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The issue with lawyers is that they block everything, good and bad.
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So you don't have stupid ideas like the one child policy.
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You also don't have functional infrastructure anywhere.
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>> America was one of the greatest engineering countries in the world for a long period of time.
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>> It is pretty striking that the US Senate is mostly lawyers.
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Let's have a few more economists and engineers within the government.
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The US should study China because the US should study a lot of best practices around the world.
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But the US doesn't have to become China.
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I think what America has, it's its own heritage to draw on with respect to having been a former engineering state.
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We do not need to be like the Chinese.
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Let's just have a little bit of reasonably priced construction. Well, hello everyone.
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It's Jim Olesi with yet another Infinite Loops.
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I am very excited about today's guest because we're going to be asking the question, what happens when a lawyerly society confronts an engineering state?
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My guest today, Dan Wong is has lived the paradox as he writes about in his new best-selling book, Breakneck, China's quest to engineer the future.
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Dan is a research fellow at Stanford's Hoover History Lab who spent years in Hong Kong, Beijing, and Shanghai and talked with factory managers, coders, and party theorists have developed this powerful framework between loyally and engineering. Dan, welcome.
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>> Jim, it's a pleasure to be here.
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>> So, let's start at the beginning. I love your framework.
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China can build, the US can block. How did we get here?
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and explain for our listeners and viewers the the broader picture of that framework.
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>> Well, the broader picture and the way that I arrived at this framework was um as you say I spent a few years living in China mostly between Beijing, Shanghai as well as Hong Kong and the years that I was in China between 2017 to 2023 felt like a pretty momentous period of time.
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I lived through the first trade war that President Donald Trump launched.
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Um something that quickly morphed into a technology war which I was studying when I was working as an technology analyst at an economic research firm.
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Um I was living through China's stunning successes in um new types of technology development including things like solar as well as electric vehicles.
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Um and I was living through uh part of the growing repression under top leader Cinping.
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And um a lot of what I had been thinking about uh was that you know we're using these 19th century political science terms like socialist, capitalist, autocratic, neoliberal, whatever that means to reason through this relationship.
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And I thought that let's have a 21st century understanding of what these two superpowers who are sometimes friendly and more often not these days.
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um and how they are um trying to confront each other.
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And so that's when I um after the start of 2023 and I should say that the centerpiece of my uh experience living in China was to have lived through all three years of zero co in which I was more or less stuck inside the country.
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Um I decided that I needed a greener pastures at least for a little point which is why I moved to the Yale Law School in New Haven not too far north of where you are in Connecticut right now Jim.
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Um but I was a fellow at the Yale Law School's Pai China Center where uh it's substantially wrote this book.
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So um the way that I'd thought of China is as an engineering state um which is a country that treats building another mega project as the solution to all of its problems.
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Um so uh whenever China's economy trembles um the central committee, the polic bureau, the state council will announce the big new project to build a new spate of roads or bridges or hyperscalers or coal plants or homes uh throughout the country.
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Um they are also fundamentally social engineers.
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um people who treat society and people as yet another mega project as yet another building material to be torn down and remolded as they wish and they are also economic engineers um people who are willing to push people out of uh Wall Street um China's financial system as well as its tech sector in order to make kids work in semiconductors or aviation or more strategic industries instead.
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And a lot of this is driven by the fact that at various points in recent history, most of China's top leaders, all nine members of the standing committee of the policy bureau had degrees in engineering.
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And I contrast that with the United States um which I call the lawyerly society because it seems like all the presidents have to go to Yale Law School.
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Um if you take a look at the US Senate right now, um there are 47 US senators who uh have law degrees.
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um one of them studied anything resembling STEM.
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Um among the founding fathers, most of them were lawyers.
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First 16 presidents um all the way from Washington to Lincoln, 13 of them were lawyers.
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The issue with lawyers is that they block everything good and bad.
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So you don't have um stupid ideas like the one child policy.
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You also don't have functional infrastructure anywhere.
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Make just one more quick point um about Connecticut since um you and I are both quite familiar with the state.
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Um when I was in um New Haven, I confess I was sometimes seduced by the pleasures of New York City.
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And so I would uh take the Metro North train down to Grand Central in New York. And the train is good.
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It takes about two hours to get from New Haven to New York.
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It is a bit of a slow train, but it is a steady and reliable train.
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And I was quite satisfied with it until one day I came across a timet from 1914 which I found that um the trains about a hundred years ago were slightly faster getting between Grand Central and New Haven uh than they are today.
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And I think that it's not quite an applesto apples comparison because um the trains make many more stops now um including Greenwich when it didn't in the past but at a first approximation um we're moving slower than 100 years ago and this is not the direction that I want things to be moving.
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I literally just gave that example last week when having a conversation with a friend.
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Uh, and because I discovered an even earlier train schedule.
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Um, and and I w I I was shocked in very much the same way you are.
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And then I looked at pictures of the trains back then, their interiors.
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They were much much nicer, much more comfortable.
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the services provided on the train for that less period of time a hundred years ago were better and and can we lay all of that at the feet of our lawyers you know there are so many lawyer jokes right uh I I'm reminded of I think it was Abe Lincoln who said uh one lawyer in a town will starve two lawyers can make a good living is is that really kind of foundationally why we are seeing this in America.
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>> Uh no, I think that we cannot pin all of America's problems on the lawyers.
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Um there's plenty of blame to go around.
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I think that if we're thinking about the Metro North trains in particular, I would say that, you know, the mechanism of the lawyers um hurting things um has been that um a lot of homeowners around Connecticut um have put up their hands to say, "Well, we don't like a rail line in our backyard."
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Um and um by repeatedly emphasizing this, they managed to sue Amtrak and the other rail authorities to take slightly more securous routes such that um we're adding about 25 minutes um into the train schedule even for the high-speed trains.
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And I think that is a feature of the lawyerly society in which um you know individual homeowner home homeowners are able to put up their hands, hire some superbly well- paid lawyers and then do things that you know I would say um defensively um subvert the public interest in in some big way.
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Um I would also lay some blame upon America's mass transit agencies.
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A lot of the mass transit agencies including the MTA have outsourced a lot of their engineering expertise um out to uh contractors uh such that you know there aren't even that many uh engineering experts working inside these agencies.
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A lot of it is um coordinating work with outside contractors as well.
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And I think that there is also some blame to go around for um the uh society not so much necessarily valuing um a lot of these mass transits.
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America likes to drive and there's no way around that problem.
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But I think the the fundamental issue I think with the lawyerly society if we accept that lawyers are to some extent a cause of the problem.
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I think the fundamental problem is that lawyers are for very large part um handmaidadens of the rich.
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They're very good at defending wealth.
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Part of that is positive.
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Um the US wouldn't be so wealthy, wouldn't have created so many companies worth trillions of dollars um if the uh lawyers weren't around defending the rights of companies like Nvidia.
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Um but I think the problem with America today, one of the many problems is that the country works very well for the wealthy.
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um you know the the wealthy in New York don't have to deal with affordable housing problems.
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They buy these skinny skyscrapers in the middle of Manhattan.
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They don't take the subway to work.
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Um they have um much more comfortable options um to get to work.
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And I think what um what I would like is for the lawyers to step out of the way a little bit such that we are able to build mass transit for the many.
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we are able to build homes for the many that we are able to build um all sorts of projects that people desperately need and it is not a few individual homeowners that are able to prevent this construction.
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>> Yeah, I think that that is an incredibly valid point.
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You know, the merit, which is the other way to get up to New Haven, actually bends out around Greenwich.
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And I always wondered why that happened.
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And so I started digging into it and it turned out if it went straight it would have went straight through a Rockefeller estate and that's why that's why it doesn't go straight.
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>> And so there's this constant tension. Yeah.
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But in my opinion, between as you say the wealthy who have access to lawyers uh and can pretty much paper anything to death uh verse like progress verse not sitting in stasis.
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Do you think another byproduct of this is just the fact that we lose that knowledge and maybe that urge to be a little more accommodating to an engineer's mindset?
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>> Yeah, I think um an urge is a good way to think about this because I think that the United States wasn't always like this in not being able to get anything done.
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I think that the US used to be an engineering state itself for about a 100 years, 150 years um in between the middle of the 19th century to the middle of the 20th century in which um in earlier times the US built you know a train system that net the coasts.
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There were skyscrapers in Manhattan and Chicago.
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there were canal systems and then in the 20th century um the US built big projects like the Hoover Dam as well as the Manhattan project and interstate highway system and the Apollo missions and you know in the earlier days of New York.
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I think there were um you know it used to be common for mayors and governors to go to these ribbon cutting ceremonies um in to open up a big new bridge to open up a a big new set of subway stations.
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Um New York opened a whole string of subway stations in the year 1925 about 100 years ago now.
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Um and also I think another big state in 1905.
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So it's been um quite a subways are not exactly a new technology even though our trains and um even though our tunnels seem to not have been substantially updated since that time and I think what America has very substantially lost and this is something I observed pretty extensively in China is that once you have physical dynamism people really do have a sense of optimism about the future.
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If you see that your city around you, as many people do in China, um did not have a subway system in the past, now you have a thriving subway system.
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If it did not have a highspeed rail system in the past, now it has highspeed rail.
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If it didn't have roads and bridges, if it did not have parks, these are all things that China is building in abundance.
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And it really gives people a sense that their country is growing better and better.
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And there are still uh things like ribbon cutting ceremonies.
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And I think that you know Americans have lost the sense that ribbon cutting ceremonies represent something thrilling.
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The opening up of new possibilities where you didn't previously expect it.
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And um this is something that China has and I think this is something you know building a new subway system isn't just only a measure of you know some sort of economic stimulus for all of the builders involved in the project.
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I think that the Communist Party has also built to some extent political resilience through these bridges and subways because people feel a little bit better about being in a society that is visibly changing and visibly improving yearbyear rather than a country that is moving more more and more slowly as uh as folks do in Connecticut.
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>> And and how much of this do you think is a sequencing problem?
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It's a bit like the argument that we got leptrog in the United States with cellular technology, cell phones, etc.
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Because a long time ago, we built a pretty uh anti-fragile landline system >> and we were like, "Ah, yeah, that's great.
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We've got this great system."
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Uh meanwhile we got uh out competed out uh installed on the cellular front.
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I I I remember going to various places in Asia and Europe and being kind of marveling at the fact that my phone worked vastly better over there because they had far more stations etc.
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You know, we built the subways a long time while we were still a building society, right?
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And and then it's the shrug.
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I'm I'm very taken by your idea of the ribbon cutting demonstrating physically demonstrating progress to the citizenry.
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Um, another one of your themes that I really like is the whole China and America are mirrors of one another.
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sort of crass materialism, hustlers, pragmatic get it done attitude in both cultures.
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In in what specific ways does contemporary China rhyme with America's guilded age and where does that rhyme break down become dissonant?
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I think it is very defensible to say that China might be in a guilded age of its own.
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Um, in which you had a lot of robber baron types uh who were building like maniacs uh and running rough shot over a lot of people.
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Um, you had plenty of corruption in both systems.
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Um and China has mostly substantially um limited a lot of the most obvious cases of corruption.
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But um it was also a time of building tremendous wealth among very hungry entrepreneurs.
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Um what came after the robber baron age?
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Um what came after the guilded age?
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Well, the progressives uh in um the United States took over.
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um people who wanted to bring about some sort of um better civil service.
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Um people who wanted to bring about some less uh less of an element of corruption.
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People who are um very interested in governing society technocratically and actually there is a more direct rhyme in which the early um progressive era uh folks in the United States uh considered themselves to be social engineers and they were also prominent eugenicists as well.
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Um and that is something that I think rhymes very slightly um with parts of the engineering state in China today.
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Um and I think that um I agree that for very large part the US has not so much needed a lot of infrastructure for quite a while that um people were able to afford a shrug with um some of its problems because um the country felt like it was relatively well built out.
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relatively well built out. But I think the longer that the United States has failed to build and I think that it has been going on decades now for the US to have not built, I think it is uh less and less of a tenable position that the
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country could get away with not building um substantial amounts of projects because right now it is really obvious that we have a housing shortage in um a lot of the richest parts of the country especially in a lot of big cities like New York, Boston, San Francisco, Los Angeles. Um when parts big parts of Los
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Um when parts big parts of Los Angeles burned down um just earlier this year, there has not been a vigorous building effort back in part because um homeowners as well as city council has blocked a lot of redevelopment efforts.
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I think the country desperately needs new housing.
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I think we need a lot uh more mass transit.
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It does not make sense that you know we are relying on subway systems that were mostly built out over a hundred years ago.
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The New York subway, which I uh take all the time, is um screechingly loud and the uh systems not work all of that well relative to other subway systems in Asia or um Europe.
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And we need to build a lot more infrastructure to say nothing of the vast solar, wind, and transmission deployment that we need to decarbonize our economy.
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And I think that it is insufficient to greet a lot of these failures with a shrug.
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And I think that I think a lot about the California highspeed rail project.
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I'm a fellow at the Hoover Institution.
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We think a lot about California highspeed rail over there.
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Where is our California highspeed rail line that was promised by referendum um in 2008 to connect Los Angeles as well as San Francisco.
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And uh right now um how many people have ridden California highspeed rail?
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The number is zero because the first stretch is supposed to be open between 2030 to 2033.
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connecting two minor points, Merced and Bakersfield.
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And so, um, you know, it is, um, the voters have actually delivered this, um, state of affairs only a shrug.
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And I find that, uh, quite odd that California highspeed rail fails. Nobody really cares.
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We have all these insane cost overruns with New York subway or a bus stop in Los Angeles or the $ 1.
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3 million toilet in San Francisco.
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People kind of greet it with a shrug and move on.
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And I say, um, that's not good enough.
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Let's be a little bit like the progressive era politicians who did try to deliver a more effective, efficient government that did try to hold government accountable to many of its promises.
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And I say, let's get back to having some ribbon cutting ceremonies once more. >> Yeah.
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Uh, the progressive sends the eugenetics, right?
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because uh the the social engineering is uh you know I I'm very difficult to uh pigeon hole politically.
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Uh I guess the closest definition would be that I'm fiercely anti- athoritarian but by the same token as I'm listening to you you sound incredibly ariodite and are making very straightforward uh suggestions that I would very much support.
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I don't know if you're familiar with the work of my friend Philip Howard.
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I'm a trustee on a board called Common Good.
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>> And Philip has been writing book after book after book about the fact that we are drowning in rules and regulations that essentially paralyze us.
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And and I think one of your terms was that, you know, America is living amid the ruins of an industrial society.
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And I I've been on the board at Common Good for more than a decade and I'm very frustrated by the fact that as compelling as Philip's arguments are, as compelling as your arguments are, we we nevertheless find ourselves in this mired in this stasis.
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Like I if if you were given the shot to, you know, go convince a mayor somewhere or a governor somewhere to to make this a campaign uh platform and actually, you know, come through and deliver on it.
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What would the advice be?
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What would what would that program look like? >> Yeah.
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Well, I think the the challenge with America is that the mayors and the governors um as best as I can tell, I've not spoken to a high number of them, um but the mayors and the governors are just as frustrated as I am that critical things that people need do not get built.
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built. Um I two weeks ago I was speaking at the abundance conference in Washington DC where there's a lot of people very motivated by these same concerns and there was u to the abundance movement's credit um big bipartisan um numbers of both Democrats as well as Republicans coming over um and many of them were local government officials who were saying that we want to build more homes, we want to build
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better mass transit and they were mostly unable to do I think the the tragedy of a lot of this um is that you know the rules are in place, the culture is in place, entrenched homeowners are in place um who are able to put their hands and you know in a thousand and one small ways frustrate the wills of the mayors as well as the governors uh in order to actually build anything. And this is why
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And this is why I am pretty deliberate in saying that the problems are of America are the problems of the lawyerly society.
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It is um the problems are you and me and everyone else who um object to some aspect of change or development that might hurt um any individual but you know they also don't uh find compelling this argument that on average over the longer run um we have greater benefits if we have some element of change.
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I absolutely want to sign on to your agenda to be against authoritarianism.
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I left an authoritarian country and um am here in the US and I'm very glad for that.
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The challenge I think is that I would say that you know it is not only an authoritarian system that is able to build pretty good mass transit.
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What I am always saying is that the US should study China um because the US should study a lot of best practices around the world but the US doesn't have to become China.
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The US doesn't have to emulate China.
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The US does not have to copy China.
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um let's only get to um European and Japanese levels of construction.
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The data coming out of Paris and Madrid and Tokyo are that these cities are able to build subway systems at about 1/8 or 1 ninth the levels of New York City.
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And arguably, you know, it is much more difficult to dig a tunnel in Paris or Madrid because there's just much more archaeology involved um in these places um than New York City.
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And so um these countries are also not really known for trampling on the rights of its people.
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So let's just get we don't have to be China levels here.
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Let's just get to Paris, Madrid, Tokyo levels of construction.
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And the other point I'll say about authoritarianism um is that you know I think one of the great tragedies of the past few months we're recording in September you know of the past eight months is that um every time I take a look at um the White House right now Donald Trump seems to be shooting admiring glances at authoritarians around the world.
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He's always talking about what a great head of hair his buddy Cining has.
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Um and I find that certainly pretty bizarre.
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But there's increasing convergence between Trump and C.
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I think that Trump and C are visiting misfortune upon the downtrodden.
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Um Trump has made now intel in stateown enterprise with American characteristics.
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There's a lack of data probity um inside the Trump administration now.
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And what we're getting right now is authoritarianism without the good stuff.
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authoritarianism without the highly functional trains that authoritarians are legendary for.
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We don't have the public order in the streets.
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We don't have the functional logistics.
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And so right now it's kind of um you know authoritarianism with a lot of bizarre characteristics.
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Um but I would wish that we had say better trains and infrastructure >> as would I. And uh I I love it.
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Authoritarianism without any of the good stuff.
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They always said, even though it was incorrect, they always said, "Well, at least Mussolini made the trains run on time, uh, which he didn't, but it was it was a great analogy."
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My personal view on this is that, you know, I often frame things as people are going either or instead of and, right?
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>> So, I'm kind of a we need both Athens and Sparta, right?
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We need open inquiry, civic flourishing, but discipline and capability.
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We need Apollo and Dionis, right?
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Form and clarity, energy and information.
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It these are enduring tensions.
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And as you note, our form of government was kind of designed to muck up the works, the separation of powers and everything else.
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What prescriptions would you offer for for getting us to the point where we don't have to be authoritarian at all?
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What what are the prescriptions that you would give to, hey, here's how we can achieve these goals and stop letting, you know, the common public areas just disintegrate into shabby uh versions of what they used to look like. Yeah.
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I mean again Grand Central that used to be like when still whenever I go into Grand Central it's a incredibly beautiful place.
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>> You look at all the Cargi libraries around the country they're gorgeous.
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what what is the catalyst to get and I think that there's a movement of foot I'm kind of part of one that that is really gunning for come on let's let's return to fixing what we got building what we need etc but what would your prescription be
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>> first I want to sign on to your idea of synthesis that um we don't have to always be be choosing or let's choose and and I strongly believe that um part of the reason I moved from China to the US was because I craved pluralism. China
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China does not have much of a measure of pluralism.
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What China has is one official voice that is meant to speak above um the register of absolutely everyone else.
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And I think that the US does embody very significant aspects of pluralism.
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Um, and I would like for there to be, frankly, a little bit more pluralism in the American state because right now it seems like the American government is made up of the lawyers, by the lawyers, and for the lawyers.
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And again, I think that it is pretty striking that the US Senate is mostly lawyers.
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Yes, we should have some lawyers among them um because they're a legislative body.
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But let's also have a few more engineers.
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Let's have a few more scientists.
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Let's have a few more dentists.
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I I I don't even mind a few more dentists um in the US Senate.
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That's totally fine with me.
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I want to have a few more economists in there as well.
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But it does not make sense to me that so much of America's um elite government class is extremely lawyerly.
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And so at a as a first cut, I would like to say let's have a few more economists and engineers within the government.
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I would like for many for fewer of the most ambitious kids who are coming out of American colleges to default to going to the Yale Law School or the Harvard Law School or any of these big law schools.
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Um, you know, there's other ways to get into public service rather than studying at very prestigious law schools.
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Um, I would like for there to be more people from Silicon Valley also entering government as well.
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And so um my um message on this is that I think that the world would be a lot better if the US could be say 20% more engineering.
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We do not need to return to the Robert Moses years.
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We do not need to be like the Chinese.
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Let's just have a little bit of reasonable reasonably priced construction things that we desperately need.
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That's that's my simple message.
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Um and I would love for China to become 50% more loyally because I think that um everyone around the world especially mainly Chinese would feel would have enjoy much more flourishing if they lived with a state that actually respected uh individual rights.
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I think that Chinese are creative. They are funny.
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Um they're marvelous in all sorts of ways and they are facing an overbearing government that is uninterested in letting them um have give full play to their own talents.
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And I think I am um slightly more optimistic about the United States than I am about um to turn more engineering than I am about China turning more lawyerly in part because I think there are various movements bubbling up.
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Um abundance uh conference in DC um two weeks ago felt dynamic had a lot of good energy people were laughing.
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Um, we contrasted ourselves with the scarcity conference which just took place in DC which otherwise known as the national conservative uh conference.
31:35
Um, but I think there are good movements.
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I think that Philip Howard is doing a really important work.
31:41
But Jim, which which movement are you um pressing to to help us get a little bit better at government?
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>> My movement, as I mentioned, I'm on the board of common good.
31:48
Uh I I lean very heavily toward the let's build uh but let's keep the rule of law, let's keep our pluralistic society.
32:01
Um, and uh, I worry with a lot of the new innovations uh, that I'm fully taking advantage of that that becomes kind of a cognitive chasm if we if we keep them in the hands of only elites, whatever country we're talking about. Okay.
32:23
Um and you know I I AI for example I think is a innovation you right at the level of Gutenberg and uh I would hate to see a centralized panopticon controlled by a few take over that incredibly important and powerful technology.
32:48
Um, one of the reasons I support open-source uh, AI, I'm not opposed to others having closed source as long as there is a continuum and as long as the open-source gives users the ability to maybe train the model on different data.
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For example, you know, the the large language models we have right now have been trained mostly on the pile, which everybody knows.
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My immediate uh thing when I hear pile, I fill in Pile of >> Yes.
33:24
>> And and one of our projects here at Oshana Ventures is to train it on some of the earlier American writings and European the can do attitude that you're advocating for.
33:35
A lot of people in this country are very unaware of the fact that as you pointed out earlier in our conversation, America was one of the greatest engineering su countries in the world for a long period of time.
33:48
And if you go back and you look at the writing of that era, not just about engineering, but about, you know, life, about all of those types of things, uh William James, for example, we're converting a lot of his non-digitized writings uh into uh digital format so that we can fine-tune models uh on it.
34:10
As long as as long as the continuum and and we're back to that, I don't want either or.
34:16
I want and I want the ability for people to um see see their great ideas through to have the ability to um allow for a plurality.
34:34
I I'm I'm very big on cognitive diversity.
34:41
>> I think some of our movements here in the country kind of went down the wrong path.
34:45
they they you know diversity by color or sexual or whatever.
34:48
Uh whereas to me cognitive diversity is is the king of what you want to be diverse in.
34:56
And and you know I advocate simple things like anytime we give an advanced STEM degree or my goodness let's say advanced degree in in any of those disciplines we should staple a green card to it.
35:11
It is bizarre to me that even with all of our dirty laundry, even with all the things that are not right in this country, people like you, some of the smartest people in the world, still want to live and work here.
35:28
And my attitude is we should let them.
35:33
And what's really interesting is I used to do a lot of media when I was in asset management and I found myself in two different green rooms during the same week.
35:42
This is about 15 or 20 years ago.
35:46
Um whenever Hillary Clinton was Secretary of State.
35:48
And so first green room I was in was Bloomberg's and there she was.
35:52
So I went over and I'd met her before and I said I have one question for you.
35:57
Like why don't we staple a green card?
36:00
And her reply to me was interesting.
36:03
It was like oh I'm I'm absolutely in favor of that.
36:05
And then a week later, I'm in a green room at CNBC and the speaker of the house is there, Paul Johnson, I believe it was at the time, asked him exactly the same question.
36:18
He goes, "Oh, I'm entirely in favor of it."
36:20
And it just made kind of my blood boil.
36:25
You know, you know, the the the yesing is not the doing. Mhm.
36:31
>> And so I do believe that there are a lot of pretty simple things that maybe a majority of people in this country would say, "Yeah, that's probably a good idea."
36:41
That just are getting killed dead in their tracks for reasons that are either lawyerally or in some way try nimi trying to prevent or trying to retain you. No, this is mine.
36:54
you you you like Rockefeller, you can't build that that uh highway through my property.
37:02
And it frustrates me that I've been at this and supporting these kinds of uh initiatives for a long time and you know, they creep along at a petty pace. >> Yeah.
37:16
Well, I think the this is I think you put your finger on one of my core frustrations that I've realized um over the last uh few months really, which is that the you know, when I wanted to get pluralism and debate uh in the United States, uh let me tell you, I I got in in spades, Jim.
37:35
I think that the um boy did I get all of the debate that I want.
37:40
And all of this is um important and it makes me optimistic that the conversations that I'm part of as a result of this book right now, as a result of being um tied up with some of the abundance folks, as a result of being at the Hoover Institution, there is tremendous energy and debate in trying to improve the country and um make it much better.
38:04
And that that that is all really good.
38:06
But the the problem is that America has this perpetual ineffectualness um that is unable really to do the sort of things that pretty much everyone wants, right?
38:17
Hillary Clinton uh was a Democrat or is a Democrat and um former speaker of the house Paul Ryan was a Republican.
38:28
>> Paul Ryan, yeah, got his name wrong.
38:28
If Democrats and Republicans agree on you know stapling a green card to a diploma, um I think that um you know you know if anything we are further away from that paradigm because um the present administration is not um very thrilled about that sort of idea.
38:48
And you know, this is also one of these things where I'm thinking about something like um the defense industrial complex.
38:56
Let's say they um US shipped a lot of munitions to um Ukraine in its self-defense against Russia, rightfully so.
39:06
But the US hasn't been able to rebuild a lot of its stockpiles because it can't get production up.
39:12
Um it hasn't been able to build a lot of drones.
39:15
Um, every class of US naval ships has been behind schedule for 18 months to 5 years according to the government accountability office.
39:23
And you know, these are only critical national security goods that our defense industrial base is unable to produce in sufficient quantity.
39:31
And so, you know, this is this is what I'm always very puzzled by in America.
39:36
lot of good energy, a lot of good debate, but you know there's a thousand and1 you know little tugs that help to dissipate the energy of a movement such that nobody ever feels like they have the ability or the power to get anything done.
39:53
Um because anytime you want to do something there just so many checklists that you have to go through um in order to prepare yourself for a future lawsuit.
40:06
And I think this is the um sort of thing that I would really like for the US to get a lot better at to actually do the things that it wants to do. Yeah.
40:14
My Spidey sense is telling me that we're probably in the beginning innings of a uh I guess you could call it battle uh of elites themselves.
40:29
uh and and I sort of just for fun uh say that on the one hand there's the rebel alliance which I tend to identify with and then there's the death star and and the death star is very lawyerly.
40:46
Uh it has a million ways to stop you in your tracks.
40:51
uh it is in my opinion pessimistic in its very nature and it is I don't want to get too dramatic here but stasis is death in my opinion movement is life and to to be on the side of stasis and and mcking up the gears just seems to me to be incredibly misguided.
41:15
be incredibly misguided. I always try to take any argument that I'm like really opposed to and large language models have been very helpful here create a steelman uh that supports that argument and I must say like you know that it's very helpful in coming up with uh all
41:37
sort things I might have missed but I mean does that resonate with you this sort of there is this fight that is going on right now maybe early innings But like where this group of elites in what I call the Rebel Alliance is like, "Okay, negotiations are pretty much over. What we're we might be fighting for, you
41:58
What we're we might be fighting for, you know, kind of the ultimate control here."
42:03
Does that resonate with you at all? >> Yeah.
42:06
I mean, the first image that you're introducing to me is let's take a look at the Yale Law School alumni list and see if Darth Vader is among them. Quite possibly. Yes. Huh.
42:17
I would love for I think that the challenge with um with the Rebel movement with the Rebel Alliance movement is that the challenge is that I think that the you know maybe that Death Star is kind of the right image because it is really difficult for even some
42:35
really motivated rebels to you take many swipes at this Death Star because it's just so big and it's just so entrenched and there are still a million ways for, you know, entrenched homeowners to put up their hands and say, um, um, no way. So, I think fundamentally, uh, what we
42:51
So, I think fundamentally, uh, what we have in the United States is a culture where people feel like there is enough of a degrowth, anti-development mindset as well as a not in my backyard mindset that, you know, many people would like to have more homeless shelters.
43:08
Um but nobody wants to have the homeless shelter in their neighborhood or in their street or in their district.
43:14
Um and so I think so long as that attitude of being against development is there so long as the um you know it is it is true that America is very bad at building a lot of things and people don't want to put up with the scaffolding and the noise and the extensive construction that is involved in lengthy construction processes in part because lawyers make it so.
43:38
Um, and so long as um, homeowners really do have access to lawyers to block whatever they don't like, whether that is um, you know, a a highway through um, a Rockefeller property or something like, you know, wind turbines off the coast of Nantucket, so long as people have access to these sort of things, I think, uh, the odds are are are are stacked against the rebel alliance, but then they always will be.
44:06
Um, so I think that the the rebels should not lose heart and should still try to figure out um how to how to get the get stuff done in the way that's because we need a lot of these things.
44:18
>> So my thesis is you know the Soviet Union looked like a big bad death star too >> and it looked like there was no way you could ever ever dislodge their control over Eastern Europe over society etc.
44:34
But if you looked at the underlying structure of what built, what the edifice was built upon, it was beginning to rot, terminally rot, uh, in the kind of the mid 1980s.
44:48
And and maybe it's just that I and I in no way want to be Pang Glossian, but I think we're seeing some rot in the Death Star right now and at least some hesitancy and as an example there, I would say that there are these growing abundance conferences.
45:10
There are these much less consequential but important symbolically.
45:16
I don't know if you're following uh the fellow who is building statues again. Um and >> a little bit. Yes. >> Yeah.
45:25
So I think we we might have contributed well we did we did contribute to to one of his efforts.
45:30
Um and that's at least in in my experience I'm seeing a lot of activity on the ground that was really absent uh say 10 or 15 years ago.
45:44
Um and and I it's it's always uh tempting to try to simplify and say yeah then if we get this this and this that will happen and I don't want to do that because I think this is an ongoing thing as you note as long as homeowners are nimi and they say yeah no way my next question would be then okay let's assume let's stipulate they're not going to change all are not going to change.
46:16
What is what procedural what lawyerly way could you make that change where they couldn't block it? >> Yeah.
46:28
Well, I think that is a um a good question and I think this is where things get sort of thorny because um event it often involves doing things like removing a rich person standing to sue and I think that is something that plenty of rich people have objections over.
46:49
>> I I might object to that one. >> Yes. Yes, indeed.
46:52
Um I think you know the way the way that I think the the thing to always keep in mind is that it is impossible to build almost anything without upsetting someone.
47:01
without upsetting someone. There are homeowners um who have objected to an expansion of the UC Berkeley building up a um an a dormatory and they used environmental laws to say UC Berkeley did not sufficiently study the idea of students constituting noise pollution as such and you know to use environmental laws to block something like that feels
47:25
quite perverse to me and so I would like to see um some changes in the law um I would like to see some changes in the culture where people recognize that, you know, we need some important pieces of infrastructure and there's no way to build anything without upsetting someone, some little person who objects to his or her light um being slightly reduced or noise being slightly increased. And I think there has to be
47:49
And I think there has to be some way to remove the ability of people to continuously tie up projects in court.
47:59
So if we take a look at some other democratic countries like Canada as well as Japan um there are authorities that have stepped in to say okay maybe have one round of objections possible to block this project but then after that you can't keep tying up a transit project and lawsuits.
48:15
Um a lot of the environmental determinations uh in Japan are made by the Ministry of Environmental Protection once it's made its determination by mostly bureaucrats who listen to public input.
48:26
their decisions cannot be challenged afterwards in court.
48:30
And so I mean I it is um a difficult going to be a difficult pill to swallow to remove people's ability to sue, but I think there has to be some statute of limitations to prevent um rich people from tying things up um endlessly in lawsuit.
48:47
And I think there has to be a little bit more recognition that uh infrastructure, homes is a little bit more essential.
48:55
And so I would like for there to be more cultural change as well.
48:58
And the way that some American states have done this was that is that it has elevated um planning authorities beyond the local city level which tends to be dominated by nimbies.
49:07
It is elevated that more to the state level which is um a little bit more development friendly because states need tax revenues and cities want to keep um their own neighborhoods unchanging.
49:18
And so there's various ways to tweak some of these, but I think um there's no way to do everything that we need to do through the status quo.
49:30
>> You said something that uh reminded me of a thesis that I've been exploring which is very simple.
49:35
Everything is downstream of culture.
49:37
And so if that thesis is correct, and I'm not asserting that it is 100% correct, but if that thesis is correct, then you would want to be operating at the cultural level, at least in as one of your your attack vectors.
49:56
Um, and again back to my buddy Philip Howard, he uh suggested that one way around this, a very lawyerly uh suggestion by the way because Philip himself is a lawyer um was what why don't we experiment with uh specialized courts and the argument that I discussed with him was medical courts you know because we also have a big problem of people suing doctors and care providers.
50:27
endlessly which adds to the uh malpractice premiums and it just it's people forget that things can compound negatively too.
50:38
>> But then also maybe uh establish that type of court for building projects for like you mentioned in Japan there's that final authority and once they have ruled that's it you're done you you move on.
50:55
What kind of effort do you think would it take at the if if we were if we were agreeing that at least for the sake of this argument that we would be better off trying to impact the ability to get those things at the cultural level? What would you advocate?
51:16
I think there would be some sort of um a program to know really give people a sense that um there should be more homes.
51:30
I think that that that is an obvious one.
51:33
And what are the benefits of having new homes?
51:38
That's part of the problem of America right now are, you know, concentrated benefits and diffused costs or concentrated costs and diffused benefits.
51:47
Uh, in which, um, homeowners don't really appreciate that, oh, if we have a few new homes, they see a lot of temporary costs, namely noise, construction, new sewage lines, and all that rest.
51:59
But they don't necessarily appreciate how their communities could get a lot better if it were not frozen in ember.
52:06
that development to some extent feels good.
52:09
Having new transit options feels good.
52:11
Having new parks and having a more robust tax base in your community um also feels good in all sorts of important ways.
52:18
And so I think there has to be an element of persuasion um going on in order to try to convince people that development is good.
52:27
And then you should um hopefully expect a a bit of a flywheel uh um impact to kick in in which people and you do see these in certain communities in the US which do grow um places especially like American South, Texas where people do feel good about um you know new construction around them and new neighbors and new life around them and revitalizations of their communities that they haven't seen before.
52:56
And so I think that the the important part of culture to transform is to um make people be a little bit more pro- um people.
53:08
Again, that's that's is how I would put it.
53:10
I've been um I spend most of my time living in Ann Arbor.
53:12
Um my wife is a professor at the University of Michigan and Ann Arbor for a while was has been a pretty nimi town.
53:19
It's pretty anti-development held up by a lot of aging hippies who want nothing to change.
53:27
And you know, I like this um little slogan that I've seen at least over there.
53:31
I'm not sure if it is wider than Ann Arbor, but neighbors for more neighbors.
53:36
You know, I think that is a very positive um message that is um inspires people about some level of development that neighborhoods aren't simply aging um and that there is a little bit more new life.
53:48
That's the sort of messaging that I would like to see.
53:52
>> You know, Oshani Ventures gives fellowships and grants uh to people who we think are doing and working on interesting things.
53:58
And this year we gave one uh to a person who's doing exactly what we're describing here, but in Japan, uh they are going in and they are taking dilapidated housing and rebuilding it, reimagining it, making it more beautiful.
54:15
and sort of the effort there is kind of exactly what you were just suggesting.
54:21
I I'm I'm more actionoriented in terms of like I think if I could find somebody here in the United States who submitted a very similar application as the one that we got from Japan, I would fund that.
54:36
And and and I think that the you've got to you you know Jung has that great line, you are not what you say, you are what you do.
54:48
And that we can talk talk talk about things endlessly, but if you if nothing's happening, if no actions are taken, if you don't have that new housing built, if you don't, right, it's just that actually probably leads to more despair, like gh like, oh my god, we can yap yap yap yap yap, but if we don't take real action, nothing's going to ever change.
55:16
And I wonder whether a project I wonder if you could get a project through more at the state level or even the local level where it's outside of government where you take philanthropists and you get together a fund and that fund uh works with the mayor or the governor or whatever to do more building to put up the housing for the homeless that you were talking about.
55:44
Um, I is that destined too to get lawyered out of the way?
55:51
>> Well, uh, I'm afraid so. I'm afraid so, Jim.
55:53
The lawyers are going to gum it up once more.
55:55
And I think what we will need is for the lawyers themselves to shift in character.
56:00
I mean, the first and most important thing is that I think um, for a lot of listeners of this podcast right now, Jim has already declared what sort of fellow he would like to have solicit him.
56:11
So, um, you know, we know it will get funded everyone.
56:13
So, um, send send in your pitches.
56:15
Um, and I think what I would like to see is a culture cultural shift not just within the broader American public, but also a cultural shift within the lawyers themselves.
56:25
Um, you know, 100 years ago, uh, Jim, a lot of the lawyers uh were, you know, Wall Street types, they were dealmaker types.
56:35
Um, they were working on behalf of some of the robber barons were building their railways.
56:39
They were raising bonds for the robber barons and they were using eminent domain to turf homeowners out of their land.
56:45
That's some of that is negative but um that was a lot of what the lawyers were doing and even throughout the second world war um Franklin D.
56:54
Roosevelt stacked his cabinet with lawyers and lawyers were the people who carried out many parts of the New Deal as well.
57:00
But that was in part because lawyers used to be creative dealmaking types.
57:05
And right now what we have is a remnant of the 1960s in which lawyers um followed the lead of someone like Ralph Nater who um I think is responsible for a substantial part of the lawyerly society in which lawyers for excellent excellent reasons decided to turn against development because Robert Moses have been ramming highways through their neighborhoods.
57:29
People were exhausted about the technocrats in charge of the Vietnam War.
57:33
Um, people were upset with the Department of Agriculture spraying DDT as well as pesticides throughout the entire country.
57:41
And then the lawyers decided to shift away from being dealmakers into more regulators as well as litigators.
57:49
And that was exactly what the United States needed in the 1960s to confront the problems then.
57:54
But I think we in the 2020s are confronting a new set of problems such that we don't have to be still so obsessed with all of the problems of the 1960s.
58:03
We don't need to keep fixing um all of these old problems that have pretty substantially been fixed.
58:10
And I think what we need is for you know I think America will always be a lawyerly society as it has been since its very founding as I as I established.
58:19
But we can maybe get the public to demand new things.
58:20
And we can maybe hope that the um elite law schools like Yale and Harvard and Chicago and whatever that will start training people to recognize that the law has gotten in the way of a lot of things that people desperately need.
58:35
And maybe the law can be um jiu-jitsu in a way to um uh shift in order to deliver things rather than purely abstract things.
58:45
And that's a wonderful point in that the pendulum always is swinging and it often swings too far.
58:54
I think by the way that you are absolutely right that back in the 60s our rivers were horribly polluted.
59:04
Our air was horribly polluted and those changes were necessary at that time.
59:11
But then to get that mental framework institutionalized, right?
59:19
And it it's one of the reasons why another thing that I support where I got the idea uh from the common good folks was, you know, why don't we just build sunsets into every regulation and law >> that we promulgate, right? A 10-year sunset.
59:35
It doesn't mean they can't renew that law.
59:38
It just means that unless there's a huge effort made to renew that law, it sunsets out of existence, right?
59:47
Because we you you can't and and I see this very much in business as well, right?
59:54
Like we have a publishing company and I I I owe a lot of my success to publishing bora books with the traditional publishers.
1:00:02
I think they're great at what they do, but I think that a lot of their uh procedures and processes and everything else are stuck in best practices circa 1925 as opposed to 2025.
1:00:18
And I saw an arbitrage opportunity there, right?
1:00:20
like, well, if if they're not going to change, I can start a publishing company that uses all these new technologies and innovations that writers are going to love.
1:00:32
The company's run by writers, right?
1:00:34
My CEO, Jimmy Sony, is a well-known author, >> excellent author indeed, >> and an advocate for the authors.
1:00:41
Um, and and it seems to me that this isn't just a problem at the governmental level.
1:00:49
By that I mean that you have these entrenched systems everywhere and and they're getting old and they're getting long in the tooth.
1:01:01
And you know, my view is at least on the business side, market forces are a hell of a drug.
1:01:08
And like if you don't like the way that uh the traditionalists are doing it in this country, you can start your own company and take your chances.
1:01:20
Now 90% of startups fail, but uh I'm okay with those odds.
1:01:26
I is there is there any way to bring that to the far less innovative governmental structure?
1:01:40
Yeah, I would like to hope so.
1:01:40
But then um now we are really waiting into the den of lawyers.
1:01:46
Um the that that it is really this is where lawyers really rule.
1:01:51
rule. and and I have been a fan of various initiatives um run by folks like Jen Pula of the US digital service um which has um you know been for better or for worse taken over by Elon Musk's Doge um and you know for the most part I
1:02:11
would say that you can point to some successes here and there but for the most part um you know the US digital service as well as Doge have not been able to really cut down the thicket of rules that are really um you know governing a lot of these crucial
1:02:28
processes that um startups and businesses are uh should be afraid very rationally to to not get wrong otherwise you will have broken laws and you don't you don't want to do that and so we have to fix our laws we have to you know
1:02:46
apply you know some degree of you know um regulatory reform form that isn't quite like Doge um which was just so much focused on government headcount as if headcount was the greatest expenditure of the US government which it is not. It is mostly defense and
1:03:00
It is mostly defense and entitlements.
1:03:02
entitlements. Um but I think that you know there there there could be a more vigorous effort here and so far we have not yet seen the super vigorous effort that is really cutting down the thicket of rules that really helps um lawyers uh
1:03:19
you know half have half their meal right now I feel like you know everything is a is a full employment for lawyers program um and um you know the the lawyers are very busy having their fill suing each other and this is Um, I think we need we can do better. We can do better than
1:03:34
We can do better than this.
1:03:36
>> I once had an idea for a predator agency and the predator agency got derived its budget from finding all of the antiquated regulations, all of the uh misguided laws that were no longer useful, etc.
1:03:53
Uh, and closing them down.
1:03:57
And then when it had done as much of that as it possibly could have, it itself would die because its budget was derived from finding those inefficiencies.
1:04:08
I guess that will probably work better in fiction than in non-fiction.
1:04:15
Um, but you know, we spent a lot of time in America and our problems.
1:04:17
Let's let's turn to China for a minute.
1:04:22
You know, right before I signed on to have this wonderful conversation with you, I saw the news that China had banned their tech companies from buying Nvidia chips.
1:04:32
And I also was kind of enthralled by your um your very cinematic uh presentation of uh you know zero COVID and what happened at um Disneyland um in China and and then to that we have this diaspora of the creatives and people and you you you I think of as a very brilliant creative.
1:05:01
you're here, you're not there.
1:05:04
And that, you know, watch people vote with their feet, right?
1:05:10
And and what could China do to make super creative, dynamic people like you stay there or want to go there? >> Yeah.
1:05:24
Well, my story is that um my parents and I immigrated um to Canada when I was uh little.
1:05:31
Um I mostly grew up in Ottawa.
1:05:34
And uh you don't have any Canadian in you, do you, Jim?
1:05:39
>> I had a 25 year relationship with the Royal Bank of Canada.
1:05:42
I managed the Oshanosy funds up there for them.
1:05:44
I've been in every province of Canada.
1:05:48
And when I was giving one speech, a fellow came up to me afterwards and said, "How long have you been an expat?"
1:05:56
And I went, "I'm I'm sorry."
1:05:57
And and he goes, "You're you're Canadian, right?"
1:06:00
I went, "No, actually, I'm an American."
1:06:05
>> And they hate it when you call yourself an American in Canada.
1:06:07
They want to say they want you to say, "I'm from the United States because they're part of America, too."
1:06:13
Anyway, I said, "Yeah, no. I'm an American."
1:06:15
And he goes, "No, no, no, you're not. I am. Honestly, I am.
1:06:21
And he goes, "Where did you grow up?" And I said, "Minnesota."
1:06:23
And he relaxed and he goes, "Oh, that's a nice Canadian province." >> Indeed.
1:06:30
Indeed, that is that's what we consider the deep south.
1:06:33
Um, but um that is uh that that I I do hear that when the way that you say process and a few other words, it sounds quite Canadian to me.
1:06:43
Um, so we left uh for Canada and where I mostly grew up in Ottawa and um I decided to return to um China as an adult when I was um around the age of 25 to study technology. M33 now.
1:06:57
And it is um one of these pretty striking things that you know China calls itself to be you know enacting the great rejuvenation of the Chinese ethnostate and I think there are so many Chinese who are willing to depart from the great rejuvenation that is undertaken in their name.
1:07:21
I think about let's say three categories of people.
1:07:26
There's plenty of rich people.
1:07:28
There's an estimate out there by some um consulting firms that in 2023 and 2024 something like more than 15,000 um Chinese billionaires have taken themselves out of the country and moved to places like Japan, Singapore, the UK, the US, Canada, wherever else.
1:07:42
A lot of creative types um are smoking dope in Thailand or they're moving to um New York.
1:07:50
Um there's a big feminist standup comedy show in um New York City uh in Mandarin.
1:07:56
Mandarin. um that takes place once a month and I've been privileged to you know hear uh some of these um people who are who are doing their bits um over in these places and um there's also um plenty of people who are not so wealthy
1:08:11
who are not so um educated who um have decided to show up on the US Mexican border uh in the southwest by flying to Ecuador where they don't need a visa from China and then walking across the gap to try to cross over into the United States. Between 2023 and 2024, the US
1:08:27
Between 2023 and 2024, the US Customs and Border Patrol were apprehending something like um up to 40,000 people at its peak of Chinese nationals trying to cross into the border.
1:08:40
And I think, you know, there's a story out there in which a lot of Chinese have wanted to move out of China forever.
1:08:46
There's a long story of the diaspora and immigration and expats among them.
1:08:51
But I think, you know, at a first approximation, it gives me a little bit less confidence that China will be the great power it aspires to when so many people, rich, educated, not so rich and not so educated, um, all want to depart.
1:09:05
And I think this really has to do with a lot of the uh, sins of the engineering state.
1:09:12
they have really smashed a lot of companies um especially those in um internet platforms that sin ping does not really value things in e-commerce um companies working in online education um a lot of rich people in uh China feel pretty precarious if you're an elite in Beijing maybe you're working in the financial industry well last year China announced that it was going to have a $400,000 uh pay uh ceiling on anyone working in finance.
1:09:46
Um and maybe you're working in the in the um e-commerce or online uh internet industry and um maybe you were working in industry that the public bureau decided to strangle and even if you're in an an elite inside the party or the military, you never really know when your patron might be ins snared in some sort of a corruption scandal in which case his entire network uh would unravel and collapse.
1:10:10
So there's something pretty precarious about living in these authoritarian regimes.
1:10:15
Um this is I think pretty endemic to authoritarian regimes.
1:10:20
They're not going to really be able to fix these sort of problems.
1:10:23
Um they are still delivering um some degree of wealth creation.
1:10:26
They are creating more and more exciting technology companies, but they are also becoming u more restrictive on all sorts of cultural production.
1:10:36
And so I wonder um to the extent to which China really could succeed fully to be a great power if it is so restricted.
1:10:43
Maybe it isn't for China to figure out advanced manufacturing which will um create more worldleading companies and de-industrialize other parts of the United States.
1:10:54
But um I think that what I would really love is for China to become a little bit more loyerly and or a lot more lawyerly and actually respect the individual flourishing of its own people. Yeah.
1:11:08
And and I think back to Deng's opening up uh markets and am I correct in assuming that a lot of the China we see today was really a result of Deng's uh reforms and and then of course I vividly remember watching Tianaan Square etc.
1:11:31
Like we we talked earlier about you know Apollo and Dianisis, Athens and Sparta.
1:11:38
Is is there some limiting factor that just closes down I mean the tension right because like I think of South Korea for example they used to be a very authoritative country um and then uh they opened up the economy uh that created a vibrant large
1:12:00
middle class and away went the for the most part I'm not speaking in absolutes here uh but the the the worst excesses of South Korea's authoritarian government and and I kind of was seeing and hoping that that was what was happening when Deg was opening up China as well. Are are we doomed to like
1:12:22
Are are we doomed to like is let me rephrase this as a question.
1:12:33
If I made you bet and we were going to do a bet and I'll take the other side of the bet, >> who are we going to bet can change and and move toward move the pendulum back a little?
1:12:44
Is it is it the engineering state of China as it is currently comprised or is it America? >> I bet on America.
1:12:53
Uh I think that um I am here and I am um prefer to be in a pluralistic world.
1:13:01
I and I think what America has it's its own heritage to draw on um with respect to having been a former engineering state because it's certainly built and built and built and built and overbuilt.
1:13:16
Um and I think that there is robust debate.
1:13:19
there are movements um that are trying to get America back on track again.
1:13:23
And I think the reason that I think that uh the engineering state of China will not substantially change a much more friendly direction is that China doesn't so much have a lawyerly tradition to draw.
1:13:38
China has never had that many lawyers in the first place.
1:13:40
It has, you know, I think about the sort of absolutism that the Chinese emperors practiced um way before European monarchs chanced upon this term absolutism the Chinese emperors had been practicing.
1:13:55
I think it is not much of an exaggeration to say that there's been a minimal liberal tradition emerging out of China.
1:14:02
Um, and there's no liberal tradition really defending the rights of individuals or corporations or families against the predations of the state mostly because the state uh created an intelligencia by administering an exam to um all of the aspirants in the court and you don't get very far in court um by advocating for constraints on the power of the emperor.
1:14:29
And so given that there wasn't so much of this liberal tradition in China, it has less of this tradition to draw on um whereas the US does have this tradition, does have the pluralism, it does have the energy and movement to try to um get to this stage.
1:14:44
And what I want to say is that let's get to that stage of development where the US is able to build and meet the needs of its citizens because it is not entirely wrong for the Chinese Communist Party to say that they have in some ways met the expectations of the citizens better than the Americans have.
1:15:02
That they have um delivered much more compelling income growth, um physical dynamism and all sorts of these material ways that people do value.
1:15:11
um delivered greater public order in the streets.
1:15:13
When they um point over to the United States and say, "Look at what um a lot of buffoonery has going on um inside at Washington DC."
1:15:20
They're not fully wrong about stuff like that.
1:15:26
And so what I would love to see is for the US to stop the buffoonery, um get a little bit more serious about delivering for the needs of its people uh and then prove that it is the United States that has the much better system than China. Yeah. Well, I like you.
1:15:41
I said I'd take the other side of the bet, but I'm going to have to hedge because I I would never short the United States of America.
1:15:51
>> Uh and primarily because of all the things that we've been discussing.
1:15:55
Um you know, I just a simple thing occurred to me.
1:16:00
What are the chances that this podcast, our conversation could be broadcast in China unedited?
1:16:11
Well, I actually wonder how Chinese uh are able to sign on to foreign platforms if they're, you know, they're blocked from watching YouTube.
1:16:20
They're blocked from many aspects of um podcast that's hosted by Apple podcasts.
1:16:25
Um so I um depending on your means of distribution um if you if you have a means of distribution in which Chinese people can access I'm not sure if the state listens in on every podcast conversation that would be too many Jim that would be insane.
1:16:44
Um you know >> but we now have we have AI that can listen to all of them. >> Yes perhaps.
1:16:52
So the AI makes a lot of mistakes.
1:16:54
I I cannot imagine a lot of sensors in Beijing listening to every aspect, every element of these 5-hour long Joe Rogan conversations. Um, they would go nuts.
1:17:04
Um, so I think it is not a it is not a minimal chance that people in China might might well stumble on this conversation and might well enjoy it.
1:17:16
>> Yeah, >> maybe they'll stumble on it.
1:17:16
I don't know if they'll enjoy it, but uh, you know, hope is always hope is always present. Hope springs eternal.
1:17:22
Before entering asset management, I had had a frustrated hobby of fictional treatments.
1:17:28
I'm actually right now writing my first fictional book uh which is really hard.
1:17:33
Um yes, >> but um one of one of the uh fictional treatments that I uh did during my the Paleolithic era of the early 1980s was it was a thriller.
1:17:48
And uh the basic plot was that it was American policy to try to keep China communist because if they ever embraced pluralism and open markets, they would bury us. >> Yes, >> possible. Indeed.
1:18:11
I think that China's Chinese society is really really strong.
1:18:13
It is really being strangled by a Leninist system.
1:18:18
And I I hope that more Chinese people could just be left alone by the engineers for a little bit.
1:18:25
>> You would rock and roll because I I like to joke u my CFO and my PA are both Chinese and and and I'm like my entire life is ruled by two Chinese women.
1:18:41
No, >> but they they they do such a good job that I'm not complaining. >> Yeah. >> What do you think?
1:18:49
I had a thought as I was reading your stuff and and getting ready for this that like the kind of the pattern, the primitive pattern like America started as an idea, right?
1:18:58
China started with dynasties >> and and with that command and control structure just right there as you yourself mentioned a moment ago the whole idea of the absolute rights of monarchs that's a Chinese concept like are are we trying to fight you know the the base pattern of cultural DNA if we are hoping for a more liberal or pluralistic China.
1:19:28
Um, another reason, by the way, I I I won't uh pull my punch, uh, that I think America probably has a better shot of adding a little more of the engineering, what we used to do quite well, than China becoming pluralistic and adding a little more of the lawyerly. Mhm. >> Yeah.
1:19:50
I think that I am I I am a little bit reluctant to say that the cultural DNA must be immutable because um you're right that China started as a with a natural conception of language, heritage, race, and um political traditions and ideological traditions.
1:20:16
But so then did most countries in Europe.
1:20:18
Um they have their own conceptions of um you know this is uh this is what the French are.
1:20:25
This is what the British are.
1:20:27
Germans are a little bit more complicated but this is what the Italians are.
1:20:30
Um and uh I think that you know all of these European countries have to some extent um moderated their you know their essentialist impulses to become quite uh you know liberal democracies in in much better ways.
1:20:49
And you're right that the US is has a more fundamental ideology of a nation.
1:20:56
It's not so much defined by uh race necessarily or language.
1:20:59
Although if we ask some people like JDBS today, they they would like for America to be more defined by by race and heritage.
1:21:06
Um but I think that I as the Europeans um have been able to transition out of this to some extent perhaps the Japanese and the Koreans have also transitioned out of this mindset.
1:21:20
Um, hope springs eternal that over not years but decades that China could also have this sort of a ship.
1:21:31
>> Um, back to America for a minute.
1:21:31
Can you give us one historical American builder archetype by name who we've forgotten about and like maybe should remember that person?
1:21:48
I offer the name of Hyman Brickover, the former US um naval admiral, also known as father of the nuclear navy.
1:21:56
Um he is someone who's not much discussed um if at all today but he Rick overach achieved this amazing feat of turning all American um naval submarines into being nuclearpowered and by turning it into nuclearpowered submarines rather than diesel-powered submarines it makes the submarines much more quiet um and more importantly able to stay underwater um essentially at this point now for the duration of the submarine's lifetime.
1:22:29
They do not need to be refueled for um many many years and that is an astounding feat of engineering.
1:22:38
Um Rick Over had all sorts of problems, personality problems.
1:22:41
He made a lot of people very mad.
1:22:44
But I still feel like there's a lost opportunity for Elon Musk to um start Doge and take a pair of shears uh into the US government rather than building incredible feats of engineering inside the government.
1:23:04
um Elon Musk um to the extent that he was co-president um really try to take down a lot of crucial functions of the US government such that I think it has become much less effective uh for the FDA to lose a lot of staff such that it is no longer able to approve a lot of critical life-saving drugs and so um I wish that Elon Musk could have devoted his considerable talents into building inside government as Ricker has.
1:23:31
Musk aside, are there other candidates uh that uh are living today who who could uh assume a kind of a Rickover role?
1:23:44
>> Well, I wonder a lot of the VCs are much more interested in tweeting than governing.
1:23:51
I for we're taking a look if we're taking a look around the table of the um you know Silicon Valley folks who recently dined with um Donald Trump inside the White House.
1:24:03
I think that it is a little bit difficult or to imagine that these Silicon Valley titans, folks who are running Meta or Alphabet or Microsoft or whatever else um to really uh Nvidia to step away from their lucrative purchase uh in running very big powerful companies to be relatively powerless member of the bureaucracy to um do um god knows what inside the government.
1:24:36
I think this is one of these other big problems of the lawyerly society that it becomes really difficult for talented people to imagine themselves be doing a lot inside the government because it is so difficult and it is so thankless.
1:24:50
Um and so that is also something I would like to change that we should increase the prestige of working within the government.
1:24:56
Um pay civil servants a lot better rather than trying to cut their jobs as Musk has.
1:25:00
um and uh try to draw in some really ambitious people back into the government once more.
1:25:09
>> Well, and that's the old that there's all sorts of shading that you need to do, right?
1:25:15
Because back in kind of America's golden era, if you will, when we were still building and still doing all that, uh we had a Wasp culture, white Anglo-Saxon Protestant culture, and part of that culture was you've got to give back.
1:25:31
And so you saw a lot of incredibly prominent people who had made their careers in business and uh other endeavors go into government because they felt you know we we it's it's our turn now to give back.
1:25:46
And I and I wonder so maybe not Silicon Valley but how about coming over to this coast?
1:25:52
Is there anyone uh that you could name or group that you could name who might be able to to to do that to go into government and and actually make it function better, engineer it better?
1:26:13
>> Well, uh I am pro-abundance movement and I am pro- common good movement.
1:26:16
Um and uh you know maybe maybe the people holding the answers can be found in these um in these movements.
1:26:24
Uh maybe maybe Philip Howard, maybe we can enlist him and and a lawyer who knows about the sins of the lawyerly society. What do you think?
1:26:34
Maybe we can put in an ask and see if uh if Philip can run the government for a little while.
1:26:39
>> I will put in the ask.
1:26:39
Uh because the thing I love about that it's like uh uh I think it was Douglas Adams.
1:26:46
Anyone who aspires to be the president of the United States should in no circumstance be allowed to be be the president.
1:26:53
Uh Philip does not aspire. >> Yeah.
1:26:59
>> So So I think he definitely would. >> He's qualified. >> Yeah, he's qualified.
1:27:02
He's definitely qualified.
1:27:05
What we're winding down here.
1:27:08
This has been so much fun talking to you about uh all of this.
1:27:10
What's your most uncertain forecast about China?
1:27:17
I think that there is always a question of what is going on inside the political system inside the bureaucracy.
1:27:26
I mean I think the one of the challenges of doing a lot of China analysis over the last couple of years really comes down to a single person.
1:27:37
What is going on in the mind of Cigin Ping?
1:27:38
mind of Cigin Ping? And it is kind of an unintellectual question because nobody will ever know and Xiinping won't tell me and he won't tell really anyone and there's plenty of you know even if you're inside the highest echelon of the communist party the standing committee
1:27:56
of the polit bureau there's seven men who are in this committee and they very rarely know what's going on in C's mind and they don't know what other people are thinking about either as well and so I think there's um there's profound uncertainty about what she might be doing next. Usually, I would say that
1:28:14
Usually, I would say that his character is generally pretty cautious.
1:28:18
He is not about to start a confilration over Taiwan.
1:28:21
That's not one of the things that really keeps me up at night in a big way.
1:28:25
He does not seem to be appear to be super confrontational at least right now with Citin Ping.
1:28:30
But so much of it comes down to what she is thinking and that is relatively difficult to predict.
1:28:38
Um and you know the course of the economy, the course of politics, the course of diplomacy, of geopolitics, a lot of it rides on understanding him.
1:28:48
And so that um that that man of mystery is the person that um is the greatest source of uncertainty for most things in China.
1:28:57
>> Yeah, I I think that um when you get it down to a single person, you got trouble.
1:29:03
uh if uh a single person can affect the outcome of such a vast and storied country whatever the country by the way let's not just pick on China >> that is that is not an optimal situation >> well so one last speculation before I I give you our final question that we give all our guests um and and I say speculation intentionally I'm not asking you to make forecast.
1:29:33
I'm I'm asking you to speculate.
1:29:35
Uh America and China are both in a state of becoming, right?
1:29:38
Um and and which way do you see each tilting?
1:29:44
And let's not put it into the way future.
1:29:49
Let's let's put it to 2035.
1:29:54
>> Uh give speculate for me.
1:29:57
>> America 2035, China 2035.
1:30:02
Well, um I expect that China will have still a fairly dysfunctional economy, fairly dysfunctional economic uh system as well as a fairly dysfunctional political system.
1:30:20
Um I don't think that she will be around.
1:30:23
Um she right now is aged 72.
1:30:29
in 10 more years uh he would be old enough to qualify to run for US president.
1:30:35
>> Um so but um I I I hope very much that he is not still running China um at that point um and though China is um will be economically dysfunctional and um politically dysfunctional.
1:30:47
I expect that China will continue gaining strength to strengthen a lot of advanced manufacturing.
1:30:54
Um, right now I think that China is already making some of the best manufactured products in the world and I do strongly believe now that made in China is a mark of quality in much a way that made in Japan um has become a mark of quality as well.
1:31:09
Um I'm hopeful that um the United States can get through the turmoil of the next few years that um as voters react to uh current events, they uh deliver punishment to the ruling party as they tend to do um just naturally uh throughout midterm cycles as well as presidential cycles.
1:31:36
And I um I'm hopeful that we get to a better place where there are not super strong disagreements uh with each other, that disagreements are kept civil, and I'm hopeful that we are able to have a degree of pluralism such that we have a little bit more engineering again. >> Amen to that.
1:32:01
I I am a big believer in conversation, especially if you disagree with the other person.
1:32:10
If you if you lose the ability to have good faith conversations and debates where people uh of very different outlooks are still willing to civily chat with each other, that's how we go forward in my opinion. >> Yes.
1:32:28
And the tiny contribution I try to make is to try to embrace as many uh goodwilled uh people that uh I might not entirely like I don't think I entirely agree with anyone or disagree with anyone but I think the more substantive conversations that people can listen to and you know expand the way they look at the world this this idea of us versus them of tribal identity is poisonous in my opinion.
1:33:04
And uh I just think your your your average American does not resemble either one of those polarities.
1:33:14
I think your average American is still basically a kind of goal along to get along helpful optimistic type person.
1:33:26
and that the the intense uh desire of of what I think are are um not well-intentioned layers to to divide us and create these tribes is doesn't end well in my opinion.
1:33:47
So, I'm 100% in favor of of uh what you're advocating.
1:33:55
I I I said last question, but what you said made me think of another question.
1:34:01
Is there is there a a way where we could have kind of a designed in California but manufactured in Pennsylvania?
1:34:10
I is is that something that we could work towards as we >> I hope so.
1:34:17
>> Get a little more engineers.
1:34:19
>> I hope so, but first we need to get a little bit more engineers and that that premise has not been established yet.
1:34:22
premise has not been established yet. I would like for there um to be more of that and unfortunately I think that right now the um direction hasn't been entirely positive that since liberation day in April the United States has lost about 40,000 manufacturing jobs
1:34:41
manufacturing production has contracted for the last six months and um you know I think it is not the right move to strengthen America America science um by um slashing in half the funding for the National Science Foundation and attacking the universities though I know there's plenty of problems with universities. This is not going to make
1:35:02
This is not going to make America much more of a scientific superpower and it is especially not to um put into chains and deport a lot of South Korean engineers trying to build a a factory in Georgia.
1:35:15
And I think that, you know, this is going to deter this action in particular against the South Koreans is going to deter a lot of people from sending over Taiwanese, Japanese, German, whatever nationals uh into the US to try to invest in the US and get these um programs started.
1:35:34
And so I would like for the US to re-industrialize uh presently all trends that we can see in the data have been negative.
1:35:47
All right, this has been an absolutely fascinating conversation.
1:35:50
Um, we we have a tradition here of asking our guests, uh, we say, "Okay, we're going to make you emperor of the world, but only for a day, and you can't kill anyone.
1:36:00
You can't put anyone in a re-education camp, but we are going to hand you a magical microphone into which you can say two things.
1:36:10
And the entire population of the earth is going to wake up whenever their next morning is and they're going to say, "Oh my goodness, I've just had two ideas."
1:36:20
And unlike all the other times, I'm actually going to act on both of these ideas starting now.
1:36:26
What are you going to incept into the world's population?
1:36:33
Well, I think the inception is to make the US slightly more engineering and um China to be much more lawyerly.
1:36:41
I think that would do a lot of good for everyone, not at least the populations.
1:36:48
Um but also um you know, I think that would create a thriving world which much more of the world would be better off if these two superpowers were not um increasingly deepening their own pathologies.
1:37:01
I think that um they need to fix themselves and stop delivering so many self- beatings against themselves and deliver the things that their people need. >> Great answer.
1:37:12
I was kind of expecting that one to be honest.
1:37:15
>> Sorry to be predictable there.
1:37:19
>> Well, I guess I'll end on where we we started in the beginning.
1:37:22
I think let's think and as opposed to or, >> right?
1:37:30
because Athens and Sparta contributed to a thriving culture as different as they were.
1:37:39
Uh you don't want to go full Apollo, you don't want to go full Dianisis, you don't want to be only left or rightrained.
1:37:48
It should be and Dan, this has been really really fun for me.
1:37:51
Uh, tell our viewers and listeners, obviously you're already on the New York Times bestseller list.
1:37:58
They can pick up your book anywhere.
1:38:00
Where can they find out more about you?
1:38:04
>> You can check out my website, danwan. co.
1:38:07
Now, my book again is called Breakneck, China's Quest, the engineer of the future, >> which I highly recommend all of our listeners and viewers buy and read. It's a great read.
1:38:17
Thank you so much for your time, Dan, and best of luck. Uh, what? Oh, final one. What's next?
1:38:22
Are you writing another book? >> I hope not.
1:38:25
Um, it is now time for me to read a few more books again.
1:38:28
Um, maybe I would like to read some novels again.
1:38:32
So, whenever Jim you finish your novel, please send it to me so I can have a a bit of a beach read, please. >> I shall.
1:38:38
And that is what I'm designing it to be, a fun beach thriller. Dan, thanks so much.
1:38:45
>> Thank you very much, Joe.