00:18:39 · Max Read, Erin Griffith, Ezra Klein
[00:18:39] S1: bit No. Investors getting dramatic. I don't [00:18:41] S4: think there's a little catastrophizing, like, you know, no less than, like, the entire market's gonna tank. The economy's in the in the shitter. Like, we're... China's gonna win. We're... All of that. I I think I even saw a tweet. Beff Jezos, the, you know, the kind of Internet personality tweeted that this is the end of Western civilization. It's time to move to space, which is where the data centers were moving anyway. [00:19:03] S2: So Gotta gotta gotta gotta get that space real estate. What I thought was interesting about this, I was hearing some of this from from investors too, and then the the Nasdaq futures were down. And then it's like the market opens up on Wednesday morning, and it bounces up. And so first, create them... Like, the market doesn't think this is so bad, but but a a good contrarian take I've seen floating around a bit is that this might be good for investors because I do think there's a widespread suspicion that there is a a kind of a collective rationality problem happening right now where [00:19:42] S4: Or irrational.
00:19:42 · Erin Griffith, Ezra Klein
[00:19:42] S4: Or irrational. [00:19:43] S2: Is investing too much in data centers because they don't wanna be the company left behind, but that might lead to, say, the end of Oracle as a existing American corporation. Yeah. And a situation in which the CapEx investment is externally paced such that some of, like, the... Particularly the more fly by night players that are beginning to emerge who could really, really collapse easily, either don't get off the ground or can't keep going. The... You know? And and similarly, a situation where players like Anthropic and OpenAI focus more on diffusion and making what they are deploying economically useful as opposed to racing each other to the notional goal of superintelligence. It... It's not obvious that that's bad for markets. Like a like a CapEx bubble is really bad for markets. Yeah. The... You create dangerous AI before you create economically useful AI is actually bad for markets. But in in a a kind of slightly more sober sense, what markets need is a kind of alignment between how fast a build out is happening and how economically useful the product is, and thus how quickly it is adopted. Not at all obvious to me that a slowdown in data center construction from where we are right now is bad for that.
00:21:03 · Max Read, Ezra Klein
[00:21:03] S1: Yeah. Let's talk about tech billionaires. This is sort of the third category of antitech sentiment that I've seen pop up throughout this election season, and it came up quite often, on Tuesday in some of the the victory speeches. We have Talarico effectively calling out Elon Musk, which is something he did many times over the course of the election cycle. Ezra, I'm wondering if you think that the amount of money that Elon was pouring into this election, because he poured in a lot of it, was counterproductive to him in some sense, because it gave politicians like Talarico a a foil to play against. [00:21:35] S2: Hugely counterproductive. So so think about what that money is buying. That money is attempting to buy attention. But this... The sheer size of that money and its attachment to, like, Elon Musk himself, who's, like, an attentional super object, it did get attention. And the attention it got was that Elon Musk is trying to buy the election, buy it from you, and specifically buy it in Texas. And does Ken Paxton... Did Ken Paxton want one of the central themes of the closing weeks of the election to be Elon Musk is trying to buy the election. Like, there's broad anti billionaire sentiment. You know, you you you can poll this. Like, people really don't like billionaires. There's specifically negative Elon Musk's sentiment. I was a little bit surprised actually that in California, the wealth tax proposition didn't pass. In California [00:22:27] S1: I wanted to... Sorry. No.
00:22:27 · Max Read, Ezra Klein
[00:22:27] S1: I wanted to... Sorry. No. [00:22:28] S2: Go ahead. In California, there's a proposition to to do a a a wealth tax to... On the very, very wealthiest California residents, which would not be that many of them, couple 100 people. But it was gonna be a sort of hard to administer tax, and there was fear of having, like, billionaires flee California for, say, Texas, and it didn't pass. So in this sort of, like, election in which anti billionaire sentiment was very, very, very constant, The argument that, you know, sort of potentially driving some of them out of California would be bad for California actually won, which struck me as a as a little bit surprising. If you had told me the... Like, how badly Republicans would lose election if I knew that a week ago, and you said, what's gonna happen to the wealth tax? I'd be like, oh, that'll definitely pass. It didn't. [00:23:11] S1: Erin, I wanted to ask you about this because, we talked about it last week, and you've done a lot of reporting on this. And I'm wondering how you sort of account for this result in what was otherwise very clearly anti billionaire election.
00:23:23 · Erin Griffith
[00:23:23] S4: It feels a little bit like a California thing where people might just be tired of the politicians kind of throwing together a plan that doesn't seem fully thought out and saying, just trust us. We'll figure this out. And so I think there was enough messaging that introduced doubts to this, basically saying it's not like... I mean, the messaging from the prop... The anti prop 40 groups were, this is poorly written. It... They're just gonna lose all the money. They need to do a better job of this. It's not sustainable. It's a one time thing. I I guess that kind of, like, resonated with people. And, honestly, it's the one thing that the billionaires I've seen and the and the tech right that we're talking about is, like... Are clinging to this more... Or this this week now where they're like, if they can't pass this kind of, you know, billionaire tax in a blue tsunami in California, it'll never win anywhere in the country. And I don't think that's true. Ezra, I'd love to hear your thoughts on that. But I think think I there'll be more attempts at bat at this in the next few years while they'll they'll just try to maybe position it a little bit differently or or or find ways that will resonate with people a little bit more. But I I think in general, people are just kind of, tired of of, like, half hearted props that are that are thrown out there, and this one got a lot of criticism for that.
00:24:32 · Ezra Klein, Max Read
[00:24:32] S2: Yeah. I agree that the California prop has, like, first, the problem that Californians have begun to be skeptical about propositions just full stop, correctly so, speaking as a Californian. But the... I do think the other issue with it was that there was a specific concern that would disadvantage California. I mean, I think it is meaningful that Gavin Newsom did not support it. And to the sort of comfort the tech right is taking this, I think it's gonna be basically table stakes in 2028 for Democrats to have a a a wealth tax proposal. And the argument for a national wealth tax is a lot stronger than the argument for a state wealth tax because, you know, they they may say they will, but they're not actually gonna move to Ireland or, you know, wherever it might be. You know, Argentina. And so I [00:25:21] S1: think history of people moving to Argentina when things go south in their country. [00:25:25] S2: So, you know, you're gonna have Gavin Newsom with a wealth tax proposal, I think, for for that election. So the idea that this is gone as opposed to it is going to move to the level at which is better administered, which is like the full force of the IRS and, like, the full jurisdiction of The United States is is more the way I understand the the situation.