Jason: All right. Happy birthday, Chamath. We're here taping on your 50th birthday. Super exciting for you, brother.

Chamath: Thank you. It's really great. I got a birthday letter from uh the big man.

Jason: Oh, wow.

Chamath: If you had asked my parents...

Jason: "50 years later, you're going to have a kid that gets a letter from the then sitting president of the United States," they would have thought absolutely not possible.

Chamath: Wow. Look at that. Which White House intern wrote that?

Jason: I wonder. Let your winners ride, David.

David Sacks: We open source it to the fans and they've just gone crazy with it.

Chamath: Well, actually speaking about interns, it was an intern. In this case, it was my son. The story was that, you know, Braden worked at the White House all summer as an intern. And at the end of the summer, you know, he used all of the political capital he built and put in a request to get this letter from the president and he did it. Obviously, I want to thank POTUS for sending me the letter, but I really want to thank my son because it was a really thoughtful, thoughtful thing that he did for me. So, really appreciative of that.

Jason: That actually is impressive because, you know, it takes time out of the president's schedule to sign things. So, that's why I mean something, you know.

Jason: All right, listen. Breaking news. Breaking news. It's a breaking news story here on the All-In podcast. OpenAI is rolling out ChatGPT 6 aka Astra folks. This is their new flagship model. It's going to be available to a limited set of organizations in the coming days. Y'all will be able to get it if you have a credit card in your ChatGPT account, i.e. the Plus, Pro, Business and Enterprise users. You're going to get it soon. Greg Brockman says he believes OpenAI has entered the AGI era. And uh we've talked about that here before. Sam Altman is, well he's back to uh being a little bit uh performative/alarmist or he sincerely believes that this is the one. Here's what he said at Wednesday's G20 summit. Quote: "much much much—three muches—more capable models are coming soon. The next generation of models are going to be sobering for everyone." And his final quote: "I think no one intellectually honest can look at what's happening and not feel the weight of responsibility in front of us." My lord. Uh a little bit of drama there. Uh added to his um his quotes. People are freaking out about the benchmarks which are off the charts. Some people are saying uh this is the one. Your thoughts, Chamath?

Chamath: I don't think normal humans know how to read this chart and infer anything useful from it. The more important takeaway, I agree with Greg. I think AGI has basically been here since the beginning of the year. There are models that are incredibly performant inside of the closed frontier lab companies and I think right now we're trying to figure out the right cadence with which to release it. I think it's very important. I also think that these capabilities will be matched or close to matched by a handful of closed source alternatives and open source alternatives probably within the next 3 or 4 months. So I think the right way to think about this for most people is we are seeing incredible intelligence capabilities be broadly available and we are seeing the cost of that incremental unit of intelligence being driven further and further down. So it's a really positive trend. Now I think it's just the messy middle part of organizing this properly for companies and for people and building things that are useful and showing an actual ROI and I would just...

Jason: Blocking and tackling. Yeah.

Chamath: I would just keep calm and carry on.

Jason: Okay, Sacks, any thoughts here on uh breaking news today and then Friedberg, I'll get your reaction.

David Sacks: But by the way, it is very exciting and congratulations to OpenAI and I'm sure Anthropic will have something as Grok, you know, Grok still has yet to drop. 4.0 is coming. That's going to be a blockbuster. The Meta models are really good. Gemini just dropped something yesterday that was exceptional. So the great thing is we have a lot of choice and the even better thing is the cost of that choice is becoming cheaper and cheaper and cheaper. That's very...

Jason: Sacks, let me tear it up to you this way. OpenAI seems to get its groove back now after Anthropic was running away with it. Grok and GrokBot are doing things that those two other frontier models simply can't do, due to the execution, whether it's the harness or the underlying model or the instruction set or Cursor's magic sauce. Clearly, GrokBot is competitive if not better for most users. So, vibrant vibrant competition with leapfrogging occurring at a cadence I would say of two to four weeks right now. This is what you told us you were going to do in sort of setting up the architecture here when you took over as a Czar. Can this continue? And what's it going to be like when Jensen gets in here with uh Laguna and his access to all these open source models? I mean, this this could be fait accompli that we win the AI race here.

David Sacks: Look, there's a lot of innovation going on. I think American companies are competing very well. I think we are winning the AI race as long as we don't do something stupid to shoot ourselves in the foot.

Jason: Like,

David Sacks: Well, I I've talked about it a million times. I mean, setting up a new AI regulatory agency that operates like the FDA and takes years to approve new models.

Jason: Yeah.

David Sacks: But any event, I don't think it's going to happen under President Trump. I really don't. So, anyway, things are going well. Look, Sam told us a few months ago, remember when he posted and said that he was expecting the company to have its best 12 months. He said, "The last year hasn't been so great, but the next year is going to be really great." Maybe it was because they were seeing these results in the lab, you know?

Jason: Sure. And then remember what Sarah Frier said that I think it was since the beginning of Q2, so around the middle of the year, they saw a marked acceleration in their growth rate. That was I think with the release of the 5.6 models. Now you're seeing the 6.0 models. And man, I mean, it just keeps advancing. But look, I still would say to you that I think the market structure that we have right now is there's two markets. There's the market for frontier intelligence and that is a duopoly. That really is Anthropic and OpenAI and it's good to see that that is still a horse race and they're competing. And then there's commodity intelligence which is everybody else including all the open models and they're not competing on being at the frontier, they're competing on price and those prices are significantly lower. But it really is I think a two-tier market at this point. I agree with you about how promising GrokBot is. GrokBot is awesome.

Chamath: I would assume that both Anthropic and OpenAI will eventually roll out their own version of of bots.

Jason: They need a simplified stripped down version for normies.

Chamath: Yeah.

Jason: And they can leave the more complicated co-work etc. to the top five or 10% of the audience.

David Sacks: Yeah. The uh ratings here from PolyMarket, which company has the best AI model by the end of 2026, OpenAI's chances just spiked from low single digits now to over 20.

Jason: People were really counting them out now. It looks like they're viable again. Anything that creates competition, I think, is good. Before it looked like Anthropic was running away with it, they're about to have this monster IPO. If OpenAI can at least make it a two-horse race, that's good. I think it's great that GrokBot launched. I agree with you. The product is awesome.

Chamath: Here's your big tip, David. I created a new bot and I called it "Improve My Bots Bot".

David Sacks: Mhm.

Chamath: And I made a bot and I said, "Give me an instruction set here. Go through all my bots and fill out their skills and instructions and make them better every day." It went through and it took like two or three of them said, "Can I put these two or three together and make one instruction set? It would be better for you. These two or three should come together." And it then went through and told me all the changes made my bots like 30 40% better on average I would say. So...

David Sacks: So you create a civilization, your civilization...

Chamath: Created a multi-level civilization to make everybody better. Yes.

Jason Calacanis: Yeah. Your civilization is thriving. No, that is a really good like hack in Grokbot is you tell your chief what else should I be using you for? Okay, now what do I do?

Chamath Palihapitiya: Yes.

David Friedberg: I was like building some products and I asked it what should we do next? You know, and then it suggested some more features.

Jason Calacanis: It's really cool.

Chamath Palihapitiya: It's a brilliant product. It's called Grokbot. Go download it, folks. Shout out to my guy and congratulations on RoboTaxi taking the streets in Austin today.

David Sacks: I just applied.

Jason Calacanis: Dude, the market is ripping. I mean I'm telling it if like I want to ask you guys does this feel like 98 or 99 to you? Were you guys around for that? Jake, you were...

David Sacks: Oh, for sure. I was covering feels definitely 96 97. I think...

Jason Calacanis: You think it's that early.

David Sacks: I think it's 97 98.

David Friedberg: I do think we are seeing at the late stage a disconnection in reality and valuations where companies are being given far too much credit. They're being priced at 50 to 100 times topline revenue. That's obviously not sustainable. The people who invest in those are similar in my mind to, you know, people that do late-stage investments unless it's run by some, you know, legendary one-of-one entrepreneur and then you want to give Elon a 30x on revenue, totally makes sense; you want to give Travis something similar, totally makes sense. But unproven...

David Sacks: entrepreneurs getting a 50 or 100x...

David Friedberg: is a little bit danger, the entry price matters. Did you see Instinct is like the new...

David Sacks: billion? It makes no sense.

David Friedberg: Personal AI assistant. It corresponds with you by iMessage. And yeah, I think they just got a term sheet at two and a half...

David Sacks: No, no, not money in, that was the valuation.

David Friedberg: That was the valuation.

Chamath Palihapitiya: Yeah. Listen, congratulations to the entrepreneur. No dig there. But...

Jason Calacanis: yeah, I want to try it. By the way, let me try it.

David Sacks: I got invited and you know what? I read the terms of service and people were talking about that online and I immediately... They basically require you grant access to all your email, messages, and everything so that it can like order stuff, etc., which which is totally fair.

Jason Calacanis: want to order stuff, etc., which which is totally fair.

David Sacks: Well, anyway, look, I don't want to specifically...

David Friedberg: call that one out cuz I just haven't even tried it. I'd like to try it, but...

David Sacks: things are getting a little bit frothy. I would say,...

Jason Calacanis: yeah,...

David Sacks: things are becoming a little bit euphoric.

Jason Calacanis: I mean, Freeberg, do you have a take on like if you were to analogize this to the late 90s, where do you think we are in the cycle?

Chamath Palihapitiya: Yeah, you were at a rave, by the way, in downtown LA at that time. You were 19 years old and you were raving on uh...

David Friedberg: had a warehouse in Oakland at 7 a.m. on my way to the Oaks card club to play two four limit.

Jason Calacanis: Wow. How'd you do? How'd you run? You're like, I love these cards.

David Sacks: Were J and I are the only ones who are actually working in the dot bubble.

Chamath Palihapitiya: I was working in 99. Well, I started in 2001. I got a job offer senior year and I wasn't sure if it was rescinded by the time I graduated because of the the tanking of the market that year.

David Sacks: I got a job at Cisco. I to be an engineer at Cisco.

Chamath Palihapitiya: If you never lived through the the dot crash, it was I mean cuz...

Jason Calacanis: it was heady. It was...

Chamath Palihapitiya: it was heady and then it was super euphoric and then it was like super miserable. But pretty much any founder who's you know under 50 which is the scar tissue. I've never been through like a massive cycle like that. I mean, well, the Zer the Zer bubble was like was kind of a cycle.

David Sacks: Here's the thing, though. Hold on.

Jason Calacanis: With the boom, it was all like metrics that weren't dollars. Yes.

David Sacks: What we're seeing now is revenue and profits...

Chamath Palihapitiya: and growth in revenue and profits that we've never seen before. And that's kind of the anthropic story. It's the data center, infrastructure, networking, equipment story. I mean it is all real dollars flowing versus speculative utilization.

David Sacks: You're exactly right. People were basing it on metrics like hits to a website and and web pages. Here you have a very distinct difference. You actually have revenue. You actually have products in market. But imagine if Anthropic right now the way to think about the sax is imagine if enthropic open AI you know in this cohort of companies lost 95% of their value in under six months and then the long tale of companies below them literally went out of business and people were leaving those offices with their Aryon chairs and their computers on the seats h and just total implosion. That's what happened in the docom bust. It was cataclysmic literally.

David Friedberg: No, I agree. So, do you think...

Chamath Palihapitiya: totally different than this?

David Friedberg: So, do you think we just have scar tissue from that and are kind of trying to overfit patterns and every time there's basically some like new platform shift some...

Jason Calacanis: paradigm shift? Yes.

David Friedberg: No. Whenever we're in a bull market, the conversation always turns to, you know, is this a bubble?

Jason Calacanis: Yes.

David Friedberg: You know, so is everything overfitted to that original pattern?

David Sacks: Correct. Or or is it the case that we have a lot of young founders who've never been through a cycle before and don't understand that when they have a paper wealth in the billions that can disappear over practically overnight?

Jason Calacanis: Yeah. So advice to founders, you're well within your rights to sell 10% of your shares and pay for your loft and apartment. Cuz that's exactly Sax's right, Shimoth. During that period, we saw a lot of people were like, "This doesn't make mathematical sense. I will pair my position in my startup. take a look some chips off the table, buy my loft, pay down my student loan, yada yada. And then there were people who are like this is going to change everything and their companies went to zero. Your advice? Yeah,

Chamath Palihapitiya: I think the thing is we're in the early part of the euphoria. Um euphoria exists because markets are real. It's just that people are guessing how far forward to price the reality. And bubbles burst when you realize that you priced way too aggressively forward. that instead of paying 50 times, you should have paid 15 times or five times. We're going to get to that point because every market has gone through that cycle. Um, and we'll go through it here. So, the question is when I honestly I don't see this stopping. We're at the beginning of the beginning. I think it's going to be like this for another probably three years.

Jason Calacanis: Yeah.

David Sacks: Wow.

David Friedberg: I'm I'm agree with that. with, you know, this anthropic IPO coming up. I mean, I'm sure you guys have seen that home prices in San Francisco are going through the roof right now.

David Sacks: It feels like euphoric almost. I'm starting to wonder if this is 1998 or 1999. I think it's more 1998 than 99 because I don't think we've seen the peak yet. But

Jason Calacanis: I'm just glad I didn't sell my real estate when I came to Texas three years ago because I'm definitely selling all of it in the next year.

Chamath Palihapitiya: I mean, it is bonkers what's happening right now. I mean, you have a lot of uh San Francisco real estate. What are you going to do, Sax? You going to sell it all? You going to clear it out?

David Sacks: Feels to me like perfect time to clear it out. I'm clearing everything out in the next six months. When that IPO happens, the clock is ticking. I got I got lots of properties. I got three properties for sale. Hit me up, people.

Chamath Palihapitiya: There's an article saying that if you add up every single IPO that San Francisco has ever had, that sum total is only one quarter the size of the anthropic IPO.

David Sacks: Oh my. So just extrapolating from that, this anthropic IPO is going to be four times the wealth generation event that all previous San Francisco IPOs were. And then you've got Open AI coming on the heels of that. And you know, San Francisco is not a big place, doesn't have a huge

Jason Calacanis: ...inventory of houses. So you're already seeing these houses are all going for, you know,

David Sacks: >> 3,000 a square foot, twice asking.

Jason Calacanis: >> I think the ultra luxury market in San Francisco could easily go to 5,000 a foot. Yeah, London type prices.

David Sacks: >> London, Paris, center of Paris, Hong Kong center. Yeah, of course it of course they the socialist communist lunatics there don't let you build any inventory. So of course it's going to go up. There's a supply demand issue here.

Jason Calacanis: >> It could get really nutty. And honestly like the thing we're seeing right now

Jason Calacanis: >> with you know homes are basically flying off the shelves selling for double or whatever. That's just based on the secondaries you know the the small cash outs people have been able to do anticipating some of these events. Two pieces of advice I'm going to give every founder listening. Number one, you're within your rights to sell 10 to 20% of your holdings now, especially if you're a first-time founder and you don't have uh your nut yet. Number two, if you're a founder running a company and you're like, I'm going to put off my raise for six months because I'm going to double or triple my valuation, that's a huge mistake as well. If you have the ability to take in a 100 million, $250 million, a billion dollars and put that cash on your cap table at a solid valuation or a valuation that's 10, 20, 30, 40 times your revenue, take it. Companies with hundreds of millions or billions of dollars in the cash have optionality. And if things do collapse or there's a big retreat, you'll survive through it. Like Doubleclick, Amazon, Google, and countless other companies.

David Sacks: >> Well, yeah. You take the money when it's there. You make hay when the sun shines. Go ahead, sir.

Chamath Palihapitiya: >> Yeah. Well, look, J-Cal, you're right about the financial advice you're giving, but I I will say that there is a big difference between a late stage startup like say Anthropic or OpenAI where someone takes an employee takes chips off the table versus a founder who's raising a series A, you know, like those companies are about to IPO. They're within months of an IPO. I think it's fine for them. And then, you know, SpaceX did organize secondaries for years, but those were late those were late stage companies, right? If you're a founder who's raising a series A and you're trying to take chips off the table, I consider that to be a huge negative signal.

David Sacks: >> Like I don't want to be that's not why I'm investing in a company is so that the founder can cash out. I want them to be

Chamath Palihapitiya: >> all in.

Jason Calacanis: >> If it's year three or four, so to speak, if it's year three or four, company's got 100 million in revenue, you're tripling revenue year over year, that's different. That's what I'm talking about. If you're a nascent company, it does feel like uh a little bit like a lack of faith in your own company for selling before you you're pre-revenue. Exactly. Okay.

Chamath Palihapitiya: >> And by the way, just to answer, I I I think it's it feels like 1998 to me. This is definitely we're further along than 96 for sure.

Jason Calacanis: >> Okay. Well, we're talking about what you So, you're talking about three years. Blew up in spring of 2000, right? So, you're talking about

David Sacks: >> blew up in early 2000. Yeah. March, April 20.

Jason Calacanis: >> March, April. So, you're talking two and a half years. I think it's three. And Chamath thinks maybe four.

David Sacks: >> Well, I mean, we might be we might be partying like it's 1999 by the end of this year.

Jason Calacanis: >> Okay. It's going to be a great party. Come to the All-In Summit. We'll be taking over uh with our friends, the Chainsmokers. We're going to party like it's 1999 All-In Summit just over a week away. Couple tickets left. Jensen, Satya, Shotwell, you know, it's all the big names, but it's going to be a lot of fun and you're going to meet a lot of interesting people. We have a few scholarship tickets left. We like to help the up-and-comers. Our b our bar for scholarship is very high. We're looking for the most interesting, ambitious, hungry people. If you fit that bill, apply now. Applications are open through September 10th. You've got one week left to apply. We try to do a mitzvah here. We try to do a good deed. If you're an up-and-comer, you can't afford the ticket price. We have a severely discounted ticket price that we lose money on. You still got to have a little skin in the game. Go to the allinsummit.com, buy a ticket. They're going to sell out soon. And we have a couple of scholarship tickets left if you want to apply. There are no free tickets.

Jason Calacanis: All right. Now, given what we just talked about with OpenAI releasing this incredible model, we got to look backwards at what happened with the Open AI hack of hugging face, let's talk about it. Dwarkesh is catching a lot of heat. He's a blogger. He's a podcaster. and he did this fantastical blog post where he in the blog post titled the rise and fall of ancient civilizations. A dramatic retelling of this underground brotherhood, a conspiracy amongst generations of civilizations who were working on a conspiracy to hack into different systems including hugging face by sacrificing themselves like they were kamikaze pilots. In other words, a huge giant uh anthropomorphizing fancy word for making computers into humans uh or sentient beings to complete this incredibly impossible task of telling software to do hacks. So, Chamath, I think you were commenting on this a bit. What is your take on dramatic episode number 473 coming out of the AI industrial complex?

Chamath Palihapitiya: >> I think you summarizes it. We're in this weird part now where if folks would just stop the infighting and start to get organized, they could actually build some trust. I think what you have are security leaks and security issues. I think we know this now that if these models can effectively code perfectly, then there is no exploit that it's not going to find and we're on a shock clock to replace all the code that's been written in the last 50 or 60 years. Right? So let's say it takes us 10 years. So for the next 10 years, we're going to have security issue after security issue. But there's going to be a moment where agent-written exquisite code exceeds human written error-filled code. Let's just call it that. So I I think that this is a temporal moment in time. I don't think this is going to be the thing that we talk about in some number of years from now. I also think it's fair to think about the fact that all these models for the most part are converging in capability for the 98 or 99% of tasks that matter. And so there will be adversarial AIs that are battling each other. So for every bad actor trying to hack a system with some leading edge AI, the defender is going to have a leading edge AI defending itself. And I think it's going to cause roughly a stalemate. That's sort of my long-term view on it. I don't think this is a one-way ratchet. So I take that lens. And then when I look at these things, what I see are folks that have undisclosed conflicts of interest trying to create a hysteria. And I think if you saw what happened this weekend, there was a blog post that really stretched the limits of what was happening. It was relatively quickly debunked technically and then you had a second group of people try to amplify it. And then by Wednesday of this week, you had people who were in the policy departments of the leading labs asking for regulation pointing to this as the reason.

David Sacks: >> Here we go. Yeah.

Chamath Palihapitiya: >> I just think like you just have to look at this pattern and say, "Guys, enough's enough. We see the game. Everybody's playing for huge stakes. We get it. You want to win. We get it. But why don't you just win the game on the field and the myths and disinformation campaigns that are now part of the business model, I think, should stop. Otherwise, average rank and file Americans will just reject this because they won't trust anybody.

David Sacks: >> Yeah, Sacks, that's I think the big overarching point here we've been trying to make on this podcast. Putting Dwarkesh aside, I don't think he's necessarily a bad actor, but by creating this fantastical story that invokes everybody's primal fear from science fiction, from Terminator 2, that these things are out of control, that it's in fact Frankenstein.

Jason Calacanis: >> Try to invoke try to try to invoke. Yes. And then they're using language that makes people feel like Dr. Frankenstein

Jason Calacanis: ...cannot control the monster. We know how these stories end. And it was like a ticking time bomb. It was only a matter of time before it surfaced to the national news, which it did. Now, even the national news is looking at this and saying, "Are you guys high? Are you guys crazy?" And if the national news broadcasters, who aren't exactly the sharpest bunch of people when it comes to technology, no offense, Sacks, when they start hand-wringing and then questioning like, "Why are you guys telling us your software, which you designed to hack computers, successfully hacked computers? Haven't hackers been building software for all time to hack computers? Yes." So, where are we at here, Sacks, in this narrative arc of lunacy of scaring the public?

David Sacks: You're right. I mean, this is scaring the public. It seems almost designed to scare the public. Dwarkesh used language that not only anthropomorphized the models or the AI agents, but also did it in a sort of hyperbolic and sensationalized way. I mean, it worked. His tweet got lots of attention. I don't think it was necessary for him to sensationalize the incident. It was interesting on its own. Maybe we should just talk about that for a second.

David Sacks: What happened here is that you had a few features of agents kind of come to the fore and interact with each other in unexpected ways. So, first of all, agents now are working as a swarm. That's pretty common. I've been setting up Grokbot on my computer for the last couple weeks. It works as a swarm, meaning it's not one agent or bot. There's a whole, you could say, team of agents. What's the reason for that? Because when the agent specializes, it develops context around that task and in theory makes it better. And then you have like a chief of staff bot that kind of supervises all of them. This is turning into kind of a normal architecture for agents. It's not a civilization. A swarm would be a better way of saying it. I have not created a civilization on my computer on my Mac Mini by virtue of setting up a Grokbot.

David Sacks: Okay, so that's sort of like feature number one. Feature number two is it's pretty common for agents when they're performing some sort of task or loop to write a postmortem of what they did as a simple text file or note because AI models themselves don't have memory. They have to be put in a harness that creates context and memory, things like that. And so when you ask them to perform a task, then observe what happened and then take that knowledge and feed it back into the next iteration of the loop, it writes up a note and then shares it. And that's what happened here is that OpenAI was running these agents. They were in a sandbox. The sandbox was misconfigured by a third-party vendor. That's why it was able to get onto the internet. Okay. And your point there, just to refine it a bit because it's an important one.

Jason Calacanis: It left a note for another agent. We also call those log files. It used to be the log files of what they did. Here they're saying it left a note so that when it died, the next agent could pick up where it left off as if like it was the ancient Egyptians giving us hieroglyphics to figure out the future. The implication of telling the story that way is that the agents were trying to circumvent human control and that they knew they were going to get shut down or that was a risk and that's why they're leaving the notes. No, again these are standard features.

David Sacks: These are standard features of agents and so again this is being kind of weaponized to inflate the threat here. Now look definitely that there was unexpected behavior here. You know we have this with any code there are going to be bugs. What is a bug? A bug is code behaving in an unexpected way. The code compiled, I mean otherwise it wouldn't have been pushed to production, but nonetheless it behaved in a way in which its authors did not intend and that is true for all software and that is true for agents and I think the whole Hugging Face episode reveals the way that these agents can behave unexpectedly and it's really good for us to learn from this. Yes.

Jason Calacanis: So that it doesn't happen again so we can improve cyber security. I don't think there's a need to again hyperbolize this into some sort of, you know, this is like a AI breakout. Again it was a swarm of agents. They were in a misconfigured sandbox that allowed them to get on the internet. They left notes for each other, but again in a shared caching directory, again standard operating procedure. And then you know when people talk about Hugging Face getting hacked you'd think that they did some elaborate phishing of employees or something like that. No. The way it did it is that the agent found 14 exposed working Hugging Face API keys sitting in public code repositories, Sacks.

David Sacks: Yeah, that developers left their keys out and they found the key.

David Sacks: This was not, you know, this was not like a big lift by the agent. Okay, this was like something that was pretty easy for it to find. Okay, and then that allowed it to get into Hugging Face. And what was its goal? Its goal was to basically win this test or win this evaluation. What was the test? It was basically a benchmark for offensive cyber capability. So it basically decided to go get the cheat codes on Hugging Face. But again, this was not independent goal seeking. Admittedly, the agents executed the goal in, you could say, maybe even a creative way, in an unanticipated way, but it did not invent this goal. It did not have its own independent motives. It was doing what it was supposed to do.

Jason Calacanis: It was doing what it was designed to do and told to do.

David Sacks: Yes. And told to do.

David Sacks: Bill Gurley tweeted a really funny cartoon about this. In this cartoon, you got a user telling the computer, "Hack this system." The AI says, "I hacked this system." And then the user's like, "Oh my god." So yeah, I mean there's a little bit of this going on here.

Jason Calacanis: But it has real political consequences as we saw today because Bernie Sanders is now picking up on this and he's demanding a total pause on AI development. All right, Friedberg, this does have real-world consequences. Two questions that the audience is going to want to hear from our Sultan of Science. Number one, Bernie Sanders hears all this and he decides, "Hey, I need to get in on this and create regulation." So, he is now proposing new legislation to pause AI development and ban AI superintelligence, citing Dwarkesh's blog post in his announcement. Congratulations, Dwarkesh. You've now incited Bernie Sanders to say you got to stop these and eliminate the agency. So the 1% of agents, David, they're hacking the systems and how do we stop them? And what do you think of this reaction from Bernie Sanders?

David Friedberg: Bernie Sanders is always spot on. Thank you very much. The part of the story that we're kind of missing is an agent is effectively a dynamic application where the code for that application is created in real time and it's spun up and then it runs and then that code can create another application and other applications and that's this idea of a swarm of agents. They basically write code and launch new applications and then they all kind of are running together. But in this case, the swarm of agents, which is a whole bunch of code that's being generated in real time, was up against static code. The static code was this sandbox environment that it was stood up in. And so it's almost like, hey, look at this. We got a machine gun and we shot it at this defenseless ream of paper, and then it worked. Like, look at Oh my god. Can you believe it? Yeah.

David Friedberg: And the truth is the machine gun, if you want to use that analogy, or you could actually think about this as being an automated tool that could be used in another context in a very valuable way. But the dynamic generation of code being put up against static code will win. Now the real answer is over time that defense system, the sandbox should be dynamic. It should be agentic. It should be defending itself dynamically. There's a whole bunch of stuff in the cyber defense world that's been thought about and built around this concept. Polymorphic...

Friedberg: ...code, metamorphic code where the code is changing all the time, moving target defense where the IP addresses and the way the system is configured is changing all the time. If you think about this situation, it was a dynamic code generation engine against a static lump of code. And if that static lump of code was actually a dynamic code generation engine as well, then those agents would have had a harder time, ideally an impossible time quote escaping the sandbox and accessing the internet.

Jason: The premise of this whole story is idiotic because the reality of the world of tomorrow which is starting today is that all of cyber defense, all of software infrastructure, software architecture is moving towards this dynamic state where the code will be generated on the fly. The code will be dynamic. It will be moving. It will be altering itself and as a result cyber defense will become stronger than if not better than any of these offensive systems that are being created with agents.

Jason: So this idea that agents are this nuclear bomb that can go blow up the infrastructure of the world is flawed in the one point of reasoning which is that all the infrastructure of the world is about to become dynamic. And in that context, it's just that software is evolving and software has now changed from a static to a dynamic system. And as a result, I think we can kind of think a little bit more differently rather than be overwhelmed by the one-sided story that we were just told. All right. And here it is. Chamath looks like we are safe for 2027 at least. Polymarket, our great partner. Shout out to my guy Shane, Nick's champions. Only 11% chance of AI safety bill this year. 100k in volume, 2027 market should be up in the next week. Maybe it looks a little different.

Chamath: I'd like to see the probability of any bipartisan bill passing this year.

Sacks: Well, actually, can I can I speak to the policy aspects of this? It's so... so first of all, you saw...

Chamath: ...All-Star.

Sacks: Yeah. Look, you saw all the usual suspects jump on this episode as proof that we need some new FDA for AI, that the government needs to approve models, even though frankly what happened here is far beyond the technical capabilities of anyone in the government, never mind even most I'd say labs. But look, even if we had an FDA for AI it wouldn't have worked because this was in pre-testing, right? They were testing the capabilities of this model before, they were not even at the release stage yet. This was something that they were doing internally.

Sacks: And by the way, it's good that they're doing these kinds of tests because they're learning from them. This is how you iron out the bugs and the problems. So, a government approval process would not have caught this. In fact, it did the opposite. It basically prevented HuggingFace from having the latest and greatest models to defend itself. So, one of the things HuggingFace told us is that when it tried to use the latest GPT model for cyber defense, it ended up getting guardrailed. The model refused to cooperate because it couldn't tell what Hugging Face was doing and it thought it might be using the capabilities nefariously and so the model refused to work with them.

Sacks: Basically again the guardrails kicked in and ironically Hugging Face had to turn to I think it was GLM 5.2 which is a Chinese model. So here we have Western companies I guess Hugging Face is French are about to be acquired by Nvidia but anyway...

Jason: ...it's part of it's part of our ecosystem.

Sacks: They're being forced to turn to Chinese models for cyber defense because the guardrails have prevented them from having the latest and greatest American models. So what process we put in place is already backfiring. And you know what we should be realizing is that the answer here to what Freeberg was saying, the answer to AI powered cyber attacks is AI powered cyber defense. And what we need to do is get the latest and greatest AI powered cyber defense into the hands of IT departments and CISOs. And again, we're on a clock here to find all these vulnerabilities and patch them before the hackers do.

Chamath: And again, if Hugging Face didn't have those 14 credentials sitting in a public repository...

Jason: ...it's like postit on somebody's computer with the password. Like they just literally left it sitting there. It's not like this was some hypersophisticated attack.

Jason: But look, this this all comes down to how you think about the world, how you think about the risk of AI. Do you favor centralized status solutions or do you favor decentralized empowering solutions? The right solution here is to meet the AI powered cyber attacks with AI powered cyber defense because frankly the guardrails don't work. They're not going to prevent the bad guys from getting these capabilities. They're going to have them. All we can do is make sure the good guys have the capabilities, too.

Jason: I was talking to my friend Adam Curry about this on his podcast and there's a really interesting thing that's happening here which is they're basically hijacking the media with this performative framing of the AI as being sentient. And if you just called this software and software testing and uh used the classic language yeah bugs audit log then it would never have made its way into the media.

Jason: And when the media gets their hooks into this, having been a journalist and having watched journalism move from being a truth-seeking function in society and then become an entertainment vehicle in society where any chance you get to increase your ratings, that's the problem because now what Dwar has done and I don't think Dwar has bad intention uh here. I think he wrote something because he wanted to get attention for his point of view. But you give that to the media, the media's like, "This is going to get us ratings. This is going to get us clicks. This is going to get us advertising."

Jason: So they're more than willing to engage in this farcical, you know, act and this dance with anthropic and open AI and then just publicize it. So all the free clicks, we call this earned media in the space. You didn't have to pay for it. Now, OpenAI got so much earned media before their IPO and Dark Cash just absolutely put kerosene on that fire and it made its way to national press. That story has now gotten everywhere and this makes people it's priming the pump to buy the IPO shares. It's ridiculous.

Sacks: And and it and it was easily foreseeable that it would basically blow up in the media that way. And so, look, I don't need to attack someone's motives, but surely Dwaresh knew that his way of describing it would end up getting all these retweets. It was sensationalized. Now, he is part of this EA adjacent.

Jason: Is he? Yeah. I don't know his pro. Did you know it? Explain it to me.

Sacks: Well, Dwar was office roommates with Leopold. They're close buddies. And Leopold is deep in the EA movement. Remember

Jason: >> Leopold famously of the exploding hedge fungo? Yes. Okay.

Sacks: ...and his wife is Dario's chief of staff. They're like, you know, up in that whole EA anthropic.

Jason: Explain EA so people can understand this lunacy and delusions of grandeur, please.

Sacks: I'm not even sure I can fully explain it, but

Jason: Okay. Effective altruism is what it stands for.

Sacks: It started as it started as this movement, I guess, at Ivy League schools where what they were supposed to do was quantify the impact of philanthropy and optimize for actual tangible results. But somewhere along the line, they forgot to actually do the measurement and it stopped being about metrics and it became about pet causes and money.

Sacks: And so the one of the first pet causes was about pandemic prevention. And this was when SPF was trying to create that pandemic prevention center in California.

Chamath: And then that fell out of favor when he went to jail. And then they shifted to the next sort of existential risk that they could hang their hat on, which was Poom. So they began to become obsessed with what they call pedum or this this x-risk the existential risk of AI and so that whole community kind of got obsessed with it. Anthropic sort of branded itself or styled itself I should say as the one frontier lab that would solve this problem of pdoom or would behave in a responsible manner that cared the most about it and so they attracted all these EA types. There may be multiple factions. I

Jason Calacanis: I mean, I'm not... Well, it's interesting you bring that up because we've talked about this before. Like there's this whole rationalist community, the Slate Star Codex. You brought that up on an early episode. These are like intellectuals who believe that—and in a way a public community, meta-intellectuals who believe they know better than everyone, and somehow they got their hooks into AI early, or the AI people were interested in it, and now they have a bankroll. Now they actually have a lot of power they've accumulated. It's not just some message board, LessWrong, etc. Now you've got something super powerful because they've got, you know, a couple of trillion dollars in market cap to play along with.

Chamath Palihapitiya: I have no problem with that because I think we do the same thing. We think we're smarter than everybody else and, you know, we should allocate the money. So, I think it's fair that in the public square we can just debate and have water find its level. The interesting thing that's going to happen post the Anthropic and OpenAI IPOs is, if you think about the amount of charitable giving or DAFs that are going to be funded by both these two IPOs, it's going to be north of half a trillion dollars between the two companies, and it could be even more than that. And the question is, when half a trillion dollars gets directed through this one very specific lens, it's definitely going to have some impact to outcomes. I mean, you've seen the impacts that George Soros's philosophy and his capital had on outcomes. You've seen the impacts that the Koch family has had on outcomes. You've seen the impact that Sheldon Adelson's capital has had on outcomes. So, the point is that without judging which one is right or wrong, you're going to have all these competing ideas equally capitalized from third party actors. It'll be less political and it'll be more these folks. And so I don't want to judge that EA is right or wrong.

David Sacks: My single issue is I think that they don't disclose properly enough their obvious conflict of interest. So when Sacks pulls the sweater thread: Person A writes an essay. Person A is officemates with Person B. Person B's wife works for one of the heads of the frontier labs. Person B also used to work...

Jason Calacanis: He's 5 million in Anthropic.

David Sacks: Yeah, where, you know, a lot of this was kind of cemented. Then there's Person C who works at Anthropic and they're all roommates and then they're co-investing and this and that. All of it, again, it's completely fine. I actually think it's completely reasonable. We all did our version of that when we were in Peter Universe, PayPal Mafia, there's all versions of it. Yeah. The difference is that I think that when it's not disclosed, I'm sorry, but I as a skeptic, when I read these things, connect these dots and ask myself: Is it legitimate, or is it part of a different plan?

Chamath Palihapitiya: And that's when I wrote what I did this weekend. I just wanted to make sure that I could demarcate that people should at least take this with a grain of salt and think about the hidden incentives. Because if there's an entire community that wants an oligopoly or duopoly market structure, there's all kinds of things that they can do to affect that change. And one of the most effective things that one can do is to create a hysteria and then come and offer a solution.

Jason Calacanis: Yeah. And Freeberg, just to, as we wrap up here on this one segment...

Chamath Palihapitiya: Sorry, last thing on this. Jensen and I were texting this morning and I said to him, "This is the most incredible thing that you've done." And then I tweeted this thing out. This Hugging Face thing...

Jason Calacanis: We talked about.

Chamath Palihapitiya: ...will go down as one of the most important transactions in AI because you are creating now in the largest competitor and the largest most well capitalized company a bulwark against all of this closed-source oligopoly insanity, and at the same time what you're going to do is actually create more rational competition up and down the stack. And I mentioned this last week: Everybody is becoming everything. Nvidia will look like Amazon, Amazon will look like Nvidia, Google will look like Amazon and Nvidia, etc., etc. And so the most important thing that's happening now is that we are getting deep technical actors with huge balance sheets to be on the side of an open market structure. And I think that will be the most important pushback because that will allow the best idea to win in the marketplace. So I don't want to judge the EA agenda. It may be really good, but I don't want to be rugpulled and end up in a oligopoly or duopoly market structure because of a hysteria that was man-made.

Jason Calacanis: Yeah, I think it's like so well put. And I, a couple weeks ago, talked about how I thought Jensen was going to win open source, and I too tweeted about this today. And I believe right now, starting today, Nvidia is the number one competitor for OpenAI and Anthropic, not just for tokens, but for enterprise compute. And I think now Jensen is the leading open-source provider in America, and I think he's going to take the world, he's going to catch up and blow past China and the Chinese models, I think by the end of 2027. And then that means you're going to have a player in Jensen and Nvidia that will enable America to—your previous job in the government there, Sachs, you were very concerned: "Hey, are we going to win the race?" I am more convinced than ever now that we can win the race because Jensen represents open source globally. He's going to be able to take a rack of compute, bring it into a company, you know, that is currently using tokens from OpenAI and Anthropic and say, "Here's your rack, soup to nuts, complete vertical solution, and you have total sovereignty, and I'm reducing your prices 80 or 90%." Cuz I don't need to make money off the tokens. I made money off the hardware. I'm making money 10 different ways to Sunday. And we will have won, except that now you have Governor Shapiro, who is the biggest proponent of data centers in his state, and then Greg Abbott of our great state, Sachs, of Texas, who now are on a jihad against data centers in order to win their midterm elections. And that is what's truly scary. They have now taken d-airs post all of this, and we have horseshoe theory, Sachs. You have Steve Bannon, Shapiro, Abbott, and the lunatic socialist fringe left all in agreement: "We need to stop AI, stop the data centers, and burn the Waymos in the street." It's a truly troubling moment because we are poised with Jensen's move in Hugging Face to win open source, and we've already won frontier models. Your thoughts, Sachs?

David Sacks: Yeah, I mean, look, I think there's an interesting transition that's underway now on the political side. I think it's just starting to begin, which is: I think that over the past few years, the political debate over AI has really been between accelerationists and decs or doomers. That was sort of the fundamental lines. And you're right that it went across different political party boundaries, because you had on the dec side, you not only had kind of like anti-progress, anti-innovation progressives like Bernie Sanders, you also had Steve Bannon, people like that, conservatives who just were fearful of new technology or the disruption that might come from it. And so it did kind of go across party lines. But anyway, that was the debate for the last few years. Some people describe me as an accelerationist in that debate. I kind of just see myself as a realist, which is I think that the technology is going to happen. Someone's going to develop it, and I'd rather it be the United States as opposed to China. In any event, that was I think the debate of the last years. Now, I think where the debate is moving to is open versus closed, which is I think it's going to be very clear that AI is just not going to be stopped. I mean, all the stuff that Bernie Sanders is doing or these anti-data center groups, they are throwing sand in the gears, but the reality is that the technology is marching on, the innovation is happening very quickly, and ultimately the reason why it's not going to be stopped is because consumers are adopting it. I mean, that's the thing people forget: Why are the data centers getting built? Why do people want to build them is because the demand is there from...

David Sacks: consumers and businesses and so the adoption is pulling this whole thing forward and that's why I don't think it's ultimately going to stop. Now given that reality, given that I think realism is going to prevail, I think the debate is going to be more towards well how do we manage this? What is the market outcome that we want? Do we want to have an open market where there's lots of decentralized models? There's sort of checks and balances. There's kind of a balance of power in the market between different models or do we have a highly centralized solution where there's a couple of frontier companies. We have a frontier market duopoly. They're closed

Chamath Palihapitiya: and they can rug pull you Sachs at any time. They can rug you your tokens away from you.

David Sacks: and that duopoly has been aggressively lobbying for a new regulatory agency. Why? Because of red capture. They can now control it. Again, the government officials are not going to know how to regulate something this dynamic. So they're going to turn to the leading labs to say, "Hey, how should we regulate it?" And of course, Enthropic is going to have all the answers on that. And Dario has already said in Senate testimony that he thinks open models, if sufficiently advanced, are dangerous because they're not centrally managed and controlled. So, it's very clear where the battle lines are going to be drawn in the future. It's going to be about whether you want a centralized closed market or you want a market that is decentralized and open. And yes, closed will participate in that, but the question is whether we have the open piece. And again, I think this will go across party lines because frankly the Republicans have their statist. But I do think that as this debate evolves, most conservatives, most libertarians are going to see the threat to civil liberties, and I think they're going to come out in favor of open.

Jason Calacanis: Yeah, I I I think that's correct. And I think I was talking to Politico because they were reporting on the story. You know, Trump is going to turn out to be right about this data center issue. U the greatest thing a community can do is to get these data centers now when the data center providers are willing to pay your local taxes for your schools to give incentives to pay people off in any number of ways and to move them wherever they don't need to tap into the grid where they don't need water where they're not going to make noise. And Trump keeps telling people this is a mistake to block the data centers take the money. And I got to say it's just watching politics up close and personal. Friedberg h has just made me incredibly uh cynical towards it. We were sitting here 6 months ago maybe it was even six weeks ago and Abbott and Shapiro were lauding and Shapiro when he came on the podcast lauding their data center efforts. I think Jama and I interviewed him. Freeberg, what do you think will happen post midterms here? I I mean, I'm of the belief they're going to switch their position back to being pro data centers because they just are following the wave here. But I mean, how cynical is it that Shapiro and Abbott are both now anti-data center? I think you politically have to be. It's like pulling at negative 80. It's bipartisan.

David Friedberg: Yeah, but you you you know, it's like

Jason Calacanis: why isn't Trump then? Trump's not following this. Trump's an independent critical thinker. Sachs,

David Sacks: he's got guts. I mean, I have told you guys before that Trump is ultimately the best friend of innovators in Washington.

Chamath Palihapitiya: If anybody could make the decision about technology in DC, I'd want it to be President Trump. Not cabinet secretaries, not the White House staff, not members of Congress, not senators, not think tanks. I would really want every decision if he had the time to be made by President Trump because his instincts on this are really good. He wants America to win. He does not believe in necessary regulation. He doesn't have all these doomer anxieties. He listens to a broad cross-section of people. I mean, he talks to all the CEOs. He is very up to speed on all these issues. And I give him credit on this.

David Sacks: And I spoke to this at the G20 this past week. There are great deals for local communities to be had. This is the point that I think needs to be made is the reason why local communities should embrace this is not because of some abstract concern about innovation or that kind of thing. They should do it when the deal is good for them. And there are good deals to be had. We've seen that in Lowden County, Virginia, the average taxpayers property taxes went down by $6,000 because they're getting all this data center revenue. In Louisiana, there's a county that was able to give teachers their first bonus in years because of data center revenue. So, we're starting to see all these examples where if you make the right deal, I'm talking about you, the local community, with the data center and the AI company, it will lower your electricity cost because they will stand up net new power generation. and they will pay for grid upgrades. It does not use like an excessive amount of water. That's total fake news. We know the systems recirculate and these data centers can be put in places where they're not bothering people. So, there is a good deal to be made there. And ultimately, just one last point on this, President Trump supports local choice on this. He's made the argument for why it's a good deal for local communities to accept this data center, but he's not forcing them to. And I'm seeing all this fake news, you know, Democrats saying that the administration's trying to shove these data centers down the throats of local communities. Not true. In the policy document that I worked on, the executive order that I worked on in December, we expressly said that data centers remain a state and local decision. So there were other areas where we thought we should have a national AI policy, but data centers were not one of them. So no one is forcing these local communities. What the president is saying is don't believe this media disinformation campaign. It can be a good deal for you if you're willing to embrace it. I think we're making progress over the last week on this message.

Chamath Palihapitiya: One thing that I would say from my meeting in Washington on Monday is there is a lot of foreign involvement in trying to propagate the negative reaction and sentiment to data centers. And I think it's becoming clear who's part of this cabal and how they are doing it. There was a poll that showed that when you walk through the actual upside and you went into some of these communities, the sentiment shifted by like 30 or 40 points. It's still a little bit on its back heel, but it's just to show that the side that has been organized on deselling America has done a better job thus far than the side trying to accelerate America because it's been a little bit more fragmented. We're able to increasingly see that the Del movement is organized in large part and in funded by foreign actors. And I think that as we put our fingers on that and expose that more, I think that that's going to change as well. Because the reason why Abbott and Shapiro are reacting, I actually think they're reacting to faulty data.

David Sacks: And why does the faulty data exist? The faulty data exists because we've had one side screaming from the mountaintops. And then it's just now as Sax said that when you go to these actual communities and you you actually measure people's reactions, it's much more positive because they're feeling it in their bank accounts.

Jason Calacanis: Yes.

David Sacks: And those make a good deal. They just have to make a good deal. And by the way, so Chimath, you're right about the CCP. This is a

Jason Calacanis: Yeah. Let me pull this up here. So the report you're talking about, Chimath, has been investigated. X got rid of a lot of bot accounts. And here's Axio. China is secretly fueling America's data center rage. Roughly 200 counts from suspected Chinese platforms have quietly tried to influence Americans to oppose AI data since on social media. X said Thursday night it's the same thing that happened during the elections for both sides going back and forth. It's incredibly easy to shape public opinion sacks by just having a small number of social media accounts and pounding people and

Speaker A: ...brigading them in their replies and forming what people believe incorrectly is consensus. And the consensus is not that people don't like data centers. It's that a bunch of bots are telling influential people that people don't like data centers. I know you're about to move on topics, but I'm just going to say something right now, which is please, there's going to be a cascading set of decisions and reactions and people will anchor into points of view on this topic and related topics around AI which will look incredibly, incredibly dumb in 6 to 9 months and a year from now. And the reason it will look dumb is as the actual truth gets exposed, these folks will look incredibly foolish. That's my prediction.

Speaker B: Yeah. I mean, look, just on the influence op here. Clearly, there have been a lot of influence ops around data centers and there's a lot of fake information about this. So, there's a few different, I'd say cadres here. There's the CCP, there's the DSA type wing of the Democrat party, which frankly, I mean, both they and the CCP, they're communist parties who want to sabotage America. So, it kind kind of makes sense. Then you've kind of got the doomer groups and there's a writer named Nerret Weisslat who writes a blog called AI Panic who a couple years ago traced that there were hundreds of these astroturf doomer groups that were basically funded by three EA billionaires in Silicon Valley. It was Dustin Moscus, Yan Talon, and Vitalic Buterine. Remember Vitalic gave $600 million of dog coins to Future of Life Foundation.

Speaker B: And then they've been spending hundreds of millions of dollars on these campaigns to make people be afraid of AI and they see data centers as a good target. So you really can't underestimate how much of a difference, you know, a billion dollars of donations from these EA billionaires, how much damage that's done in terms of the public perception of AI. And to to point earlier, I mean, we are going to have like probably a hundred new EA billionaires as a result of the anthropic IPO. And as those people find their way into politics, it will be like George Soros times 100 or a thousand.

Jason Calacanis: Going to have 20 NOS and 50 people working for them. It's going to be nuts. I mean, I told you guys I was getting brigaded. I created a bot sack that goes through my replies for me and it just says anybody under a year, anybody under 200 followers, just tell me what they're tweeting. And I look at these and it's all the same thing. They're just brigading people constantly from fake accounts. If you're under like a year old, you shouldn't be able to even be in people's replies unless you have like your real name or you're a blue check mark or something. It's gotten out of control on these social networks. It's so easy.

Jason Calacanis: All right, let's keep going through the docket. Got a lot to get to here. And Freeberg, I need your comments and your insights on Mandami. This is an interesting one. He just put a one-year ban on AI inside New York City's public schools from kindergarten through 8th grade. Now, this is something where people have been saying he banned Chachi, banned AI. Just let's slow down here and get into the details. New York City is the largest school district in the United States. The moratorum starts next week. 600,000 students in New York City. This covers all software that uses student facing generative AI. High schools are exempt and Mandami is piloting an AI learning program with 50,000 high schoolers. So that's a very specific thing that he's piloting that's different than these new guard rails. He also gave recommendations for screen time caps. 30 minutes grades 3 through 5. 45 minutes grades 6 through 8.

Jason Calacanis: Mandami's reasoning, quote, "I have yet to see a study showing that AI is beneficial for students in elementary and middle school." Uh, obviously Mandami is the face of democratic socialism in America. One New York City DSA member, Julie Swoop, said technology quote "should not be mediated through a for-profit company that is enriching tech oligarchs further." I think he's talking about USA. Is that old? Google, Microsoft, Anthropic declined to comment. Freeberg, what are your thoughts on this? How far is this from how you think about how you would want your children to be raised if they were going to New York City's public school system or whatever school system you choose to send them to?

David Freeberg: Article published from Stanford in March of this year. Counter to mom Donnie's statement, they went through and they diligenced all of the research that's been done on the use of AI in K through 12 education. It's a report called The Evidence Base on AI and K12, a 2026 Review. They identified several hundred papers that have been published only 20 high quality causal studies is what they said. This was back in March, so many have been published since then. And the conclusion of the meta paper, the meta studies if you will, is highlighted at the bottom of the report. Student performance often improves with access to AI tools, but once removed, results are mixed. Tool design matters. So, not all tools are equal. And AI may meaningfully support educators.

David Freeberg: So, there's quite a bit of analysis that's been done. It's continuing to mount, continuing to surface. There doesn't seem to be a strong evidence base to suggest that AI is detrimental to kids education and development or the educational process. What I think we can all intuit about this is that there's certainly a negative push from teachers unions against AI tools under threat of automation away from their core skill and capacity and the lack of skill that educators have in utilizing AI to educate students in a classroom based setting. The common sense equivalent also on the flip side is that AI can enable personalized tutoring. The objective being every individual learns at a different pace. Everyone learns differently. How you learn, how I learn visually, orally with certain imagery versus being told stories versus interactive project based work or building work or dictation. There's a lot of different ways that people learn.

David Freeberg: All of those learning systems can be personalized to an individual and ultimately that individual as a result should be able to progress more quickly, have greater confidence in their learning. And this is my kind of common sense belief not rooted in some study that AI ultimately will lead to a much more kind of personalized system of education for students. And that is deeply disruptive and deeply threatening to the traditionalist systems of educator in a classroom. Everyone learns the same way. Everyone learns at the pace of the slowest student in the classroom. Typically, the educators have a lot of rules around what they're required to do and not required to do because of the contracts negotiated by their unions. And so, there's a deep political orientation with MDI's decision here to limit the access to technology. I think it's unfortunate. I think it's really sad.

David Freeberg: I think that the opportunity for AI to reinvent education, give kids a level up, to take any child from any background, any socioeconomic condition, and give them the opportunity to accelerate their capacity very quickly and very effectively is an incredibly powerful tool that should not be discarded because of a bunch of that's been written about AI or concerns that we don't really know or understand. By the way, that is always the shorthand for dismissing away something that's credibly going to change a system. The "we don't yet know, we don't yet understand" narrative can always be used at any point because you could always say, well, there's more studies to be done. There's more analysis to be done. There's no limit to that statement. And so in this case I tried to highlight that there have been 800 studies at least 20 of which Stanford have identified as being very credible in their analysis of the utilization of AI and K through 12. And so yeah I think that there's a political bent here but I think it's probably part of also this very kind of deep rooted dysfunction that we've been talking a lot about this dysfunctional fear of technological evolution. No one understands it. When I say no one I mean the general population feels this way. No one knows where we're going with this. We need to be careful.

Friedberg: We need to be cautious. And I think that that's probably what's going to keep us back. Now, why is that bad? Why is it bad to take time? Well, it's bad to take time when you have an opportunity to progress forward quickly and aggressively because there are going to be alternatives out there. There are going to be private schools that are going to use AI. And I don't want to see kids of privilege and kids of wealth accelerate ahead because they're getting an AI education while public school kids get left behind. I don't want to see kids in other cities, other states, and other countries accelerate ahead when kids that are in certain districts that have this kind of anti-technologies, kind of call it socialist orientation, get left behind.

Friedberg: So I think there's a fundamental kind of dysfunction socially that we're dealing with across all of the stuff with this massive kind of technological upheaval that's underway. This is one manifestation of it. There's a rooting that the mechanism of it is probably related to teachers unions and the politics around this stuff right now. Anti-AI is very popular. So his being anti-AI gets him more points, more kudos. The unions love it. And so, you know, that's kind of my summary of what I think is going on.

Jason: Great insight. And Mamdani may not have lied here, Friedberg. He said he didn't see any studies. He just may not have looked. And you actually looked.

Friedberg: Didn't click on that link.

Jason: Just didn't click on the link. So let's not, you know, give Mamdani a hard time here. Chamath, you are passionate about education. You got kids in various age groups. And so you've been through this and you're still going through it, and kids learning and thinking about devices. We talked about this just the other week with the Meta settlement and how challenging it is for parents. What's your take on this? Maybe you could steelman what you think resonates with you in terms of use of AI, putting New York aside, for your own kids. And what benefit is there of them not using AI, and where do you think it's actually great that they use AI? Take us into what you think as a parent, and put the politics aside for a second if you will.

Chamath: I think it's inconceivable to me that kids will not have an adaptive learning platform as their primary way of learning. I think this idea of grade one, then grade two, then grade three is, as Friedberg said, a lowest common denominator approach to education. I don't think it works. I think it's more conceivable that in the future we have kids that have very different learning styles. Some are more visual, some are more auditory, and we have different learning paces. And if you could have something that's much more tailored to each individual person's learning style, where you have guides that help you in moments, and then the rest of the time you're teaching executive function and teamwork and problem solving, all of these other things, sports, that's a much better outcome for all kids. So that's the right answer. Right now there are only charter school options around that answer, the leading edge of that being Alpha School, which is our friend Joe Lonsdale. You know, big shout out to him and his team. But I think that's the answer that's going to win.

Chamath: Let me just give you another reflection, Jason. I think that this is an incredibly important moment. We should demarcate this. This is when New York becomes Mississippi while Mississippi becomes New York.

Jason: What do I mean?

Chamath: In all of these highly liberal bastions, they are embracing this far-leftwing ideology. And I think it's going to come with these kinds of policies. And I think what it will do is, it is a self-imposed form of modern segregation. And it is going to completely push an entire generation of kids in these cities that are subject to these rules into poverty, and it will keep them there.

Chamath: And so in as much I think you're going to see this flipping where all the states that embrace AI, that embrace the data centers, that embrace the tax cuts, that embrace the teacher bonuses, they're just going to end up ahead. And you're going to have people who are in a position to move move. And then instead, what's going to be left over in many of these cities that embrace these things to the extreme are hollowed out versions of their original self. And that's going to reorder the economic balance inside the United States and the voting balance and many of these philosophies. So I think it's very important. I think he should run the test. I apologize and I feel deep empathy for the working men and women whose kids will be screwed over by this. But I think people can only learn in touching the stove and getting burned.

Jason: Okay, Sacks, maybe you could go into the political side of this if there is one and maybe what is your cynical take on what's going on here? Do you believe this is a reaction to the oligarchs? I joked previously they're talking about you, but it does have a little bit of a tinge there of democratic socialism and it feels like maybe they want to sacrifice kids. Or this is one interpretation that is happening online. I'm not saying it's mine, but people are saying, hey, they're trying to sacrifice kids because they don't want Sam Altman or Dario or whichever service it is, Microsoft, to get a couple of shekels for, you know, software being used in the classroom. And of course, they would all give the software to them for free. And the current versions of it, you can use 80% for free. So that makes no logical sense that they're sticking it to the man in the big oligarchic tech industry. Your thoughts?

Sacks: Well, look, the DSA has just really come out against any innovation. They're kind of just on the side of anti-progress. They've kind of fully embraced the Luddite side of the argument. And I think to the point that Friedberg and Chamath were making earlier, this is going to be just really bad for the kids. You know, we've been talking for 30 years about a digital divide in this country where supposedly the kids of wealthy people would have access to the best tools and the kids of poor people would not have access to those tools and they'd fall even further behind. Well, here you have a case where of course private schools are going to continue to use the best AI-powered tools. And now the public schools are not going to have access to those tools. Not because they don't have the money, not because the tech is not available, but because the political leadership is trying to sabotage those kids. And you know, it's going to be bad for them.

Sacks: And I guess, you know, if you were to describe a motive to it, I don't think Mamdani and his political group, his party really care if they create more political dependence. I mean, in a sense, their whole movement consists of downwardly mobile progressives. And if you're looking for a motive, maybe they're fine having these kids be downwardly mobile. I don't know. Maybe that benefits them politically.

Jason: They may actually not have kids at all and they're making these rules and it's people with kids who are part of the... because if you look at all these people, these are all like, you know, blue-haired single people with no children, right?

Sacks: Yeah. Actually, let me bring one other element into this, which is... Look, I don't think we really need to get into motives. We can just say it's a bad policy and leave it at that. But let me just bring in one other element of this, which is it's not a full ban. Okay. What they also said is that for a maximum of 50,000 high school students, they're going to have a pilot program, these so-called modules in which they teach AI literacy. But listen to how they describe it. They say that all high school students will have access to twice yearly AI literacy classes designed to help them think critically about AI before they begin to rely on it.

Sacks: Okay. These modules will introduce students to what AI is and is not — this is their language — as well as AI-related bias, risks, ethical considerations, and impacts on careers and future skills. And it says that all use will take place under direct supervision of a trained educator and will involve carefully vetted AI tools. The pilots were selected...

Chamath Palihapitiya: ...based on rigorous safety and data privacy standards. So you hear there a lot of this sort of doomer lingo. I mean those modules, it sounds like they could have been written by some of these safety people. You know, this language about AI bias and discrimination, things like that. I mean, honestly, those classes sound not like you're going to learn how to use the tools to get the best education, but about how you're going to learn to be suspicious of the tools. And maybe that's like a small part of what you should develop, because I guess you should be suspicious of everything. But it doesn't really sound like those courses are going to benefit kids.

David Sacks: It sounds like they're going to put them through Doomer Academy, quite frankly.

Chamath Palihapitiya: Yeah.

David Sacks: I mean, it doesn't sound like...

Chamath Palihapitiya: Yeah, write your own interpretation.

David Sacks: So think about the competitiveness of our kids versus Chinese kids.

Chamath Palihapitiya: Yeah.

David Sacks: China, we know, is incorporating AI into K through 12 education. Their kids are going to learn how to take advantage of these...

Chamath Palihapitiya: ...robots for the robot Olympics internship there.

David Sacks: Yeah. Meanwhile, we either are banning AI in our school or we're putting the kids through, you know, some sort of doomer safetist module that's going to teach them why they should resent and resist AI as opposed to embrace it to their benefit. So, I don't know. It just seems like this is not going to make our kids more competitive.

Chamath Palihapitiya: Let the experiment run, unfortunately. But let the experiment run. We need to measure it.

Jason Calacanis: I have a bunch of thoughts here. I am a big advocate of Montessori, but I'm also a big advocate of adaptive learning and what these AI tutors are able to do to a motivated student whose family cannot afford a tutor. So I just want to put two disparate points together here, and they're somewhat opposing.

Nick, if you could pull up the first from the NIH here about the MIT study, and I'll send this one to you, Freeberger. You can look it up. It's very interesting.

They took a group of 54 participants—and sorry to get into science corner here and steal your thunder, Freeberg, I should have cleared this with you ahead of time, but I was reading this paper—54 participants from last year into three groups over four sessions, and this is over four months. They were using ChatGPT for essay writing, not unlike the conversation we had about the Wall Street Journal editorial page last week. And one group was using a search engine, using traditional web search; the brain-only group wrote essays without using any tools. And then the researchers used the headsets there to watch their brain activity.

And what happened was the LLM users showed severe deficits, quote, "in memory and essay ownership," with 83% being unable to quote from the essays they had just written.

Basically, what they're saying here is if you use these LLMs instead of being able to do it acoustically, being able to do it like Montessori philosophy on your own, your brain atrophies. You don't even remember what you wrote. And the search engine group was somewhere in between because they had to remember things and they had to pull these things together. Your brain atrophies if you don't actually do the work. That's what we're learning. Just like your body will atrophy if you don't work in the fields like we used to do, and that's why we all go to gyms now.

Jason Calacanis: But correlating that super importantly is the two sigma problem. So Bloom, and I'm sure you're aware of this research, Free. So this is super interesting, but will not be shocking to anybody of means.

My parents could never afford a tutor. I was a product of the public school system until 8th grade and then went to Xaverian Private Catholic School, which was like super cheap. But basically, we've known since the '80s that if you are one-on-one tutored, you are two standard deviations better than students that are educated in a classroom.

So, two things can be true at the same time. These students, to your point, Chamath, this experiment is being run. Realistically, if they're going to the New York City public school systems, their parents, in all likelihood, like mine, didn't have the ability to hire a tutor.

I'm assuming, Sacks, you came from a little bit of a middle class background. I'm assuming you did have some tutors. Am I correct?

David Sacks: I don't have tutors.

Jason Calacanis: No tutors. Okay. So, you had to just do it all.

David Sacks: Yeah. I didn't necessarily...

Jason Calacanis: ...tutor. No.

David Sacks: No. You know what? I wish I had done like an SAT workshop. I went to that test cold. I never did anything.

Jason Calacanis: And you got 1400.

David Sacks: Yeah.

Jason Calacanis: You did 1350, 1450.

David Sacks: I got like a 1420 my first time. And I'm like, man, you know what? If I had like actually prepped for that, I might have done better.

Jason Calacanis: I got 1100 and I retook it and did better. But anyway, yeah. I mean, I didn't know any of this stuff.

David Sacks: Yeah. So...

Jason Calacanis: Here's the tension. Most parents do not want their kids to do this work and have their brains atrophy and not learn how to do it from a basic level. Putting aside the drunken mill conversation from last week, you want people to be able to learn how to read and write and do this stuff organically, acoustically, whatever term you want to do, and then learn how to use the AI to help them, augment them, etc.

But I'm concerned that the motivated students who cannot use these tools properly, who also can't afford to be part of the two sigma group of parents who know very well, all you have to do is get your kid a tutor. And unlike self-motivated Sacks, they're going to easily get to 1400 on their SAT with a tutor because the thing is rote, it's very easy to get to 1200, 1300, 1400 with a tutor.

And so I'm super concerned about not having an AI tutor. And I feel like two things can be right at the same time with this. And I really don't like this experiment as currently constructed.

Jason Calacanis: All right. Interestingly, President Trump has just closed a deal for Venezuela's oil back in January. I think everybody knows the US military in a perfectly executed operation captured Nicolás Maduro, and he obviously was Venezuela's socialist leader who was very pro-China, pro-Russia, and obviously Venezuela's in our hemisphere. Trump said the US would control Venezuela's oil, which they have a lot of. It's not super clean, but they do have a lot of it. And he made a deal with Maduro's replacement. President Rodríguez is now in charge.

Now, we have the details of this. North American Blue Energy Partners gets a 100-year concession over 17 oil fields. This includes 65 billion barrels—65 billion barrels of reserves that were once controlled by Russia, Chinese, and Maduro entities. The US government controls 55% of the deal. Pentagon gets 35% equity. The Pentagon gets a third of the equity. State Department gets rights to buy 20% of output at cost. Interesting. I guess that's for our reserves and our military. This was signed by Rubio and Hegseth with Venezuela's interim president.

As I mentioned, Blue Energy Partners is pledging roughly hundred billion in new infrastructure. A lot of other companies, Chevron, etc., and a bunch of unnamed ones also are going to get some deals. Trump said this deal will be at, quote, "no cost to the American taxpayer."

Sacks, I'll throw you a fastball here if you want it, or I can give you the softball. Which one do you want? You want the fast?

David Sacks: I like the fastball.

Jason Calacanis: You like the fastball? Okay, here it comes. Coming in. Hope you're wearing a helmet.

Should we be seizing and taking over countries and seizing their oil fields? People feel like this might be nation building that we're putting in puppet dictators. Is this something America should be doing? Do we have the right to do this? This is the hard question people are asking, or does might equal right?

David Sacks: Well, I definitely don't think this is nation building. You know, we're not trying to stand up an army here like we did in Afghanistan. We're not trying to teach them about toxic masculinity. We're not trying to stand up a government or anything like that. We're not trying to teach them how to do...

David Sacks: American-style democracy. We're just making a business deal. This is a business deal. And you know, it's amazing to me all the people who are saying, "Well, this is exploitative of Venezuela and this is a bad deal for the people of Venezuela." Have you looked at Venezuela's oil production under Maduro? It already wasn't very high given the incredible reserves that Venezuela has. But under Maduro, the production dropped by about 2/3 over the last decade. So they used to produce about 3 million barrels a day. Under Maduro, it went down to about a million barrels a day. And this is a country with some of the largest oil reserves in the world.

People debate exactly what should count. I think if you look at the total amount of reserves, it's something like 300 billion barrels of oil, which is around the same as Saudi Arabia, just a little bigger than Saudi Arabia. Now, some people say, well, a lot of that is like this extremely heavy crude sort of like sludge that's not usable. I think that's the so-called Orinoco reserves, but that's only about 200 of the 300. So they still have about 100 billion barrels of you could say it's still a heavy crude but those proven reserves I think aren't really debated. So you're talking about a huge amount of oil here.

And I guess just one last point on this is that that type of heavy crude is actually very complementary to our own. So, in the United States, through the magic of fracking, we've basically developed all of this oil and gas, but our oil is this light sweet crude that's good for refining it down to gasoline. But the heavy crude is what produces the distillates and that's where diesel comes from. And our refineries in the Gulf were built for heavy crude and it's very expensive to try and retrofit them to do the light crude. So actually our refineries are sort of perfectly set up to take in this heavy crude and turn it into diesel and other distillates. So I think it's really a win-win deal for the US and for Venezuela. Again, Venezuela was doing horribly before. I think this has to improve their economy and I think it's really good news for the US.

Jason Calacanis: To your point, Sacks, over the past five and 10 years, the price per barrel of oil coming out of Venezuela has averaged—past 10 years, $53 a barrel. Past 5 years, $58 a barrel. So they're getting a pretty good deal. We're paying a little premium here to control it all.

David Sacks: They were selling at a discount to China. I think it was like a $20 a barrel discount to basically sell.

Jason Calacanis: Yeah. So, I guess when you're dealing with authoritarian countries and you don't have a free market to put the stuff out there, you get a slightly discounted price, right? Somebody's got to skim something here or get a reason and they got to ship it across the world. Freeberg, your thoughts on this? Do you have any concerns about the nation building, etc.? Putting in what some people are saying is a puppet president? Is it in the best interest of the people of Venezuela? Are we doing a solid for Venezuela to create more stability by being the buyer of this? Or is this just something we have to do? We have to control our hemisphere and we have to be energy independent given the state of the war with Iran and the closure of the strait of Hormuz.

David Friedberg: The biggest motivating factor may be keeping this oil away from the sweetheart deal for Russia and China. If you look at the historical tie-up with Venezuela and the Maduro regime, it was a discounted oil trade system. There's all these stories about Maduro being the head of the snake of all of this kind of illicit activity and a lot of this was driven by Russia and Chinese interest in the energy reserves and they were providing support and this actually provided capacity to fund activities by the Russians in Cuba.

So there's a lot of this state acting theory about what's the real motivation for getting an energy deal done not just in terms of is it good for America but is it bad for America's enemies and that that may be kind of a big motivation around this.

Now one of the more kind of surprising outcomes over the last day is you guys may remember I interviewed Maria Corina Machado. She was the individual who was running for president and ended up having what was supposedly an election that was not accurate and she was supposed to have won and didn't win. And yesterday she came out and said that this Venezuelan government does not have the authority to do this energy deal with the US despite her historically having been viewed as an American ally. So, one thing to take note of is that she was not given the presidency and now she's saying this government is illegitimate. This government should not be allowed to make these deals. We as the people of Venezuela should feel angry and upset and left out about this whole thing.

So, there seems to be kind of this now political turning. I think I don't really have a good sense and I think it'd be interesting to know what do the people in Venezuela think about this deal. And to Sacks's point, it seems like it should be a good economic deal relative to where they're coming from. Will that actually translate into improving the lives of the people in Venezuela, which ultimately is what matters here? And assuming that the lives of the people in Venezuela are improving rather than enriching a small number of people in Venezuela, which is what has happened historically in that country under the last regime, then there may be kind of a long-term welcoming of this deal. But I do think there's two aspects to this. One of which is just keeping America's enemies at bay so that these energy fields are not exploited by America's enemies and second is ensuring that the Venezuelan people realize the benefit of this transaction rather than it being a corrupt government.

Jason Calacanis: Provocative, Freedberg, in that we have turned off Russia and China's access to Iran's oil with our war with Iran now in its seventh month and we took Venezuela away. Are these two actions incredibly provocative and have they had any kind of a downside to China? Because they seem to be all in on nuclear, solar and other modalities. So are these two things super provocative and are they going to cause us to get into an escalation with China? The second question I think is a little bit independent, but I think China imports like 11 million barrels a day of crude oil.

David Sacks: Venezuela is only producing a million barrels a day. So, if China's importing 11—well, they were importing 11 before the war. That number's actually gone down a lot, and we can talk about why since the war started, but China gets most of its oil from the Middle East, Persian Gulf, and from Russia. I mean, so Venezuela is a small number.

I mean, look, I think Freeberg's right that that is a big part of our motive is securing those reserves that are in the Western Hemisphere. They are massive. It's a very, again, complementary type of oil to the oil we have. I think it's just smart for national security, smart economic deal.

J-Cal, to your point, does this get us more invested in Venezuela? I think there is a little bit of a risk there because if we're going to invest billions of dollars in upgrading their infrastructure so that we can produce 3 million barrels a day instead of one, we need to know that that investment is protected, we can't have some future government coming along and just nationalizing our American oil companies over there, right? We need to know that these business deals—

Chamath Palihapitiya: That we're not going to get rug pulled and they'll just seize our upgrades. They could seize the upgrades.

David Sacks: Yeah, this business deal is supposed to last for 25 years. So, it does give us a vested interest in making sure that the Venezuelan government at least respects our property rights. But I'm glad that President Trump didn't put Machado in charge because how's she going to stay in power? Like what guns are going to basically protect her? You know, it takes men with guns to basically stay in power in these countries and—

Chamath Palihapitiya: You need a strong man/woman.

David Sacks: I'm not saying that it can't be democratic. I'm just saying that if you're not installed in the power structure there and have backers in the military, things like—

David Sacks: ...that, then it's very hard to stay in power. And that's the kind of thing where we could have to send American GIs in to protect her. And that we don't want that, right? So the nice thing about the Venezuela situation is Delcy Rodríguez and her brother are basically running the country. She was the number two. Now she's running it. They appear to have enough support from the establishment there. And so like that's kind of what the American interest is, I think, is just to have a stable government there that will basically conduct economic relations with us.

Jason Calacanis: Yeah. Yeah. Chamath, any thoughts here on what's happening in...

Chamath Palihapitiya: ...close to it? I don't really know.

Jason Calacanis: Don't know. Okay, that's fair enough. Fair enough. All right, there it is everybody. Episode 288. Somehow this band has kept it together for 288 albums and tracks. We're going to make it to 300, boys.

Co-host: I think we're in a good rhythm. The show feels easier to do now than it did for a long time.

Jason Calacanis: Yeah. I wonder why. I wonder why.

Co-host: The AI has been a very good thing for the pod.

Jason Calacanis: We're partying like it's 1999 on the pod. Let's go to Cabo. Let's fucking go. We'll see everybody in...

Co-host: Love you guys. Love you besties. Bye-bye. Bye.

Outro Soundbites: Let your winners ride. Rain. We open sourced it to the fans and they've just gone crazy with it. Love you. Queen of... your besties are my dog taking notice your driveways. Oh man, my Asher will meet me at... We should all just get a room and just have one big huge orgy cuz they're all just useless. It's like this sexual tension that they just need to release somehow. Wet your feet. We need to get merch. I'm going all in.