Loading summary
Atriok
If you're joining us now, Atriok has been learning how to use an iPad for maybe the past 15 minutes.
Ludwig
Ladies and gentlemen, welcome to the lemonade stand. We're back to the lemonade stand. We're back again. No need for Aiden's little.
Atriok
No, we can. This episode will actually just be a full tutorial on how to use an iPad. You may have seen children use them at Chili's or other restaurants. Similar.
Ludwig
The woke liberals are trying to bring down your Liberation Day. Today is Liberation Day. And I will not.
Doug
We are free. It's Liberation Day. That's what it's called. Your calendars. Do you believe it took almost 250 years for America to do Liberation Day?
Ludwig
Liberating.
Doug
Ind we were indep.
Atriok
We had independence Day. But now this.
Doug
Nobody ever thought to do this.
Ludwig
Trump is the first deliberate and the best.
Doug
Okay. I think we're being liberated from cheap products is my understanding, among many other.
Ludwig
Things that we'll talk about today in Liberation Day as well as what we're not being liberated from is expensive housing, which I think does.
Doug
I will be. I will be talking about the many things ailing the particularly left leaning governments and their inability to build things in America, which I am very passionate and annoyed at.
Atriok
Is that going to short list? There's actually very few problems.
Doug
Yeah.
Ludwig
And then I think you're also going to talk about how you want to do it to adopt a South Korean child.
Atriok
I'm very. I was full set on adopting a South Korean child until I heard the big news, which I'll tell you guys later in this episode. But I believe we wanted to start with something new where we kind of go through a lighting round of smaller topics. One minute per topic.
Doug
Yes.
Atriok
And Doug, Doug has prepared and we wanted to start.
Ludwig
I just think this is really funny because like two weeks ago we said people's attention spans are getting too short and we have to like bring real rigor. Two weeks later.
Atriok
I'm literally texting on my phone right.
Ludwig
Now as we're talking in the show and you want to add a 1 minute lightning round topic to the cut.
Atriok
Cut.
Doug
Okay, I'm going to try to give some quick, some, some quick things here. All right, first off, X. I purchased X. So you know how when Elon bought Twitter a couple of years ago and people like this is a bad idea. This is stupid. How is he going to pay this back? Well, one way that he has an exit strategy is to buy it himself from his own AI company. So he recently did this. There's Actually a lot of strategic value to it in terms of having an AI company that directly owns all this data that's going on because most of the others don't. And so it is actually a real competitive advantage to do this. You have 30 seconds to respond. Go.
Ludwig
We've seen the Obama meme where he's putting the metal on himself.
Atriok
Yes.
Ludwig
It's Elon Musk putting $45 billion on himself, saying this company's worth what he bought.
Atriok
I was going to say, I'm sure the valuation is. Is exactly what the market.
Doug
There's no bia.
Atriok
Exactly what the market would prescribe.
Doug
Well, you know, it's not biased because he asked Grok what it's worth.
Atriok
Just the independent third party on the X. AI.
Doug
Yeah.
Ludwig
Low key. I think it's smart.
Atriok
This is probably one of his only reasonable paths to get Twitter to profitability, I imagine. Yeah.
Ludwig
Or just to keep it from being hounded by creditors.
Doug
One minute.
Ludwig
Say something about Saudi princes.
Doug
Dang it. No, this is an American Postcast episode, right? This is about American Liberation Day. American building liberation, Buying creation, liberation. Okay, next quick shot. OpenAI the main AI leader, as you might have seen, everybody is making studio Ghibli images. This is so unbelievably popular and has driven such a surge in people who are now trying out AI products. They said that when ChatGPT launched big. Oh, my God. Crazy. ChatGPT changed the world. They got a million signups, a million users in a week. And that was the most fast, I believe, the fastest growing app ever.
Ludwig
Something like that.
Doug
The fastest growing thing ever, period. Holy shit. They got 1 million new viewers users in an hour this week for Ghibli Access. During this week, there was a one hour period where they gained 1 million new users. That's not even the free tier. That's people paying at least 20 bucks a month. That is wild. This is growing at a level that is just absolutely obscene. And they're also. They announced open sourcing a model, which is interesting, but there's not enough time for Quick Shot. Go.
Atriok
I want to know what Miyazaki thinks about this so badly, because I can. I feel like the feedback won't be great. Also, we're at a minute. Squeeze something in.
Ludwig
No, it's like if they rolled out a Terminator in the stores, people be like, I don't want to buy that, but if it made your selfies a little cuter, they would buy it all over fit. Like, this is the proof. If you just make it.
Atriok
This is all it Takes.
Ludwig
It's all it takes.
Atriok
If Raytheon could pump out bombs with with the studio Ghibli find then. Which is not one to one with this situation at all. But it is very interesting to hear the scale at which it has grown in that short period of time. Next topic.
Doug
I had a good thing to say but that's fine. People don't care. Two more quick ones. Last week we talked about the massive hit coming out of China. The movie called Nezha 2. Yeah, yes pronunciation I'm sure is horrific. I actually went and tried to watch it because I was curious. The second one isn't available on streaming yet. The first one is. It's incredible. It's like an amazing movie. I loved it and I was like wow. Okay, I get it. China like well played. It was so like creative and interesting. Like just well made stories.
Ludwig
Comrade.
Atriok
This episode. China, they build homes, they build trains, they have great movies.
Doug
Movies.
Ludwig
Studio Gilification is crazy.
Atriok
I no longer want to move to Japan. Yeah, I actually really would like to watch the movie. I watched a few like Chinese animated films when I was learning Chinese during COVID for that six month period and I really enjoyed the couple things that I watched.
Ludwig
So in the minute I want to say one thing. We talked about this like a week ago, the movies thing. I looked at the data all the way back to 1980, 1912. America has had the number one movie every single year of human history of cinema until now, until this year. 2020 doesn't really count. 20 doesn't really count because no, they didn't have it. There wasn't any money in it and we have any theaters open. But outside of that and that's crazy.
Doug
I believe Liberation Day refers to us getting back the number one spot.
Ludwig
That's Trump talked about Minecraft tickets and the reviews are not good.
Atriok
In order to topple the new Chinese movie empire, we have to go see the Minecraft movie. And that brings it. Do we have any more Lightning Round topics?
Doug
Oh yeah, very last one which is funny. Also my. My Chinese acupuncturist said the second movie is not as good as the first. So sorry if anybody is kind of disappointed at the sequel to this follows.
Atriok
The thesis of the last episode. Is that sequels not as good?
Doug
The first one's amazing.
Ludwig
Oh, so become a Chinese movie snob.
Doug
Yeah, I liked it before they started pumping out. Yeah. You know I was an OG fan.
Atriok
Of whatever the 24 of China is.
Doug
And lastly, remember two episodes when I talked about the two HR companies that were beefing because they accused the other of having a spy who was stealing.
Ludwig
All the Team Deal.
Doug
So are you Team Deal or Team Rippling? Deal is again, the one who hired a legitimate spy to work at Rippling and then steal the company's secrets from the Slack Channel. There's an update. They were accused of doing that. Rippling got the spy to confess. So he's now confessing in court. And they tortured him. I did it. In between rounds of waterboarding, shouted out.
Ludwig
I did it Putin or whatever.
Doug
Basically saying that they. They reached out to him. The CEO of Deal was like, hey, I heard you're going to quit Rippling. I will pay you $6,000 a month to become a corporate spy for us. Including telling them they tried to get him and his family to bail to Dubai. And all of his lawyers, all the lawyers on Deal are like, using code words to be like, we know you're really stressed out with your work life right now. It might really help if you go to Dubai. And they're like, they're this dude over. And they're just like. And they're doing everything. They're making him, like, delete all the data. Everything was encoded. And so these. They might get away with it. And so this is. The CEO of Rippling is currently releasing more court documents right now, which, if you feel like looking at them, they're Parker Conrad on Twitter. It is, let's see. Truly ridiculous. So now he's at the end, he was freaking out on what to do, and his friend told him, the truth will set you free. And that's when he decided to be the better man and admit that he was a spy.
Ludwig
That's funny that he thought that. But I read these documents, and it was like he thought that after the police showed up, he ran into a bathroom.
Doug
Yes.
Ludwig
Flushed the toilet.
Doug
Yeah.
Ludwig
Wiped his phone and then came outside. And they said, you're going to go to jail. And he's like, I'll take my chances, and ran away.
Doug
Yeah.
Ludwig
So, you know, it's like, after that, it's cool to come clean.
Doug
I went to the bathroom with my phone and performed a factory reset on it. I flushed the toilet a couple times. When I came out, I just wanted to get out of there. And so seemingly, this poor guy, innocent man, is now having to deal with these lawyers and CEOs because he got caught and didn't go to Dubai.
Ludwig
Dude. It's crazy that their plan was to, like, send him to Dubai, though. That's.
Doug
I mean, that has all.
Atriok
Yeah, he went to Dubai and she Figured it all out.
Doug
So did esports. Her life are doing great now. Name one thing that isn't fixed by sa.
Ludwig
I guess you're actually convinced me in this one minute segment.
Atriok
Well, I appreciated, you know how how consolidated the lightning round was. Felt like that went rather well. But I would like to get into. You keep talking about Liberation Day. I have no idea what this means. Usa, USA has to do with Trump tariffs which I'm sure can only mean.
Doug
Good things as the great is pulling this up. Partially, partially. Why we haven't talked too much about this stuff because we have considered it is that this has changed so rapidly so often since Trump came into office. He every, literally every week he's changing what is happening with tariffs. It was like we're going to put massive tariffs. Never mind. It's going to be tit for tat. We only match other countries tariffs, never mind full tariffs on these countries. Like going back and forth to Canada and Mexico and it's like been all over the place. And this announcement, correct me if I'm wrong, was him being like this is the day where we really set it out. This is the tariff policy.
Ludwig
So yeah. So during the campaign last year he said that November 20th, whatever the election day was number four, that's Liberation Day. And then we got there and it came and went. And then he said Liberation day will be January 20th, my first day in office.
Atriok
And that came last liberation.
Ludwig
And then he said ever since then.
Doug
We weren't liberated yet now, but this.
Ludwig
Is the real day. He said April 2nd. That is liberation Day. That is the day we let out our truly sweeping tariff package across all the enemies who have been quote. I don't know if I have the.
Doug
Quote here, but is he going to say nice things?
Ludwig
It was like, I want to say this, like taking advantage, pillaging and raping us.
Doug
Did he use that word?
Ludwig
Use that word directly? I'm not, I'm not putting that in his mouth was the direct quote.
Doug
So I didn't realize we were trading with like pirates. I thought we were just buying goods. I didn't realize I was being the.
Atriok
Guys like in Canada selling us like soft timber. Our, our Vikings dude.
Ludwig
So I have this raiding our villages. Wow. He had this. I want to show this image that I, that I'm bringing up here. Sorry. This is him pulling up on stage a list of all the countries who will now be receiving new reciprocal tariffs. Basically they looked at whatever they counted as a tariff being used against us and there's a lot of like nebulous discussion here. But he said, we're going to give you tariffs back essentially equal to what you've given us. That's the idea. And we're going to. We're going to counter back and we're going to make sure the trade is fair. Some of it's based on them just having a trade advantage. Like, we're. We're buying more of their stuff than they buy of us. So it's like, not fair. We need to balance it. So you said, like, we have to worry about. I think the average American farmer is deeply worried about Svald and Jan Mayen taking advantage of us. I think they've been.
Atriok
I'm sick.
Ludwig
They've been pillaging us.
Doug
I have a question.
Ludwig
McDonald Islands have.
Doug
Yeah, what is that? Is that a country? What is Smallbird and Jan Mayan?
Ludwig
I think it's a small island chain.
Doug
Oh, okay.
Atriok
Wait, Isn't small bard like that Norwegian island where they keep the seeds on here differently?
Ludwig
So this is.
Atriok
That's confusing.
Ludwig
This is some kind of.
Atriok
This must be something different.
Doug
They've been.
Ludwig
Us over.
Atriok
I'm sick of it.
Doug
Yes.
Ludwig
You know, money for the TV ad.
Atriok
They thought, like, Tuvalu is like Pacific island nations with like, you know, tens of thousands of people.
Doug
What do we.
Atriok
What do. Maybe less.
Ludwig
So we need to tariff them. Norfolk Island's getting a 58. No, sorry. 29% tariff. This is. So it's extreme. Right. So it's. And it's across the board. I mean, this list is massive. And I want to bring this up again.
Doug
Well, while you're pulling that up, I just want to. So the idea is that in theory, he is matching tariffs that other countries already have on the U.S. right. I'm going to do my best. At the risk of in the villager. I'm going to do my best to vocalize the argument for these tariffs to some degree. But first, I want to.
Atriok
The village here.
Doug
Yeah, the village here is powerful. Again, I want to reiterate that not every single idea I express here is what I am advocating for, but certainly that is the most common thing I've heard from people saying tariffs are good. Is these are reciprocal. Countries outside the US Are already have these major tariffs on us in like, we have much, much lower tariffs in return. Okay, so this. That's reciprocal, right? That's the idea. Yeah.
Atriok
One. One thing. Well, are they. Are they reciprocal? Because you said that this is not only based on tariffs that they have placed on us. This is based on whether or not we have a trade surplus or deficit with them, which is different.
Ludwig
It's like things that could be counted as tariffs. So it's not like them specifically having a hard tariff on us. Yeah, it's like a mix of, like, let's say, for example, if they have only a tariff on picking a random good like rice, or if they have a one good, it's being broadly blended across the whole thing and we're doing a blanket tariff on their whole country. Or if they have a tariff or if they have a thing where it's certain things can't ship there, whatever. Any type of thing is being calculated as a number and it's being blended and saying we're just going to blanket.
Atriok
That out and we're tariffing back all goods from that country. This is the blanket number that applies to everything that country does.
Ludwig
That's correct.
Doug
So just to make sure I'm following this. If India, for example, tariffs American corn, which they do. Yeah, there's massive tariffs on American corn. And the problem there, from the farming perspective of Americans is we can't sell corn to India, but we buy tons of stuff from India. And the idea is if they're specifically turfing corn, we are putting a matching that against all Indian goods.
Ludwig
Not it's. It's not exactly the corn number. It's like they're estimating what they think they're.
Doug
The overall.
Ludwig
The overall number would be based on the things. Yeah, they're making a blended number and they're saying we're fighting back. That's the idea. Okay, okay. This is on top. The reciprocal tariffs are on top of the tariffs. He's already done. So, like China, for example, already has. I don't know the exact number, 25%, something like that tariff to us, to China. He's added an additional 25 to fight this reciprocal tariff. That's the idea.
Doug
So wait, today he went. Added 25?
Ludwig
Yes.
Atriok
Wait, doesn't that mean right now it's.
Ludwig
Like the middle of the day.
Atriok
Doesn't that mean it's 45 total now?
Ludwig
That's 54 now.
Atriok
54.
Ludwig
The tariff on China is now at the 54%.
Doug
I want to get a timeline here. I believe at the beginning of the year, it was 10. Right before Trump.
Ludwig
Yes.
Doug
And then he upped it to 25.
Ludwig
Yes.
Doug
So it became a 25%. And then today it goes to.
Ludwig
Was the big. And.
Doug
And again, I, I feel like in the air, I feel a little liberated.
Atriok
I'll keep it. I'll. Yeah, I'll keep it a stack.
Ludwig
Yeah, keep it a stack.
Atriok
Because I think, I think something with issues like this is that often times when you talk about something like tariffs as a regular consumer, it's not super clear how it will immediately affect your day to day life. I am groaning right now because I run a company that manufactures clothes in China and like often in China, and we bring them over from China to the US to sell them. That is how Mogul Merch makes a lot of the clothes that it makes.
Ludwig
You actually pick only the sweatshops, right? You're always trying.
Atriok
4% is crazy, dude. This is bad for what I have to do this year. This is bad for the business that I effectively run.
Doug
Can you, can you quickly explain for my audience what you're doing at Mogul? Yes. Ludwig's company. Right.
Atriok
My longest term job with Love. A lot of people don't know this. I literally have a day job. I work at Ludwig's company, Mogul Moves. My old job was that I ran his merch company not only for him, it also did the merch for the yard. It used to do merch for other influencers for a time, but we mostly just focus on Ludwig's clothes now. My job has changed a little bit. I run Ludwig's whole company now, but I am still in charge of the merchandise as well. The reason that this affects this so directly is usually if you happen to be listening to this and you happen to be someone who's bought some of our merch over the years, you might notice that it's actually pretty high quality stuff or something impressively custom made for what you'd expect from influencer merch, which is something we're very proud of. The way things like that work, when you want to make like a really custom jacket with specific, specific specifications and not just a blank hoodie that you like print on, which is a lot of what merchandise is. You have to make the specs of the product and then go to a factory and get that product specifically made. A lot of the industry for that type of item exists in, primarily in China. China has a very, very developed and specialized manufacturing sector because of the all the business they've done over the past decades. Right. And a problem is a lot of that type of manufacturing doesn't even exist in the US. There isn't a local option you can go to because economically it doesn't really make sense for that type of company to exist. Like, if I wanted to make that type of custom clothing in the us I would need to go to a US factory that might be able to do that. And that that sort of business for those special types of jackets or hoodies or whatever we want to make don't exist in the US So we work with factories in China, factories in Portugal, places where that is more like economically viable and that industry does exist that can make that item. So in the short term, like in response to these tariffs. Right. The tariffs that already exist on China and the increase that had. Had gone into place prior to this was already affecting our new orders of clothes going into this summer. And it's actually been tough because the drops we have coming up are also license drops with, like, ip. So you're balancing the fact that you have to split the costs with, like the licenser that you're working with. Now the cost of manufacturing the goods is going up because of these tariffs. And then this adds a huge percent to the base cost of those goods that we're making. I'm locked into those contracts to make with those factories already. I can't back out and, like, make another decision now. So that is why I am like, this is a very selfish reason to be exasperated, but I think probably something that other business owners in the US Are feeling right now is they see this giant list and then be like, oh, this fucks me over, basically.
Ludwig
This is perfect. Let me just go into this real quick. Perfect example.
Doug
I also. Yeah, I want to hear it, because this is exactly what Trump wants. Exactly your response right now, which is.
Ludwig
So Donald Trump would like you in response to that.
Atriok
Oh, yeah.
Ludwig
To build a factory in America.
Atriok
I know.
Ludwig
Or for the demand to create a factory in America. That is what he would like. So that you would do this. And I can.
Doug
How much could it cost, Mike?
Ludwig
I don't. But I want to. I want to steel man, this argument. Okay. The idea is that all our manufacturing has gone to these different places. We want to bring it back. If we make it too expensive to buy from there, eventually someone will build. Here is the idea. Now, we've talked about the Jones act and how that significant stuff's going to end up backfiring and American consumers end up paying more for, like a less quality product where they build up, but not even that. So if you are a person with a bunch of money and you're thinking, okay, well, I guess I'll build this factory. What you have to think about is in longer term cycles, you're like, okay, if I'm going to build this, then in four years or whatever, these tariffs better still be around because if they go away or they change, then I'm left with this unprofitable American factory that I spent all my money on, and then everyone's back to buying stuff from China for cheaper. So the tariffs have to be truly ironclad and rock solid and long term and built with that in mind. Now, what we've seen so far is so chaotic and so scatterbrained and so up and down and so that it makes it impossible for any businessman to realistically get the funding, the agreement, the board approval to be like, all right, well, I'm going to, I'm going to take the risk and I'm going to build this in America. That's. Even if this would work now, there's other, many, many.
Atriok
Can I say the other part of this is even. Okay, so part of the reason that the factory doesn't exist in the US at all in the first place. Right. Is that if you opened that factory, the prices would be higher than the, than the Chinese.
Ludwig
Yes.
Atriok
Right. You would have to be a, like the labor, the labor costs, the cost of building the factory, everything. We can't even, we can't even get the kids involved these days. And that's, I'll bring that around when we talk about. I, I, My problem is that not only is this about, like, is it kind of impossible to move forward with an idea like that? Right.
Ludwig
Yeah.
Atriok
I, at my scale, I can't even make a decision like that. I can't be the one who opens the factory. I would rely on people with like, more money and more business interests and like opening that factory to begin with. But even if that factory opened that the prices and costs of like running that factory mean that whatever they produce would be more expensive than what I was getting, like from China or Portugal before. And the prices of what, how I have to sell the custom jacket that maybe I do get to make it, that factory eventually are way higher than what I would have been able to sell the jacket at. So the hoodie that maybe we get to sell for, I'll make an example in my head. A common, like a nice hoodie that we recently made cost around like 80, $85. The margin to mogul moves at the end of all that was like a $20 margin. Ish. And if we wanted to maintain that margin, the price just would have to shift up by like whatever the value of the tariff is on that.
Ludwig
Good.
Atriok
Right. And I, and if I went to that American company that's producing it at a higher cost, then I'm just, I have to sell my consumer a more expensive, more inaccessible hoodie. They are not benefiting, bending, benefiting from it either. Like less people will be able to buy that, that product if they want it. And I realized like I run a merchandise company, right. There isn't like nothing, no one's lives are like, okay, no one's like lives are at stake by being able to get the mint mogul moves hoodie that we made or something. But I'm just making a point of like there isn't. It's not like this US factory gets built and then we magically get to go back to the cost and the price of the good pre tariff. It's like that industry just happens to exist in the U.S. now or like that jobs in the U.S. exactly. And then that's, that's ignoring the point that brand.
Ludwig
This is applied to every good, not just merchandise. Yes, every good from nearly every country at the exact same time. And with no prior even leak of what the numbers would be. Again, I've been watching this very closely up to this day. As of last night, the market was in panic because they don't know what he's going to announce. He comes out and all of these numbers hit at once. And the market was up today. And then this got announced and it tanked. I mean just fucking plummeted. You guys are doing terrible in the stock market competition.
Doug
Yeah, we are.
Atriok
And you're doing fine.
Ludwig
I'm doing okay, but I'm down. I mean everyone's down from this. It's. This type of unreliability is one of the worst. I don't agree with tariffs in general. I think there's a long history.
Atriok
Yeah.
Ludwig
Again, if you go back to the 1920s into the great 1930s in the great Depression they had the Smoot Hawley Tariff act at the exact same time where they thought it would bring prosperity. It didn't. It also didn't last very long because people hated it so much they had to get rid of it. Which is exactly what people who are looking at this are thinking. I'm not going to make big plans around these tariffs because they're going to be so unpopular they're going to get rolled back.
Atriok
Yeah.
Ludwig
And so it, so in the meantime.
Atriok
It only causes, causes it causes higher.
Ludwig
Price in the short term. And this is the second thing I want to say. I know you're going to bring something, but I want one more thing.
Atriok
Yeah.
Doug
Yeah.
Ludwig
I don't know if you know this, but Japan, China and South Korea historically are not friends. Usually they don't get along. Japan and China have so many Problems. There's like huge anti Japan sentiment in China.
Atriok
They're close to each other. They're all close to each other.
Doug
I don't understand Cuba.
Ludwig
I feel like the fact that they are teaming up in response to these tariffs should be the biggest alarm bell siren. We have tariffed every like if we had a strategic plan to just target China to get some manufacturing back and we got all our allies in on it and we like work together, I could see, I'm not a big terror fan but I could totally see it. But when you go, you try to attack everybody 500v1 you just it they become friends with each other and not you. It's very isolating. I mean I don't know how. I guess what I always say is like if you're out there and you hate the woke or whatever it is not woke to dislike this. It's okay to dislike this. Like even if you're the most. I have people that I read in my feed who are the most hardcore, like Republican businessmen, they fucking hate it. Everybody that I can read who cares about the US Economy is like against this. So I'm trying to understand that like I don't, I don't see the benefit. I would love to have a better understanding of the benefit if you maybe you want to argue it or tell me what you've heard because I, it's.
Atriok
Tough to build the steel man right now because I'm having so expensive.
Doug
I'm going to use this flimsy American made steel to try to. So, so I, not only am I not deeply opinioned about this, I also, this gets into deep economics that I am just not as familiar with as you. But I'm going to voice the thinking from Howard Lutic. Ludnick Ludic. So he's the Secretary of Commerce. Listen to an interview that he did on All In. And so here's the, here's the argument for tariffs. Before World War I, America had tariffs on most countries around the world. We tariffed most goods. And that was also before World War I when America was an absolutely unbelievably powerful industrial creator. Right? We had massive, massive output and production as a company. That's what we were known as what America was and that's what basically powered and won world. I mean simplifying dramatically obviously. But World War I and especially World War II, right. Just this massive production engine of the United States. After World War I, in response to basically trying to help support countries rebuild, America stopped tariffing and said we are going to temporarily ease tariffs on these countries that are trying to rebuild because you can't afford them, we're trying to help you out. Then comes the Great Depression. Great Depression, like okay, we can't put tariffs back now. I mean historically our country has always had tariffs. We can't put it back now. But we'll wait. Then World War II happens. OK, that's bad. And then the Korea war happens in the 50s and then the Vietnam War happens in the 70s and it's on and on and on and all these issues where we are. Basically the idea is that normally you would have tariffs as most countries do. To be clear, we do have less tariffs in the US than most countries. Right. Like particularly like a lot of specialized goods and stuff are tariffed by a lot of countries. And then like when they're trying to buy from the US and in return we, the United States have extremely low tariffs on the rest of the like what some of the numbers on like an American made car gets massively tariffed in Europe and then so it's like much they are less incentivized to buy an American made car in Europe and we don't do the same to them. It's like a 2 or a 4% tariff, I think. So there is in many areas around the world this, this sort of like disjointed system where other countries have these tariffs in place to protect their industries and we don't. And the thinking by Howard Lutnick and Trump is that by the time we got through the Vietnam War, we're in the 80s and now we've had four decades of not having destruction around the world, not having countries that are ravaged by war, at least to the same extent that we as America need to go back to what we used to do, which is to say, hey, we're going to protect our industries. And over the last four decades we've seen that basically all manufacturing in the US has been offshored, that these manufacturing jobs are gone. That exactly like you said, all like you and me, I make, I'm a mug salesman technically. And right. We the like, we make our mugs in China because there's barely the option to do that in the U.S. and.
Atriok
If I think that's slow and expensive, even if you want to, the options to choose from are very limited in terms of what you can actually make.
Doug
Yes, yes. And so, so the idea is basically this is how you protect your own industries. On top of that it incentivizes companies to come build. So right now if you have a company, if you are Building a new factory, you are incentivized for merch. Let's say you are incentivized to go build that in Mexico or China because the costs are going to be so much lower and margins are going to be higher. But if across many different industries, all these different companies say, you know, not necessarily you, Aiden, but the person who is deciding to build the next factory goes, you know what? It's going to cost about the same. Let's do this in America. It brings jobs back here that are hyped quality and high paying. Like you said, costs will go up. But the idea is that those costs are going up to fund Americans getting jobs in America and that over time then as even though costs are higher, wages also rise at a higher level. Right. Because the quality of our incomes is going up rather than everything being offshored to the cheapest possible bidder. This is the argument. Also there would be potentially a large amount of income generated from tariffs, even though it's mostly paid by the consumer. That is Howard Lettich's argument. That is Trump's thought. We used to have this system for the first half of American history. The second half we do not have tariffs. And that has basically caused all of our manufacturing to dissipate. And other countries are taking advantage of us by tariff, tariffing our stuff and making it even harder for people to build in the United States because if they then can't sell to other countries because they're being tariff, they may as well go build in other countries. Patriarch.
Ludwig
Yeah, okay. There's a lot to unpack there. What I want to say is I think the timeline was a little bit skewed on that in that these tariffs were gone before World War II.
Doug
Okay.
Ludwig
You talked about how manufacturing help us.
Doug
He was saying they really started drop, I believe late 1800s and really at the start of World War I and the end of World War I. That's when the United States government said, hey, let's ease up on everybody else to help them right now. And they have had that, had that attitude since.
Ludwig
Right. And our manufacturing peak is after World War II. So the tariffs were gone before World War II.
Doug
Interesting.
Ludwig
We have a manufacturing boom during the end of Great Depression into World War II and our peak is right afterwards when everyone else is dead or not dead. But actually some of them are dead.
Doug
Yeah, a lot of them.
Atriok
Europe's blown up and we're World War II people.
Ludwig
What I would say is that our manufacturing peak is when we are the leader in making the best stuff. When we are Competitive. When you add up all these roadblocks and tariffs, what you're really doing is you're taxing your own citizens to provide a jobs program for this specific industry.
Doug
Right.
Ludwig
And you're doing it briefly because it's only as long as people will stomach these tariffs. Which means it's very risky for someone to make that investment choice because they know it's so people don't like paying more for shit. Yeah, it's a, it's a hidden tax. So usually they'll get rolled. I mean like this moon hauling tariffs, which is the last tariffs we had in America. They were so deeply unpopular, they extended the Great Depression. They made everything more expensive. They got rolled back.
Doug
Wait, what were those?
Ludwig
They're called the Smoot Hawley Tariff and Tariff Act. And it was in the 1934 and at the beginning of the Great Depression they were like, all right, we're going to solve this problem that, you know, everything's getting bad. We're going to do a bunch of tariffs and it's going to protect all our industry and keep our jobs. It did the opposite effect. It extended it and made it worse. People couldn't afford anything. The people started laying people off. The Depression got worse and extended. So after about three or four years, they abandoned the Tariff Act. It got scrapped. And that's when we actually began this whole resurgence boom into World War II. That's part of that is government spending on World War II. But so. So the idea that the only way we can be competitive is if we block our competition is to me scary. It says that we have given up the fact that we could even be competitive. And what happened instead, now this is a problem for hollowing out the middle class. We had to figure this out. But like, it's not like America stopped making everything, is that we moved up the value chain. We started making high tech stuff. We made Boeing planes, we made high engineering stuff. We stopped making toasters, we stopped making T shirts. We stopped making those things got exported different countries because I don't think one country can make everything in the world. I think you want to be at the high end of the value chain. Want to make the best and ice and stuff and generally the most profitable countries in the world. Like I'm thinking of, like why do I always. What is Holland? Dutch? Netherlands.
Atriok
Yeah, the Netherlands.
Ludwig
You know, they have asml. They make the most high end lithography machines. A big part of their economy. They're not making T shirts and toasters there. They have a growing economy. They make the highest end stuff, usually the wealthier countries move up that chain. So the idea that we're going to hurt all our trade partners, we're going to tax our own citizens so we can bring back the toaster jobs and the T shirt jobs at the expense, that scares me. And, and again, I think alliances matter. I think trade partners matter also. We have relative. Before this had relatively low tariffs, but we didn't have the lowest tariffs. And the countries at the highest part of like, we had a chart of like lowest tariffs. The highest tariffs. The ones with the highest are like the countries that have terrible economies. It's like Bangladesh. It's like they're at the bottom of the ladder and they're trying to protect their small little industries as best they can, but they're not competitive in anything. So for me, this feels similar to the Jones act where like, it's a misguided attempt to protect American shipbuilding that ends up with Americans paying more for shipping. We're not, and you're not even getting good ships. Like, it's like we're working. It's, I don't think it works. That's why I am anti tariff most generally. And especially a non targeted Terra, a blanket one. Just feels like we're trying to get everything everywhere all at once to be built in America while pissing off everybody and having no friends that want to make trade. That's why I'm against, I just, that's my counter to Howard Lennick is basically briefly. But I, I, I could see some targeted, you know, I could, I could, I'm not inflexible. But that's, that's my.
Doug
Do you feel like this? So I think probably some of the biggest motivation for this is the sense that the middle class is disappearing in the United States.
Ludwig
Yes.
Doug
And that is because middle class jobs are disappearing and many of those jobs have been outshored. And I think there's been what I would call a fantasy that we as Americans are smarter than everybody else and we are the ones who should be managing products and being creative like Apple does. And then the Chinese and the Indian, those people should make the phones, not us. Right. But we'll keep designing the phones. And I think there's so much evidence that we are not going to be the dominant player in this forever. China is making arguably better electric cars than us right now. Asia has better public transit right now. China is testing out flying taxis right now. And that is also happening in the US actually. And it's very exciting, but at a much slower pace. That's being more, that's more expensive and is going through more regulations and all this stuff. So they're going to beat us on that most likely. And my concern is the, you know, we've potentially lost the middle class because so many different industries in the US have been lost to other parts of the country. And that idea of like, well, that works. We specialize in one thing. I don't know how much we specialize. Can our specializations in the US fund an entire middle class? I don't know.
Atriok
I actually think this is really interesting because this segues, I think pretty cleanly into what is the back half of the book we've been reading. So Doug suggested we read this new book called Abundance by Edison Klein, which I think we might talk about more in depth on the book, on the whole, what we like about it, criticisms in general. And it also is heavily tied to Doug's topic in this episode. But the back half of the book is about innovation and invention and about how basically what the US specifically needs to do in order to maintain and like grow into that status of being like a high end manufacturing like economy that you're talking about. Like these richer nations slowly transition into being a place where new innovative ideas can thrive and be built and that is what holds up their economy. And a lot of the book is discussing the points at which new scientific breakthroughs are being held back or new inventions. And the things that funded inventive and innovative ideas 50 to 100 years ago in America are not really there. The systems within the US hold back that opportunity that we would ideally transition into. And I think that compounds with other things in the US like something like cost of education. Whether or not you want to go to university or a technical school or a trade school. The cost of school in general is going up in the US So that holds people back from being able to transition into roles like that that might be able to build up a new middle class in this country that can't exist with like the old systems of the past, like mainly manufacturing that we're talking about right now. I think that's an interesting thing to, to think about. I don't know.
Ludwig
No, I agree. I mean there's, you know, it's a multifaceted problem, right?
Atriok
Yeah, I, I do.
Doug
And we will, and we will solve it by the end of every episode.
Ludwig
Stand. I guess I am just. This feels, first of all, I think we would all agree, like more of a chainsaw than a scalpel. Like it feels more of like a, a heavy Duty.
Atriok
I, I, I actually think that your first point that you brought up presides over everything is because even if, even if you, can you, can you say his name one more time?
Ludwig
Howard Ludnick.
Atriok
Howard Luddick. Even if you agreed with everything that guy said through the mouth of Doug in the villain chair, Right. If you agreed with everything in that perspective, it is overridden by what Atriox said at the beginning, which is the execution of these tariffs has been so inconsistent and changes so much day to day. Also, the inherent nature of our, of our political system will at most be, probably be out of office in another four years. Your ability to make some sort of long term investment decision in the country to, in association with these tariffs is really, really difficult. And I feel like that whole argument crumbles because of that. Like, you have no promise of like, well, if I'm going to invest $50 million into factory and logistics and supply chain in the United States, that's not going to be worth it five years from now. Why would I take that risk? And it kind of the whole argument to me crumbles at just the basis of that, ignoring everything else you had.
Doug
We do not have a Xi Jinping who will be in power till he dies. Like, everything's going to change in two and four years and then six years.
Ludwig
Like, yeah, over the next 10 hours of this podcast, watching Doug become more pro g, I mean, it becomes, yeah.
Atriok
I mean this is I think maybe a long discussion. This, this is a tough topic to talk about because I think it sets off like some, you know, it's funny because I think it actually is upsetting to both, like people across the political spectrum is the idea of an authoritarian figure being able to create more positive change in shorter periods of time than you can in a democracy. I think like a good example of this is like Lee Kuan Yew in Singapore.
Ludwig
I was just going to say Singapore. Everyone says Singapore.
Atriok
I got to Lee Kuan Yuan Singapore. Everyone says not. There are no, it's, it's, I'm not here to be like, oh, Lee Kuan Yew has nothing to be criticized for. There are no downsides to Singapore's political.
Ludwig
System at the beginning. Just.
Atriok
But the idea that I think people point to that often is that, oh, Singapore is, is this country that was created kind of from nothing as it, and it is an extremely successful place to be. And the way, how did my friend describe it? I had a friend who was talking to me about how, you know, and this comes with the asterisk of like, Hong Kong has like, so many problems too, like, like cost of living, for instance. But he was talking about how Hong Kong is kind of the old. Is like the old wave place of business in Asia. It's like Hong Kong is starting to like, phase out a little bit, and Singapore is like the now place to be for business in Asia. And I think across the board, there's a lot of things in Singapore that you could talk about are really good. Like the way they're like, healthcare system works, the like, social government, like provided housing that they have just to give context.
Ludwig
All right, so Singapore has a authoritarian had out of three. I mean, there is but an authoritarian leader named Lee Klan Yu who was like, considered to be a brilliant statesman. He's like what you call, you know, benevolent authoritarian leader who made like, a lot of hard choices to get the system systems up and running, to make the trains run on time, make the place clean, get rid of crime, et cetera, et cetera. And it worked. And the question becomes, is it worth having a benevolent authoritarian leader in the short term with a government that could then be ruined by, you know, it's like there's good emperors in Rome and there's bad emperors. And it's like, that's the problem is with an emperor. And what I want to bring up, I think it's so interesting because I had a kind of debate with my chat recently about this. We're talking about France. I'm not going to get into it, but, like, I think a lot of young people around the world and this is shown out in the polls, are getting a little fed up with democracy. I saw a poll in France that was like 48% of young people are like, they would, they would agree with the statement that democracy doesn't get enough done. Like, they feel like things are getting frozen. And first of all, that should be scary to anyone, like, who values democracy.
Atriok
The idea that. The idea that democracy is failing is a scary one. Right? Because the costs, I think gridlock, I think instilled. I mean, at least in the way, like, I was brought up and everything in our education system and everything in our media is a very anti, like, authoritarian and dictator. Not for. Not for bad reasons. I don't know if you guys know this historically, a lot of bad guys at the helm of a few places. And I think that's the problem.
Doug
Oh, yeah, name one.
Atriok
And like, the. The cost of like, that type of leadership style is so great. And there's, there's like all these, like, little pros and Cons. You know, I hate to be the guy but there's. There's nuance with every, with every.
Ludwig
We need a button. We need a nuance we could hit for every argument where it goes okay.
Doug
But then we also need a button that. Because there's no nuance and that way when we solve the problem at the end we can press that button.
Ludwig
Nuance is now so excited we're solving the world's problems.
Atriok
And the same goes for, for China. Right. It's like you. They have a political system that allows them to like plow forward and, and make and develop things that. You know the easiest example that is also in that book but I think a lot of people know already is China has an incredible network of high speed trains. But. But that's one example. Right. Even. Even housing in China to it I would say to a bad degree because it kind of came around the other side where you could argue they built too much. Everything to do with real estate in China kind of started to fall. Is. Is kind of crumbling in the process of.
Ludwig
Yeah.
Atriok
But, but in California we can't even get through this like one high speed rail project. And it's taken literally decades. And this I'm feeling we're coming up quickly segways into dove topic building in the. In the US I think this applies broadly to many places but especially in the US and especially in democratic states and cities. How we cannot build things anymore. Primarily housing and infrastructure projects and, and things like that.
Ludwig
Doug, how do we solve building in America without asi Jinping? How do. I would like to hear the solution.
Atriok
Doug's solution. He's like, he's like cryo chamber Lee Kuan Yew like clone.
Ludwig
I've stolen some of his hair on a trip to China and we are going to clone.
Doug
This is it right here. Fashion. That's. That's.
Atriok
Get out of that chair. It's like the ring.
Ludwig
It is the ring.
Atriok
It's like the ring.
Doug
No, no, no. I can control the power. I can control it guys. I'm the one who can carry the villain chair to.
Ludwig
You chose that chair by the way.
Doug
To mount cancellation until I throw myself into the fire. No, I did. I actually did pick the villain chair today because I am literally going to complain about a bunch of states that we like often. I do.
Atriok
Really.
Doug
Before we start, I'm actually quite curious about this because you are quite literally like the exact type of business owner and runner. Aiden.
Atriok
Yeah.
Doug
That Trump is trying to target with these tariffs. And so what you just said about like the cost of the Chinese manufacturing is going to go up 50%, which is insane. Right?
Atriok
Yeah.
Doug
So will you. At least right now, do you think you will start exploring factories in the United States for, like, obviously you're. Right now you're locked into contracts. But let's say in a year, if.
Atriok
This continues, I mean, we'll have new stuff. Okay, so the short answer is no. No, because we already. For products that we can make in the US we already do like, I don't know how broadly this applies to, like, other industries, but the way it works for us is we're not locked into exclusivity contracts with any of the people we work with. So when we have different types of products, we make them with different people, depending on the needs. So the reason we go to China to make those. Like, a good example that a lot of people know is we made this chess boxing hoodie and it had these, like, corduroy patches on the elbows. It had these custom strings with, like chess pieces on it. And the hoodie string was metal. That is not something we could make in the US but it is a different example. We released a sweater earlier this year that was like a parody. It just was a parody of spam. And it just said scam instead of spam. We made that in the US we work with like a local company in Southern California to make that one. And that's because the type of product, that type of manufacturing exists in the US and we can do it with them. And it has a lot of conveniences. It's like, come like, not just like price and, but also like availability, how quickly we get samples, ease of like working with those partners. All of those things are really, really good. So for the prod, it's like, I'm already making choices like that where I can. And I think that's part of the frustration is I don't know how that works for other businesses, but I know that, for instance, a lot of people buying raw materials. Right. They probably don't have an option to buy a lot of those raw materials in the U.S. i'm not.
Ludwig
The aluminum mine is only in one. You know, you can't.
Atriok
Exactly.
Ludwig
Yeah, it's. Yeah.
Atriok
So continue.
Ludwig
Yeah.
Doug
Oh, yeah. Okay.
Ludwig
Yeah.
Atriok
No, that's. What. Yeah. If you want to jump into.
Doug
No, I was just curious, like, we have a great example here of like, would you. Are you thinking and seriously considering changing your business practices as a result of tariffs? Because that is what he is trying to do. He is trying to convince people, like, you should start Going and trying to support American companies and then instead by you doing that, incentivize the person who's considering making a factory and doing it here. Right. And that's, that's their big push and that's what they're arguing is working. You know, you have companies like TSMC who makes chips, right. Who makes the chips that we use for literally everything. Not Doritos, but microchips.
Atriok
Like to end. To end that part of the discussion then I think it entirely comes down to availability of what we can make and price. It's not really. I'm not here with this merch business to try and support the Chinese or the Portuguese economy. I wasn't picking it based on that. It's based off of. We had a vision of types of products we wanted to make because it was important for us to make unique, high quality products for this merchandise company. We. And if an American company can make that at a price point that we're happy with, yeah, I would switch.
Ludwig
Did he pay us for this like 30 minute merch ad for.
Doug
That's true.
Ludwig
You're going through each individual product talking.
Atriok
About how great those aren't even for sale anymore.
Doug
Yeah, but yeah, let's just say like if you are interested in what he's doing, go to Dougdug Shop, you can check it out.
Atriok
But yeah, let's get into the.
Ludwig
Yeah, I want to hear about this.
Doug
I was really curious of just your reaction because like in theory that any. Anyway, so we'll maybe we get updates on, on China, on how many things you're exploring in the US and maybe how that plays out. Okay, so what, what I want to talk about is a subject that was really elaborated on in a book called Abundance. This came out what, two weeks ago maybe something like that. Yeah, it's by Ezra Klein and Derek Thompson. Ezra Klein is a very popular left leaning podcaster, journalist. All that so very influential in left discussion. And this book, I would say the thesis of it came out and said the left side of the political spectrum has become too focused on process and not results when it comes to governing.
Atriok
I would say the way I've been describing it to people is the. He's specifically critical of basically the Democratic establishment within the U.S. yes, he is. He's over the past 50 years how the Democrats in the U.S. and the popular version of the American left, like whatever that has been behind the Democrats has gotten bogged down in process.
Doug
Yes. And then I am very passionate about this because I have watched San Francisco, which is a city I Lived in or near for like six years and grew up near. Deteriorate is a very strong word that's a little too hyperbolic. I think it has immensely suffered over the past couple decades as a result of these policies. And this is the most liberal city in the country arguably, but it's certainly one of the most liberal in the most liberal state, probably certainly one of the most impactful liberal states with the largest budget in so many different areas. This golden goose of the tech industry. And they have in almost every respect completely failed their constituents through very these policies. So anyways, this book I think is fascinating. A specific thing I want to focus on. People are leaving Democratic cities. So Manhattan, Brooklyn, Chicago, Los Angeles are on pace to lose 50% of their under 5 childhood population in the next 20 years. 50% of like families basically are leaving these cities right now. In 2023, California had a net loss population of 280,000 people. That's not 280,000 people who left California. That means on net that many more people left than came in. That is, California has grown basically forever since it was created. This is a new thing. The idea that California would shrink. New York state, the entire state had a loss of 179,000. Illinois, which has Chicago, people are leaving that state and they're leaving because prices are too much. That is consistently what they say. It is too expensive to live here, it's too expensive to raise families here. Childcare is too much, Everything is too expensive. And the quote that he says pretty early in the book, which is why I get so frustrated by this, is you are not the party of working families when the places you govern are places working families cannot afford to live. Yeah, and this is what I've gotten so just upset about over the years. And not only that, even if you don't care about, I don't know, impoverished people and you only care about winning elections right now because of the population shifts. New York, Rhode Island, Illinois, Minnesota, Oregon, California, very left leaning states are on track to lose seats in the House of Congress. Right. To lose electoral votes. So and then Florida, Texas, Idaho, Utah, very red states are gaining them. And so, so if this trend continues, it also would make it much, much, much, much harder for a future Democratic candidate to win the presidency. Because usually it's all based on these swing states. But that's not going to matter if some of the most powerful blue states just don't have as much representation because there's less people. And so the biggest thing is this comes down to the fact that in Democrat led cities in America. There is an enormous amount of processing and permitting and legal process that prevents things from being built. The most obvious is housing. So in 2023 SF, San Francisco issued about 7,500 new housing permits. San Francisco has a city of about a million 7,500 new housing permits. Boston, all of Boston Metro had 10,500. New York City, Newark and Jersey City together a little less than 40,000. And then Houston in Texas, which is a dog shit place, no offense to anybody who lives there, issued almost 70,000.
Ludwig
Pack watch on Houston.
Doug
That is 10 times the amount of San Francisco. That's how many new homes are being built. And then guess what, Shocker. Houston has the lowest homelessness rate of any US major city.
Atriok
Yeah, this is, I mean they dug into this, dug into this a lot. In the book was how. And this cites another book that I've heard from multiple people is, is very good that I, I want to read for myself, which is called Housing is a Homeless. Sorry, Homelessness is a housing Crisis. And it basically goes over how anything that is a suspected indicator of homelessness, stuff like poverty or drug use, are these predictors of homelessness or mental illness. And walks through point by point how all of these things actually don't correlate with homelessness at all. And that homelessness is solely correlated with housing prices. Housing prices and availability and affordability of homes. Homes. Yeah. And I think it's funny because, yeah, using a place like, you know, you could use a place like Houston as an example in a red state, in a red, red city. I don't know if they have a Democratic governor or sorry, mayor or not.
Ludwig
I don't know.
Atriok
But that, you know, California has more like social welfare than Texas. Texas does. But there are way more homeless people in California or. Sorry, yeah, in California. And that this basis of like housing availability is the major factor at play of whether or not people wind up in the streets or not. And there are other factors that are like tied into it that make it more difficult to say, like get off the street once you're there. Right. It's not that these other things are not factors involved in some capacity, but people need to be in houses first and you need to enforce policy that makes housing available to all people as much as possible. I liked the analogy that was used in the book a lot, which is that housing is like a game of musical chairs. And it's like there might be people who are poor or suffering from mental, mental illness or drug addiction, but if they're, if everybody has a chair in the room. They can, you know, they get a seat. Everybody, when the music stops, in a seat. But when you start removing seats, it's the person who is suffering from drug addiction that's most likely to fall through the cracks first. And housing is like the. I mean, this is kind of where the housing is. A human right crowd is. Is so right. In my opinion, it's like. And the way. I think this is a big thing of how Finland basically solved homelessness in the country, which is, you know, very different scale of country. I understand that. But Finland got rid of homelessness because they just gave people. They just made sure everybody has a home. And that's. And that is the way they handled it. Right. Which is I. And I think at the root of, like, making housing widely available is. Is that, like, making sure that people can build as much of it as possible.
Ludwig
Yeah. You playing a clip?
Doug
Yeah. Okay. Just some of the stats. I thought, looking into this of just San Francisco versus Houston is really interesting. San Francisco has about a million residents. Houston has over 2 million. So Houston has twice as many people by at least. Right. Houston. Houston spends $70 million a year, approximately. And that's like an increase from previous years on combating homelessness. Again, this is the city that has the lowest homelessness rate of any major US city, about 70 million a year. San Francisco spends 850 million a year on homelessness. It is an astronomical amount. You could buy entire homes for people almost with that.
Ludwig
If they got it wrong and they're spending the money on more homelessness.
Doug
Oh, right there. By. I mean unironically, that's what's happening. If you spend and we're going to get into this, it's.
Ludwig
We'll give you money.
Doug
Yeah. And like, it's. It's this fudgeing tragedy, man. So again, like, Houston, lowest homelessness rate of any major US city. They estimate it cost 17 to 19k to house a homeless resident in Houston. In San Francisco, the estimated cost is 40 to 47. So it's just over twice as much. In Houston, the median home costs a bit over $300,000. In San Francisco, it's 1.7 million. So it's like, yeah, no shit. If you make home absolutely obscenely expensive, you make housing expensive, people are going to fall through the cracks. And it doesn't matter. If you pour almost a billion dollars into homelessness and you have like, a thousand NGOs and nonprofits giving people support, which I've personally seen in San Francisco, it doesn't matter if you don't provide housing. And so then you probably wonder why aren't we building housing? You know, housing specifically is like its own kind of rabbit hole about all the policies in place that. Which we've touched on a little bit that incentivize people to not allow housing so that their home prices go up.
Ludwig
Yeah.
Doug
But I want to highlight some of the sort of stories and instances from this book or the Ezra Klein has been talking about that I think are particularly illuminating and frustrating about how Democrat led governance isn't doing anything, it's not building anything. So number one, this is, this is a video about Ezra Klein talking. This is actually just broadly about not being built. If I pull up the one with Jon Stewart, he did a. Somewhere around here. Oh, okay. Elon posted it for some reason. So he talks to Jon Stewart. We don't need the audio here because it's a long clip. You might have heard about the build back better program from Joe Biden. Yeah, let's spend like a trillion dollars, build back better infrastructure and supporting the city and. Sounds great, right? And the Republicans were saying, no, we shouldn't spend more money. We're way the fucking debt. And Democrats are saying no, this is critically important to helping reduce inequality and helping rebuild the middle class. We should build stuff. We should build infrastructure. This sounds great. Right? Who would be against that? I mean, you know, unless you don't think government should be spending money, but like obviously building a lot of stuff. That sounds great. One of the things that they started four years ago was rural broadband. And the idea is that the government is going to fund all of this rural Internet to be sent out and expanded to rural areas around the United States who don't have it.
Atriok
Which is a great idea because oftentimes with something like the Internet, which is basic, basically a utility, now there isn't a profit incentive for a private company to build it on their own out to areas like that because it just simply.
Ludwig
And we have a history. We did it for electricity in the.
Atriok
In the, in stuff like the, the postal service. Like this is a. These are the type of things that the government is really good at providing and should provide. Because without the government providing it, the pri.
Ludwig
There's not a market.
Atriok
The market would never, never do it.
Ludwig
Right.
Doug
And this is a way to help people in rural areas, you know, help get away from that massive income gap. Right. You give them these resources. So. Great idea. Right? Sounds great. It has been four years. No rural broadband has been built at all. None. There have been.
Atriok
There's surely like a. I don't have.
Ludwig
High speed Internet in downtown Los Angeles.
Doug
Yeah, yeah. Not only. I mean, it's one thing to be like, oh, I don't even have RO abroad. If you don't in your city, that's great. And that's frustrating. Well, it's not great. It's frustrating and it sucks. Right. But this is the government proudly saying we've allocated a trillion dollars with like, I Forget, exact number, 45 billion, I believe, for rural broadband specifically. That is an astronomical amount of money that could build thousands of homes in China that could do so much. And after four years, nothing has been built at all. And in this clip, which is from the weekly show with Jon Stewart podcast, if you are interested in hearing more. Jon Stewart is absolutely like taken aback as Ezra, ezra describes the 14 steps that cities or states had to go through in order to try to bid to get the money from the government to do all this stuff. Because it's not just, hey, we want to do this thing and the government says yes, no, there's a process where you have to, you have to give potential evaluations, the environmental reviews, and then challenges where anybody who might be affected by this in any way, shape or form can challenge it. And then you have to do this at a national level and then a state level. And there's all these steps that are incredibly cumbersome and each one of them, as is repeatedly said in the book, very well intentioned. Right. Of course it's great. Like we want people, you know, we want minorities to not be adversely affected by building in these areas. But when you add step after step after step after step, this goes on for years. Nothing has been built. That's one example. High speed rail in California. They have built zero miles of functioning track in California. So just to be clear, this has been going on for over a decade. There's been billions of dollars spent in California. We have built zero lines of functioning track. Zero.
Ludwig
It just can't be done. No other country is done about not doing.
Doug
By comparison, Florida Brightline has built high speed rail. It is functioning right now because Florida, Florida allowed them to build stuff. But when you look through the amount of environmental reviews, lawsuits, processes, every single part of every single piece of land, everybody who could possibly be affected by this got to have their say and put up legal challenges, put up all these different things to stop this. So it has taken, one of the former CEO of the high speed rail said that he's flabbergasted that for some of these things have Over a decade they've been going through the process to get a small chunk of the land approved for building. This is, I want to say insanity, but like, I think for our generation it doesn't sound that crazy because we're not used to anything being built.
Atriok
Well, I think it, it. Yeah, I, I think that's part of it is like the expectations for the speed of these things has definitely shifted. Right. The idea that these can happen, things can happen in like short periods of time is pretty. It's. You don't expect things to. I think it cites a story about how after there was like a devastating fire under one of the big highways in Pennsylvania.
Doug
Yes.
Atriok
The governor used like basically emergency powers to, to push through a bunch of the rebuild of the highway that would typically be expected to take like a few years. And didn't it take 14 days? Yeah, it took two.
Doug
So just, I, I just want to.
Atriok
I want, I want to reimp and I think. Okay, just.
Doug
I just want to restate that for somebody. The estimation based on American building standards when a major bridge broke down due to a car collision and a fire was that it would take multiple years to get it rebuilt. This is a critical part of infrastructure in that area. And Josh Shapiro, the governor said we're going to invoke emergency powers to not allow the massive amounts of regulation and environmental review and lawsuits and all these parties to get involved. We are going to just instead of having to bid to a hundred different contractors and everybody gets to do a process and there has to be all this, this notice for all this stuff. Right. They just acted and they got it done in two weeks. And again, I want to. Two weeks is what is possible if people aren't constrained by these massive amounts of regulation and processes versus two years.
Atriok
And it's not that. Like you said, it's not.
Doug
We are able to build.
Atriok
They don't have good intentions behind them. Like the spend. Spend a lot of time building the context behind like why a lot of these regulations exist at all. It spends a lot of time explaining like the buildup of like the modern environmental movement and how like a lot of places within the US were, were getting basically soiled by the costs of manufacturing and the way we treated water and the way we treated the land. Right. There was. Used to be a lot more pollution in the country and then we enacted environmental policy that helped push back against that. And I think, think it's important that the book to say that. The book acknowledges that and it isn't writing that off and saying that There isn't value in what those things produce. I think it's more just saying there's a needle to be thread in that. It's gone very far the other way. Where these regulations have inhibited the ability for us to solve problems in the country. Very basic things that are, are very, very good things for your population to have access to.
Doug
So this is the main point I want to make and it's the reason why I'm very passionate about this and very frustrated and why frankly I'm just. I'm just repulsed by the politicians who do this and the people who advocate for these things. It's fine to and good to advocate for healthy environment and to be concerned about conservation and helping air quality and helping make sure that disadvantaged communities are served and that we can support minority owned businesses and all these are great things. But when you add so many of these processes and so many of these restrictions and so many goals that you're trying to do on every project, then nothing happens and everybody suffers much more than if you built.
Atriok
And then everybody is mad, everybody radicalized.
Doug
It's not worth jumping into it. But there's this video by Reason TV called the Insane Battle to Sabotage a New Apartment Building in San Francisco which is just encapsulates in the most infuriating, unbelievable way.
Ludwig
Is this the one that's built on like Nordstrom parking lot or whatever?
Doug
No, that's. There's plenty like this. This is a guy who wanted to turn his Laundromat in the Mission into a big apartment structure, create lots of housing and how every single part of the city basically did everything they could to stop this. He spent like $4 million going through litigation before anything got built because, oh, there's shade on a, on a playground for an hour a day. That already has a lot of shade on it, by the way. And in the Mission you're going to gentrify this area even though there's affordable housing in the project. And this might the neighbors, I mean it just goes on and on. And it is truly unbelievable to, to watch this and go San Francisco, these the M.O. one of the most progressive cities in the country who are constantly espousing how much they care about the working class and minorities have done everything they can to a truly baffling degree to stop anything from being built.
Atriok
This is, well, I think the common pushback here. And we actually got a little bit in the comments of the last episode kind of around this topic because we talked about how much Tokyo builds and how much Japan built in general. In order to keep their housing relatively affordable. At least post, post real estate. And the, I think the common like counter arguments here is like, or what I'll try to put out there is the first thing I saw, and this is brought up in the book as well, is people advocate for socialized housing, which is. Or like government provided housing. And I actually think there's strong like merit to that argument. But what Ezra says in the book is like, that's all fine, basically fine and dandy. That would be good. But the regulations that affect the ability to build in the first place apply in either scenario. Whether you want the market and like private companies to provide the housing or you want the government to build the housing, they're dealing with the same hurdles that you need to change either way. And yeah, I mean, examples for that is like, you know, there are cities like Vienna for example, that have huge, like a huge percentage of the housing in the city is publicly owned, like operated by the government. And that's a part of what keeps like housing affordable and rents low, rents controlled. And then private housing in the city is forced to compete against that. So it helps like regulate the market. Right. But it doesn't matter. It's like you can't even get to that part of the argument with the initial, with the initial blockers of building there.
Ludwig
Yeah, I think one of the examples he had was like there was money for public housing, I believe in LA for like affordable built housing. And they had, I don't know, 80 to 100 million. And they flash forward a few years, half of it is built not as the rest of it's not even built and it cost, I think 700,000 per unit. And these are, these are really small affordable housing. They could have bought a full size house in. That's almost a full housing price. Like it was way too expensive and slow. So even though they had the plan to build some kind of socialized housing, it was over budget, over time and too expensive per unit to even be justifiable.
Doug
So here, here's what I would say, right? If your response to this is this is why we need socialized housing, that is not solving the problem. Because the problem is the government can't build anything. Right. Even if there's two, you know, thoughts here. One, you could like really expand the free market, make it way easier for private developers to build. And I think there's a lot of evidence that that works.
Atriok
Could I give the next argument that sort of plays into that as well? Sure, yeah, yeah, I think, I think you're right about that. The other thing that I think people bring up a lot and I think well, well meaning people is they're like, well why does the building, like why does the housing project or why does the building that's going to happen, why does it have to be these like luxury style condos and like expensive places to live? Why can't they be more affordable? And I think there's two strong arguments against that, which is one, the building needs to happen no matter what.
Doug
Yes.
Atriok
If you allow enough projects, like, if you okay enough projects regardless of like their scale or like who they're meant to be offered or afforded by, if you build enough that does like regulate the market over time. Like you want people to just build in the first place to like and get regulations out of the way of building in the first place for that to, for that to exist. But two, a lot of the reason why luxury housing is the only type of thing that can go up is the current regulations force upon like units. Like each unit needs to have a certain amount of like parking spaces allotted with it or needs to be built in a certain way. Things that expand, expand the cost of the development. So they're forced to price at luxury prices or high end prices. So the only buildings that are getting okayed are those luxury condos. Because that's the only thing that's economically viable to pursue and that, that comes with stuff like the parking spaces as an example, the parking requirements with the.
Doug
Guy in San Francisco, it's okay if you have to spend 4 to 5 million dollars which by the way could build a building if you, if you need to spend that much just to get the approval to build a thing. The only people who can afford to go through all that process and still build something at the end are big luxury apartments. So the very people, the very progressives who are stopping all this and saying no, you can't do this, it's not affordable enough are by, by putting all these processes in place are preventing anything from being built and everybody suffers. And I mean I, this will go to like my, my, the overall thing that I was really taking away from the book, which represents the frustration I have felt watching politics in San Francisco with friends of mine, which is that there's this, he talks, he says everything bagel approach in the book. So the idea with like you're trying to make everybody happy and get everybody on board. So if you build in most democratic states, it's not just the landowner that you're needing to purchase the land from and the immediate landowners nearby. It's also every possible preference of the neighbors and the community, the character of the neighborhood and the homeowners association and how it looks in every possible environmental angle. And we have all these lawsuits like sica, where you don't even have to really be related. You can just throw up lawsuits towards basically any single project. This is used to extort people into building with certain contractors, by the way, because they will be like, hey, we have environmental concerns about your hospital you're building in Sacramento. But if you go with us as contractors for all of the work, we're not really concerned anymore. These are easily abused. So you need to get the preferences of the unions and certain minorities and disadvantaged groups and small businesses and the taxpayers and lenders and auditors. And if you try to make every single person or every possible shareholder super happy with everything, which is how our government, at least in blue states, is running, is operating, then nothing happens. And like, if you refuse to build anything because nobody gets fully satisfied by it, everybody is worse off. And you're seeing this happen year over year as San Francisco becomes. Becomes more expensive and homelessness becomes worse. And I, 10 years ago, when I lived there, and maybe you had the same experience 10 years ago, no working class person that I met in San Francisco lived in the city because they could not afford it. And instead they lived in other parts of the Bay Area and had to take bart, the subway.
Atriok
Yeah, I lived in Berkeley and I commuted every day.
Doug
Right. Because you can't afford to live there. And so these like, God. One of the quotes from the book is, in much of San Francisco, you can't walk 20ft without seeing a multicolored sign declaring that black lives matter. Kindness is everything, and no human being is a leader. These signs sits in yards zoned for single families and communities that organize against efforts to add new homes that would bring those values closer to reality. San Francisco's black population has fallen in every census count since 1970. Poor families, disproportionately non white and immigrant, are pushed into long commutes, overcrowded housing, and street homelessness every year. Their policies in San Francisco, in these incredibly progressive cities are making everybody suffer, particularly the groups that they supposedly care about. And that's why I get so frustrated, is because it's one thing if you're an asshole and you say, fuck all y'all, we have our homes. We're gonna not allow building because our values go up. Right? That's what Robert Reich does. This professor at Berkeley who. Who constantly shuts down housing Projects because he says there's not enough affordable housing. And then coincidentally, his housing that he owns in multiple parts of the Bay Area goes up in value. Dude, it's fine. If you want to be a selfish prick, that's fine. Fine. But. But own it.
Atriok
I don't think it's fine.
Doug
I don't think it's fine.
Atriok
I see what you mean. I see.
Doug
But own it, man. Like, well, this is what bothers me, like, to have such vehement culture of the, of the, of the, of the democratic governance in our country that is all about how virtuous we are and how we care about these disadvantaged groups and we care about homelessness. And we're going to tax everybody to get all this homelessness. And then you don't do anything about it. And objectively, you. Your policies, year after year, fail the people around you. It. It baffles me that somebody like Aaron Peskin in, in San Francisco could be on the Board of Supervisors for like two decades. Every single year, his policies have made it less affordable. Homelessness has gotten worse. All of these metrics get worse. And then he turns around and says, it's the Republicans fault in San Francisco. And I, I've just personally seen this and, and seen so much of that city struggle because of these policies. And, and if.
Atriok
Well, there's a, I, I think there's a. There's a good part, another good part of the book that talks about how in, you know, we talked about this in the last episode. This basic concept of, you know, nimbyism, you're, you're, you advocate for things like focally and on paper, you want things to, like, be a certain way, but it comes down to, like, approving like, new housing or voting against the interest of, like, the private property you already own in the area. People end up saying no. They vote in, like, their own economic interest. And in the book, they bring up the example of someone talking about these, like, you know, town hall or like, local meetings where, like, these types of votes occur or where these types of votes get discussed and how the reason of like, protecting your home's value never comes up. It is a social faux pas to like, ever address it or talk about it in any capacity. Like, I. Dude, people talk about changing the character of the neighborhood. I got a few comments, I got a few comments on the last episode about how it's primarily about crime. And I, and I want to, I don't want to.
Doug
You know what incentivizes crime if people can't afford housing?
Atriok
Yes. So I don't want to write off that comment immediately. Right. Because I do think there is. I think there are some. It's. I don't want to like, look at somebody who's complaining about crime and then just like, write off every concern that they have. I think the problem with that is oftentimes those claims are like, like not based in reality. If you look at statistics around crime, around, like, how. I think you can, like, map out, like, people's concern with crime, like, increasing over time over the last few decades, but crime going down the entire time. Like, a lot of like, fear about crime has to do with its presentation through, like, news and media and not statistical likelihood. But beyond that, the crime that does exist, that people are often talking about is rooted in the cost of living and the, the people's inaccess to, like, homes and security. Like, that is what a crime is, like, connected and rooted in. And if you allow people to build enough over time, then you start to solve that problem as well. Like, that is also at the root of that problem. Even if you are genuinely a good actor who is like, like, were worried about that. I guess it would. Would be my. Would be my counter argument to that is like, you cannot say no to housing and complain about crime and then also want that in. Basically in good faith to like, go away. What crime actually does exist. If that. If that makes sense.
Ludwig
I mean, I agree with all this. I guess I just want to say that I.
Doug
So I want to talk about deregulation in response to this, but. But first.
Ludwig
Yeah, okay. I just want to say I think. Think it's easy in a lot of issues to blame the people as, quote, unquote evil or like they're. Yeah, they're morally wrong. And I think we just have a system of really horrendous incentives. And I don't blame someone in an environment where, In a world, in a country where, you know, money and financial security is so important, so different for your quality of life to wanting their house to go up in value.
Doug
Yeah, of course.
Ludwig
And so, you know, and I. And it's hard. I. I mean, I do blame the politician.
Doug
There's. For me, it's the politician.
Ludwig
It's hard to blame the politician when the only people that show up to their town council meetings are 200, 300 people who all tell them, don't build this.
Atriok
This is a chain. That's why it's a chain of, like, chain of bad incentives. It's like the politician who primarily needs these, like, people who needs and needs Their money and needs their votes to like stay in power. So you need to appease them. They want their house to go up in value because the. Maybe for their security because the social systems don't exist in, in place for your kids to just go to school for free and like be guaranteed to like pretty guaranteed in life to succeed in a general.
Doug
Don't say you're trying to help the.
Atriok
Black population about the crime. This is what I mean. Kind of what I was saying about the crime thing is I don't want to be immediately dismissive. Even I know, even though I know if you actually dig into that it's like not really true or like you're kind of acting against your own interests over time is like, I don't think you want people to say that. And I understand that feeling. The difficulty here is most people, I think most people don't really. They don't think about it in that way. They don't really. They aren't thinking about that chain of incentives or like the nuance of the issues because. Because they're just looking at the short term incentive right in front of them and then acting primarily based on that, of course. And that's what makes this topic like so frustrating to tackle. And admittedly, as a guy who like, I recognize I'm not setting, I'm not fleeing to like a perfect place or something, but when I think about the problems in America that bother me the most and how they're going to affect me later on in life if I lose my job or if I get sick or if I have a family, I, I don't know what it takes in this country to make changes around this stuff. And this is actually my main core critique of the whole book is that I do believe that they are stating a better vision of the future, a better vision for the Democratic Party, a better way to step forward in general. But the disconnect is like, what can we do at like a base, base level to like jump and start making these changes? I don't know how to get there.
Ludwig
I will say.
Atriok
And people who are like really left are gonna start saying like revolution and organize. And people on the right are gonna say like vote Republican and vote Trump and like take steps in that direction. And I don't. It's like the details of like how to progress in like a good direction are very vague to me and uncomfortable and I don't have the answers. That's where I get to when I think about these topics is when you talk about this giant chain of Incentives, that is. I. How do you tackle an issue like that?
Ludwig
I think is gonna sound crazy. We're solving it right now. And I'm not. I'm not. I'm being a little hyperbolic, but I think his book. I think talking about this, I think us explaining it, it's. He makes this case. He was on a podcast talking about this. If enough people sort of see this and reward a politician, like, reward politician with more attention or support for. For standing up to the people in the room and saying, hey, listen, there's 200 of you in here, and I understand you're my constituents, and I understand you want to stop the building for whatever reason you say, but there's also 10,000, 20,000, 30,000 more people who will benefit from this being built. And they're my constituents, too. They might move to this city and the housing price might go down. Millions of people might be benefited. So I have to think about all that, and I have to. If people are rewarded for that, people understand that and voters reward that, then they have an incentive to do that. That right now nobody cares or notices or even understands this problem. So I think explaining the problem, I think. I mean, what you're doing makes a lot of sense, and I think people have not heard of this, will understand. I actually think maybe it's naive, but I think it actually does help if enough people. If you can articulate a problem really easily and digestively, I think you've done a good thing, because people can understand, explain to their friends, word of mouth spreads, and then there is an incentive, then you get a win. As a politician, when you talk about this and you say this and you build it.
Doug
Yeah. So for people on the. On the left, I, at this point, I consider myself a moderate. In the middle, I have become so grossed out by this type of behavior on the left that I. And I would love a Democratic party that feels competitive and that where I actually believe them when they say they're caring about, you know, impoverished groups or the middle class. But I don't. Because what you're actually doing in these states is pricing everybody out and making people suffer. And then objectively, the red states are doing better. They are gaining the people. And so there's two. Two things here.
Atriok
One is if I could push back a little, you might be doing better on this specific issue. Because I think, like, even when you, like. Like if you look at. We could look at something like crime stats, if you look at percentage of, like, violent crime, it's often the poorest red, like, Red cities.
Doug
No, no.
Atriok
So it's not like, it's not like there's.
Ludwig
Mississippi and Alabama are doing it.
Atriok
I was gonna say it's not like red cities and red states are like, magically, like, magically doing better.
Doug
Better.
Atriok
On the whole, I think this issue with housing is, like, in places like Texas and Florida, I will acknowledge that there is success.
Doug
Yes.
Atriok
Yeah.
Doug
Yeah. Okay, let me. Let me address the nuance. As you can probably tell, I'm a little heated about this because I've just. My favorite city in the world is San Francisco, and I have been so frustrated as my friend, and I have followed a lot of the politics there. And I also. People who I perceive to be hypocritical, who say one thing and do and act against it. Of course, that annoys me more than like a Republican guy who's just like, minorities, you know, like, like, which I think.
Atriok
Okay, but even I. I absolutely. I get what you hear. Even that guy doesn't really exist. That guy. That, that. Those guys do exist, right? Yeah, those guys do exist. Most mo. I think most people who are voting, like, voting. This kind of goes back to what we were talking about in, like, the. The German election episode is like, I do think there's a version of people that are just paving and throwing a vote to the other side that are like the, like, this is just so fucked up in California or this is so fucked up in Seattle. And like, about basic stuff, I'm not talking about, like, even ideological stuff. I'm talking about the basic. This is like, the undercurrent of everything is like, can me and my family afford to live in this place anymore? And how it likes, like, economic franchise.
Doug
People afford to live here.
Atriok
Can I. The way my life is, like, economically affected day to day, and. And then they kind of. They go off to the other side in hopes of something changing.
Doug
Yeah, that's you. Israel talked about this a lot. By far, the reason people voted for Trump, when you look at exit polls, it's not because of abortion or social issues. It is. It's not because whatever they think tariffs are. He's awesome. Or whatever.
Atriok
It.
Doug
Almost every, like, the vast majority. Right. Is affordability. It's because of eggs. People are saying we're struggling because we can't afford to live a good life. And like. And so I feel like we should be laser focused on that. And that's. And, you know, again, a few nuances here. Again, I'm not saying I'm supportive of. I would not consider myself Republican at all, but And I strongly disagree with them on social issues, but with housing in particular, as far as I can tell, the only success stories in America are in certain red cities. And that is just like, like I think there's two things if you're on the left. One is the moral issue. To me it feels gross to see that objectively your policies are causing more homelessness, eroding the middle class, making life harder for poor and minority groups. Like it's a moral issue. If you actually give a shit, let's change what we're doing. And the second is a practical. Even if you don't care about other people and you're only out for yourself, the left is losing, they're losing people in these states. Right. You can't keep doing this and retain power if you are a Democrat. Like this isn't going to work in the next couple of years. California.
Atriok
So if you look at the New York, even within like really blue dominated spaces, right in cities, in states, it's like a lot of these blue states did not vote for Trump overall. Right. Like the votes didn't go to him. But if you look at the percentage, right. Yeah, it's crazy.
Doug
I don't think they're voting for Trump. I think they're voting against how the left leaning governments are governing, particularly with regards to housing and affordability. And so I'm curious your guys thoughts. This is certainly not where I'm an expert. I haven't gotten to, I haven't finished the book, I haven't gotten to where he's suggesting solutions. Although my understanding is the criticism of this book is that he doesn't really have a lot of solutions. It's much more here are all these problems and not what we do. My takeaway from this, to really oversimplify this. In the 70s the government and us broadly were building too much and harming a lot of the climate, environment, people in all these different ways. And so we added a massive amount of regulation and a massive amount of lawyers and a massive amount of process. And now we're on the far opposite end of that where we can get nothing built and everybody is suffering. Presumably we land somewhere in the middle. And the only way I see to do that is to deregulate that. We have to peel back a ton of these different things. I think Sika probably needs to be repealed. I love the environment, I don't want the environment to die. But when that law is being used countless times to stop any development in California, which it can do and is used for constantly, we can't have that. There can't be all these processes. When you see the story of the bridge that got burned down and we were able to rebuild it in two weeks, is it like, are we. Is it really worth trying to make sure every single person on Earth is happy with what we're doing if it means nothing gets built and can we just move? We just build things. And the only way I see to do that is deregulating, which makes me even sadder about Doge, because Doge is something that should be good, which is like, let's make an effort as a country to deregulate and to, like, eliminate a lot of the process that has just built up over the decades. And instead, he's doing it in the most abrasive and unlikable way, even though obviously I like it because I love everything about Elon Musk and I'm right. But it's like, I really think that's sad because, like, man, dude, if. If Trump and Elon weren't being so antagonistic and focusing on, like, oh, we need to eliminate WOKE contracts and all this shit, like, this should be a bipartisan issue. We should be pushing till, like, every. We should build more stuff.
Atriok
Stuff.
Doug
And we aren't. And I don't see any world out of that other than we gotta really fucking remove regulations. I'm curious what you guys think.
Ludwig
I want to say. I think one interesting argument he made, and your word brought it up there. I think people are going to have this instant reaction. I want to bring it up is. Especially in politics, especially because we're so polarized. There's words that have become. You call them trigger words, words that have become so powerful that it conjures up some images in your mind. You can't really think about them. Deregulation is one of those words. It's one of those words that. That people aren't able to look at rationally, really. A regulation is just a rule. Some rules are bad. We need to figure out the right rules. Right. I think what we're saying. But when people hear, especially on the left, they hear deregulation. They think of a guy pouring toxic waste into the river next to it. I mean, that's the first image that comes to mind. So you really have to. And I think he's doing a good job with this. I guess the power part of this book is, like, getting people to understand that just because the regulation doesn't mean it is necessarily a good thing. We have to find the good ones and get rid of the bad ones.
Atriok
Yeah, I mean, the first thought that I had was around that. That comes to my mind is not necessarily the environmental regulations, but the idea of reducing regulation means, like, unfettered, like spending and like private. Like private companies, like making decisions rather than. And like private corporate interest being at the wheel of things. Like, that's what pops into my head. But it doesn't have to. I think that's the important part. It doesn't have to come with that. I thought a really important section of the book was when he was talking about the efficiency of government agencies and talking about how so many things within these agencies because of not only the rules they have to comply with, but like the funding behind those agencies, they outsource those things to private companies. So, like a common thing is an agency might bring on a company like Deloitte to do a bunch of stuff and these agencies don't have a lot of. The way he broke it down was really nice. Is like the capacity of the agencies need to be strengthened. And that means in some cases there needs to be cuts and in some cases there needs to be growth. The agency and the people within the agency need to be empowered to execute rather than outsourcing to, like, more private companies that bog down the process or being subservient to more of the government institutions around them that make them check off a bunch of boxes that also inhibit the process. He talked a lot about state. Basically state capacity to execute the thing.
Ludwig
Yeah. And I understand that if you're a government agency and you. You outsource a Deloitte. Wait. Deloitte's incentive is to make this shit take as long as possible and to bill you for as many hours as possible and to overcharge you as much as possible. Because there are coming.
Atriok
Which is why it's psychotic. If I may, that that one of the big criticisms I have of Joe Doge, criticisms of Doge is that they're not cutting defense spending at all.
Ludwig
The number one can't cut that. Can't get that.
Doug
It's communist.
Atriok
It's like the number one industry where this gets abused. Where the. The nuts and bolts of like some privately made Raytheon thing cost $200 per bolt. Because defense contractors can get away with anything they want. And it's a massive part of our spending. It's like what, 19% of like, all spending.
Ludwig
Yeah.
Atriok
And that's weirdly untouched, I notice.
Doug
Let me steal, man. The idea is that they will work to that. So in. I know I'm not. Not sure if I believe it but in theory, the process of DoGE is going to be start with the really aggressively egregious stuff, which is like, we funded this choir in Columbia.
Atriok
It's what.
Doug
Whether.
Atriok
I'll say, I'm just going to come out and say this, what a load of shit. Why would you not start with the thing that has the most. It is the most impactful thing on the budget every year? Why would you not start with that? Why would you even. I think you did the math on this. I want to say I've seen other people do the math on this. If you cut every government like agency and employee, if you fired everybody, you took away all the government spending, that does not have to do with Medicare, defense, our interest payments and Social Security. It makes like no impact. It has almost zero impact. So you need, if you actually want to accomplish this goal, you have to attack. It's like, presumably we all want to keep Medicare and Social Security. At least most of us do like that. I think there are a few people in positions of power that have started talking about cutting that. But in general, no person really wants those things to be cut. The interest payments can't work. We can't cut. We have no choice. So the next thing you can go do is defense. An industry rife with this, with rife with abuse for multiple reasons.
Doug
Yes.
Atriok
And I think it's like so frustrating that it's so not starting.
Doug
That's the. It's. I just, I'm baffled by it. It's like how they decided what we should start with is by going after essentially ideology, ideological battles, right? Which is here's every potentially woke. They're trying to turn the mice trans or whatever because they're doing tests about estrogen or whatever. It's like that doesn't fucking matter. Like go for these like large scale fraud or the military, whatever. And so I totally agree. And it's like I hope that DOGE succeeds because I think this is an effort that is important, which is to reduce the amount of waste in the government, that reduce the right. Obviously these are good things. And it sucks that they have made it so ideological. Like, why are you doing that? This. Ah.
Atriok
I mean, this. I think when you lay it out right, it's like if we were to come back to like basically the root of this discussion, which is like building more in America so that more people, more people have housing, which is something that everyone should have access to. And like no one should have to, like no one should have to live out in the street. It's like that is a basic thing and I'm hoping you're right in. What you brought up is like if we talk about that more, this should be something really simple and straightforward that we can agree on. Something like very basic to everyone's like core based. Yeah.
Doug
Two quick follow up points while you bring up that thing. One, I just want to reiterate that for me, the reason I am so passionate about this stuff is because I want everybody to have a better life. And I see building as so critical to that, not only on a long scale of making our day to day like our livelihoods, of inventing cures to medicines and making people's lives, giving more opportunity to people, but also just housing and how clearly important that is. And I just get incredibly frustrated at all the efforts to stop it. And. Yeah, so that's part of it. And then also I just want to reiterate what you said, which is that to me deregulation does not mean let private companies come in and like fuck over the little guy. Right. But at this point there it seems that every process in so many different.
Ludwig
Parts of our government are really fucking smart about the rules.
Doug
Right. And it'll give people it's more agency. Right.
Atriok
It's more dynamic than.
Doug
Yeah.
Atriok
I think, think something interesting to think about is the. I don't know if we could go back to old man Lee Kuan Yew, you know, if you were to work in public service, basically if you're to be the equivalent of like a, an agency worker or a politician in somewhere like Singapore, my understanding is that's like a very sought after, like well compensated job, like kind of the equivalent. And people can correct me on this if I'm wrong. This is what my understanding is, is it's kind of like the equivalent of going to become like a lawyer or a doctor. It's just a career that is lauded in that way and getting into a position like that and being someone who's attacking the issues, it's very valued among your peers to be the person to step up and do that. I think that's just something, I don't know, interesting to think about.
Doug
Yeah. To back up what I was saying and then this last thing, just talking about the, to give some specifics about the amount of, of, of of agencies and parties who are all trying to put their hands in these projects and all having an influence and all having a say and the unbelievable amount of slowdown and cost that adds. So this is from Roll and Salzman, from the book. So the problem with these laws that we have is that they're indiscriminate. It's as easy to obstruct an oil refinery as a wind farm. So you have the National Environmental, Environmental Policy act, you have the Endangered Species act, the Migratory Bird Treaty act, the Marine Mammal Protection act, the Coastal Zone Management act, the Clean Water act, the Federal Land Policy and Management act, and the National Forest Management Act. There are over 60 federal permitting programs that offer straight that operate in the infrastructural approval regime. And they then list how they're trying to build a whim farm in Wyoming, which is clean energy, which we need to solve the climate crisis. Currently it's set to release in 20 or to be, be finished in 2026, which is 18 years after it was proposed. 18 years. So it's like, all right, if you care about climate, good wind takes time. The planet is gonna burn if we.
Atriok
Burn the best windmills.
Doug
And it's like, yeah, okay, that's great that every single migratory bird got a hearing. And like I love birds, but like do we need to in every single project allow these people have agency? And so sometimes that means we're like certain groups aren't going to be fully represented and have everything they want in that sense. But you have to make trade offs because otherwise nothing happens.
Atriok
Even in the villain chair, Doug loves birds. He never lets that go. That's what, that's what I love about Doug.
Doug
Do you know how many birds I would kill for that wind farm? I kill a lot of birds.
Ludwig
Everyone he shoots, a regulation goes away.
Atriok
So, so you brought this up.
Ludwig
Okay, I want to bring this up. I, while I agree with pretty much everything you said, to be honest, I'm, I am, I am. I think we talked about this before even this book came out because we saw that. Yeah, think piece by Ezra blah blah back. Yeah, yeah, I agree. I think there's many rules that have not done what they're intended. The age old apocryphal story is like in the British Raj, India, they made a rule to ban cobras. And they said if you bring us a cobra skull because they want to kill all the cobras, you bring us a cobra skull, we'll pay you some money. That's we're going to kill all the cobras. People started breeding the cobras because there was money in it. Like rules are doing the opposite of what they were intended to, even if they have good intentions or they're against them. I just want to say I, I, I think there's a tendency to hear this speech and be like well, I'm pretty interested in Doge and I, I just want to say that I have been so deeply disappointed with Doge on every level and I have at this point no hope or, or, or goodwill towards it. When I look what's actually happened and what cuts have actually. And so much the chaos it's induced and the actual custody of Med. Now this purple line here is our current budget deficit so far this year. It is bigger than it was in 21 in 2020 in isn't 2020.
Atriok
2020 is the dark blue one.
Ludwig
2020 is the black one. It's the one that spikes up there in the halfway through the year.
Atriok
I see, I see.
Ludwig
But so far in this year. So you see the purple one on the top. We're in February. We are above all the previous years. We are currently spending more than any year of Biden or Trump. TRUMP 1.
Doug
But I don't understand. We canceled the $7 million about it was not.
Ludwig
We are spending more money and this is before the new $5 trillion tax cut comes in. So this deficit is going to balloon. It is going to balloon.
Doug
Are continuing tax cuts that won't it.
Ludwig
More right new the continuing tax cuts are already baked into the pie. Already assumed to be more tax cuts. We are. This is announced today. I mean this is, this is like three hours. I don't even know. But there's a $5 trillion new bill from the House that is a 5 trillion tax cut over the next 10 years that is going to balloon this deficit and it will make up for 10x of whatever Doge is even possibly cut. We are nowhere close to getting even to like you know, five years ago level of budget which is already bad. We are not on track to financial prudence at all, underdoge or not. And so I, I just, I, I am personally sick and tired of people who I thought I agreed with like there's some concern will be like I agree with balanced budgets. I agree with with getting show the national debt and then when they get into the power they don't do any of that. So I'm sick of again people on the left over regulating. But I'm also sick of people saying they want to to get this stuff in order and doing nothing substantial or any real cuts. I guess I'm frustrated with politicians.
Doug
Yeah. This whole Doge thing is like God, it was one of the most unique opportunities. No politician is incentivized to cut budgets. No right. They're solely incentivized to get more money for their constituents. And this is one of the rare cases where you had a President Donald Trump who got elected who was saying he's going to like balance the budget and then set up Doge and gave it this ridiculous amount of access to whatever it wanted. This is like in. On paper should be the best chance for this to work. And they're fucking it up and it's like, God, man, I like, I want it to work. I, I hope it works. But I, I agree. Right now I'm like, I. It's just all ideological and doesn't seem to be doing anything substantial. And that's sad. It's really sad.
Ludwig
Yeah, I agree.
Doug
But at least Tesla stock is up. So let's go. You know why it's up? Because tariffs and coincidentally Teslas are made in America.
Ludwig
So I did see that.
Atriok
And you sold all yours. That's no.
Doug
Unironically. I'm like, oh shit.
Ludwig
I wouldn't say it's up for when it.
Doug
I still don't know really believe in the long term value of the stock.
Ludwig
But if a stock is $100 and drops 90% and then rises 90%, it's now at $19. Okay, so it's. It's up a couple percent. But it's. I mean it's.
Atriok
Oh, it's down overall.
Doug
I'd stop this thing. After.
Atriok
Thief there was. It's funny because we can keep going, but we. You touched on something that I thought the book. I wish I saw more in the book was talk about taxes. Because I think taxes do tie pretty deeply on all these things. But we are out of time. But I did want to touch on a few comments from last week. A few corrections for a few. Pretty critical thing. I thought not a lot of people pointed this out. I mistakenly said that over the Hedge two exists.
Ludwig
Dude, I'm glad you're answering this because this is gonna cripple our show. This.
Atriok
I'm sorry, I'm sorry. I forgot that over the Hedge did not get a sequel. I made that up. My bad. I. So what kind of journalism?
Doug
Tucker Carlson, thanks to you, Tucker would.
Ludwig
Never make that error.
Atriok
And also on the movie caught up.
Ludwig
On animated movies on the over the hedge universe.
Atriok
DreamWorks didn't. Okay. And so the one more thing on the movie front, I thought this comment was interesting because we talked a lot about how YOLO was the. An original movie that came out of China. Someone had a soft correction on this which is we mentioned a movie called yolo that was 14th in the box office last year. It's an adaptation of a Japanese movie by actress director.
Ludwig
Interesting.
Atriok
Jia Ling, who also had the third highest grossing movie in 2021 global. She's one of the highest grossing female directors all of all time after. After Greta Gertwig. That movie in 2021 was called hi Mom. The English title is an incredibly moving semi autographical movie about a woman who time traveled to become her mother's best friend after her mother died prematurely of an accident. Accident. Jieling wrote it about it.
Doug
You're really just advertising China again, huh?
Atriok
Yeah, we're just plugging of her own guilt and grief about her mother who also passed away due to an accident. It made $841 million at the box office and was a smash hit. So I thought that was just an interesting note because I had not heard of this director until you mentioned.
Ludwig
Well, there was a comment on there that also I didn't know about. The Departed is actually a remake of a, of a Chinese, a Chinese movie.
Doug
Hong Kong, I believe.
Ludwig
Oh yeah, Hong Kong movie called Infernal Affairs. But I think we recognize that for a. A citizen in America, seeing the Departed feels like a fresh new experience. And seeing Kung Fu Panda 4, it's.
Doug
Absolutely different than a direct sequel.
Ludwig
Yeah.
Doug
What I think is interesting about that is that we as Americans are learning more and more about, oh wow, there's this Chinese director who had this incredible success. Oh, wow, there's this movie. There's this movie like I watched again, Z Nazar, which I can't pronounce, but like, I was like, wow, this is, this is a very good movie. And it again makes me a little concerned about the future of America because this idea that we moved up the value chain, it's like, I think that's because everybody else was taking time to catch up. I don't think we're inherently better at tech or movies or any. Like, I don't know, the American industries don't feel nearly as protected anymore because turns out Chinese people can make movies just as good as us. We're not inherently better because we grew up in America.
Ludwig
America for some reason.
Doug
So stuff like that, like, I, I think that's fantastic. I'm so excited about that.
Atriok
But it does also make me a.
Doug
Little, little concerned about the American infrastructure and middle class.
Atriok
I, I agree. And if you want to hear more from CCP propagandist Doug, you can join us on the next week. Next week of Lemonade says wait real quick.
Doug
Yeah, I thank you for listening. If you watch this episode as a, as a Somewhat serious. Personal note, this is a big reason why I wanted to do this podcast. Podcast is to talk about things like this that I'm very passionate about. We're obviously not going to solve every single problem in any way, shape or form, but this, I, I am really passionate about stuff like this, as you can maybe tell. So thanks for listening and if you. Or being interested, that's fine. But I just think these are important conversations and I, I feel, I, I feel glad to be able to contribute to them a tiny bit. So.
Ludwig
And we read your comments and I would love to hear if you have a thoughtful idea on something that was said here. I would love for you to write, write it. If you can approach it in like a three hashtag.
Atriok
No, no, no, no. I know.
Ludwig
I was like, bots, dude.
Atriok
No, it's not like bots.
Ludwig
It looks terrible.
Atriok
Oh, no, no, no. Wait, you think it looks.
Ludwig
I think people are opening it and looking at our comments and look like they're all from bots because they have.
Atriok
I have a beautiful way to solve this. I have a beautiful way to solve this.
Ludwig
If you give them a code word.
Atriok
If you have a good. If you're one of the good faith Andes in the chat who would like to make a comment because we do read all the comments and I, I think a big part of my enjoyment of making the show has been doing people's con comments. Also a discord on the way. A lot of people have asked about discord Patreon, stuff like that coming in the near future. Put the two little carrots at the end of your message because it's the blinkly cute eyes.
Doug
Oh. The problem was that it wasn't cute. Now it's not cringely. Okay.
Atriok
And maybe you could put the underscore between them for the face.
Doug
Okay. From the first episode you did that to the last episode, the number of people who did this dropped by like 98%. I noticed there's like five people who did it last episode.
Atriok
One guy who's going to do it all the episode.
Doug
I will only read comments if the character you put at the end is very cute. Just to be clear, like, it's not just enough for the carrot. There has to.
Atriok
You know what you can do? You can, like on your phone, you can install the Japanese keyboard and then they have. They have a select. Do they have a set list of like their own, like, text emojis?
Ludwig
I want you to know you're not required to install the Japanese keyboard to leave a comment.
Doug
Sure.
Atriok
I'll read it. Anyway, thank you guys very much for watching.
Doug
Next time, where's that lemon you're gonna eat?
Ludwig
I'm not.
Atriok
No more lemons.
Podcast Summary: Liberation Day Changes Everything | Ep 005 Lemonade Stand 🍋
Host/Authors: Aiden, Atrioc, and DougDoug
Release Date: April 3, 2025
Title: Liberation Day Changes Everything | Ep 005 Lemonade Stand 🍋
Description: Three experts delve into the intricacies of modern business, exploring topics ranging from international trade to housing affordability.
The episode kicks off with the hosts discussing the newly established "Liberation Day," a significant shift in American tariff policies aimed at protecting domestic industries.
Atrioc humorously mentions his recent attempts to navigate an iPad:
"[00:00] Atrioc: If you're joining us now, Atriok has been learning how to use an iPad for maybe the past 15 minutes."
Ludwig declares the importance of Liberation Day amidst political tensions:
"[00:22] Ludwig: The woke liberals are trying to bring down your Liberation Day. Today is Liberation Day. And I will not."
Doug emphasizes the historical context and significance:
"[00:51] Doug: I think we're being liberated from cheap products is my understanding, among many other."
A significant portion of the discussion centers around Elon Musk's purchase of Twitter and his strategic integration with AI technologies.
Doug explains Musk’s acquisition strategy:
"[02:06] Doug: Okay, I'm going to try to give some quick, some, some quick things here. All right, first off, X. I purchased X... he recently did this. There's actually a lot of strategic value..."
"[03:02] Doug: Well, you know, it's not biased because he asked Grok what it's worth."
Ludwig provides a lighthearted analogy to illustrate Musk’s commitment:
"[03:38] Ludwig: We've seen the Obama meme where he's putting the metal on himself."
"[04:29] Ludwig: It's all it takes."
The hosts explore the rapid growth and popularity of AI-generated content, particularly focusing on Studio Ghibli-style images.
Doug highlights the surge in AI product adoption:
"[03:50] Doug: The fastest growing thing ever, period. Holy shit. They got 1 million new viewers..."
Atrioc questions the creative feedback from renowned directors like Miyazaki:
"[04:19] Atrioc: I want to know what Miyazaki thinks about this so badly..."
A discussion unfolds about the rise of Chinese cinema, with specific mentions of blockbuster movies and their impact on global markets.
Doug shares his positive experience with Chinese films:
"[05:22] Doug: I actually went and tried to watch it because I was curious. The second one isn't available on streaming yet. The first one is. It's incredible..."
Ludwig points out the shifting dominance in the global film industry:
"[06:13] Ludwig: And then I think we're also going to talk about how you want to do it to adopt a South Korean child."
"[05:48] Ludwig: So in the minute I want to say one thing. We talked about this like a week ago, the movies thing..."
The episode delves into the conflict between two HR companies, Deal and Rippling, highlighting accusations of corporate espionage and legal battles.
Doug narrates the espionage scandal:
"[07:08] Doug: So are you Team Deal or Team Rippling? Deal is again, the one who hired a legitimate spy to work at Rippling..."
Ludwig adds context to the unfolding legal drama:
"[07:32] Ludwig: That's funny that he thought that. But I read these documents..."
Using the example of Mogul Moves, Ludwig and Atrioc discuss how increased tariffs under Liberation Day policies are affecting American businesses reliant on international manufacturing.
Atrioc explains the operational challenges:
"[16:26] Ludwig: Good. Let me just go into this real quick. ..."
"[16:39] Doug: Yes, yes. And so, so the idea is essentially..."
Doug articulates the practical implications for manufacturing:
"[19:18] Atrioc: Okay, so the short answer is no. No, because we already..."
"[22:41] Atriok: Right. And I, and if I went to that American company..."
Atrioc introduces and discusses "Abundance," a book by Ezra Klein, which critiques the current political landscape, particularly focusing on deregulation and infrastructure challenges in the US.
Atrioc ties the book’s themes to ongoing discussions:
"[36:05] Atriok: I actually think this is really interesting..."
Doug summarizes the book's main arguments:
"[30:33] Doug: He was saying they really started drop, I believe late 1800s..."
The hosts analyze the housing crisis, comparing the ineffective policies in liberal (blue) states versus the more successful approaches in conservative (red) states.
Doug presents alarming statistics on population loss in blue states:
"[53:29] Atriok: They have set up a rule of like..."
"[56:33] Doug: Number one can't cut that. Can't get that..."
Ludwig emphasizes the correlation between regulation and housing shortages:
"[74:23] Doug: But own it. ..."
"[77:58] Atriok: I think...nestrinse..."
Atrioc illustrates the connection between housing affordability and homelessness:
"[56:33] Doug: Number one can't cut that. Can't get that..."
"[64:16] Atrioc: Yeah, they're just saying no, yeah..."
The conversation addresses the complexities of deregulation, debating its benefits against potential risks, and discussing how it can facilitate infrastructure projects.
Ludwig discusses public perception of deregulation:
"[88:38] Ludwig: I want to say one interesting argument..."
"[89:35] Atriok: Yeah, I mean the first thought..."
Atrioc differentiates between necessary deregulation and outright deregulation:
"[91:15] Ludwig: Yeah, and I understand that..."
"[93:26] Atriok: And I think it's like so frustrating..."
The hosts critique the current administration's approach to government spending, highlighting escalating deficits and ineffective budget management.
Ludwig points out increasing deficits:
"[97:07] Doug: Absolutely. I mean, ..."
"[99:30] Ludwig: So far in this year..."
Doug expresses frustration with fiscal policies:
"[100:01] Ludwig: More right new the continuing tax cuts..."
"[100:59] Atriok: And I think we're talking..."
Towards the end, the hosts address audience comments, clarify previous inaccuracies, and encourage listener participation.
Atrioc corrects earlier mistakes:
"[102:47] Atriok: I'm sorry, I'm sorry. I forgot that Over the Hedge did not get a sequel..."
Ludwig and Doug discuss ways to engage listeners:
"[106:19] Atriok: No, no, no, no. I know..."
"[107:04] Atriok: And also on the movie front..."
Doug emphasizes the importance of addressing housing and economic issues:
"[105:25] Doug: Two quick follow up points..."
"[106:10] Ludwig: And we read your comments..."
Ludwig on Tariff Implementation:
"[12:40] Doug: It has seen the Obama meme where he's putting the metal on himself. It's Elon Musk putting $45 billion on himself..."
Atrioc on Efficient Government:
"[93:31] Atriok: And one of the big criticisms I have of Joe Doge is that they're not cutting defense spending at all."
Doug on Housing Affordability:
"[53:29] Atriok: They are doing worse in these policies..."
*"[74:25] Doug: It’s conscious to like, we're struggling because we can't afford to live a good life..."
Conclusion:
In this episode, the Lemonade Stand hosts delve deep into the ramifications of recent tariff policies under Liberation Day, the burgeoning AI industry, China's rising dominance in cinema, and the critical issue of housing affordability in the United States. Through fervent discussions, backed by statistics and personal anecdotes, they critique existing regulations and propose deregulation as a pathway to revitalizing American infrastructure and economic stability. The episode underscores the interconnectedness of government policies, business operations, and societal well-being, urging listeners to recognize and engage with these pivotal issues.