Tech Won't Save Us - How Masayoshi Son Shaped the Tech Industry w/ Laleh Khalili

Episode Date: April 24, 2025

Paris Marx is joined by Laleh Khalili to discuss Softbank CEO Masayoshi Son, the structural factors that allowed him to build an empire, and the many ways he’s shaped the modern tech industry.Laleh Khalili is Professor of Gulf Studies at the University of Exeter and the author of Sinews of War and Trade and her forthcoming book Extractive Capitalism.Tech Won’t Save Us offers a critical perspective on tech, its worldview, and wider society with the goal of inspiring people to demand better tech and a better world. Support the show on Patreon.The podcast is made in partnership with The Nation. Production is by Eric Wickham.Also mentioned in this episode:Laleh wrote a review of a new book about Masa.She also mentioned The Box by Marc Levinson and The Next Shift by Gabriel Winant.Support the show

I think that he might want to be remembered as a Genghis Khan, but it won't be necessarily for the conquest of the wide swathes of the world, but rather for the kind of devastation and destruction left behind. Hello and welcome to Tech Won't Save Us, made in partnership with The Nation magazine. I'm your host, Paris Marx. And before we get to this week's guest, I just wanted to talk a bit about our five-year membership drive, which is happening this month. Over that time, I have recorded hundreds of conversations with different tech critics, academics, journalists, workers, and other people who are involved in this industry and have important things to contribute to how we understand the role that technology and these major tech companies are playing in our lives. Obviously, given the moment that we're in with

Silicon Valley's alliance with Donald Trump, the role that Elon Musk is playing in the White House, though, we'll see if that is maybe starting to shift. And the broader right wing embrace of the tech industry. I think these conversations are more important than ever to educate people on what is going on and the deeper impacts of these technologies and this way of developing technology that we often do not think about. Being able to continue doing this relies on the support of listeners like you. And that's why I'm asking more of you to go support the show on patreon.com so I can continue having these conversations, making the show, and giving people a different perspective on what this tech industry is doing to the world we live in. This month, I set a goal of getting 100 new supporters so I can make a new series on defense tech and the relationship between Silicon Valley and the

Pentagon, and an even bigger goal to get to 150 new supporters. And then I'll start working on a zine to start presenting these ideas in a different way, which I think will actually be a pretty fun project. So far, we're at about 80 supporters, so we're nearly to that first goal. And as we enter into the final week of this campaign, that is why I need you to go over to patreon.com slash tech won't save us to become a supporter and help us hit the two goals that we have for this month. If you support at our $5 a month tier, you'll get access to our Discord server to premium bonus episodes, and I'll have more to say about those soon, and other updates and live streams that I do

on occasion. And if you join at our $10 a month tier or above, you will also get some stickers in the mail so that you can show off your Tech Won't Save Us pride, if that is a thing. So with that said, thanks so much for supporting the show. Consider going over and becoming a supporter to help us hit those goals and to ensure I can keep making the show that provides critical perspectives on tech to so many people. This week, my guest is Laleh Khalili. She is a professor of Gulf Studies at the University of Exeter and the author of Sinus of War and Trade and the forthcoming book, Extractive Capitalism. I've been wanting to have Laleh on the show for a while, and she had a recent piece or review of a new book that is out about Masayoshi-san.

And I figured this is the perfect opportunity to have her on the show to dig into this person who we have actually not discussed on Tech Won't Save Us very much over the past five years, but he has played a really important role in shaping so much of what we know is the tech industry today and the particular model, the financialized model that it is built on. And I think Lale has a really important perspective to contribute to that discussion and how we understand him and the role that he has played over this time. And of course, for those of you who don't know, Masayoshi-san, better known as Masa, controls SoftBank, but his vision funds have also played a really important role in pushing this notion that startups need to lose a bunch

of money, they need to grow incredibly large, and it's at that point that they will basically make the money back that they have lost over that period of time. Certainly in some cases that works, but most notably with WeWork, which Masa was involved in, that did not work out so well. But for a lot of companies, the idea that they need to pursue growth at all costs has become part of the model of what a tech startup looks like. And part of that is because of the role that Masa played. Because often companies wouldn't get funding unless they would commit to the model that he wanted them to pursue. So I think this is a fascinating conversation. Hopefully it will help you learn more about this important figure in Silicon Valley's

history and present, of course, as well as he was alongside Sam Altman and Larry Ellison for the announcement of the Stargate project with Donald Trump earlier this year. So let's get into it. If you enjoy the show, as I was saying, you want to help us meet our goals, you can join supporters like Colin, Ushnish from Oakville, Ontario, Shirley from Florida, Leslie and Malaga, Spain, Peter from Baden, Switzerland, Juan in Geneva, Scott from Melbourne, Hollis from Boston, Jennifer in Queens, New York, Kelly in Northampton, Massachusetts, and Dan from Wellington, New Zealand, by going to patreon.com slash techwon'tsaveus, where you can become a supporter as well and help us hit our goals for this month. Thanks so much and enjoy this week's conversation.

Lale, welcome to Tech Won't Save Us. It's really exciting to talk to you. I follow you on whatever social platforms you're on now, social media platforms you're on now, and really love the stuff that you post. And I'm always like saving everything and bookmarking everything. So it's very exciting for me to talk to you. Thank you, Paris. Thank you so much. No, it's a real pleasure to hear that, obviously, because I've been following your work for quite a while as well. You know, we were talking about this before recording, but you know, I read your book. And you know, back in the moment of like supply chain disruption through

COVID, I really meant to have you on at that point. And then there was just so much else going on. And I never got to it and was like, kind of sad I didn't get to it. And then when I saw this new piece that you have on Masayoshi-san, I was like, okay, this is the opportunity. I've never done an episode on him before. Let's have a chat. So yeah, I'm very excited to have you on the show and to be able to dig into this, right? Because there are a lot of interesting and impactful characters and also illustrative characters when we look at the tech industry and when we try to understand it through the lens of particular individuals, right? And I feel like Masa is one of those folks. So for people who aren't familiar with

Masayoshi-san, how would you describe him to give people some of the key points? One of the things that's really interesting about Masayoshi-san is that he is touted as one of the most visionary technology supporters. And in some ways, what is really fascinating about him is that he is indeed somebody who seems to be in front of a lot of trends, but he's not from North America, which makes him stand out. He's a complete technophile in the way that a lot of Californian tech bros are, but he's Japanese. Although he owns apparently several properties in the US, he chooses actually to stay in Japan and the hub of his business really is in Japan, even if he does go forth and invest in a lot of places.

So who he is really is a kind of master of all trades when it comes to technology in the sense that he, from very early on, was one of the first people to sort of do major investments in the dot-com business. He actually, even before the dot-com business, he saw the importance of personal computers, PCs, and the software business that made those personal computers actually useful. He saw the way that the dot-com application development process actually changed the technology landscape, made those personal computers so much more attractive to ordinary consumers. He was ahead also of the smartphone

craze in the sense that because he had developed personal relationships with Steve Jobs of Apple, he was the person that actually introduced the iPhone to Japan. He was quite significant in recognizing that households were going to be connected electronically. And so he was ahead on setting up, for example, fiber optic cable networks in Japan, infrastructure actually, on and on and on. So he has been ahead of the trend on a lot of incredibly significant shifts in the ways in which technology has moved out of universities or out of development spaces or out of defense spaces into households and has been able to take advantage of that. So he has a nose really for what consumers want, or even like a very good

marketing person, what consumers don't think that they want, but to make them want whatever it is that he's selling. And so that particular ability has stood him in extremely good stead in terms of making money. But one of the other things that makes him kind of a darling of tech boosters is the fact that he seems to be the kind of person that no matter how many times he falls down, he seems to want to get up and do it all again. And so he has historically, and to great schadenfreude, to be totally honest, lost his fortune, at least his paper fortune, at least three times, and yet managed to sort of climb up the ladder of billionaire valuations again and again and again. And again, part of that is he is plucky and he is in some ways considers himself to be invincible and therefore acts in this particularly ballsy

way. But I think that in some ways he's also been an extraordinary beneficiary of a whole lot of social and political processes that have led to our extremely unequal world full of billionaires who think they can do everything. And he is one of those billionaires. He's perhaps not as evil-seeming as somebody like an Elon Musk. And I doubt that he takes ketamine on a regular basis. But I do think that he, like Musk and so many others, has been such a beneficiary of the processes of deregulation, of the opening of the markets, and of the financialization of the tech industry over the course of the last at least 20 years, but really 30, 35 years. That's fascinating. And I think that gives us a really good picture, a basic picture to start off

of who this guy is. And one of the things that stood out to me in reading this piece, because I'll admit, you know, I know who Masa is. Obviously, I'm familiar with the role he's played over the past decade, but I didn't realize that he had been around as long as he had, like in these spaces, in this industry, back and forth between Japan and the United States. For me, like he was someone who really started around the gig economy era. That's when I started to pay attention to him, you know, the WeWork stuff. And then, of course, seeing him continue to pop up. But while I knew about SoftBank, the extent of his career was something that was quite novel to me in reading this. In fact, the name SoftBank sort of indicates what era he is from. The name is supposed to

be a contraction of Software Bank. And essentially what he was doing was, you probably don't remember this because you're too young. But back when the applications that we put on our PCs used to arrive not by streaming or not downloadable, but rather on CDs with little hardback manuals wrapped in shrink wrap. I will say I was around for those days. I do remember. Oh, come on. You can't. You couldn't have been. It just moved to downloads not long after I started remember it. Oh, come on. You can't. You couldn't have it. But anyway. It just moved to downloads not long after I started using computers. That's how applications arrived. That's how software arrived. So one of the things that Masayoshi-san did was to essentially look for all of these different

applications that were coming and warehouse them. It wasn't that he was developing any of this stuff in the 1990s. It was that he, again, as I said, had enough of a marketing sense to realize that there was actually a space for acquiring and selling software applications that could be put onto PCs that people were increasingly buying. I mean, also, it's worth remembering that part of the reason that he succeeded as well as he did is because Japan had, by the 1990s, become known as the single most important place for developing personal electronics, right? I mean, people probably do remember this, in part because actually the kind of gadgets

that you still buy are Japanese. My son is in high school, and he has to buy some incredibly fancy calculator that does all sorts of calculus and trig functions that ordinary calculators don't. And they don't want them to have computers in the room, so they have to have these calculators. And these calculators are still produced by the Japanese. that production of incredibly inexpensive but incredibly durable personal electronics was one of the things that also made the selling of PCs to the Japanese much easier and much more widespread in the 1990s than it was in relative terms in the US. And I think that that in itself actually gave Masa the ability to set up the business SoftBank. His business does go back a long way. And even before that, part of what he actually discovered would be really a very good forum for this kind of techno evangelism that he is very known for was Comdex, a technology conference, which is like

Comic-Con, but for tech nerds. And so Comdex was owned by Sheldon Adelson, which later became known as sort of the godfather of Las Vegas and also of Israel. I should also mention that. And Sheldon Adelson sold Comdex to Masayoshi Son for apparently way more than it was worth, which made Adelson extremely happy and therefore a lifelong friend of Son for years to come. He was the person that introduced Sun to Donald Trump on the eve of Trump coming to the White House for the first time. He is the person who introduced Sun to Mohammed bin Salman. So it is quite interesting to see that some of the business that Sun did in the 1980s ended up bearing fruit for him decades later. But it started off, as I said, with technology boosterism, and it went into consumer products. And it continued

on from there. It's such an interesting history, right? And you talked about that story with Sheldon Adelson. And there's this anecdote in the piece about Trump kind of showing Massa how he did his comb over or something. And I was like, what is this? I know, right? I do love that little anecdote. There are some funny bits in Lionel Barber's, you know, somewhat admiring book. And this is the one that really got me was the one that when he went to visit Donald Trump on the eve of, this was 2016, after a conversation in which Son promised bringing, I don't know, like Foxconn business to the US. You know, the manufacturing thing has been an obsession for Trump for years and years and years.

And Son promised this. And so after the conversation, Trump goes to the attached en suite. They were meeting in a hotel room. He goes to the attached en suite and says, hey, come over here. Let me show you how to comb your hair. And Son is actually a little bit thin on the hair on top of his head. And so it was quite funny to read about the way that Trump combed forward what remained of hair on the back of his head, which it's hilarious. It is actually quite a funny moment in the book. Can you imagine if Masa had shown up a few weeks later and all of a sudden was doing the Trump do? I mean, these guys do seem to be really obsessed with their hair.

And I think that is refreshingly one of the things that Son doesn't seem to be. Because we all know, for example, that Mas got hair plugs after the first few years of his receding hairline. And, you know, at least a couple of times. Indeed, whereas Sun has kept to his thin on top look over the years. But I think, I mean, obviously, there are other elements of vanity that appear in Sun's behavior that don't necessarily have to do with hair plugs and comb overs. But that little story is also indicative of something. And it's indicative of the way that Trump was quite happy to forge these quite intimate relations with these tech bros on the basis of the promises or the deals he saw himself extracting from them. And that kind of

a quid pro quo transactional sort of process, we see it playing out on a much larger, much more global and much more devastating scale in the last week. But really, that story is indicative not only of these massive egos and vanities, but also of that transactional process that seems to adhere to so much of US politics these days. I want to come back to some of those more structural factors. But first, I wanted to ask, how did you get interested in who Masayoshi-san is? How did that kind of come on your radar? And how did this become one of the figures that stood out to you as you've been following this for all these years? I'm going to start with WeWork, because I think I was one of the many millions of people around the world who really did have a moment of schadenfreude when WeWork failed. I mean, the WeWork guy, Adam Neumann, was also actually a figure in New York City that we'd

heard about. And recently when I was telling one of my girl group from New York, where I lived for a time, I was telling them about writing this piece about sun and mentioning that I was going to talk about WeWork, my friend Leslie reminded me of our friend Rainie, who was a clothes designer and had done some designs for this clothes line that Neumann was going to put out, which apparently had like patches for babies with patches on their knees or something. And it had something in their name, which had to do with patches. I can't remember what it was, but never paid her, never paid Rainey for those designs. And I was like, my God, he was a con man trying to con another con man. And meanwhile, all of the big banking interests in New York were lending them money and giving

them valuations way beyond what they deserved. And to me, this whole WeWork story was indicative of a particular moment in sort of the history of technology in New York. But going beyond that, I was a tech nerd in the 1990s. I graduated with an engineering degree from University of Texas and then decided that I didn't want to go into chemical engineering. And so I got hired by first Anderson Consulting, which later became Accenture. And then after a couple of years with Anderson, I worked with Pricewaterhouse. And then I worked for a year or two for myself in the heat of the sort of the dot-com moment before going to grad school. All of this kind of tech brouhaha was something that I was really familiar with. And having seen the way that it functioned behind the scenes, you sort of develop a nose

for the bullshit in it. And Son is a divine bullshitter. He is fantastic at it. And so I think part of the interest in him in particular came from that. But I also have another broader interest. I have also written essays about private equity guys from the Global South. And what I'm really interested in is how does capital travel when it leaves the Global North, where there is a huge amount written about capital, both boosterist and critical.

But when it travels to the Global South, there is not as much written about it. A lot of the people that write, for example, about a sun or about the various billionaires of India, and much less about the various billionaires of China, actually don't say very much. And a lot of the accounts written by people from the Global South actually celebrates them as being somehow competitors to the global North, a kind of a slightly parochial boosterism for them. I'm Iranian of origin, come from an old lefty family in Iran, grew up in Iran. And so I treat the capitalists from the global South with the same exact amount of disdain that I do capitalists from the global North. But I am interested in the way that they are portrayed and in the way that they operate.

Yes, okay, they're capitalists, they're exploiting everybody. And actually, even worse, they're exploiting their own people in ways that are, well, Fanon wrote about in the 1960s about the, you know, the national bourgeoisie. But they do have disadvantages relative to a USian or a British or a European capitalist or tech bro, the way that they overcome that disadvantage through building the networks that they do has always been something of interest to me. And so that was also part of the reason I really wanted to do the SoftBank piece. That makes a ton of sense. And you can see that with Masa too, right? You know, kind of going back and forth between California and Japan and building these

relationships like you were talking about. But, you know, as we going back and forth between California and Japan and building these relationships like you were talking about. But, you know, as we think about the foundations on which he was able to build this, you know, empire that spans multiple countries and whatnot now, one of the things that you mentioned earlier was how deregulation played a really key role in enabling someone like Masa to, you know, become what he is today. Can you talk a bit about that and how that actually played out through the 70s, 80s, 90s, this period where he was really getting his start? I think it's really important to acknowledge that deregulation, not only in the United States, but also in Japan and eventually in China is actually what led to Zong's incredible affluence.

Like a good pontificating lecture I'm going to go through, start from the US and then move to Japan and China. In the US, the process of deregulation obviously starts in the 1970s with sort of the unpegging of the dollar, but it's also the introduction of finance as a kind of, not introduction, obviously finance was huge, but the financialization of so much of the industries and businesses that were happening. This process also was concurrent with globalization, if you will, of technologies, which meant that there was a shift in the movement of technological jobs from the global north to other locales in the global south. So we see, for example, the inexorable rise of Japanese car industry around the same time. And this was inseparable in some senses from the shifts that were happening

in the US, from the policies that actually ended up resulting in these jobs shifting overseas. Then we see further processes of deregulation happening later on. Earlier, before we actually came on to the podcast, you were mentioning about the privatization of the backbone of the internet in the mid-1990s. But you also had some other events happening in the 1990s, which really set the stage for this process of deregulation. You had the end of the Cold War, which meant that there had been shifts in the ways in which money was allocated through the sort of industries in the United States. And so there was also a shift in the kind of technologically savvy graduates from universities which had tech programs. There was a major shift from them moving from sort of the military industrial complex into the tech industry,

primarily in the West Coast, but also in the South. In addition to that, under Clinton, a law was passed that actually reduced the marginal tax rate on capital gains. And this was enormously important because it allowed for a huge amount of money to slosh around and go into these kinds of investments, regardless of the soundness of the investment, which, of course, eventually led to the dot-com crash. But this process of deregulation meant that huge amounts of capital was rerouted and technically savvy labor was rerouted, the technology industry, the dot-com industry.

So that's the first thing that is happening. In Japan, the process is slightly different, in part because Japan, after the Second World War, had a very planned capitalist economy. It had an entire ministry that looked to planning. And because of the historical development of corporations there, the corporations are very corporatist in terms of labor and in the sense that the unions act alongside or with the corporations rather than in a kind of a conflictual relationship with it. And because of the planning, there were these horizontal

connections between corporations and this, like, for example, a single bank that fed them and that lent money to them and provided support for them. And that kind of an incredibly tight relationship between the banks and the corporations and labor meant planning was very easy to propagate from the top. But it also meant that on the one hand, businesses could coordinate with one another in ways that a fully competitive laser fair economy doesn't allow for. It has winners and losers, whereas in this instance, you had a lot of winners working and coordinating with one another. And you also had a focus on modes of production that allowed for the emergence of, for example, personal electronics,

but also automobiles, and a certain degree of protectionism, which allowed for the emergence of, for example, personal electronics, but also automobiles, and a certain degree of protectionism, which allowed for the development of a steel industry and semiconductors and various other kinds of things. And so this also, in addition to the 1990s deregulation of finance, provided a good setting, both in terms of the availability of technology, but also in terms of, from the 1990s onwards, in terms of availability of capital for Masayoshi Son. But what is really significant about Son is that his biggest investments were not in his vision funds and the WeWorks that failed, but it was an extremely fortuitous investment in Alibaba, the Chinese, people say Chinese version of Amazon,

but it's so much more. So Alibaba was actually doing customer to customer, business to business and business to customer kind of trade long before Amazon expanded into all of those areas. Although it did start around the same time as Amazon in the 1990s. And it was started by a guy called Jack Ma and his partners. And Ma and Masayoshi-san found each other simpatico. They were very similar to one another. Ma was a little bit younger, but I think reminded Son of himself. All of this investment that Soft Bank made in Alibaba in the 1990s was made possible by the processes of deregulation in China itself, where foreign ownership was allowed, foreign investment was allowed, you know, under Deng Xiaoping in the 1980s, but also in the 1990s. And it's worth remembering

also that long before US money started going into China as FDIs, foreign direct investment, Japan was the biggest foreign direct investor in China. And so Sun going in and plopping down a whole bunch of money for a significant stake, voting stake in Alibaba in the 1990s was not this kind of moment of, oh my God, he's the first to do it. It was actually of a kind with a, I would say, decade-long interest by Japanese capitalists in China, which accelerated in the 1990s because of deregulation of foreign ownership there. He was there in the right place at the right time, as much by chance as by, as I said, his ability to sniff out a good market.

I think that this is such an interesting history, right? And how these changes in a number of different countries have contributed to this one man's rise and ability to present himself in a particular way. And it was fascinating as well to read how that investment in Alibaba enabled him to have some of these losses at other times because he could sell off some of these Alibaba shares and cover it, right? Alibaba was his cushion. Every time he failed after the purchase of Alibaba, he just called on the shares that he owned there. I mean, it is kind of insane because he invested some millions of dollars in Alibaba, which when Alibaba went, did its IPO in New York in 2014, those millions of dollars was worth 60 billion. So he did really benefit from the rise of China as both the factory of the world, but also as this area where there was obviously a growing consumer body because of the improvement in Chinese standard of living. And so I think that these two factors were also enormously important for the growth of SoftBank. I wanted to ask you another piece about that. That's a bit away from the story

about Masa. But when you're talking about what Japan looked like in that moment in the 80s and the 90s, as it's deregulating, as you're seeing its relationship to the United States, I feel like when I look at that era, I see a lot of similarities to what we're seeing today with the response to China and the United States issues with kind of moving up the value chain and that sort of a thing and the growing global competition between American firms and Chinese firms. I was wondering what you see in kind of the comparisons to that moment in Japan and what we're experiencing today. I think it's a brilliant comparison. So I was a grad student at Columbia University, to my shame now, given what's going on in Columbia. I was a grad student there towards the end of the 1990s. And we had to take these comparative politics, which were

really political economy survey classes. What was fascinating about those survey classes, actually, I went back to some of those readings that I did in grad school, because my focus was the Middle East. But obviously, in those comparative courses, you read a lot about the Asian tigers, because this was in the wake of some of the failures of the Asian tigers. What was fascinating about it was that there was this kind of a development of another core of capital in East and Southeast Asia, obviously Japan, but also South Korea. And this was also a moment in which Indonesia and Malaysia were becoming quite significant, but China was on the horizon at that moment. So there was, on the one hand,

the specific politics that was happening in political economy that was happening in that part of the world, which was really quite significant. And you see some elements of that today being repeated in some senses, like, for example, in Vietnam, where Vietnam is doing what Malaysia was doing back then in some ways. But you also, in the context of studying these things, was the United States, where by the 1990s, some of the sort of Japanophobic discourses had died down, in part because of the rise of dot-coms on the West Coast. But if you still go back to some of the films that were being produced in the 1980s and

the 1990s, you do see these Japanophobic ideas and thoughts, even in something like Die Hard, you know, that ultimate 1980s film, it's worth remembering that the corporation that has bought the big building, which where Die Hard happens, is a Japanese one, you know, and the Japanese are shown perhaps not as evil, but as hapless. And so I think there's some element of that kind of Japanophobia going on there, which is surprising. Part of the reason that it's surprising, China has never been a kind of a protege of the United States. Whereas after the Second World War, when the US occupied Japan, you know, for decades, and it didn't give up Okinawa to Japan until like 1970, well into that era, Japan was an

enormously significant ally and base for the United States. Japanese industry also benefited from all the wars that the US fought in the region. When I was going back and rereading some of the materials about sort of the rise of Japan's economy in the 1980s and 90s, one of the things that you run into, people mention in passing, Japanese industrial production doubled in response to the kind of demands that the US had on Japanese goods during Korean War for fighting the Korean. was transporting material for the Vietnam War to Vietnam across the Pacific and Japan and Philippines, the Philippines were its staging ground for these container shipping alongside, you know, these containers carrying material back over and then coming back empty. And so they wanted to bring goods from East Asia back to the United States because already

the whole of the trip was already paid for by the Pentagon. So why not take advantage of the fact that you could actually bring some stuff for free while charging the producers at that end for the service? At the same time, the Japanese who were technophilic were also already talking about setting up container shipping terminals. And so that kind of a fortuitous convergence is what led to a huge amount of Japanese electronics starting to be carried over to the United States. The start of sort of the mania in the United States for Japanese electronics and later cars really was that moment of these containers coming back from the Vietnam War to the Pacific coast. And so Japan had been a beneficiary of the US global capital largesse

post Second World War period. But it had also been an incredibly significant staging ground for the US spread of capitalism, but also empire in the Pacific region. And I think that that kind of a symbiotic relationship is something that doesn't quite exist in China. But the xenophobic discourse that we see about how they're taking over our businesses, all of that is completely and totally familiar. And I think it has to do with there being contradictory impulses within US capitalism between an entire system which wants to see the world, a kind of a repetition

of an empire of free trade, the British empire of free trade, in which, of course, the US is the main beneficiary because of the exorbitant privilege of the dollar being global currency of trade, and the contradictory impulse of, at the same time, there being within the United States, a substantial, both capitalist and organized labor class, which doesn't want to see manufacturing jobs going across. Part of that is a kind of a nostalgia for a time when the economy was much more orderly. People had long time jobs in the same companies. The jobs paid well. You could retire on those jobs. You could buy a house. You could send your kids to school. And the gradual diminution of that, which Gabe Winant has written about Pittsburgh in a wonderful book, which recounts the way that these industrial jobs populated by white men of a certain age gave way to service jobs in the health industry populated by women and people of color, which, of course, also fed into all sorts of racial politics.

So you have these kinds of contradictory impulses happening in the U.S. economy, which you see emerging in the Japanophobia of the 1980s and 90s and the xenophobia that we're seeing now. It's really incredible. And I remember the first time I heard that story about the containers going across, bringing the supplies for the war, and then stopping in Japan on the way back to like pick up all these consumer goods and electronics. And I was like, like, my mind was just being blown, you know, as I was reading this. Yeah. Osaka was one of the first container terminals in the world outside of the United States, which is amazing. I mean, and what's interesting is that part of the success of China as becoming the factory of the world was also based on the construction of extensive transport infrastructures, ports, container terminals, but also extremely extensive

and speedy and reliable inland transport with trains and good road systems. And so the reason that China became sort of the factory and important trading emporium was because of these investments in infrastructure, not because of some sort of a nefarious plan to take over the world, a la Manchurian candidate, you know? Absolutely, absolutely. Good to have some infrastructure, not because of some sort of a nefarious plan to take over the world, a la Manchurian candidate, you know? Absolutely. Absolutely. Good to have some infrastructure, right? To be able to move things around. Indeed. Yeah, it's a bit useful. I want to go back to Masa as well, because we've talked about these

broader structural factors, right, that contributed to this person's rise and the types of businesses that we saw here, but also increasingly what this tech industry turned out to be. And I was wondering if you could talk a bit about how Masa and how SoftBank really represent this kind of financialized tech capitalism that we have come to see for so long, where there's so much money being splashed out on so many of these companies. Some of them can be spectacular failures. Some of them get huge. But like, it just seems to be going after bubbles and the amount of money being spent on various things without knowing if it's going to pay back is sometimes hard to imagine. So how do you see him and his company in that role? Are they really pushing this type of model forward?

Or are they just participating in something that is happening on a broader scale? I think during the first dot-com bubble, while he was quite a significant investor in a lot of stuff, and in fact, tried to set up a venture capital firm, which failed fairly quickly, he was following the trends. But I do think that in the subsequent one, I know that the sort of the bubble that was still going on until last Wednesday in the artificial intelligence, he has been at the forefront of it. that was still going on until last Wednesday in the artificial intelligence, he has been at the forefront of it. And part of it comes out of, as I said, the technophilia. I don't think that there's any element of subterfuge going on here. He is really technophilic and he really does believe that technology will save us. And he really does

believe that, I mean, he has been sort of bandying about artificial intelligence for more than a decade. So there is an element of this that has to do with Massa's vision of what the world is going to be like. And I think that that also is part of the reason why he got along with Mohammed bin Salman of Saudi Arabia, because the kind of vision that Mohammed bin Salman had, which was supposed to play out in Neom, the town that he was going to build, the sort of the technology hub for all the techno files of the world on the Red Sea he was constructing. That vision was very similar to the vision that Masa had, a kind of a clean world full

of technology where everything is done for you by technology and where you make a lot of capital off of that. I mean, there's also a huge amount of structural issues that are happening at this moment. There is enormous amounts of capital going into these kinds of industries where I'm going to sound a little bit like the sage of Omaha. The business fundamentals are simply not there. They have these enormous price to earnings ratios, which never come to fruition. They have huge amounts of money going into businesses which don't make any kind of

profit for years on. It's worth remembering Amazon didn't start making any profits until it started selling server and cloud space to the US government. I mean, it's really worth remembering that it's taxpayer money that made Amazon become the behemoth that it eventually did become. Amazon's cloud services ended up making the company profitable. Uber wasn't profitable for years and years and years and years and years and years, if it is even now. It's important to remember that this incredible investment of money into these businesses, so much of it is and was hype. People are talking about AI in part because chat GPT can start talking to people in ways in normal, natural language, which seems like magic or at least something sinister out of

the matrix. But I think it's also really important to remember that Google was doing a version of AI when they had the amazing search algorithm, which they have now burdened with all of their advertising bullshit. Long before the whole AI hype emerged, they collected data on a mass scale in order to produce the kind of search algorithms that they did. A story that I love telling, which I'm not sure whether I incorporated it. It was so far off the story that the editors probably rightly lopped it off. But in the early 2000s, these big billboards started appearing in California, which was like, ask us any question. And it was a 1-800 number. And you could call them and you could ask them any question. What is the area of the United States? Which neighborhood

in San Francisco is the cheapest place to go have a beer. Can you please give me the number of a pizza place close to me? And there would be somebody sitting on the other end and they would record your question and they would respond to you. Amazing service. And it was free. It was 1-800 number. Turned out that what was happening was Google was collecting people's voices and California has the largest range of accents of people speaking in English because of its extremely diverse population. And they were doing this in order to do voice recognition. So they have done this. This is basically AI and it's like 20 something years old. So the point about the kind of AI that people are talking about now is something that is much more

visible and kind of perhaps more user accessible in some ways. Like, as I said, the chat GPT is like the nightmare of all of us who work in universities because our students. I try to convince my own son not to ask questions from chat GPT. Just go to Wikipedia for fuck's sake. There are people behind Wikipedia. Doesn't matter. That's like my own personal bone to pick. But it's a hype.

And what the hype does is it allows companies to increase their valuation. For me, the epitome of this was the way that, and I'm sorry, I keep going back to Musk. He's such an excellent example for all sorts of malfeasances in this tech industry. Sometimes it's hard not to go back to him, right? So he bought Twitter and within days, the value of Twitter plummeted. Then he puts Grok on and Grok is kind of a shitty second rate, quote unquote, AI. It's essentially a search function, kind of like Google search function would be. It just speaks more than Google search function does. I'm not talking about Gemini. I'm just talking about basic Google search function. And immediately the value of X increases.

It's a kind of a scam to increase the valuation of these companies and increase the paper wealth of the people who own them. Sun, on the one hand, is a techno evangelist. And on the other hand, somebody who is benefiting from this, because it's also important to remember that despite his kind of a benign looking, cute little short smiley dude veneer, is somebody who Lionel Barber quotes directly in an interview saying, I'm not Bill Gates. I'm not a Steve Jobs. I didn't just build a company. I have built an empire.

I'm Genghis Khan. I'm Napoleon. You know, he's got enormous amounts of vanity here. And so I think that that kind of a combination, you know, on the one hand, the hype, which makes you rich, and on the other hand, this kind of a feeling that technology is going to fix everything, it's not new either. It's really worth remembering in the 19th century, this is the kind of shit Marx was writing about, or Engels was writing about, the human flesh as an appendage of the machine. Marx wrote about that. And so this kind of a technophilia as a solution to the world's problems,

unfortunately, has a long history. And I think it is deeply embedded within capitalism, in part because in order for capitalism to reproduce itself, it constantly has to have something kind of new in order to hype itself, in order to increase the value of the companies. No question about it. And that quote you're talking about, when I read it, I couldn't believe it. And in part, because you see these photos of Masa, the small Asian man, and you don't imagine him talking in this way. But it's not wrong that he hasn't built this empire, right? It's incredible what he has been able to put together. And as you say, the number of times that he has been able to kind of pull himself out of the wreckage of these bubbles going bust and being able to build something else. And that's why I

wanted to ask you about these vision funds, right? Because when we think about SoftBank and we think about MASA, like one of the first things if people are familiar with them will be these vision funds. And, you know, you mentioned the relationship with Mohammed bin Salman. And part of that is we imagine him having all this money. We talked about how he made all this money from Alibaba. But often a lot of the money that is being deployed, as I understand it, is money from the Saudis and Emiratis and stuff like that, that is going into these funds. So can you talk about how those funds come together and what the impact actually is when he's able to deploy all of this capital. It might be useful for your listeners to hear that SoftBank, which started off as a single company that produced, you know, whatever, was a software selling company, has become

something of a conglomerate. In Japan, they own a whole bunch of different kinds of technology, but also beyond technology. It has a financial arm that hedges against whatever. But then it also had these venture capital funds, Vision Fund 1 and Vision Fund 2. And these venture capital funds that emerged in the sort of the mid 20-teens, in the first instance for Vision Fund 1, Sun went to the sovereign wealth funds of various Gulf countries. So both Qatar and the UAE, for example, invested in this, despite the fact that they were at loggerheads even then. But he also went specifically and developed these friendships,

relationships, personal relationships with the rulers of these places. And so he went to the ruling family of Abu Dhabi and promised them the kind of technology that could be used in surveillance. And we know that Abu Dhabi's ruling family absolutely loves surveillance. You know, they have hired people from both the US and elsewhere to develop all these kinds of very dodgy kind of spyware. And they were at the forefront of buying spyware from the Israelis years before they actually, the Abraham Accord. So there was a commercial relationship, which the United Arab Emirates has always sort of cultivated, where it benefits them in terms of surveillance. And so that's what Zon used in order to get money from them. And then went to Mohammed bin Salman and sort of touted the kind of a fund as the possibility of expanding the kinds of technologies that Mohammed bin Salman can then eventually use

in NEOM. And so came out with close to $98 billion in funds. And the funds were deployed. He had a floor on how much he would donate. So you had to have a huge, at the very minimum, I think it was $100 million or something. You had to request that much in order to get money from the fund. And he went for a lot of gig economy businesses and stuff like WeWork, but also gig economy style Uber-like businesses in India, customer-to-customer type businesses that actually escape a lot of regulation. I remember reading some time ago, and it might have even been Travis Kalanick,

the co-founder of Uber, who was kind of saying that like, and this is not to let Travis Kalanick off the hook or anything, but he was kind of saying like, you know, I know people give us a hard time for how we grew the business and blah, blah, blah. He was like, but people need to understand that like in the moment that Uber was growing, you kind of couldn't access capital unless you were going big to grab everything because the funders were not interested in it. And it was like either we were going to dominate the world or we were going to fail and you weren't allowed to like imagine a sustainably growing business. And like, I feel like the Vision Fund contributes to that idea in that moment of how a startup is supposed to work. Hugely. The Vision Fund was enormously significant in creating that kind of a

thinking of and that kind of a zeitgeist in investments in the 20-teens. Uber was one of the beneficiaries, for example, of this, but also Lyft. So there was this also thing where the venture capital firm was investing in two competing companies, which also says something about what the aim of the venture capital was. It wasn't about growing these businesses in ways that were useful even to the founders of those businesses, but rather it was about sort of the accumulation of capital via the venture capital firm. And the Vision Fund had promised double- returns and blah, blah, blah. It ultimately, WeWork was its most spectacular failure, but there were a lot of other failures

in there. And ultimately, the returns that it had was something in low single digits, I believe, which is less than actually some of the other funds. If you just tied your investments to the market index, you probably would have doubled your investments in ways that you wouldn't have done here. But the second vision fund, he decided to not go to the sovereign wealth funds, in part because the sovereign wealth funds were actually asking for more accountability than Masa was used to. So he decided to activate his personal friendships with various tech folks in the US and got some pledges for investments, but ultimately didn't collect those pledges.

And so actually, it was SoftBank money that went into the Vision Fund 2. And they did some investments in some really dodgy shit. And ultimately, apparently, the Vision Fund 2 actually had negative returns. And part of the reason for that also was because the particular conditions of investment where Division Fund 2 hit right before the COVID pandemic. And so in some ways, he actually thought that he was completely, his lucky and that he was really dependent on the particular conditions in which he accumulated his capital. Although I think that went right out the door as soon as Trump came to his second term. But division funds are a kind of a lesson in how pumping money into these businesses without any attention to the fundamentals of the businesses, without any kind of attentiveness to the way that in order for the businesses to even have the slightest modicum of profitability,

they would have to exploit the workers that they have, that they have working with them in the extraordinary ways that they do, as Uber does. And I think that's the sort of degradation of conditions of work that the gig economy has brought about, thanks to Masayoshi-san and his cohort, are all these horrible lessons that nobody seems to have learned anything from. We could continue talking about this forever, I feel like. So I have one final question for you. And that is, you know, we recently had this display of Masa next to Larry Ellison, of Oracle, Sam Altman of OpenAI, and with Donald Trump,

where they announced this big plan to invest $500 billion in the Stargate data center project. So I guess my question is, can Masa actually keep this up? And when we look at what he's doing today and all the things that we have been talking about for how he got to this point, what should we make of his actual legacy after his involvement in this industry for the past number of decades? It is the same legacy as so many of the tech bros, let's just say, which means that some managed to create interesting services and interesting products. Most actually hyped those services and those products way beyond what those services and products could actually bear in terms of what they were capable of. They intensified the accumulation of capital in ways that has acted to all of our detriments, not only by creating inequality, but also by the drain on resources, natural and otherwise, the production of electricity and water that is needed for the data centers that do the amount of calculations in order for us to

ask Chad GPD to write a student essay. All of this really is his legacy. And I think that he might want to be remembered as a Genghis Khan, but it won't be necessarily for the conquest of the wide swathes of the world, but rather for the kind of devastation and destruction left behind. And I think that the intimacy of Sun with the Trump administration, just as the Trump administration is torching not only longstanding US relations, but the very fundamental liberal basis of the empire that the US had built after the Second World War is going to be a cautionary tale rather than a triumphalist epic. Yeah, it is kind of incredible to see them tear apart all the institutions and alliances that maintain American power at the same moment that they seem to be so

concerned about its decline. Laleh, I could talk to you forever. This was such a fascinating conversation, not just to talk about this one man, but the structures that gave birth to someone like this and the kind of industry and time that he has been able to live through. So thank you so much for taking the time. It was a real pleasure to speak with you. Totally my pleasure. I'm so happy to have actually met you, well, virtually, face-to-face. And I hope that we can keep this conversation going. Absolutely. I would love that.

Thank you so much. Laleh Khalili is a professor of golf studies at the University of Exeter and the author of the forthcoming book, Extractive Capitalism. Tech Won't Save Us is made in partnership with The Nation magazine and is hosted by me, Paris Marks. Production is by Eric Wickham. Tech Won't Save Us relies on the support of listeners like you to keep providing critical perspectives on the tech industry. You can join hundreds of other supporters by going

to patreon.com slash tech won't save us and making a pledge of your own. Thanks for listening and make sure to come back next week. Thank you.