The Pomp Podcast - #656 Power, Money, and Ego w/ Teddy Schleifer

Episode Date: September 7, 2021

Teddy Schleifer is a reporter who writes about the influence of billionaires, particularly in Silicon Valley. He is also helping launch a new media company called Puck. thestratosphere.news In this conversation, we discuss billionaires, philanthropy, good intentions vs bad outcomes, power, influence, money, and ego.  ======================= Polymarket is the world’s leading information markets platform where you can trade on the most pressing global questions and see unbiased, real-time data on what the market thinks will happen – all on the blockchain. For a limited time, sign up with referral code “Pomp” to get your first trade reimbursed up to $100. Click on the link to get started: polymarket.co/pomppod ======================= Cosmos is building the Internet of Blockchains, marking a new era of interoperability, scalability, and usability. The free flow of assets and data between blockchains with bridges to Ethereum and Bitcoin will unleash the potential of DeFi, NFTs, and much more. Dive into Cosmos at cosmos.network/pomp  ======================= Matrixport, Asia’s fastest growing digital asset platform with $10 billion in assets under management and custody, it offers one-stop crypto financial solutions including fixed income, DeFi in 1-click, structured products, Cactus Custody™, spot OTC as well as lending. You can earn from high single digit with fixed income to high double digit yield with their Dual Currency Product. If you hold crypto and look for yield, this is the app you don’t wanna miss out. Go download the Matrixport App and enjoy a welcome offer of 30% APY on USDC here: https://invest.matrixport.com/en

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Teddy Schleifer is a reporter who writes about the influence of billionaires, particularly in Silicon Valley. He is also helping launch a new media company called Puck. In this conversation, we discuss billionaires, philanthropy, good intentions versus bad outcomes, power, influence, money and ego. I really enjoyed this conversation with Teddy and I hope you do as well. Before we get into this episode though, I want to quickly talk about our sponsors. First up is PolyMarket, the world's leading information markets platform where you can trade on the most pressing global

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reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. All right, guys. Bang, bang. I've got Teddy here with me. Thank you so much for doing this. Sure thing. Absolutely. So you are part of a team that is releasing a new media publication called Puck website, Puck dot news. And I couldn't help to start the conversation when I went to the website. It simply says a new media company covering power, money and ego. And those three words, I think, elicit all kinds of emotional responses from people, power, money and

ego. But you've been writing about a lot of this stuff for a while. Where does the personal fascination or interest come from in covering some of these topics? So in some ways, the world is very big. And in some ways, it's very small. What I mean by that is there are 350 million people in the United States. But a very small number of people have an enormous amount of influence in American society. People who like, you know, I think lots of listeners might not even know their names. If you look at the Forbes 400 list from time to time, I'm always humored at like how many of these people, even as someone who covers billionaires, I have never heard of, you know, people who have 30, $40 billion

who made their money in some God awful, boring industry who have enormous amount of assets and can convert that into political influence, philanthropic influence, influence in just kind of in public life more broadly um so puck's kind of central uh conceit is that the world is actually driven by a small number of people um and that there is uh a big world that is governed by people in hollywood people in washington people on wall street people in silicon valley and that ultimately that world needs to be unspooled for the rest of us to understand. And these worlds are also, I feel like, often very – are treated as isolated power sectors, right? People in Hollywood who cover Hollywood really well, people on Wall Street who cover

the financial system really well. I've covered Silicon Valley. This is actually really one world, right? The people on Wall Street have influence in Washington and people in Washington are trying to regulate people in Silicon Valley and Silicon Valley is attacking Hollywood and creeping on kind of traditional studios. So one of the other ideas of Puck is that let's kind of narrow the synapse here and try to really uncover this as one world. So my story is I used to be at CNN before this covering money in politics and covering kind of billionaires who were trying to, know kind of elect presidents or elect governors or elect mayors um and then i moved out here to san francisco in 2017 uh to join recode and write about sort of the billionaires of the tech

industry you know the people who make huge amounts of money what do they do with it afterwards um you know i've always been uh less interested in how the money's made and then more and how it's spent um and so at recode over the last four years i've been one of the main people writing about tech billionaires influence in politics or influence in charity. And now I'm over at Puck to do the power, money, and ego world beat over there. And I think it's a great company. And I think people who are listening will like it a lot. You recently wrote a piece that has a crazy statistic in it. And you said, eight tech billionaires today control more than $1 trillion in assets. It's roughly equivalent to the market cap of Bitcoin, or about one third the wealth of

bottom 50% of Americans combined. And then you go on to talk about not only do they hold those eight people about a trillion dollars in assets, but it's actually accelerating. You point out Steve Ballmer basically has doubled his net worth in the last two years. Larry Page, Sergey Brin, the same thing. Jack Dorsey, you kind of go down the line. How unprecedented is this level of wealth versus these are just different players, but the world has always had this type of concentration of wealth? It's a great question. I mean, I think the problem has gotten the problem or the opportunity, depending on your politics and how you see it. I do think the trend is accelerating for sure. I was reading one of my favorite books, or what became one of my favorite

books is called Wealth and Democracy by Kevin Phillips. And he wrote it in 2000, around 2000, about the first Gilded Age. And this is often something I'm asked about is, is this really that different than like, you know, Rockefeller and Carnegie? And I think the answer is in some ways, yes, in some ways, no. Yes, there's always been an enormous wealth concentration in, you know, America that comes with more and more capitalist innovation, right? You have the industrial revolution that then creates economic concentration among wealthy people. At the same time, it leads to a growing middle class, yada, yada, yada. And I think the question that I often wrestle with is how do you encourage kind of an economic expansion while still trying to make

sure that those gains are broadly shared, right? So in some ways, it's similar to the first Gilded Age. But in some ways, this is an entirely different beast. And I think putting our hands around the numbers often helps because it's very easy to sit here and say, what's the big deal about billionaires remaining billionaires, right? Rich people are still rich. You're not going to get an iPhone push alert for Steve Ballmer's net worth doubling in two years. But Steve Ballmer's net worth has doubled in two years. And what does that mean for society? What does that mean for Seattle or Los Angeles or Detroit, cities that are heavily dependent on Steve Ballmer's philanthropy? What does that mean for the Clippers? I mean, there's all these questions that

are second order effects of wealthy people getting wealthier. I mean, you could argue that this is good, that rich people getting richer eventually leads to more money for social projects. I think you also have to concede, though, that it leads to, in some ways, less of a traditional democracy. And I'm not going to overstate the case. I don't think that Bill Gates and Steve Ballmer and Sergey Brin are sitting there deciding public policy on a WhatsApp chain it was part of some secret billionaire cabal. But, you know, obviously, wealthy people have more power than than I do, or even pump than you do. And, and, and really wealthy people getting wealthier, I think does lead to greater economic concentration. And it can lead to greater

political concentration of power. That that's, that's what I wrestle with. And I imagine lots of people who are even even billionaire fans, so to speak, even people who think that wealthy people are more effective at solving public problems than government have to kind of feel when you read the stats that you know there are some downsides to this stuff so there's two kind of interesting conversation points here right the first is i think a lot of the coverage and you previously wrote this um which i think is a fair point is you said a big reason i've been drawn to writing about power and influence is because of these singular individuals eagerness to remake the world in their image. And so would it be a fair character characterization if these billionaires,

wealthy people, however you want to classify them, if they just had all the money sitting in the bank and they weren't doing philanthropy, they weren't spending it, they weren't trying to influence things, it would be just a much less interesting story. So it's like less about the wealth itself and it's more about like, what are they doing with it? Is that fair? Sure. I mean, yes. If, you know, if Bill Gates had $150 billion and he stored it under his mattress, right? And he wasn't trying to oversee America's COVID response and wasn't trying to influence the U.S. education policy. It would be a much more boring story. And I think there are some activists who, believe it or not, I think there are some activists who would say that that

is a better outcome for America, that wealthy people using their money to influence public policy often leads to worse outcomes. I don't know if I agree with that wholesale. I think there are some times obviously when uh philanthropic projects do backfire um but ultimately you know the when i say wealthy people want to remake the world in their image i don't necessarily mean that in a bad way like i don't necessarily mean that you know uh they're they're trying to you know sitting there trying to uh create schools that reflect their ideology or fund climate change in ways that they think are best i think it's just natural if you have a lot of money you think about what are my obligations to society and then when you think about that question it leads to you

doing things that can kind of skew the public policy process um uh whether that's through political donations philanthropic donations sometimes the line between those two things can be kind of blurry so to answer your question like yes i do think it'll be more boring if people didn't do anything um and ultimately they are remaking the role in our image in their image though just by fact of being human beings right they have their own biases like these are all white guys let's just start with that fact right who all have their own biases they're bringing to the fore um they all have their own political opinions so sometimes i think it's an unreasonable critique to say um well should these people literally do nothing with the money right like

i mean that's would you rather bill gates not involved in a covet response at all um i don't know these are thorny questions because at the same time having these people involved i think does give them more power and how do we reckon with that but that's that's that's the question that motivates my reporting. So the second part of this conversation has got kind of two perspectives from my standpoint. One is, is there a right answer or is it all, there's a spectrum and each situation is different. Each person is different and we have to keep that in mind. And then also, do you generally think the intentions are positive or do you think that there is like malicious intent maybe at times or overall? Like how do you think through, and I'm

trying to just identify like the framework you use so like is there a right answer or is there not always a right answer and also is there good intentions but maybe negative outcomes sometimes or do you see like actual malicious behavior at times i don't think there's a right answer i mean um uh if i thought there was a right answer i'd probably be in a different field trying to uh you could make a billion dollars and just do it execute the right it would be easy if there was a right answer right like i mean to me the debate over kind of billionaires in society All interesting questions journalistically are about the gray zone, right? Like about the things that are like, well, you know, we get this good thing, but in exchange

for this bad thing. I love the gray zone. That's why like we get into the like, that's why things are intellectually interesting. I think there's a lot of trade-offs in this world, right? I mean, as I mentioned a second ago, if you want wealthy people to feel a sense of civic responsibility, you want them to do something, oftentimes what they do can entrench their power. So it's often a trade-off.

I wish there was a right answer. It would make everyone's lives and a lot easier. Your second question, do I think there's ulterior motives or do I think they're just unintended consequences? I would say it's more unintended consequences. I mean, we're also way overgeneralizing here, as I'm happy to do. But I think if you talk to wealthy people, they would say, oh, I'm not Charles Koch, right? Charles Koch, I'm Reid Hoffman, or I'm Dustin Moskowitz, or I'm Carla Jurvetson, or choose your kind of billionaire du jour. They would say almost a hashtag of not all billionaires when trying to distinguish between some people might have ulterior motives, but I do not. Look, I think every wealthy person is

trying to do what they think is best. And whether or not you think they have an ulterior motive probably depends on whether or not you agree with them or not. I would often hear when I covered conservative billionaires and I was at CNN, you often hear a critique of, oh, wealthy people are just, you know, Charles Koch is just doing this to lower his tax bill because he wants to get wealthier. And, you know, I'm fighting for democracy, but they're fighting for their bottom line. Like that often reflects your point of view. I would talk with donors in the Charles Koch network who certainly didn't think that, you know, Koch was out there to enrich his bottom line. They think that Charles Koch is fighting for democracy and they might have their own kind

of critique of kind of lefty donors. That's to say that everyone's got their subjectivity here. I think one person's ulterior motive is another person's good hearted public spiritness. It's not, again, I wish these things were easier and simpler, but oftentimes the gray zone is where these things really are. What is, in your opinion, the current state of maybe billionaire spending or philanthropy or however you want to call it, right? So there's obviously they're giving away some of the money, they are spending some of the money, and then they're investing, holding on assets, et cetera.

Is there one overarching strategy or framework that you would apply where you're like, hey, at this current time, most people, they sign the giving pledge, they don't give it away until they're dead, they invest 70% of the money. How do you just think about what the average billionaire, which sounds ridiculous, but the average billionaire actually does? Yeah. I think overgeneralizing is tricky, but sometimes it's actually useful to talk about this stuff. Because to my point, you can always slice and dice it and make your own narrow points, but let's talk about the big picture. So let's just start with something you talk about a lot on the show, which is the stock market being absolutely bonkers. Billionaires are getting wealthier. I think when we talk about philanthropy, there's the numerator and there's the denominator, right? And I like to make fun of this group of people on Twitter that I call

Net Worth Twitter, right? Who anytime there's any philanthropic donation announced, immediately they are pounding the keyboard to compute what percent of their net worth this wealthy person is giving away. And then they bring out the guillotine, bring it to the mansion, and immediately call for the execution of billionaire du jour. That is like, I'm being affectionate toward this group of people, but they're very predictable. And I, uh, it takes about five seconds before any gift is tweeted before they are all up in your mentions. Um, so, so, but I also think that the denominator matters, like, I mean, even since the, you know, the concept of like typing right in the Bible that, and then lots

of kind of, uh, Christians still think about, you know, giving away 10% of your assets, um, is kind of the morally right thing to do. So, and that's a percentage, right. It's about a, it's a numerator over a denominator. So I don't think the denominator is relevant as much as like the network, Twitter people can be kind of annoying at times as much as I love them. So the current state of billionaire philanthropy and billionaires more broadly is these people are getting wealthier. That's step one. At the same time, are people announcing charitable pledges and commitments that make your jaws drop? Absolutely. And so the numerator is, at least in terms of pledges, is as high as it's ever been, right? So wealthy people are

signing the giving pledge to your point earlier, though the rate of people signing it has definitely slow down. They are announcing big pledges. You see Jeff Bezos last year announced $10 billion to address climate change. Jack Dorsey and Mackenzie Scott made some of the other big charitable gifts during COVID that are some of the biggest charitable gifts ever. So I often find that when we talk about billionaires, multiple things can be true at once. A, wealthy people can be doing these incredible acts of generosity, blah, blah, blah. and at the same time they can be not keeping up with the stock market because the stock market is crazy so so how can both those things be true at once like the numerator can be going up and

the denominator can be going up and my favorite stat on this whole thing is you know i mentioned mackenzie scott jeff bezos's ex-wife a minute ago and mackenzie scott gave away um i think she's given away eight billion dollars uh over i forget if it's over 18 month period or 12 month period obviously generated tons of headlines. We can talk about McKinsey and the impact she's had on the charitable sector. But McKinsey Scott is still getting wealthier, even though McKinsey Scott has given away more money at a faster clip than any person ever has in human history, ever, at least someone who's alive, not in a will. And yet she's still getting wealthier because Amazon has decided like, okay, McKinsey, that's an interesting stat. Let me give you another

stat on top of that, which is we're going to grow at an absolutely absurd rate and we're going to make you wealthier. So Mackenzie Scott, who signed the giving pledge saying she wants to empty the safe, she wants to empty her assets, is failing at that. Even though she's doing all this good in the world, the denominator is getting bigger at a faster rate than the numerator is. So that introduces all these interesting questions about what can wealthy people do to give it away faster? Do they really want to give it away faster? If they really want to empty the safe, should they just like sell all of their positions? That might be a faster way to do it than through philanthropy. So you said doing good in the world, and this is like one of those questions that does

not have an answer, but just how you think about it. How do we measure? Let's say that a billionaire gives away, you know, $500 million. How do we actually measure? Are they doing good in the world or are they wasting money? Like to some degree, it's not like a business where you can explicitly say, okay, I'm going to invest $500 million. I expect this is going to bring me back $2 billion in profits over the next five years and either hit the numbers or you don't, right? This is a little bit different. And so how do you look at maybe good decisions, bad decisions on capital allocation and also like doing good in the world versus not? Yeah. I mean, look, I mean, there's, I think some people, let's say you and I had a billion dollars tomorrow. Nice.

Yes, very good. I don't mean this to be glib. I don't think some people are overly concerned with effectiveness. I think some people see, generally donors more aligned with the further left, see their objective primarily as disempowering themselves. I think Mackenzie is a great example of that. She's spoken eloquently about the need that she shouldn't be as powerful in society as she is. And to some extent, whether or not the groups you fund are effective or not, I mean, I'm sure she'd rather they be effective than not, but it doesn't necessarily matter as much. I guess the flip side of that would be things like the effective altruism movement, which a lot of your listeners probably know about because it has a lot of

overlap with crypto. A lot of crypto people are big into effective altruism. Those people are almost exclusively concerned with effectiveness. What can you measure? Is there a randomized controlled trial to substantiate the fact that this thing works? It's very popular to fund things like GiveWell, which is a big philanthropy that tries to run the numbers on everything and it recommends funding things like malaria nets in Africa. And it doesn't recommend funding things like giving $300 million to Harvard. Even if Harvard is where you went to college, no one cares. Whether or not you went to Harvard or Stanford should not impact the things that get funded in the world. And you should fund malaria nets instead. That's the range of thought.

There are people who see philanthropy as all about personal self-actualization, disempowering yourselves, and centering nonprofits, centering people of color, centering people who are not the billionaires. And then there's the other range. That range runs all the way through, I should be a cold-blooded capitalist mercenary and fund whatever works. And if this thing is 0.07369% more likely to save a human life, then I will do that. Um, that's kind of, that's kind of the range. Um, and I think lots of Silicon Valley donors, um, you know, it's interesting. I mean, I see generational differences between this stuff. Um, you know, a lot of the young crypto billionaires, uh, are very interested in effective altruism. And I think they think that, um, there's a way to make a lot of money and use

the money for good. Uh, and they sort of reject the soft touchy feely, you know, I want to give it to my alma mater BS. And I think there's a good debate about that stuff. A couple of the stats that over the last few weeks, as I've been looking deeper and deeper into potential impacts of monetary policy and fiscal policy that have blown me away are three in particular. One, 80% of millionaires in America are reported to have inherited $0. So 20% inherited something, 80% inherited nothing. And I look at that stat, maybe it's 75, maybe it's 85, whatever. Just directionally, it's much bigger than I think most people would originally guess. The second stat is approximately 33% of Americans have never made more than 100K in a given year as a household

income, which again, directionally much lower than I think most people would guess if you're an American millionaire. And then the last statistic is that in America, 80% of workers earn $15 an hour or more. And I think people get caught up in like the minimum wage kind of political debate. But when you account for all American workers, and I'm assuming this includes everything from white collar all the way down to the actual minimum wage workers, 80% already make $15 an hour or more. And again, whether that is 80% or 70% almost doesn't matter as much as just much bigger number than I think most people would guess based on that public narrative. And so the reason why I bring up those three statistics is if we concede that, okay,

they're directionally correct, how much of the billionaire class and maybe even now the millionaire class, as we get more and more millionaires in America, is simply a product of the monetary and fiscal policy. And this is almost like the educated class, right? It's like the people who understand own assets, you're going to have the tailwind at your back. Those that live and hold cash only or live paycheck to paycheck, they kind of go the other way. And we get this widening wealth inequality gap. Is that a fair tailwind to identify and say, yes, you can do things in as an asset owner to be wealthier or not as wealthy as your peers, but there is this like almost education gap that ends up driving this inequality to some degree. I think that's a great

point. Lots of this debate doesn't really allow for that nuance, right? I mean, if you are someone who believes that the rich should be put in one of those guillotines, you tend to have this caricature of like Scrooge McDuck, right? Of like the wealthy person who is like clenching their money around the hard cash and like you know batting away the poor people who are asking for for handouts diving in the gold coins right right and if you are some like you know billionaire bootlicker um then you are a believer that like these people are god's gift to the earth and how dare you criticize or even scrutinize charitable giving or how they made their money because these are you know the icons of our time the reality is like much more boring the reality the reality of

why wealthy people and why inequality, at least over the last five years, is growing. I mean, not that what you laid out is the whole story, but certainly part of the story is things like the Fed, the Trump tax cuts, monetary and fiscal policy that leads asset holders to get wealthier over time, right? I mean, why is Amazon stock going up? It's not entirely because Jeff Bezos is sitting there fighting away Amazon warehouse workers with his bare hands and depriving them of the money that they're owned, although there's a great debate to be had about that. Part of it is just boring reasons like quantitative easing that creates asset bubbles and blah, blah, blah. That stuff doesn't really get talked about on MSNBC or

frankly, in lots of news. But billionaires and inequality... Billionaires get wealthier. I think one of the main reasons they got wealthier during COVID, for instance, which is a sensitive question that obviously has stirred a lot of kind of good conversation about the fairness of the system. A lot of it is reasons that are beyond their control. Like, are they out there pushing the Fed for quantitative easing? You know, have some of them supported Trump tax cuts? Definitely. But these are like kind of the more fundamental structural issues that you're pointing out that don't get much airtime because they're more boring. But I think they do contribute to inequality for sure. Yeah. It's interesting because you can't quantify it, right? How much

of somebody's wealth is because of structural issues versus they did something versus they took advantage of a worker. I mean, there's, it's impossible. And if you even look at somebody like Bezos, I mean, he's fascinating to me because during COVID, I forget exactly. I remember there was at least one pledge if they were going to hire a hundred thousand workers during COVID. And at the time that, you know, millions of Americans are losing their jobs, basically they're soaking up as much employment opportunities as they can. And then you would see articles where people are like well they don't get so many bathroom breaks or you know whatever it is and as i've like looked at this to me it's almost like the truth is somewhere in between if

you take like the two extremist views of like he employed you know hundreds of thousands of people oh he also doesn't let them go to the bathroom it's like well actually both have like a kernel of truth in them and i i think that the internet uh while it drastically increases awareness and allows for kind of public discourse the nuance is you know it's almost banned right it's not allowed to uh to be had in uh in you know 280 characters for sure let alone in some of these other mediums yeah i mean it goes back to two things can be true at once is often kind of my my claim on this stuff and that's not like a side it's not like a sidestep over or you're not wrestling with the tension it's like like yes amazon could be hiring more people than ever

before and you know uh helping people who otherwise would have no job have a job at the same time you know amazon clearly has been you know uh on a war path during the pandemic and has made jeff bezos you know uh the wealthiest person in at least in today in current history and that should increase scrutiny on bezos and like is that legitimate is that fair is you know i guess i don't want to like elide the hard questions and i do think that like you could reasonably say, is Jeff Bezos worth $200 billion because he, you know, decided to incorporate Washington state, the company in Washington, which is a state with sort of a not very progressive tax system. And, you know, why is, uh, Bezos not treating

workers fairly? And is that a contributor to his current wealth level? Like you can have that debate for sure. Um, so I don't want to like pretend it's entirely structural, uh, but clearly some of the structural things that you're talking about are part of the story. Yeah. One of the things that's really interesting to me, I think, is when you start to unpack a lot of this debate around wealth inequality specifically, if, you know, just look right now in America today, there's 10 million plus open roles. It's the most that we've ever had in the housing market. And people are being forced as business owners, you know, you see every kind of anecdotal story on Twitter where there's a fast food restaurant that's paying $15, $16, $17 an

hour. They're offering bonuses. If you come and get an interview, you can get an iPhone if you get a job at McDonald's or whatever. So obviously people are struggling to hire. I wonder how much of this is as the billionaires get richer. And we know that there's a massive wealth inequality gap that's getting worse, but still even the worst off in our society. If you buy into a lot of the longer term data around this is the safest, most wealthiest, most prosperous time in history of in human history. It makes you think if you're a student of history, like, oh, there's bad things to be fixed today, but it's better than it's ever been. But it still doesn't solve the short term problem. And I guess like from your perspective, how many of these folks who have the financial

means, regardless of how they deploy it, how many of them understand the long term tailwinds, the point in history that we're at the structural, like, are they thinking deeply about that? Or are they simply saying to themselves, I'm going to donate a hundred million dollars this year and 20 million is going to feed, you know, the hungry 20 million is going here. And they just kind of think about it from a more action more piecemeal versus actually trying to think like first principle structural, um, you know, how do we change this for future generations? I think, uh, for all wealthy people's, uh, power, um, and I think most wealthy people understand they have a lot of power you might you might get some some weaseling out of that question

and like what am i to do like i hear this sometimes um um like let's take the debate over taxes right um um they're obviously uh wealthy liberal mega donors claim that they want taxes to go up and that you know the taxes revenue that's you know driven by those increases will then lead to social lead to kind of more money for social problems and that you know they they believe in theory and i don't doubt they believe this that lots of these things should be problems should be solved by government and that sort of they shouldn't have to give away 20 million dollars to feed the hungry because the solution to public problems should be public policy and government-led solutions not private citizens you know doing things out of the

generosity of their heart um and you often get things like like what am i to do like i'm not in charge of u.s tax policy like i'm just a voter you know i contribute to you know democratic campaigns and democratic super PACs. And I'm out here to trying to make sure that wealthy people pay more in taxes. You know, if I'm Reid Hoffman and I gave a bajillion dollars to support Joe Biden and I'm for higher taxes, you might say, yeah, that sounds great, but I'm not in charge of American tax policy. I think that can be true and it can also be a cop out. And the reason I say that is because you see things like the ProPublica tax leaks, regardless of the wisdom or the fairness of those things being out there. They're out there. They show, obviously, that lots

of wealthy people actually pay very little in taxes, or some wealthy people pay very little in taxes. Lots of times, wealthy people, although they're not necessarily in charge of US tax policy certainly are taking advantage of every loophole that's you know permitted on god's green earth um and i think there are some things that wealthy people can do to kind of better equip the public sector with the money that it needs to solve public problems that goes short of like being appointed secretary of the treasury which is often i feel like the bar that some of these people will hold themselves to unless they're like unless they're held responsible for their public actions like i think even even as private citizens there are things we can do um to make

make the system more fair um that are short of of you know running for president yeah well do you think we're going to see more billionaires running for president yes for sure i mean uh like uh i think trump will not be the last billionaire president i think lots of these wealthy people uh have enormous egos for sure and um you know despite bloomberg it's funny like i feel like lots of people watch bloomberg blow up and it's not like oh what's just because he's like this you know stiff has been of the past and like i'm the billionaire who can solve it uh for sure i think lots of these people easily think that they could do it and um uh i mean for you know we've seen even though bloomberg failed and tom steyer failed like there's jb pritzker who's the new

governor of illinois who i believe is a billionaire um like there's a long history in this country of uh extremely wealthy people running for office and succeeding uh and i think uh wealthy people read the Bloomberg news as like an aberration rather than, uh, anything that should actually indict them and their political skills more broadly. He didn't win. And if I remember quickly, he spent like a billion dollars, uh, before he finally stepped away. Uh, but he did give us some delegates in American Samoa though. So, yeah, well, here's the, here's my favorite part is he did get us some great, uh, Instagram memes. They went and they bought a bunch of the, the memes on, uh, on Instagram. So we got that out of it. How can you put a price on that? I mean,

So our point about effectiveness, you know, you can't put a price on joy. And the joy those memes encouraged and brought to American society, definitely worth a billion dollars. Thank you, Mike. Let's talk about kind of Bitcoin and crypto billionaires. I don't know how accurate the statistic is, but from what I can tell, it's, again, directionally accurate. that when Bitcoin hits somewhere between $170,000 and $200,000 per Bitcoin, about 50% of the Forbes 400 list will come from this industry. And again, let's say that those numbers aren't perfect. Some big percentage of the world's wealthy will come from this industry shortly, depending on

when that actually occurs. Is there a difference between, let's call them fiat billionaires versus crypto billionaires, or you got a billion, you got a billion, and what it took to get there makes your personality, et cetera, very similar? I'm interested in what you think in this one. I mean, you're more obviously plugged into the crypto world than I am, but a lot of people in crypto are kind of eccentric. Is that wrong? And I think they have different views of what their responsibilities to society are. I mean, tell me, do you think it's going to be that different? I think it's like everything, right? Some are exactly the same, right? I mean, there's people who are going to make a billion dollars off of Bitcoin or crypto or, you know,

whatever industry, and they're already a fiat billionaire, right? So it's just kind of compounding already, already a fiat billionaire. And then they basically are. Yeah. So now are they a crypto billionaire or fiat billionaire? Well, they're both, right? So like a billionaire is a billionaire to some degree. But there's definitely some people who have accrued an incredible amount of personal wealth in a very short period of time who previously were not wealthy. That could be early investors in one of these assets, that could be the creator of the asset, that could be creator of infrastructure, and it's like more of like a traditional private company, etc. And what I actually think is probably the biggest difference, if I had to kind of think about it

at the moment, and this probably will actually change over time, is this, let's call them the initial class of crypto billionaires, they look much more to technology and building as a solution more so than policy, right? If you look at, you know, in Washington for as much wealth has been generated in this industry, it's really not that much policy in terms of trying to influence politics or put people in office or do a lot of that stuff. And I think some of it is, I think it's Balaji Sreenivasan has this like thought process of East Coast versus West Coast. A lot of the east coast mentality is you know let's say that um you i hold an asset and i'm a reporter on the east coast uh it's a conflict of interest and that's seen as a bad thing on the west coast

somebody may say oh you have skin in the game like i want to listen to you more because you're holding the asset that you're talking about and so you believe in it and you know you're long and so again over generalization but let's just say that there's an east coast west coast mentality i think this west coast mentality of like if you want to have a solution like build one or like create one, um, is going to play out in a really interesting way. Uh, that doesn't mean that it's going to work or it's not going to work. It's just, it's a different strategy. And so what we haven't seen yet, um, and again, some of us just, we haven't had enough time, but I don't think we've really seen, uh, what I'll call like the legacy billionaire playbook being used by pretty

much anyone in crypto yet. I'm sure it'll happen. Right. But, but it just feels like, um, there's still very much like uh uh value accrual states like people are looking for hey how do we how do we continue building today and oh by the way we'll do some good along the way but nobody's i'm retired i wasn't i wasn't asked about how much of a factor in age of this is to flip the tables here i mean like i mean to me like that seems like i mean generally lots of people in crypto are younger right of course you know i do think i do think kind of spending time on philanthropy or you know spending your money on philanthropy or on politics or on whatever you kind of see your civic responsibility as this stuff does take time and lots of crypto people are still sort of in the

yeah still trying to make the money um or still you know data or still trading or still investing or still running companies so i think some of these people might argue they don't have the time to solve the problem uh and ultimately you know maybe and right to your point this is obviously very we're in the early innings of this story and maybe in 30 years uh they'll end up just like the rich people of the fiat world but i do think we're seeing like some some outside the box thinking on some of this stuff i mean there is a younger generation of kind of crypto folks who even if they're not necessarily spending the money yet uh are thinking about their kind of financial contributions and their civic responsibilities differently like um you know

I've written about Sam Bankman-Fried, who obviously is CEO of FTX, and I think is now the youngest billionaire in the country. I think he's only 29. Net worth is somewhere in the 10 to 15 range, I think. I mean, Sam, I've talked with him before. He sees his role in the world as make as much money as humanly possible, like any means necessary, blow it up. And then point two in that kind of uh life journey is to give it all away to in his opinion you know the best way to give it away is to effective altruist causes um and that's a very different kind of thinking than sort of some of the old guard you know capitalism right where you sort of think about civic responsibility while you're building a company you think about good in the world and sam has a

very kind of contrarian opinion like he thinks a lot of that is like bullshit he thinks a lot of money that is made through socially responsible ways actually leads to worse outcomes than just being a cutthroat capitalist who then makes as much money as humanly possible and then gives it away as quickly as humanly possible. Certainly, I know there are people who disagree with that, but I think you're beginning to see some different points of view among crypto billionaires in ways that I think will challenge conventional wisdom. Another good example is is Vitalik, right? I mean, you know, I don't know what his net worth is. And obviously in crypto, like net worth starters kind of go up and down. Make a billion, lose a billion in a day. Who

cares? Did you follow the story with Vitalik and the money he donated in Shiba coin to India? Did you follow that at all? I saw that he, what is like a billion dollars, somebody that had sent him and then he basically turned around and he donated it. Yeah. But like, I mean, like what's like the net, like, I do think some of the crypto donations, like do have some asterisks around them like i think if you gave if if italic gave you know a billion dollars in bitcoin like that would be you know i don't think that would need uh that heavy an asterisk but you're i don't even i don't follow this stuff as closely as you do but like when you donate a billion dollars in shiba coin and you know it like that's the the value of the coin tanked immediately after i donated

the money so was it really a billion dollars or was it something else um uh i think i think I don't have great answers, but some of the definitions around crypto donations, I think, need to be reconsidered a little bit just because the values of these things are so volatile. Yeah. One of the other pieces that's really fascinating to me is when you think of the, let's call it the fiat billionaire playbook versus the crypto billionaire playbook, is a lot of the crypto folks, from what I can tell so far, and again, this may change over time. uh, they do less of like what I'll call like the status donating. So I have yet to see somebody donate, uh, to a school and put their name on a building. I've yet to see somebody do it at a museum, right? Like all the things that you would normally see, uh, maybe the closest we've gotten to it is somebody who's made a donation to a school and they have like a scholarship in their name or something. Right. But, but not what I think most people think of like the billionaire

ego stroke donation, put my name across the front of the building. And every student that walks in here will know you know who i am and i made this place again that could drastically change but there is an element of like i don't think they really put that much value on the physical building to begin with they live in the digital world right like like it's almost like why would i you know give you all this money to put on a physical building like let's do something in the digital world i i don't know yeah i think i think um i don't know if that's entirely a a crypto versus fiat thing versus like tech and innovation economy versus non-tech um uh like i think a lot of people who are not who are who are tech billionaires but fiat billionaires would agree

with that that like all these east coast people who are like obsessed with like the status of charitable giving like the met gala is probably like the best example of kind of this like you know charity status circuit that like uh you know lots of people on the west coast roll their eyes at really hard. Though, I think the breakthrough prize on the West Coast certainly has some of that same status seeking. That being said, yes, I do think lots of wealthy people in the current generation, whether they're fiat or crypto, see the name on the building stuff as just like total ego stroking. And I'm always kind of humored by some of the defenses when you talk to kind of East Coast billionaires about this stuff. They argue that like, oh, well, it helps

improve the reputation of the school uh and you know that there are these kind of altruistic motivations for having their name on it which i do not necessarily buy um like the david geffen you know he just contributed i think 100 million dollars to yale and he's getting his name on some program over there um look i mean the the idea that that status is a part of charitable giving is you know an immutable law of the universe and i don't know if that's going away anytime soon But I don't know if you really need the name on it to tell people privately you did it. If given that you spent so much time, you know, reporting on kind of like money, power, ego, you've literally studied billionaires now for years and understood what I'll categorize

inherently. There's going to be, you know, kind of good outcomes and bad outcomes there, regardless of the strategies people have pursued. It sounds crazy today, but there's probably a number of existing crypto billionaires that are listening to this and also many future crypto billionaires just given how quickly the industry is growing and and how large it likely will become what would be like maybe your advice or just like words of caution or uh some sort of like guardrails things you've seen that hey maybe don't do this or maybe think about it this way like is there anything that you can kind of impart from like a knowledge standpoint on people who either are at that point in life or could potentially get there uh very flattering question considering

uh what the fuck do i know but but but but but you've studied it you know more than most yeah yeah i know but like i think i mean i'm sort of in the cheap seats and i totally i totally totally concede that to some extent um but look i mean i've seen i've seen people screw up uh in ways that in ways that i find admirable in ways that i find less admirable i think that as as a general point i think the the the tolerance for screwing up uh at this stuff uh is often lower than is when it comes to people's business work and i think it actually should be the opposite um some sometimes people are like like okay the the great example of kind of, or the stereotypical canonical example of billionaire screwing up at philanthropy

is the Mark Zuckerberg $100 million donation to New York schools in 2010 announced on Oprah Winfrey show. There's a great book about kind of what went wrong there. And you hear it like this $100 million in one school district a decade ago. And it's crazy how much that one donation still is like lodged in the psyche of these people. Like, oh, I don't want to pull a Zuckerberg in Newark. I think it's honestly made some people avoid charitable work altogether in a way that you might not wish that that would necessarily be the case. And people are so scared of messing up that they don't really try anything. Now, look, I mean, there are ways in which messing up can hurt people, right? Like if you're a second grader at Newark Public Schools and Mark Zuckerberg

shows up and your school goes to shit, you're not like they're saying like, oh, well, Zuckerberg screwed up. So good for him. Your second grade was just ruined. I don't think you're thinking any bigger than that. So the thing that I think that wealthy people need to wrestle with is how do you try things in a way that is innovative and take risks and do things explicitly that governments cannot because their risk appetite is theoretically lower while also reckoning with the real-world consequences of this stuff. Lots of wealthy people, I think, would love to just give away money to some indiscriminate, anonymous person living far away and not really reckon with the public consequences of it. But there are public consequences of it. I see this with

political giving too for future super PAC mega donors out there. Lots of wealthy people, I think, get hoodwinked into funding political stuff they haven't really vetted. I'm shocked at how many wealthy people and billionaires sort of use their corporate staffs to execute their personal political giving in ways that these people are not qualified often to be in charge of kind of overseeing $100 million to win an election. And I often think that wealthy people need better advice on this stuff and need to hire full-time political practitioners who are campaign people, who are not like, you know, the SVP of government relations who, you know, is co-splaying as a, you know, political mega donor Sherpa. So I think the other thing is to hire people who

know what they're doing and not try to be the maestro behind the scenes, you know, making individual decisions. There's a whole reason there's a professional political and nonprofit industry. And I think trusting those people more to make the right decisions and not trying to like bigfoot this stuff is probably a good piece of general advice out there. So one of the things I want to move to close on is this idea that in the Bitcoin world, donating to Bitcoin developers

is generally seen as a very positive thing to do. Interesting. And it's usually done from the idea of these are individuals who in many cases don't have a regular job. income is sparse or comes from many different sources. And so if we can help fund your work, then you end up being much more effective. Now, the reason why I think that's interesting is because in some way, a fiat billionaire donates money to, let's say, a charity. That

charity then does work. And it's much harder to tell what the impact of the work is, uh what the uh kind of outcome is etc with this bitcoin developer mechanism i gave you the money i can see your github right like i know how much code you're pushing i know what you're building is high quality is not included like there's so much more um kind of uh transparency to the actual work that's being done do you see a world where fiat billionaires start moving more and more to this model of rather than almost give it to like an intermediary and then have that intermediary go and you almost lose the transparency. Are we seeing more billionaires just say like, like kind of get out of the way a little bit as the middleman. And I want to just go and hand

the money right to the person and whether they're successful or not, I feel better because I know that that person actually received the funds. So this used to be, I think a very niche point of view that during COVID has become extremely mainstream to the point where it's almost been US government policy, right? I mean, so there's an organization called GiveDirectly, which is popular, has always been popular among the tech set and, you know, effective altruists, people like Dustin Moskowitz, and probably lots of crypto people as well have been interested in GiveDirectly. But it was not like this, you know, this was not the American Red Cross. I'll say that, you know, this is not an institution that was, you know, had mainstream appeal.

And obviously, during COVID, you know, as part of the stimulus measures, we've seen the US government, you know, give people checks for, you know, do whatever you want with it, buy an iPad, go gamble at, you know, in Vegas, or buy crypto, whatever. And I think it's become much more mainstream to just give people money. And whether that's your government, or whether you're a private philanthropist, there's a lot of wealthy people who have, I think, gravitated to this idea. Now that, that, that is very simple. And in some ways it's beautiful, right. To just like, you know, I've given through give directly before. Um, I think it's a, you know, a process that, uh, that makes it, it's, it's easy. That's all pointedly that it's easy. It also sort of is

a big middle finger to the entire like nonprofit industrial complex, right. For everything I just said a minute ago about how you should trust people with advice and hire staff. Um, you know, if you're bill gates, you can log on right now to give a directly.com and give a hundred billion dollars to give directly. And you can fire the 1500 people who work at the Gates foundation tomorrow. And, you know, like, I mean, you could do that if you really want to. So I think cutting out the middleman, look, this is true in general. And sometimes that makes a ton of sense. And the middleman is just adding, you know, overhead costs and, uh, process and bureaucracy. Sometimes middlemen are important. Like we began talking about Mackenzie Scott

and sort of her kind of pathbreaking charitable work. As much as I think Mackenzie is a fascinating story, I do think some of the hoopla around Mackenzie is a little premature. Mackenzie certainly has cut out the middleman in some ways. She does not have a big charitable foundation. She's a donor advised fund, which is sort of a nimble vehicle for charitable giving. And everyone's talking about Mackenzie, like she's the greatest thing on God's green earth. And maybe that'll be true. I do think it is certainly possible that in five years we could find out that McKenzie maybe needed more bureaucracy. Maybe she needed a middleman. Maybe she needed a kind of more traditional charitable advising, you know. And some, sometimes the bureaucracy has, has a logic. Sometimes it doesn't. I think lots of philanthropists that, uh, find the simplicity of giving to give directly and firing their 1500 employees at the Gates foundation, uh, could regret it, but it certainly is like a trend that I think is accelerating, uh, right now. It's all a game, man.

Making the money is a game. Giving it away is a game. Some people do it better than others in both directions. But ultimately, I think it's all just a game. There is an element of it that is a game. But I think people... It's also a big business. Like the whole charitable world is a big business.

I think my big overarching point here is the philanthropy world deserves reckoning with these questions and discussions of the trade-offs and who's doing it well, who's not doing it well. like i often one thing i often find frustrating about uh some of the backlash to kind of philanthropy journalism is like oh you should just be thankful like you know don't ask these questions about like the game or about whether or not wealthy people are doing good like be thankful they're giving any money away at all and that's just like a simplistic like rudimentary thought process about like it's almost like treating charity like sports it's like you know more

yards is good therefore you know do not criticize like you know should the coach be fired like i mean, I could talk to you about this forever because I feel like part of, um, part of what's so intellectually, uh, stimulating about it is that there is no right answer, right? To some degree, you're constantly having to iterate, uh, and you want to move closer and closer to almost this unattainable goal of perfect billionaire behavior to some degree, right? Like even what is that? Like how would somebody, uh, kind of quantify that or be able to measure you can't. And so instead, what we end up doing is we end up looking at the next best thing, which is, uh, what are people doing? What's the impact of it? How transparent are they?

And I, in some weird way, it almost comes down to like, how much do we trust them? Right. I mean, there's examples of super wealthy people that most folks felt really good about and was like, that's amazing. And then you find out, well, maybe it's the money they got by not paying their taxes, or maybe they were giving to something and it wasn't so great. And, and very quickly things can change or maybe not. Maybe people actually say, oh, whatever, you know, everyone makes a mistake and they, and they keep kind of feeling good about it. So it's just this crazy, crazy thing that, uh, I think is only going to come more and more in the conversation. So it makes a ton of sense why you guys are doing this. Yeah, you're totally right. A lot of this,

a lot of this comes down to who do you trust more wealthy undemocratically elected well-meaning, but you know, inevitably, uh, fallible wealthy people, or do you trust more the lumbering government that is democratically representative in theory but also screws up who do you who do you trust to screw up less uh is the thought i'll leave absolutely where can people follow you on twitter or where can they find out uh more about puck and uh and subscribe to the work sure sure so the the i'm on twitter at teddy and then my last name schleifer which probably somewhere associated with this podcast um but the main way for folks who are less interested in this is you can sign up for free at... I'm writing a newsletter this summer called The Stratosphere,

which is the... And the word stratosphere, which is a part of the air for folks who are not aware of it. But the stratosphere.news is the link that folks can get on the email list. And that's an appetizer to Puck, which is launching around right after Labor Day. So Puck will be a subscription publication but for now for folks if we're thinking about it and want some free content um the stratosphere.news is the best way to stay in touch puck again the description is a new media company covering power money and ego it's right there on the home page and i was telling teddy beforehand uh i don't think there's very many people who see those three words and don't have some sort of emotional reaction so i think i think you guys have a pretty big audience here but thank

you so much for doing this and we'll definitely have to do it again in the future as you guys continue your work. Cool. Thanks, man.