want to like investigate those details and try to restore the feedback loops. You know, and I do like generally think that the more the like creator of the product, like a city,

like the closer they are to the users of that product, the more likely that they'll do a better job. But it's like much bigger than aesthetics. It's like, whatever it is that people want, let's like structure things so that the creators have an incentive to make that. And the case of cities, like, you know, having a city run by a for-profit corporation where the more beautiful

the city is, the more people enjoy it, the higher the real estate value is in tax base, and the more money they make, I think is just fundamentally a better feedback loop, and is going to solve this, at least to some degree, will solve this problem and a lot of other problems too. Last thought, given the entire conversation we just had, exit or build? Exit America or build in America? Is there a path to save America? Is there not? I think I know where you're gonna come at this,

but Kelsey, I'm starting with you. Exit versus build. I wanna build. I think that we're in a like weird realignment time. There's a lot of leverage to having a case for what America ought to look like and a lot is rapidly changing about what the government thinks of itself as doing and can do. There is a point where I'd be like, nah, I'm out. But it's, it's pretty far away. I feel like I've got to give this a try first. And I think it can work. I think things that people thought were impossible

actually happen all the time. I mean, I have strong opinions on this. I would say for me, it's not exit versus build. It's like exit and build. And I think I kind of disagree with this, like the framing of the exit. Like look at something like the Traders 8 leaving Shockley and starting Fairchild Semiconductor,

which led to our entire electronics industry. They exited, right? But they exited in order to build something and then bring it back to the market better. The Shenzhen, Hong Kong example is incredible. Like millions of Chinese people like exited China to go to a place where they could actually produce value that had better laws, better regulations. Did they really exit though? Did they really exit? China can flip that switch at any second.

Well, now they can, but in the British days, they had genuinely exited because they were protected by this different empire. For Hong Kong. And then if you look at the impact on Shenzhen, when Deng Xiaoping started to liberalize China, a lot of this business expertise flowed back and was able to uplift hundreds of millions of people out of poverty. More people were uplifted out of poverty

than has ever happened in the history of the world by the combination of Deng's interest in reform and Hong Kong to draw models and experience from. And so I think that when you exit a giant institution to build something that is meant to like make a better product, like there's a sense in which you're not exiting, you're exiting the institution,

you're not exiting the economy. Like your goal is to make something even better for those who are using the current system. And the same way with charter cities, it's not running away. It's like, hey, I want a clear space to reimagine this. But do you imagine that path, that exit to be China-like? So within this, it's not really exit. It's not a full, it's not like an exit to Costa Rica. It's like an exit to a freedom- That's right. It's not it's not a full it's not like a an exit to Costa Rica. It's like an exit to Into the jungle like with low cost of living it's like let's go build something better and then come back and out compete them

Like you're not trying to leave you're not trying to you're not like trying to take your abilities out of the domain of the human Race you're just taking them out of like an institution. That's not what I'm saying They're doing that in America. Are you doing that physically in America? Are you doing that in like a free is that your, is that the path that you see? Well this is, you can do, you know, by, by like, you can to some degree do it in America using cyberspace and incorporating in other places, but your ability to do so is limited. And I think that like one of the most important problems to solve is like upgrading the operating system running on every piece of land and like managing every city and county. You know, and that's what I'm about.

And I think like you upgrade that operating system by setting aside having a blank canvas and taking the space to design something new. Probably maybe the first thing you do doesn't work. Maybe the fifth thing you do doesn't work. But like look at how much benefit has come to the world from the American Constitution. And then America is showing that like, hey, this different way with tolerance of like with like free speech and free religion, like guys, it actually works better. You know, like I feel like countries are even more herd animals than VCs are. And, and that's saying something. So, you know, having the proof of concept

can go a long way towards getting countries to reform. Well, great. Thank you guys both for joining me. It's been a real pleasure. Talk to you later.