The Manosphere Report

0:00all right everybody emergency podcast time episode 263 of all in we have emil michael

0:05the undersecretary of war for research and engineering working directly for pete hegsa we had

0:13to get this out to you on thursday night because it is an emergency pod

0:17one of my old besties emil michael is here emil and i uh were part

0:22of team uber back in the day he was travis's right -hand man some might

0:27say fixer and emil michael is now the undersecretary for war here in the united

0:34states serving his country like our bestie david sacks welcome to the program for the

0:39first time emil michael how you doing brother i'm doing good uh i hope it

0:43was more than the fixer but you know i mean you got it done you

0:49got it done the hard he would give you the hardest things yeah just that's

0:52right fair enough if it was hard and that's what a fixer is an operational

0:56axe that's what they call all right sure uh in brooklyn we call them fixers

1:00with us again a rain maker there's that too there's that too making it happen

1:05with us again chamoff palihapitiya how are you brother great yeah look at that smile

1:12what do you got going on you got some pokers in the fire i'm not

1:19going to say in the coming weeks i think some news is going to drop

1:22that's my prediction i don't have are you loving chamoff's tweet mogging that's been going

1:25on this week so good so good so good he's looks maxing by default but

1:32he's been mogging the gooners yeah so funny what was your favorite favorite the one

1:38i sent you this morning that you said what you said it's so what are

1:41you collecting your losses by tax harvesting what did you say he's like chamoff said

1:48uh oh my god it was just like yes i did yes i did yes

1:52someone said something to chamoff he's like drops in why is everyone so mad at

1:56chamoff all he did was lose billions in retail investors money one -page SPACs it's

2:02not like he then told them to enjoy their capital losses or anything give the

2:04man a break jamoff's response yes i did all right piling on is your sultan

2:10of science everybody's favorite had a great so yeah some great science that he brought

2:16to the show last week friedberg how are you doing oh yeah i've been traveling

2:20this week back at home all right sax is out today he's very busy on

2:25capitol hill we'll talk about what he's up to next week let's go come on

2:28let's go let's go go jason all right the u .s and israel launched a

2:31joint attack on iran on saturday today is day six of operation epic fury iran

2:38supreme leader ali hameni was killed within hours of the operation 40 senior officials have

2:45also been killed death toll so far about a thousand people according to reports tragically

2:51six u .s army reserve soldiers were killed following a drone strike on a base

2:55in kuwait a u .s submarine sank an iranian ship off the coast of sri

2:59lanka this is the first torpedo kill since world war ii why we're at war

3:04been a bit of a moving target in a debate first explanation from rubio he

3:09said israel was going to attack and the u .s had no choice but to

3:13participate later walk that back trump made it clear this is not a regime change

3:18effort but we're doing this to stop terrorism and the development of icbms by obviously

3:25a pretty crazy group of individuals and obviously nuclear bombs which we blew up a

3:31couple weeks ago trump also mentioned the people of iran should seize the moment quote

3:36and take their country you you you you Hegseth, I believe is your boss, Emil,

3:41said, quote, this is not a so -called regime change war, but the regime sure

3:46did change and the world is better off for it.

3:49So here's an interesting poly market.

3:51Right now, US forces enter Iran.

3:55This is boots on the ground.

3:56By the end of March, 40 % chance.

3:59By the end of the year, 59 % chance.

4:01So the idea that we're not going to have boots on the ground, the sharps

4:04on poly market believe we will.

4:07Will the Iranian regime fall?

4:10By June 30th, 39 % chance, according to poly market.

4:14And by the end of the year, 51 % chance.

4:16So Emil, I guess there are two questions people really want to know.

4:21I'll leave off why we're doing this.

4:22I think President Trump has been pretty clear now.

4:25But how long is this going to take is the one question.

4:29And are we going to have to have boots on the ground?

4:31Maybe what is success here?

4:34Um, I think the the president talked about this is a weeks, not months kind

4:41of operation. And it's aimed at essentially disarming the regime or the country from in

4:51such a way that they can't supply Hezbollah, Hamas, Muslim Brotherhood, all the kind of

4:57terror groups that get sponsored by weapons and money from Iran, not to mention the

5:02nuclear bit. And that's how you see from the reporting, they're going after the depots,

5:09the, the, you know, we went after nuclear sites before they're a prodigious drone maker.

5:15These like huge one way attack drones that can go hundreds, you know, hundreds and

5:20hundreds of miles. Um, lots of ballistic missiles, uh, that are aimed at every country

5:26in the middle East, as you've seen, they've attacked them.

5:29So I think that's one in terms of boots on the ground.

5:32There's no scenario where we have some protracted boots on the ground, Afghanistan, Iraq, too,

5:38like scenario. Freeberg, your thoughts on this war?

5:43Obviously, a lot of people voted for Trump in order to have the peace dividend

5:50that he was in his first term, absolutely the peace president.

5:54And now here we are, eight countries have been bombed, and we've had two leaders

5:58deposed, and one of those two have been killed.

6:01Your thoughts, Freeberg? I think the president and the administration have probably the biggest meetings

6:07of the term coming up in China in April.

6:11My estimation, based on the conversations and the comments made by the president before he

6:17came into office, and since he's been in office, is that finding a grand bargain

6:22or a deal with China is probably one of his top priorities.

6:25And if you think about the importance of that, is the U .S.

6:29going to wade into a giant global conflict led by a U .S.-China rift, or

6:34is the U .S. going to find some grand bargain?

6:37I think he would probably have a preference for the grand bargain.

6:40And that being the case, I think you could look at the, in the context

6:43of Maduro and the actions in Iran, as creating maximal leverage going into those negotiations.

6:51The reason for that Freeberg?

6:5290 % of the oil that comes out of Iran goes to China, and there's

6:57been a long developing and developed relationship between Maduro's government and China, and these are

7:05big economic drivers, or support the economic driving in China.

7:10So, creating leverage by having significant influence, or damage, or destruction.

7:16to those supply chains for China gives the United States footing to be able to

7:20negotiate a better deal for America.

7:23I would imagine that the president's intention here isn't to go and decide who should

7:27be in charge and drive regime change and end in a multi -year conflict with

7:31Iran. But ultimately, if there's some transaction with China that gets everyone out of this

7:36and puts the US on a strong footing where American businesses can sell into China,

7:40which is very challenging, as everyone knows today.

7:43And there's parity, regulatory parity, economic and trade parity between the US and China.

7:49There's a point of view on what happens with Taiwan and availability of key technologies

7:53like semiconductors. I think it could be a win -win.

7:56And I think that a deal with China could be the crowning achievement of this

8:00administration, particularly going into the midterms.

8:03So the timing is right.

8:04And I think that's probably a core part of the motivation here.

8:07Chamath, your thoughts on this action?

8:10And why we're doing it?

8:12You've heard, obviously, the president has his position.

8:15We're not doing regime change.

8:17It's a secondary effect, obviously.

8:19But we want to stop those ICBMs and nuclear bombs from being developed.

8:23And we want to stop terrorism.

8:25Additionally, Freeberg says, hey, we're framing this great, you know, discussion we're going to have

8:32with Xi and China, and oil is part of that.

8:35Where do you think you stand on all this?

8:38I'll build on both what Emil said and what Freeberg said.

8:41I don't think this is about regime change.

8:44And I don't think it's about a local regional conflict.

8:48I think if you take a step back and zoom out, the most important thing

8:53that we did in the last three months was by taking out Maduro and by

9:01taking out the Iranian leadership, we have created enormous leverage, as Freeberg said, with China.

9:10Now, why is that important?

9:11Because I think all of this centers around that geopolitical discussion.

9:17Last night, something important happened, which is that the official Chinese bureaucracy posted what their

9:24GDP targets were. And it was shocking to anybody reading it, because what we saw

9:30was that they guided to a range of four and a half to 5%, which

9:35if you look at the historical context of that growth, is the lowest that it

9:40has ever been in about 30 years, so three decades, so before they entered the

9:47WTO. And the question that one should ask yourself is, when a country that's growing

9:51at 8%, 9%, and 10 % start to grow at half that rate, yet have

9:56double the number of people and double the GDP, what happens?

10:00You already have incredibly high domestic unemployment, especially youth unemployment.

10:05Does it become more or less chaotic?

10:08And I think the historical artifacts of every other country would show that it will

10:12become more chaotic. If you have that as a starting point, what is it in

10:16China's best interest to do?

10:17And I think it becomes obvious that the right thing to do would be to

10:20invade Taiwan. Why? Because you start to create a sinkhole that occupies your people, that

10:26occupies resources, that can get domestic production up and running, that can start to generate

10:31a war machine. And you see the economic impact of war machines in any country

10:36during any conflict. And if I had to guess, just to build on what Emile

10:41said, the president saw that, and I think what they did can be summarized in

10:45this chart, which I sent to Nick.

10:46So if your goal is to prevent war with China, which is a massive global

10:53conflict, which could... be nuclear, which could be cataclysmic, how would you do it?

11:00And this chart paints one way to do it.

11:03If you look at the conditions inside of the Chinese economy, the most interesting takeaway

11:09is that they are enormously dependent on imported oil.

11:15So about 20 % of their economy.

11:18But it's not 20 % of their economy, because it's 100 % of these critical

11:22things that create GDP, logistics, transportation, aviation, feedstock inputs.

11:29And of that 19%, about a fifth of it comes exclusively from Iran and Venezuela.

11:36And now all of that is off the table.

11:39So if you take that, and then you see what Steve Witkoff and Jared Kushner

11:43and Josh Greenbaum have been doing, which is trying to get a deal done in

11:47Russia, and you put all of these things together, because by the way, if you

11:50add Russia into that mix, it's about 40 % of China's oil.

11:54Not only do you re -dollarize, not only do you stop the funneling of all

12:00of these illicit oil funds to creating chaos all around the world, but you hem

12:05in China going into a massive moment at the end of March, beginning of April,

12:10where as Freeberg said, really astutely, there is the potential for a grand bargain.

12:14And I think that secures global safety.

12:17In that, that is a huge thing for America.

12:20Emile, how much does this have to do with China?

12:23I think, you know, my instinct is, and I'm not speaking for the administration on

12:29this, is that's a second -order benefit to some of these things.

12:33Like the, you know, and you said eight conflicts.

12:37There have not been eight conflicts.

12:39There is, like, we inherited Gaza.

12:42We inherited Russia, Ukraine. Venezuela was its own operation.

12:47And then you could sort of attach to it the drug boats that were coming

12:50out of that as, like, one big operation.

12:53And then the Houthis was just, Biden was ignoring the Houthis.

12:56They were just shooting at our ships.

12:58So that was, like, very limited in terms of, like, stop shooting our ships.

13:01We need freedom of the seas.

13:04And that wasn't sort of a, you know, so that's something any president should be

13:08doing, generally, I think. Sure.

13:10Iran being the one, you know, material conflict outside of Venezuela.

13:15So it's not that many.

13:17And how long did Venezuela last?

13:19It was one raid. One night.

13:21I guess that's a really important - A few hours.

13:24Yeah. This is an important note, I think, for you, Emile, to sort of explain

13:28to us - I've made love for longer than that.

13:29There's a new approach here with regard to these actions, which is no boots on

13:37the ground. And we seem to, and you, of course, have better information than anybody

13:42else does. I don't think anybody would have known Venezuela would have gone as well

13:46as it did. And so far, listen, we got a long way to go with

13:50Iran. This has gone very well as well.

13:53So explain to us what you know, and what you, the president and Hegsev know

13:59that we don't, that makes these two operations go so smoothly.

14:03What is it? And then there's obviously some new technology here in the case of

14:07what happened in Venezuela. Yeah.

14:09Besides the discombobulator, what we've got is a very well -trained military, like the global

14:18war on terror was a disaster in so many respects.

14:22But the people now who are fighting that are generals now.

14:27And so they've learned a lot of lessons.

14:29And you compare that to the Chinese military, they don't have a lot of experience.

14:32In fact, the - the decapitation they did in the Chinese military, the one guy

14:37they took out was the one guy who had experience in Vietnam.

14:39So they don't have a conflict experience.

14:42And that matters because you understand going in, what are the things that could go

14:46wrong? Um, and then you, you have incredible technology, space, air, land, sea, cyber, um,

14:55all kinds of effects that you could bring together.

14:58And so you imagine, uh, a hundred guys goes into the most fortified compound in

15:03Venezuela where the president is, you know, take him and his wife out safely and

15:08are out with no KIAs.

15:12I mean, it's incredible, right?

15:14Yeah. So, and they, they, these things, these war games have been on the, on

15:18the shelf for a long time.

15:20Every, every scenario has been planned for years ahead of time.

15:23Midnight hammer in Iran was planned years ahead of time in terms of how would

15:28you do it if you were going to do it?

15:30Um, and then you're keep refreshing the tactics, the tactics, techniques, and procedures, and you're

15:35updating them. So we have a very sophisticated way of, of doing these things to

15:39minimize loss of life and maximize success.

15:41Can I ask a question?

15:42I don't want to, I don't want to derail this conversation, but is the discombobulator

15:46real? Like, what can you say about the discombobulator?

15:49It's real. I completely, I was like obsessed with this when I saw it on

15:53X. I was like, what is this thing?

15:55I mean, I need it in my house.

15:57Like I just want to push a button about these kids.

15:59And that's just for when Helmuth shows up.

16:01Oh my God. Not meant for your kids.

16:03I don't know if they're behaving badly.

16:04No, it's, can't talk about it.

16:06Amil, do you think we would have been able to pull off that mission as

16:09successfully as we did five years ago, 10 years ago?

16:12Has the technology improved that quickly that this is not something that's been possible historically

16:17and how does that change the, the pacing and the face of war for the

16:21next couple of years? I'd say, no, it wasn't only a technology maturation from five

16:28years ago. It's the rules of engagement, the rules of engagement that we used to

16:33have. Uh, there was something, I mean, if you read about them, some of them

16:37are insane. Like if in Afghanistan, if the guy had a small gun, you had

16:41to have a small gun and you know, there was this parody in weird ways.

16:46And when you're like, well, but is the objective to have like a fair fight

16:50or an unfair fight? Um, well, if you're on our side, you want it to

16:53be unfair. So the rules of engagement were relaxed to be.

16:57Who writes those Amil, who sits in an office and says, you can't shoot back

17:01if a combatant is shooting at you, if you aren't matched gun for gun.

17:06Yeah. I mean, who writes that crazy policies that are written into military departments.

17:11And that's why when secretary Hicks talks about, um, this kind of thing and what

17:17was happening with him when he was in Afghanistan, if you ever read his book

17:20in Iraq, he's like the rules of engagement were so punishing that we were, we

17:25were at risk all the time because you had to have like a legal understanding

17:29of what was happening in every minute in the battlefield, as opposed to, well, your

17:32job is to, you know, take out these guys and protect these guys.

17:36Here's your munitions. Here's like the, the, the red lines.

17:40And then like in the middle of that, go use your judgment, your commanding officer,

17:44use your judgment on how to win.

17:46And we kind of gone back to that, use your judgment, push a responsibility field,

17:51still have your red lines.

17:52But other than that, the objective is the objective.

17:55It's more of a Colin Powell approach.

17:57It's like, go all in, have a clear objective, come out, use overwhelming force.

18:02And we were not doing that for the last four years.

18:05And then going back to the face of war going forward, my understanding is that

18:09there have been more drones deployed by the.

18:12united states this past week than we've done in the history of military activity is

18:17that right and like how does that really change things going forward here it changes

18:21it big well so so the predator drone was the first big drone program like

18:2610 15 years ago it was this big honking drone um and then if you

18:30remember obama would take out some of these al -qaeda leaders with drones on their

18:34balcony and things like that uh i think we uh president trump took out suleimani

18:39with the drone near his car that was the beginning and then the iraq sorry

18:44the russia uh ukraine war happened where it's like drone on drone 70 of the

18:49the casualties are for drone but because of drones so um drone on drone warfare

18:55robot on robot warfare those things are the future for sure right and that's why

18:59companies like andrel are companies like andrel is because they're making unmanned systems and this

19:05has been something you've specifically been very focused on and you tweeted today a little

19:10bit about a competition we'll play a little video here and this lucas yeah this

19:14is amazing combat attack systems it used to take a lot of time it certainly

19:20wasn't startup time to get new product into the channel for our military to use

19:25explain what program you're running here feels like the darpa self -driving challenge all over

19:31again and what these drones cost i know there's a company making them for i

19:34think 35 000 am i correct i mean the small drones like i'm holding right

19:39there and that are way cheaper than that the lucas one -way attack drone which

19:44can go five six 700 miles at the speed of an airplane carry a big

19:50warhead those are like 50 80 000 depending on what kind of equipment you put

19:54on you put on it but the we have a drone dominance program and the

19:58reality and we basically have to build an arsenal for for drones now are we

20:03likely to have a territorial conflict like russia ukraine with canada and mexico no but

20:09but we do want to take out drug drones at the border and we want

20:13but long one -way attack drones are important for you know any kind of major

20:18conflict like you're seeing in iran but also to protect military bases for america 250

20:24world cup uh olympics in 28 like there's other there's a lot more uses of

20:30drones for surveillance not just for you know for combat there you're showing drones that

20:36are sort of human operated but how much of this should basically be ai so

20:40that it's just some computer vision and again back to what you said before a

20:45model understands the rules and the red lines but otherwise is be on task and

20:50accomplish your mission how much of it is one versus the other i mean it's

20:54i believe that a sophisticated drone war is going to be drone swarms controlled by

20:59ai to some degree or another right to what degree the control matters like for

21:03example drones have decoys they could spit out you know they could dazzle they could

21:09put out things so how do you discriminate what's a drone and how to hit

21:13it you know you can use ai for that because it's learned you know how

21:17to do automatic target recognition for example um and then also could it identify a

21:23person and that and does that make it safer so it's going after actually someone

21:27you want to get and not someone you don't want to get um so there's

21:31a lot of uses for ai at the edge if you will um in the

21:34future here the ukrainians and russians do something called like a kill box where they

21:39lose comms because it's jammed for this drone and then it just starts going in

21:43a box and looking for you know the person they're trying to get and they're

21:48trying they're starting to use ai to do that to do that you you And

21:51China has this ability already, probably times some magnitude, yeah?

21:58They have drone swarms because they can force the companies that make them, not just

22:04EGI, to interoperate. So interoperating drones called heterogeneous autonomy, right?

22:11You take different kinds of drones and how they communicate with one another and then

22:15make sure they're not going after the same target is like a pretty complex thing

22:19that they're definitely working on.

22:21And let's talk about the fidelity of these.

22:26Obviously, AI is a new technology.

22:29It can make mistakes. Anybody who uses it on a day -to -day basis might

22:32experience a hallucination. How confident are you in the AI?

22:37Ukraine and Russia conflict, they obviously are not going to be as thoughtful maybe as

22:41we are in putting this together.

22:43They're in a hot war right now.

22:45But we as the United States have to be very thoughtful about this.

22:48So how confident are you that this isn't going to make a mistake?

22:50I think that's the key to a lot of this debate.

22:53And when will it be, you know, perfect to find as much better, and I

22:59guess this dovetails with the self -driving, you know, thoughts.

23:03It has to be a magnitude better than a human.

23:05So when will this be a magnitude more accurate than, you know, when we have

23:09make a mistake as a military and we kill a civilian?

23:12No, it's a good question.

23:14And I don't know when that moment hits, that FSD moment, where it kind of

23:20gets better. It's certainly not there.

23:23And you wouldn't want to take huge risk with that.

23:26You know, there's a gradation of when you would use that and what kind of

23:29risk you were trying to take or not.

23:30If you were trying to take out a drone using AI, using like a laser

23:35or something, you'd be pretty like, okay, making mistakes because you just missed the drone.

23:39You know, like whatever, with the laser and the laser goes off, it's all over.

23:44If you were doing something more sophisticated in a population area, have a densely populated

23:48area, you'd take less risk.

23:50So we're developing procedures, tactics for each scenario.

23:54And this is part of the debate I had with Anthropic, which is we need

23:58AI for things like Golden Dome.

24:01Chinese hypersonic mixel comes up.

24:02You've got 90 seconds before it separates and all kinds of decoys and you don't

24:07know where the actual payload is.

24:10And you want to get it, hit it from space.

24:13And a human can't, doesn't have the reaction time, doesn't have the, may not be

24:17able to discriminate with their own eyes what they're going after.

24:20That's a pretty, you know, low risk thing because it's in space and you're just

24:24trying to hit something that's trying to hit you.

24:26So I think in the next 10 years, you're going to see a lot of

24:29these applications develop AI to one degree or another, so long as we think it's

24:33safe and it's not going to do the, you know, make mistakes.

24:35Before we get on to the Anthropic discussion, and we really appreciate you coming here.

24:40And my Lord, this has been so informative.

24:42So thank you, Emil, for coming here and explaining to the American public and to

24:45us what you're working on.

24:47It really makes us, I think, speak for everybody, really confident in what you're doing.

24:50It's so great that you've, you know, left the private sector to do this.

24:55What I would say just very quickly, Emil, is I think that not enough people

24:58understand that the American military has had to fight with one hand tied behind their

25:03back. Just that little insight that you just gave about Afghanistan, to me, seems so

25:09scary because the men and women that sign up for the American military, they're doing

25:14this to fight on behalf of this country.

25:17They deserve a lot more than being sent there and all of a sudden being

25:21given this rule book and say, do your best.

25:23And it's like, oh, wait, you violated 19 rules trying to protect America, do your

25:27job. That's insane. let's just it's really insane in some cases and we i my

25:33my belief is that's what the frustration for those soldiers who are out there in

25:37those wars had more than anything there was the broader frustration like what are we

25:41doing here and then the secondary frustration is while i'm here why can't i do

25:45my job yeah is there is there much of a debate internally amil i'm sorry

25:50jake before we move forward on this regarding this idea of full autonomy in military

25:56action i don't want to speak ahead to the anthropic point but it was something

26:00that the media seemed to say was part of dario's concern is that when you

26:05press the button and hand over complete autonomy and there's a kill action that you're

26:09now giving to a robot or to some autonomous system do we then kind of

26:14have a moral issue at hand and is that something that's kind of debated or

26:19discussed and is that the right way to think about the framing that what goes

26:21on i mean we're not even close to there yet right we're like this the

26:25systems are not we wouldn't feel that a system uh that would have sort of

26:32like real risk for a civilian is ready to launch yet so we're not even

26:37debating that we're just trying to get basic autonomy in drones basic autonomy in underwater

26:43unmanned vehicles basic autonomy that you know you've heard of this collaborative aircraft that fly

26:48along with a jet craft so that it has more firepower but it's still tethered

26:53to what the jet does so we're that's incredible yeah yeah so we're just at

26:57the very beginning of this stuff but for golden dome is a good example of

27:01like yeah who can oppose that like it's the only way to get out of

27:04threat like that um so who could oppose if you have a military base you

27:09have a bunch of soldiers sleeping that you have a laser that can take down

27:13drones autonomously on that so there's it's it's pretty scenario by scenario but i don't

27:18we're not having a lot of debate because the skynet thing is so not a

27:22realistic thing at this moment right except if one thing i did tell the anthropic

27:27guys i was like you know or i'd tell us any company your models are

27:31getting stolen by the chinese they're going to unguard rail them and use them against

27:36us and then you want our models to be less capable against your models it's

27:41sort of not going to be thoughtful in other words they're going to go for

27:44it right and you know if we just benchmark this against where we were at

27:48you know but 10 15 years ago there was the wiki leak of collateral murder

27:54i think they called it where we tragically had an apache take out some journalists

28:00and this technology even applied today probably would have avoided that in my mind yeah

28:05like we have enough that when you're targeting not drones but you know people on

28:10the ground with an apache this would have probably avoided that yeah or or you

28:16know the kuwaiti aircraft hitting you know an american aircraft making a mistake because it

28:21doesn't have the identification i mean it's the same self -driving argument to a degree

28:26like self -driving could save lives even though it's scary to look at a car

28:30without a human behind the wheel but there's tons of scenarios where it's a way

28:34better safer option more precise than the alternative all right before we move on to

28:40the dario thing and anthropic and that brouhaha there was one piece that we haven't

28:44addressed with this interaction freeberg chamath which is uh the israeli government and their desire

28:51to take out this regime and us according to tucker colson and a large contingent

29:00of the maga base they feel that we are captured by this group does israel

29:06have to too much over the United States with regard to these actions in the

29:10Middle East. This is a big debate within the party, within the Republican Party, within

29:15the MAGA constituent. Hey, number one, we don't want these wars.

29:19Number two, is Israel driving this thing to the point of Rubio's quotes that, hey,

29:23we're doing this because Israel is going anyway.

29:25I think we should address it here.

29:27Not that I have a personal stake in this.

29:28I'll give my personal opinion at the end.

29:30I don't think the president is captured by Israel in the least.

29:33I think he decides what is in the best interest of the United States.

29:37If Israel can be a part of that, then they're a part of it.

29:44Look, let's be clear. They're incredibly capable.

29:48In something like this, to be able to incorporate the intelligence of Mossad, what you're

29:54seeing today in this Operation Epic Fury, we're four days in.

29:58Iran has been 90 % depleted of all of their munitions, it looks like.

30:02They're just firing no more missiles out from Iran to anywhere else.

30:07There's fleets of drones and planes just waiting.

30:09Everybody knew where the Iranians were.

30:12It's great that when we make a decision on something that we need to do,

30:15we can rely on our allies.

30:17I think the opposite question should also be asked, like, what was the UK doing?

30:21Why is Spain pontificating? Why was Europe taking the weekend off before they could even

30:24issue a statement? Why don't you ask that question?

30:27Yeah, no, it's an equally valid question.

30:30And Freberg, do you want to get in on this or no?

30:34No. I'm a Jew. No one's going to care what I have to say.

30:36They're either going to be like, totally like, or they're going to say, this guy's

30:40a Jew. We shouldn't listen to him.

30:42So let's move on. Go ahead.

30:43Yeah. Emil, any thoughts on this?

30:46I do want to know from Emil, though, like, you know, is this Iron Dome

30:50working, this laser in Israel system?

30:53Is this operational? And if so, is there any success metrics you can share around

30:56it? I mean, I think the gold, sorry, the gold, no.

31:00Iron Beam was the first generation of the Israeli air defense thing.

31:05And then they're building Iron Beam.

31:07And I think it's still early -ish, but yeah, it works.

31:10They're a technologically sophisticated country that's very small, that has like a reason to invest

31:18in these things and have a lot of smart people to do them.

31:21So I think, I think it's good.

31:23But does it primarily work on rockets?

31:25And I guess I just want to understand the logical evolution of this, because in

31:28the 80s and 90s, there was a lot of conversation about space -based lasers that

31:32could shoot ICBMs out of the sky to avoid, you know, global nuclear war.

31:37And we could always take out every nuclear warhead delivered on an ICBM.

31:41Is that technology feasible? Is there a place in the near future where we could

31:45see basically maximal global deterrence using these systems, either ground -based or space -based to

31:51take out hypersonic missiles? I think, I think the, the harder but more valuable problem

31:57to solve would be the space -based way of doing it, because then you could

32:02get at any kind of, almost any kind of threat that hits space, but you

32:06still need a ground layer because there's cruise missiles that could come at you, there's

32:10drones and so on. So, so we call them multi -layers.

32:13Like, how do you, how do you get every kind of weapon at every layer?

32:18But, you know, directed energy lasers, as they get more powerful, you could take on

32:24a bigger weapon farther away, right?

32:26So those, so those technologies that, as they improve, it gets more and more capable.

32:32And I think all these defense systems are going to get more and more capable

32:37to get more and more of a variety of weapons, that farther, farther standoff, which

32:41is what you want. You want it to, you don't want to shoot it when

32:43it's right over Tel Aviv.

32:44You want to shoot it, you know.

32:45Thank you. Thank you, everyone.

32:45Thank you. when it's still over their land, ideally.

32:48Are the laser interceptors in the field today?

32:51There's reports that they are.

32:53I think there's some. I think they've demonstrated some of them.

32:56Got it. And is this our technology or Israel's technology?

32:59Because President Trump said, hey, that's actually our technology.

33:03Is there any insight there?

33:04We have collaborations with Israel on some of this stuff.

33:08They have their own. We have our own.

33:10So it's not this is.

33:13But they're good at tech.

33:15We're good at tech. There's certain there's certain ways you get part of our system

33:19and part of their system, because it's like a it's a quickly evolving part of

33:24science right now. How do you cohere beams of light to like get distance?

33:29How do you use high powered microwave to like just drop drones in their tracks?

33:33There's lots of different ways to get at some of these things.

33:37And yeah, a lot of it's ours and a lot of and some of it's

33:40there. Yeah. And to to the earlier question, you know, I am pro regime change.

33:47If it can be done thoughtfully and obviously isolating a dictator, that's the best thing

33:52you can do. We've done that successfully with, you know, Putin, Kim Jong Un, et

33:57cetera. Keep diplomacy up. But if there is a moment in time where you could

34:01free the people of Iran after 50 years of being subjugated by these lunatics and

34:07dictators, I'm all for it.

34:09And I actually trust President Trump to make that decision.

34:12I know this may sound crazy.

34:13People think like I'm a libtard or something because of the way my besties frame

34:17me on this program, which is completely inaccurate.

34:19I'm an independent. You are.

34:21I actually are not completely independent.

34:23You're not. And I am just based on my voting and I'm not on either

34:27one of these sides. I am pro President Trump and I trust his judgment.

34:30I think he has more information.

34:32That's I think you have more information.

34:33I actually trust you guys to do it thoughtfully.

34:35And there obviously was a window here.

34:37Israel can have their own, you know, motivation.

34:39That could be the China motivation.

34:40But there's also spreading democracy.

34:42Can I say something on that?

34:43Which might be the least of people's concerns here.

34:46But that's on the top of my list.

34:47I would like to see the people of Iran free.

34:49Just to build on your point, Jason, the thing that Emil said before, which I

34:52think is important as well, is we have an enormous amount of learnings about what

34:57happened in Iraq. We also have a ton of learnings between the Iran -Iraq war

35:01and a ton of learnings in 53 when us and the British deposed Mossadegh in

35:06the first or at least fomented that and put the Shah and then the Shah

35:10was booted out. Yeah. If you take those three chapters in Iranian history or that

35:15regional history, there's a ton to learn.

35:17And to your point, there is a way to affect what we need to do

35:22without creating some 20 year forever war.

35:26There was an incredible tweet.

35:27I don't know if you guys saw this.

35:29Somebody said, so every war doesn't have to be three decades and trillions of dollars

35:35to your friends in Virginia, Maryland and D .C.

35:38Did you guys see that tweet?

35:39It's true. These things can be one and done in and out.

35:44And if President Trump succeeds here, I just want to also give him some flowers

35:48here. The people of Venezuela and the people of Iran being free represent about 5

35:53% of the people in the world living under an autocracy, under a dictator.

35:57If those both flip back to democracies, he'll have done more for the spread of

36:02democracy than any president for many decades, perhaps in our lifetime.

36:06This would be incredibly noble, incredibly noble, incredibly just.

36:11And would you in the human rights set want him to get the Nobel then?

36:16Absolutely. I'll give him all the Nobels.

36:18Like literally, if you can free people, all of them, give him every prize, give

36:23him an honor. Physics, chemistry, economics, physics, philosophy.

36:31Jake Howell's an independent. When's the last time you voted for a Republican presidential candidate?

36:35Just curious. Yeah. Say it.

36:39Say it. No, no, no, no.

36:41Mondale. No, no, I didn't.

36:43I would have voted for, if I was of age, I would have voted for,

36:46I wouldn't have voted for the Bushes.

36:48I voted for the moderates, obviously Clinton and Obama.

36:54Oh, we're playing the would have, should have, could have game?

36:56I would have voted for Reagan in this situation.

36:58I would have bought NVIDIA at $4.

37:00Well, no, and I didn't vote for Kamala, so I'll leave it at that.

37:03But I voted probably 45%.

37:06Why don't you say that you voted for President Trump?

37:07Just say you voted for President Trump.

37:09I don't want to complicate things here.

37:10But you did, so just say it.

37:12I didn't vote for Kamala.

37:13I'll leave it at that.

37:14All right. It's so weird that you'll say you're a moderate, but you won't say

37:17that you voted for President Trump.

37:18I am supporting President Trump in about 60, 70 % of what he does.

37:22Let's leave it at that.

37:23Three, two. All right, let's talk about the economic impact of oil and insurance.

37:28Oil has rose to $84 a barrel Wednesday.

37:30Straight and four moves. Here's a video.

37:32It's basically a standstill at this point.

37:35Here's the clip. You can see the traffic slowing down.

37:38And then, hey, some of the dots are even going away.

37:40That could be ships we're taking out.

37:44Unless the straight opens, 3 .3 million barrels of daily production would be lost early

37:51next week. And then there's insurance companies.

37:54They've all canceled the war risk coverage of vessels in the Gulf effective March 5th.

38:01Supertanker traffic dropped 94 % within the first 48 hours.

38:05Trump said the U .S.

38:06will provide political risk insurance for all maritime trade through the Gulf, especially energy.

38:11Freeberg, your thoughts on the economic second order effects that we're starting to experience here

38:17and over the next four weeks could be, you know, intense and acute.

38:21The modern insurance market emerged specifically to solve the risks of maritime trade.

38:27So in the 17th century, Lloyd's of London, which was a coffee shop in London,

38:31where all the maritime traders would get together and they talk about, hey, what's the

38:35safest route so pirates don't get our ship and so you don't run into weather?

38:39That's where they would kind of have these conversations.

38:40And eventually they started underwriting the risks of the shipping routes and giving each other

38:46guarantees. They said, hey, if you make this route, great, you pay me a certain

38:50amount. If you don't make the route, I'll pay you the lost value.

38:53And that's how Lloyd's of London, which is the kind of world's biggest reinsurance market

38:58started. Today, Lloyd's of London has 78 what are called syndicate members.

39:02And these are kind of these pools of reinsurance that underwrite big, crazy risks like

39:06maritime insurance for folks that are moving oil tankers through the Strait of Hormuz, which

39:12the IRGC just announced they're shutting down.

39:15When the IRGC announced that they were shutting down the Strait of Hormuz, there's a

39:19significant risk of all the mines going in the Strait and the ships getting attacked

39:23and blown up. So loss of value.

39:25The insurance premium spiked initially from a quarter percent, so 0 .25 % of the

39:31value of the ship to 1 .25%.

39:33So it went up by like 5x.

39:35And so folks had to pay a lot more of the value of their ship

39:38in order to continue the routes and get guarantees that they'll make it through.

39:41And then all of the markets started to shut down.

39:44So once the conflict got heavier, everyone said, let's shut this thing down.

39:47And that's obviously a massive risk to energy prices globally, which drives inflation and puts

39:53U .S. economic security at risk.

39:54And so this is a brilliant move.

39:57I would say the U .S.

39:58government stepped in with the U .S.

40:00International Development Finance Corporation, which was...

40:02It's actually funny enough, started a couple of years ago, like in 2019 or something

40:06like that, as a kind of output of one of the agencies that provided credit

40:11from USAID, much talked about USAID.

40:14And so they're leveraging the credit capacity of this old USAID agency to go out

40:21and say to all the shipping companies, hey, we'll give you insurance on your routes.

40:26And the reason they need it is the shipping companies are levered, they take on

40:30debt to buy the ships.

40:32And the debtors require that they have insurance, or else they're not allowed to take

40:37the routes, because the debtors are ultimately going to be out the money.

40:39And so the shipping companies themselves need to have insurance.

40:43And so this provides a market that has now gone away.

40:46Very smart. And ultimately, a lot of people are saying this could actually reshore or

40:51onshore maritime insurance back to the United States, and create an entirely new insurance industry

40:57here in the US that has historically been served almost exclusively by European syndicates and

41:03European partners. And it actually creates a big economic opportunity as this war dies down

41:08for American insurance companies and American brokers to basically be the underwriters and the guarantors

41:13of this sort of insurance and create a new industry.

41:16So that's super, super interesting kind of side story on what's going on here.

41:19All right, some breaking news here, folks, via Bloomberg, the Pentagon has formally notified Anthropic

41:25that it's been deemed a supply chain risk.

41:27This has never happened to an American company.

41:30It has happened to Russian companies, and Chinese companies, Huawei.

41:36And for background, the Department of War canceled Anthropic's $200 million contract on Friday, and

41:42said they would do this.

41:44The dispute came down to two clauses, according to sources, and we have one of

41:47the principles here. So we will hear directly from him in a moment.

41:52Anthropic had two concerns. Number one, fully autonomous weapons, aka murder bots, as we previously

41:57discussed. Dario didn't feel that their technology was reliable yet, and wanted some assurances.

42:05The second thing Anthropic said was they were concerned about mass surveillance of Americans, because

42:11they believe this technology is uniquely powerful, and can do things beyond what a series

42:19of webcams or a network of 7 -Eleven cameras can do.

42:25Kentagon said they wanted all lawful use.

42:29Dario, you're welcome to come on the program next week or any time to give

42:32your side of the story.

42:33But this week, we have Emil.

42:35Emil, your thoughts, and explain to us what happened here and how this broke down.

42:39It's worth a little history, short history.

42:42So if you remember the Biden executive order on AI, which was this crazy executive

42:49order that limited the amount of compute any model company could do, and was essentially

42:55grandfathered in a small number of AI companies that they were going to designate the

43:00winners, and everyone else was out so they could have more control on what they

43:04did. And Anthropic was one of those winners.

43:08And then they were smart, actually, it was a good sales strategy to sell into

43:13the most sensitive parts of the U .S.

43:15government, like all of our combatant commands, CENTCOM, Central Command that's doing the Iran fight

43:21now, the Indo -PACOM command, which is sort of responsible for China, several of the

43:26intelligence agencies. And they did forward -deployed engineers, Palantir style.

43:31So they got very sticky to the workflows and all that.

43:35And so I came in and I got the AI portfolio for department in August.

43:41And I said, I just want to see the contracts, you know, the old lawyer

43:44in me. And I looked at contracts.

43:47I was like, holy cow.

43:48They say you can't use them for, you can't use them to plan a kinetic

43:52strike. You can't use their AI model to move a satellite.

43:56You can't, there was a 20 page.

43:58You can't do a war game scenario with it?

44:00You could do a scenario, but you can't like, let's suppose you're writing a plan

44:04saying like, if this happens, here's what we would do.

44:07And it might involve a kinetic strike, which causes harm to a human.

44:10So like, well, what do you think these folks do?

44:13You know, this is the department of war.

44:14This is what we do.

44:16And so I said, okay, well, I've got to number one, have direct relationships with

44:20these companies, not just through Palantir, because I want to use it more broadly.

44:24And then number two, I need to have the terms of service be rational relative

44:28to our mission set. So we started these negotiations and took three months and I

44:34had to sort of give them scenarios about like these Chinese hypersonic missile example.

44:40They're like, okay, we'll give you an exception for that.

44:42Well, how about this drone swarm?

44:44We'll give you an exception for that.

44:46And I was like, the exceptions doesn't work.

44:47I can't predict for the next 20 years what all the things we might use

44:52AI for. And so all lawful use seems like a good thing.

44:57If Congress wants to act, great.

44:59We have our own internal policies.

45:01Like we'll follow them. We're not knuckle draggers here.

45:04We want to, we don't want to hurt people unnecessarily.

45:07So, you know, it's our province to decide how we fight and win wars so

45:12long as they're lawful. And I think at some point it turned into a PR

45:17game for them because they were not going to win this intellectual battle of, well,

45:25we're going to stop you.

45:26We're going to use our judgment because we think Congress is behind and impose it

45:30on the U .S. military.

45:31And it became this, like, let's find the issues that are most inflammatory.

45:36Robot weapons and mass surveillance.

45:39And you're like, we're the Department of War.

45:40We're not the FBI. We're not Homeland Security.

45:42We're not ICE. You're not allowed to legally spy on Americans.

45:45Yeah, you're not. You're not.

45:47So it's, so you're like, and then what it came down to on that issue,

45:52just as an anecdote, is they didn't want us to bulk collect public information on

45:58people using their AI system.

46:01And they wrote it in a way that I was like, so you're telling me

46:03before we got to bulk collect if someone types in, you know, Shemot's LinkedIn, it's,

46:10I'm using public available information that I would be violating your terms of service.

46:15Like, yeah, well, okay, let's rewrite it.

46:16So there's months of this, like, stuff, which was sort of interminable.

46:22And then the trigger point was after the Maduro raid, one of their execs called

46:29Palantir, who we buy themselves through, and asked them, was our software used in that

46:34raid? Which is, by the way, classified information.

46:37Anyway, so we're trying to get classified information.

46:40And implying that if there was use in that raid, that that might violate their

46:44terms of service. So they wanted to enforce, this is very important here.

46:48Yeah. They wanted to enforce their terms of service.

46:50They went behind your back to try to collect information to then maybe pull your

46:57license for their technology. You know, it wasn't behind my back.

47:01I don't want to accuse them of that.

47:02Palantir is the prime contractor.

47:04Um, but it raised enough alarm with Palantir, who's got a trusted relationship with the

47:09department to tell me, and I'm like, holy what if this software went down, some

47:15guardrail kicked up, some refusal happened for the next fight.

47:19So I was like, holy is the definition of service, some of our like this

47:20one. And we left our people at risk.

47:23So, I went to Secretary Hegseth.

47:25I said, this would happen.

47:26And that was like a whoa moment for the whole leadership at the Pentagon that

47:29we're potentially so dependent on a software provider without another alternative that has the right

47:36ability to not only shut it off, maybe it's a rogue developer who could poison

47:40the model to make it not do what you want at the time or sort

47:44of trick you because you have to trick it.

47:46I mean, all these things that we know we're aware about models or hallucinate purposefully

47:50or not follow instructions like some insider threat stuff.

47:55So, then that culminated in the Tuesday kind of dramatic meeting with Secretary Hegseth and

48:01me and Dario with the Friday deadline that got blown.

48:06And I never thought they really wanted to make it.

48:09Is the model entirely hosted by Anthropic or just explain to us technically, does this

48:15sit in a cloud that Palantir runs for you guys?

48:19Is there really technically a way that employees at Anthropic could kind of interfere or

48:24intervene in the use of the model?

48:26Yeah. So, they put their model in AWS GovCloud.

48:31At GovCloud, yeah. And then Palantir serves it from there and they refresh it.

48:37They held the control plane for the model.

48:40So, yeah. They can change the model weights if they want.

48:43They can do whatever they want.

48:44Yeah. The insight into this thing is unbelievable.

48:47Not just governments, but now if you're running a company, the reality is that what

48:54Anthropic showed, which by the way is their right at some level, is that they're

49:00going to have a political perspective and a set of terms that reflect their philosophy

49:06and that that philosophy can change on a dime.

49:09But what the government did was also completely reasonable, which is we can't rely on

49:14you if you're going to be completely unreliable and disallow things that are reasonable.

49:22I'll give you a different example to make the point.

49:26There's a state that wants to run some healthcare program, but they're a pro -life

49:31state. You can't conduct abortions in that state.

49:35Does that mean that the Anthropic engineers can decide, you know what, we're pro -choice,

49:40so we're going to change the access model and the capability of that model inside

49:44of that state? Is that allowed?

49:46Should that be allowed? At one level, you'd say this is a private company.

49:50They're allowed to choose. But what that really means is for the government, for all

49:54the states, for any city, for every company, you cannot choose to only use one

49:59of these things. Because it is just a matter of time until some person inside

50:05of one of these companies goes on some lunatic moral tirade and then jeopardizes your

50:10business against something that is nothing about law, but is everything about subjectivity.

50:16That is the huge thing that this thing tore open this weekend.

50:19So if you're not figuring out how to be multi -model and agnostic across these

50:24models, you're taking on enormous business risk after Friday.

50:27Because you can't tolerate that these folks will do that.

50:29It's too critical of a technology.

50:31By the way, this is deplatforming all over again.

50:35Remember what happened when you didn't like what was said, now all of a sudden

50:38you were deplatformed? This is that times a thousand.

50:42Because this is not about posting on social media.

50:44This is about using fundamental technology to either advantage or disadvantage your business.

50:49Emil? Yeah, I mean, I think I described it the other way, the other day,

50:54as the leaders of these companies say, you're going to listen to me.

50:58I mean, the other day...

50:58they're going to cause 50 % white -collar unemployment.

51:01This is as powerful as a nuclear bomb.

51:04It's like 50 ,000 geniuses in a data center, so you could have a small

51:07country coerce the world into it, whatever.

51:09So you're like, holy cow.

51:11All right, so this is a general substrate of intelligence, of technology that's applicable to

51:16a lot of things. Very generalized.

51:18It's not like workday HR software where you could just use a competitor.

51:22This is going to be part of our everyday life in so many different ways.

51:26And they're controlling whether it has a moral conscience.

51:30I mean, Anthropic has its own constitution.

51:32It has its own soul.

51:34It's not the U .S.

51:35Constitution. So you're subject to that, plus whatever whims and how that changes.

51:41And that's a scary thought for Americans generally.

51:45And I think that did come through a little bit today.

51:48And in the coming years, it's going to be a bigger and bigger deal.

51:51So take us through OpenAI software, Gemini software, and Grok software, have they pushed back

51:58on any use? Or are they like Dell or Apple?

52:02They sell you a computer and you have the computer and you can use it

52:05as you will. I have any of those giving you any pushback?

52:09So Grok's all in for all awful use cases across all classified and unclassified networks,

52:14as you'd expect. Because, you know, Elon's truth -seeking.

52:18We want truth in Department of War.

52:19We don't want ideology because ideology will mess with operational decisions.

52:24Like, you don't want anything to be fake or tilted.

52:28Where's Sergey and Google and...

52:30We have them. We have Google for all awful use cases on classified networks, and

52:35we're trying to move them to classified networks.

52:37They have to build out infrastructure because this stuff's complicated.

52:40So they're in compliance in terms of what you're looking for as a partner.

52:44And then I guess the last one is OpenAI.

52:46And Sam seems to be, just characteristically, playing both sides a bit.

52:51No, no. Where is he at?

52:53To his credit, I called him and said, I need a solution if this thing

52:59goes sideways. I need multiple solutions.

53:02I'd like you to be one of them.

53:04And he's like, okay, what can I do for the country?

53:06He's like, I need to get you up running as soon as I can.

53:09And he was trying to protect Anthropic to his credit.

53:14He was like, don't call him a supply chain risk.

53:16That's bad for the industry.

53:18Maybe I can negotiate terms that they'll find acceptable.

53:22But he's in the middle because they compete for the same researchers.

53:26So a lot of this comes down to this thousand researchers, like baseball players that

53:31get traded between these companies.

53:33Moneyball, yeah. These are the best of the best.

53:35It's a very moneyball -ish sort of thing.

53:36And there's not that many of them.

53:38And you lose 20 % of them.

53:41And all of a sudden, they launched Claude Code before you launched Codex or something

53:45like that. And then the numbers change pretty dramatically.

53:48So he was being a real patriot to his credit and trying to help Anthropic

53:53while they were trashing him and recruiting from his company.

53:56And I'm not biased. I want all of them.

53:59I want to give them all the same exact terms because I need redundancy.

54:04I want to see if they diverge or not or if they converge.

54:08Maybe I only need two over time.

54:10But we don't know. It's too early.

54:11But why keep them in the mix, Emile?

54:13So if there's clearly a difference of operations and philosophy and how they want to

54:19run their business, and there's other models, is their model particularly good at particular applications

54:26that make it important to keep it in the mix, given that there are three

54:30or four other kind of alternatives here?

54:31Anthropic, you mean? Yeah. Well, because the number one reason...

54:36were having this conversation at all was because they were deeply embedded.

54:39So now I have to un -entangle them.

54:42And the other companies have not gone as heavy enterprise, enterprise sales, forward deployed engineers,

54:49government business. So they have to catch up, not necessarily the capability of the model,

54:54but just how do you serve the government?

54:56And probably because just way ahead on that.

54:58Right. But the models themselves, you don't think are uniquely advantaged?

55:01Or do you have a view on that at this point?

55:03I don't have a view on that.

55:04I don't think they're, you know, certainly cloud code was innovative and ahead.

55:09That's true. But do I believe in 12 months Codex is not going to be

55:15close? I think it will be.

55:17I think you're right. There's an asymptoting that's happening.

55:19If you just look at the confidence interval on how over -performing or under -performing

55:24some of the leading models are, the error bars are shrinking, right?

55:27The confidence intervals, like these things are all kind of becoming the same.

55:32Eventually, they're all getting access to enough power, enough compute.

55:36They're generating similar results, it turns out, which I think you would expect.

55:40So even more important that you have a complexion of models.

55:45The other thing, Emil, I don't know if you saw this, but they posted about

55:49the revenue ramp of Anthropic.

55:52And I have a small software company called 8090.

55:56And I asked the team, let's go at our OPEX.

55:58I posted it because I was so shocked at these numbers.

56:01Our costs have more than tripled since November of 25.

56:06Between the inference costs that we pay AWS, which is ginormous, between our cost with

56:12cursor, between Anthropic, we are just spending millions.

56:16So more per unit and more in aggregate?

56:20Both. But the problem is that my costs are going up 3x every three months,

56:25my revenues are not. Token use is very addicting.

56:30And by the way, because everybody has gotten infatuated with what we call these Ralph

56:34Wiggum loops, like just like send the thing off and like, it'll just go figure

56:37something out. A, it never figures anything out.

56:40And B, you just get this ginormous bill from Cursor.

56:43So one of the things we had to do was just, we had to say,

56:45guys, you got to deprecate Cursor because you're just wrapping plot code and charging us

56:48way too much for these tokens.

56:51But I don't know if you're seeing any of this thing where like the tool

56:54usage, it's so great to use these tools.

56:56Let's be honest. It's super fun.

56:57They're phenomenal. It's like, you feel like a genius.

57:00But then the ROI of these tools are really important.

57:03I'm not sure that that's as much of an issue for you or not in

57:05the department of work. Not yet, but it will be.

57:08It will be. For sure.

57:12As people find more and more use cases, the use cases get more sophisticated.

57:15So the next marginal thing you have to do is likely to be harder and

57:20therefore be more consumptive, right?

57:22Right, right. Let me just ask, Emil, the important question that I think triggered a

57:27lot of the news this week is why then designate them as supply chain risk?

57:32Why not just abandon them, move on, use the other vendors?

57:36Like why take this kind of punitive action?

57:38Yeah. So I don't view it as punitive and I'll tell you why.

57:41It's if their model has this policy bias, let's call it, based on their constitution,

57:49their culture, their people, and so on.

57:52I don't want Lockheed Martin using their model to design weapons for me.

57:56I don't want the people who are designing the things that go into the componentry

58:01to come to me because if that poison, if you believe the risk of poisoning,

58:06you're compounding that risk. Yes.

58:08It can enter into any part of the defense enterprise, but it's just the defense

58:13enterprise. So. Boeing wants to use Anthropic to build commercial jets?

58:19Have at it. Boeing wants to use it to build fighter jets?

58:22I can't have that because I don't trust what the outputs may be because they're

58:27so wedded to their own policy preferences.

58:29I guess a dovetail to that is why couldn't this have been handled quietly?

58:34Is this Anthropic who made this a public spat or was it the administration that

58:40made it a public spat or two to 10?

58:42I mean, they have a very good, sophisticated press operation and like really good and

58:49painting us as doing mass surveillance where their issue was like some commercial database thing

58:57that someone else could buy.

58:59They didn't want us to buy to use it, which I'm not even sure we

59:01buy them, except to do recruiting for soldiers.

59:04And, you know, we run schools, hospitals.

59:06We do a lot of things that do, do we don't just fight wars.

59:09And, um, and the way they were able to characterize these two things, which are

59:13genuinely scary to people, but we're not the real issues.

59:17Um, it was really the, you worry, I worried about them shutting off our system

59:22at a moment of need or them messing with our system.

59:25I mean, those were, we were scared came to mind is if they are selling

59:29you batteries and you need to use the batteries or the laptops, whoever you need

59:33to use them lawfully. Okay.

59:35That should be enough for them unless they are peaceniks and they don't want to

59:39be involved in selling weapons, which by the way, was Google's position for many years.

59:43They just didn't want to be involved in it because to your point, they want

59:47to recruit talent that is also aligned with that.

59:50So there's just seems to be, maybe this isn't the right partner for the department

59:54of war. Yeah. If you don't want your stuff to be used for department war

59:59stuff, you shouldn't be selling to the department of war.

1:00:03It's in the name. Well, and then also I have to say when, you know,

1:00:09you said, Hey, we don't know what, how we're going to use this thing.

1:00:12Like it immediately came to mind was like nine 11.

1:00:15You have to go check with them.

1:00:17You know, if you find out there's another nine 11 unique, you know, black swan

1:00:22event that's going to occur and you have to go clear with them.

1:00:25Like you, that was literally the comment.

1:00:27That was literally the comment when I was, yeah.

1:00:30So it was in a room of 20 people.

1:00:31So this is not undeniable.

1:00:33If ever, everyone wants to deny it.

1:00:35And I was given these scenarios, these golden dome scenarios and so on.

1:00:39And he's like, just call me if you need another exception.

1:00:42And you know, I'm like, but what if the balloons going up at that moment?

1:00:46And it's like a decisive action we have to take.

1:00:48I'm not going to call you to do something.

1:00:51It's like not rational. And so that was another holy cow moment of like how

1:00:57they think about it. That just means that what he wants to be is the

1:01:01secretary of war. That's right.

1:01:03He wants to be the God King there, I guess.

1:01:05Yeah. You can't do that.

1:01:07The thing that shocks me, Emil, I don't know.

1:01:09Maybe you can't say anything, but guys, you can comment on this.

1:01:12It's clear that Anthropic just lost all the Republicans.

1:01:17But I think that if they think that they have the Democrats, that's fleeting as

1:01:20well, because I think progressive Democrats fundamentally just hate Silicon Valley and technology.

1:01:27And so there's no way they're going to let some God King over here that

1:01:31they don't control either. And so in both ways, I think they accidentally may have

1:01:34pissed off every constituent. The longer term fallout amongst them and progressives will come home

1:01:40to roost because as the progressives want more control, and these guys push back on

1:01:44them, they're just going to fall into the same situation.

1:01:48Yeah. I mean, it's an interesting perspective.

1:01:52I think if you're don't want to be involved in war, that's your right.

1:01:56I think you mentioned this like three times, Jamath, just don't sell bullets if you

1:02:00don't want to be in, but you can't call Smith and Wesson and say, can

1:02:03I? The other thing is, what the hell was the senior management and the board

1:02:08talking about over these last few days?

1:02:11Because to me, it would have sounded insane.

1:02:13So then the question is, were people just so breathless to buy this revenue curve?

1:02:17What is the board doing?

1:02:18What is the senior management really doing?

1:02:20What do you change guys?

1:02:22What do you think you would tell them if you were sitting inside of the

1:02:24board of Anthropic? Fraber, if you're an investor, you're on the board, what do you

1:02:28say to Dario when he says, hey, I need to dictate to Emil and Hegseth

1:02:33how they use my tool and everybody else is just saying lawful use as the

1:02:36standard. What's your coaching advice?

1:02:39Well, it's also a very unusual circumstance because I don't think any business in history

1:02:44has grown as fast as they have in the last 90 days.

1:02:47So they've added, what was it?

1:02:49Six billion of ARR in a month or something.

1:02:53I mean, that's absurd. It's absurd.

1:02:55It's absurd. It's a great product.

1:02:57Open Claw has driven a lot of this.

1:02:59It's absurd. If you're on the board - You're closing your eyes.

1:03:01Yeah. You're shutting the f*** up.

1:03:02You're just shutting the f*** up because something's working.

1:03:05You're selling a secondary? I think he's off doing his thing and they're going to

1:03:08let him do it. And I don't think that company's worth 350 billion anymore.

1:03:13God knows what it's worth.

1:03:14Oh, that's interesting. Where do you, if you get put a block of stock right

1:03:18now, where do you put a bid in?

1:03:19I'll tell you where I put a bid in.

1:03:20Oh my God. I had this conversation at dinner two nights ago.

1:03:23It's like, you have to pick between OpenAI at their current mark, Anthropic at their

1:03:28current mark, or Google. And it's either multiple from here or net market value creation

1:03:36from here. Because those are actually two very different conversations.

1:03:38Explain the difference. I think the net market valuation, because Google's already worth 3 trillion.

1:03:42So if they double, they've added 3 trillion.

1:03:45But I think Google is the bet.

1:03:47I think Google is the market value creator bet.

1:03:50But I think Anthropic is the multiple bet.

1:03:52I think Anthropic is a trillion five market cap at the end of the day.

1:03:56Unless this blows them up.

1:03:58You're still buying the 5X versus the 3X kind of thing.

1:04:00You'd buy the 5X instead of the 2X.

1:04:03But if you get put a block of stock now, do you buy it at

1:04:05the last post or do you buy it at a discount?

1:04:07Or do you just say, ah, I just buy it at the last post.

1:04:10Anthropic is worth a lot more than 350.

1:04:11That's for sure. It's undervalued compared to ChatGPT.

1:04:15They just added 6 billion in the last month.

1:04:17And I will tell you, anecdotally, anecdotally, everyone I talk to is on CoWork.

1:04:23Everyone has gone deep on this.

1:04:25Everyone's amazed and shocked and actively using it.

1:04:28And everyone's saying the same thing, which is Anthropic may actually be fulfilling the promise

1:04:31of AI. I will also say that it's only going to take 90 days for

1:04:36Google to flip on a virtual version of CoWork.

1:04:40And once Google has this integrated with G Suite, and you have a virtual hosted

1:04:44version of CoWork, I think Google sweeps the market with this same competitor.

1:04:47But right now, CoWork is such an incredible product.

1:04:50And everyone's saying the same thing.

1:04:51It's like giving truth to AI.

1:04:54Elon said something with respect to Grok, which was that he expects it to exceed

1:05:00all of these coding models, probably in the May spin, but for sure by June.

1:05:07So to your point, Freeberg, I guess my question, guys, to you is like, what

1:05:12happens? Okay, what do you guys do?

1:05:14Emil, what do you do when all the models asymptote?

1:05:17Let's just say by October of this year, let's just say I can guarantee you,

1:05:20just for the thought exercise, by October, all the models are the same.

1:05:26Do you just take a complexion of them all and say, great, we're going to

1:05:29build some governance layer around it and everything.

1:05:31Al, we're indifferent or what do you do?

1:05:35I would love to be indifferent because then I could compete on price, right?

1:05:39And then I have one main and one redundant or two mains and I'd need

1:05:47at least two. Anthropoc's not going to be one of them if they continue sort

1:05:51of with their sort of posture.

1:05:54So then it would be three.

1:05:56And if one gets wobbly from a policy scenario too, because they all, you know,

1:06:00except for Elon's is based in San Francisco and has that vibe to it.

1:06:04So you kind of want to have two or three at any given time.

1:06:07And yeah, then you price compete them.

1:06:10I do think Google has a long -term strategic advantage, not only because of their

1:06:15consumer thing, but because they have their own cloud.

1:06:18So between them, they don't have the margin on top of the cloud that Anthropoc

1:06:22will have to pass on.

1:06:23So it's an interesting economic proposition from them.

1:06:29And just to build on your point, Friedberg, after you finish your insightful comments, here,

1:06:37pull this up, Nick. Almost on cue, Friedberg.

1:06:40You're such an oracle. Here is the announcement from Google.

1:06:43Google Workspace is now integrated for agents and 40 agent skills were included today.

1:06:50Amil, you've been great today.

1:06:52Super honest. Dario's position. I'm going to give you some fastballs here.

1:06:57Dario says, the real reason the Pentagon and Trump admin do not like us is

1:07:04that we haven't donated to Trump.

1:07:06While OpenAI, Greg, have donated a lot.

1:07:10Here's Claude's answer to that claim.

1:07:13Here's nine companies and their activities with the administration from the inauguration to attending the

1:07:20inauguration to the White House CEO dinner to the Melania documentary.

1:07:24If you go through and you look at these nine companies, Microsoft, Apple, Tim Apple,

1:07:31NVIDIA, Amazon, they have all participated.

1:07:34There's one company that hasn't participated, and that's Anthropoc.

1:07:39Are, is Anthropoc being singled out because they are not genuflecting and because they're not

1:07:45paying the cover charge? People say this administration is pay for play.

1:07:49That's the accusation he's making.

1:07:52I'd say maybe there's a cover charge.

1:07:54Nobody likes to pay it, but the other companies have.

1:07:56What do you think here?

1:07:57I mean, it's literally one of the dumbest things I've ever heard.

1:08:00But I, truly, just because I'm like, I'm in the Department of War.

1:08:06I need to win wars.

1:08:07If you help me win wars and I don't have to waste time transitioning you

1:08:10out, that makes me thrilled.

1:08:14It's sort of, it's a criticism on me because it's not like Trump, President Trump

1:08:19dipped in and he's like, hey, Emil, by the way, those guys didn't get me

1:08:21any money. You can't use them anymore.

1:08:23Obviously. It's sort of like invention in his own mind.

1:08:27It's like, I don't know if people sleep at night, if those thoughts get in

1:08:30there and, and I was trying to work with them.

1:08:34Why would I spend three months trying to negotiate with them to get to a

1:08:37simple standard? If I would have just said, okay, guys, you're out by.

1:08:41So I think it's just some internal psychosis.

1:08:45That's the only way I can explain that.

1:08:47Okay. It could be on Dario that he's antagonistic to the administration, both with respect

1:08:51to how he operates commercially.

1:08:53And it's also reflected in the fact that he doesn't want to support the administration.

1:08:57I have a different theory.

1:08:58I think that they have a massive instance of co -work running internally that helps

1:09:04them come up with business strategy.

1:09:07And I bet you there's like some element of AI.

1:09:10I bet you there's like some element of AI.

1:09:10that says yeah you should do it do it it just makes sense zig where

1:09:13they zag and get more press and so now there's some some clod bot telling

1:09:18them to basically tell the department of war to pound sand it's going to turn

1:09:22out to be the stupidest decision listen if i was chairman of the board of

1:09:25that company i pulled dario aside and i'd say listen you're obviously a genius we

1:09:29obviously have the best tool in town this is not a battle you can win

1:09:33and it makes no sense you're going to come across as not being patriotic and

1:09:38tim cook is showing up for the melania premier would it kill you to support

1:09:42the president would he kill you to show up look what happened i think that's

1:09:45the wrong look what happened when biden excluded elon that ankled him show up for

1:09:51the president i'll tell you i'll tell you show up for america and be a

1:09:54patriot you don't have to donate but be a patriot and show up for the

1:09:56dinners that's terrible advice here's my advice okay here's your advice okay hey dario call

1:10:02a meal back right now and say you know what sorry we fucked up we're

1:10:06gonna own this and we're gonna put out a press release that says we support

1:10:11our customers use of our models to do everything and anything that's lawful number one

1:10:18and number two that our terms of service are written in stone and that you

1:10:23can expect solidity and reliability from us and this was just the misstep camille how

1:10:29do you respond i mean i would say that's what i've always wanted i need

1:10:34a reliable steady partner that gives me something that'll work with me on autonomous because

1:10:40someday it'll be real and we're starting to see earlier versions of that and i

1:10:45need someone who's not going to wig out in the middle and we're just at

1:10:49the early stages and is rational but then you know you called president trump and

1:10:54your 5 000 word essay on friday a wannabe dictator you're gonna have to apologize

1:11:00to more people than just me yeah maybe time to re -underwrite the position here

1:11:03uh let's just say kumbaya everybody kumbaya we've solved the problem and look who's on

1:11:09the line surprise guest dario's here i thought i would surprise everybody nick pull dario

1:11:13up no he's not here what's your view on how the industrial supply chain for

1:11:18hardware components and systems is coming along in the united states because my understanding is

1:11:23we're trying to reduce dependency on chinese manufactured components where are we with respect to

1:11:29where we need to get to in the u .s manufacturing supply chain we are

1:11:34early days um critical minerals you see you've seen the action around that um you'll

1:11:41start to see so i have the office of strategic capital which has 200 billion

1:11:44in lending authority and what we're trying to do is is it's like treasuries plus

1:11:50100 bips loan to companies show them that the department needs their solid rocket motors

1:11:56their batteries their fiberglass like all the things that we that we're heavily dependent on

1:12:02for our defense industrial base that are completely outsourced to china and domesticate them here

1:12:07um and we've got a bunch of great people running it so i but it's

1:12:13early days it's going to take for the rest of the term to get um

1:12:17i think we'll get critical minerals done before the rest of the term where where

1:12:21we have the access to what we need to from us or allied countries um

1:12:28and but from batteries it's like the next problem i'm trying to solve for example

1:12:32batteries are totally outsourced both technologically and from lithium to china um and there's like

1:12:37you know kind of call it 20 critical things if i could get to all

1:12:42of them at some level but then it'll take a few years for them to

1:12:45like build plants and do that stuff but they're there it's it's very important i

1:12:48hope Whatever administration comes next continues it because I'm all free market, but we outsourced

1:12:54so much that, you know, it crippled sort of the kind of assembly part of

1:13:02putting all these things together.

1:13:04Do we have a munitions risk right now, given the conflicts that we're involved in?

1:13:08We don't have a munitions risk, but we do need a plus up because the

1:13:15Europeans are taking a long time to contribute.

1:13:17Like Ukraine, Russia has consumed a lot of munitions from all over the world.

1:13:22And then obviously these conflicts we've been in and we need to have like the

1:13:30next generation. We're still there's still a large degree.

1:13:33We're fighting with 1980 Cold War weapons.

1:13:35Right. And not modern weapons.

1:13:37And so we need to plus up those things that to regenerate them.

1:13:42I mean, our nuclear missiles are 50 years old.

1:13:45Some of the planes are 40 years old.

1:13:47So all that has to be renewed.

1:13:50Do you think it's just speak to the venture capitalists in the audience?

1:13:54Are we in the early stages of this kind of defense tech boom?

1:13:58Is defense tech well -funded at this point or is it kind of too hypey

1:14:02and bubbly? And that's not really the issue.

1:14:04It's not about funding the companies.

1:14:05It's about funding some of the further upstream issues that we're facing.

1:14:09What's your view on where we are?

1:14:10There's more defense tech venture capital than ever by, you know, 3x more than last

1:14:15year. So, you know, it's growing.

1:14:18What I need to do and what the department needs to do is have some

1:14:22of these companies win big contracts quick.

1:14:24Like whether, you know, Andrel Shure, Saronic Shure, like a bunch of these companies so

1:14:31that more money flows in, more entrepreneurs do it, and I could buy more.

1:14:35Because generally, I do think warfare is going from big carrier ships that cost $20

1:14:42billion and a decade and a half to build to mass, attributable, low -cost things.

1:14:51And that's what these new entrants can do.

1:14:54So we need those to succeed so that the flywheel goes with venture capital money,

1:14:58entrepreneurs' capabilities. In that sense, and what I've heard as kind of the explainer for

1:15:03this is we're moving from the old primes to the new primes, that there's going

1:15:07to be a small set of big winners, and then obviously lots of seconds and

1:15:11subs and whatnot. Is that really how this market's going to evolve?

1:15:15So are we going to end up with Andrel, Palantir, maybe three or four others,

1:15:18and that's where most of the value is going to accrue from a market perspective?

1:15:22I mean, Andrel and Palantir want that, and I joke with them all the time

1:15:25about it, but I definitely want at least a second layer that's innovative and trying

1:15:31to disrupt the first layer all the time.

1:15:33I've had a mom -and -pop wholly -owned company that makes these missiles called ERAMs

1:15:38that we really send to Ukraine, and they do it with like 30 people, and

1:15:42they can do 1 ,000 a year because they've designed and manufactured, and it's awesome.

1:15:46So I want companies like that to continue innovating.

1:15:50Maybe Andrel then buys them, but one of the reasons the primes are such a

1:15:55small number, it's not the only, but it's one, is they learn how to contract

1:15:59with the government. They learn how to go through the bureaucracy, and that became a

1:16:03competitive advantage. I'm trying to take that competitive advantage away.

1:16:07That's a really important point.

1:16:08How do you disassemble all that bureaucracy so that product innovation can actually get to

1:16:15you? Yeah, so we did a big, so part of it comes down to requirements

1:16:21reform. What used to happen is people are like, oh, we need a new fighter

1:16:25jet. So Army, Navy, Air Force, Port.

1:16:27into the requirements and we needed to be stealthy, to hold a missile, to hold

1:16:33four humans. And it became this unbuildable thing, but the contractor didn't care because they're

1:16:40getting paid cost plus. So like, sure, I'll fulfill your requirements.

1:16:45Two years from now, you're like, that was never engineered properly.

1:16:48It'll be another few years late and a couple more billion dollars.

1:16:51So we're trying to change that to, I tell you my common operational problem, I

1:16:55need a bunch of missiles that go 500 miles or more that have this kind

1:16:58of blast. Come to me with solutions as little requirements as possible on that side.

1:17:03And then on the contract piece, trying to get to as close to commercial contracts

1:17:07as possible. And this is where the startups are so good.

1:17:12They'll do fixed cost pricing.

1:17:13They'll do, you don't pay me as much if I deliver late.

1:17:18You pay me more if I deliver early.

1:17:20It's very disruptive to the existing system.

1:17:22Super disruptive, but that's, that's what I'm, I'm like waking up every day trying to

1:17:27do. So you could put out as something saying, Hey, the straight and four moves

1:17:30is super important. We need to keep it open.

1:17:33We need these types of devices to keep it open, but come to us with

1:17:36your ideas and let them be creative entrepreneurs as opposed to, you know, just trying

1:17:42to goose the profits. Yeah.

1:17:43It's really brilliant. Yeah. Emile, you also oversee DARPA, yeah?

1:17:47Yeah. Darpa is the father of the modern internet and it's created a lot of

1:17:52really critical technologies. Can you talk about what's going on in there?

1:17:55Are there interesting things that you think our audience should know about that you're trying

1:17:59to push forward? I mean, there's so much, probably my favorite part of, of my,

1:18:04my office is like, because there, that's where you, it's sort of like, it's still

1:18:09a very honored profession to be part of DARPA.

1:18:12Like, you know, being a, being in government service for a long time is sort

1:18:15of reduced in its stature since the Manhattan project.

1:18:19Now, because now, now if you're a great ask, you know, uh, someone who wants

1:18:23to do rockets and stuff, you go to SpaceX.

1:18:25DARPA still has the best of the best.

1:18:28And so the most creative ideas happen there.

1:18:30One of the things that they're working on that's public is they're trying to use

1:18:34biology to synthesize critical minerals.

1:18:36So, so how do you, so how can you just pull them out of ground,

1:18:39use biology to do it so you don't need to do all this crazy, messy,

1:18:43dirty refining that would like change the game big time on our ability to get

1:18:48the critical minerals we need faster and leapfrog the Chinese in terms of tech.

1:18:52Um, so they're doing a lot of that kind of stuff.

1:18:56They're deep in cyber, cyber attacks are the next huge threat with AI, right?

1:19:01What we saw with creating all these agents to attack systems that anthropic actually happened

1:19:06to them. Um, um, so they're, they're, they're working on this.

1:19:10That's, there's not a ton I could talk about kind of DARPA because it's so,

1:19:14it's so classified, but those are a couple of examples for you.

1:19:17All right. Speaking of classified, uh, just two quick questions before we wrap here.

1:19:21Are there aliens? And when are you going to tell us as a number two,

1:19:24uh, in all seriousness, I'm curious, what have you learned about China and where they're

1:19:30at and the threat there and our ability to counter it?

1:19:34Like give us some idea of where we're at as a country.

1:19:37Cause we hear a lot of hyperbolic stuff.

1:19:40They're building this incredible mobile, small Navy.

1:19:44They've got hypersonics. They're just way ahead of us.

1:19:47You know, we hear these things, but realistically, are we competitive?

1:19:51Um, I fought, well, I'll answer your first question was I fought for the alien

1:19:55portfolio. I didn't get it.

1:19:58All the guys on my team were like, do you got to get this for

1:20:04us? Please talk to them.

1:20:05Terry, we want to do this.

1:20:08But I was like, as long as I had 100 % access to everything, I

1:20:12would do it because that would be amazing, right?

1:20:15Lifesamers would be a game changer.

1:20:17But on the second one, it is true that Chinese have had the greatest military

1:20:23buildup in world history in the last 15 years.

1:20:26And we're asleep at the wheel to some degree because we're focused on global war

1:20:31and terror. So they've advanced without sort of us thinking about threat.

1:20:35That being said, our operational expertise and our space, we have some sophisticated stuff, our

1:20:44subs, our space layer. We still have the best stuff in the world, but we

1:20:52have to make sure that gap doesn't narrow.

1:20:54Right. We can't be complacent.

1:20:56We should sleep well at night knowing you're there, knowing President Trump's allocating money towards

1:21:01this and he's decisive in his actions, but we cannot be complacent.

1:21:04We can't be complacent. I feel like this week was a true reminder of how

1:21:08fortunate we are to have the defense that we have for the United States.

1:21:12When you look at what happened in Dubai and in Doha and in Tel Aviv,

1:21:18and you see how people in their residential homes are getting attacked and bombed, you

1:21:23realize just how fortunate we are to have all of the layers of protection that

1:21:26we have by our government.

1:21:28And I've actually come around to this quite a lot.

1:21:30I'm a true kind of arguably libertarian at heart, small government.

1:21:35But the one thing that I've realized is so critical for us to have the

1:21:38freedom to do all the things we want to do is defense.

1:21:41And so I think it's an amazing institution, very valuable to the United States.

1:21:46Emil, thank you for what you do.

1:21:47Yeah. Thank you, Emil. Really appreciate you coming on and being so candid and thoughtful

1:21:52and insightful. This has been an amazing episode.

1:21:55We'll see you next time.

1:21:56Bye -bye. Love you, boys.

1:21:58Bye -bye. We should all just get a room and just have one BQ Georgie

1:22:33because they're all just useless.

1:22:34It's like this, like, sexual tension, but they just need to release somehow.

1:22:38Wet your feet. Wet your feet.

1:22:43We need to get merch.

1:22:45I'm going all in. I'm going all in.

Inside the Iran War and the Pentagon's Feud with Anthropic with Under Secretary of War Emil Michael