Loading summary
Transcript70 lines
- [00:00]
Jill Lepore
This is an iHeart podcast.
- [00:04]
Justin Richmond
This is Justin Richmond from Broken Record. The three things I love about summer are pool days, blaring, all the new summer songs that come out, and endless refreshing iced drinks from Starbucks. Even better, my favorite summer drink has returned to Starbucks. The Summer Berry Refresher is available now. A mix of berry flavors shaken with ice and poured over raspberry flavored pearls and it's light, vibrant and just as refreshing as the summer fun you'll be having. So queue up your playlist and head over to Starbucks to check out their summer menu. There's something for everyone, from creamy cold brews to ice cold refreshers. Your Summer Berry Refresher is ready at Starbucks.
- [00:43]
Elon Musk
In business, they say you can have better, cheaper or faster, but you only get to pick two. What if you could have all three at the same time? That's exactly what Cohere, Thomson Reuters and Specialized Bikes have since they upgraded to the next generation of the cloud. Oracle Cloud Infrastructure OCI is the blazing fast platform for your infrastructure, database, application development and AI needs where you can run any workload in a high availability, consistently high performance environment and spend less than you would with other clouds. How is it faster? OCI's block storage gives you more operations per second cheaper. OCI costs up to 50% less for computing, 70% less for storage and and 80% less for networking better. In test after test, OCI customers report lower latency and higher bandwidth versus other clouds. This is the cloud built for AI and all your biggest workloads right now with zero commitment. Try OCI for free. Head to oracle.com strategic that's oracle.com strategic.
- [01:55]
Jill Lepore
Pushkin the COVID 19 pandemic was a boom time for the world's billionaires who gained nearly $2 trillion of wealth in 2020 alone. As CNBC reported, at the height of the pandemic, one of those billionaires was fast climbing the list of the world's richest people.
- [02:18]
Elon Musk
Elon Musk just passed Bill Gates become the second richest man in the world with a fortune of over $128 billion.
- [02:27]
Jill Lepore
From for a while he jockeyed for the top place with other tech giants. Altogether, the worth of those on the list is $13.1 trillion, up from 8 trillion last year. The rise occurring as most the world.
- [02:41]
Elon Musk
Was shut down during the pandemic.
- [02:43]
Jill Lepore
By the end of that year, Elon Musk had become the richest man in the world. It was also during the pandemic that Musk underwent a political conversion. Moving to the right by 2024, he'd become one of Donald Trump's closest advisors. Take over, Elijah Elon Musk is taking over with an axe to government spending in a newly created Department of Government Efficiency, or doge, which is also the name of a cryptocurrency inspired by a dog meme. Doge, the Department of Government Efficiency, staffed by Silicon Valley entrepreneurs and engineers hoping to make use of artificial intelligence to reinvent American government. Welcome to the Elon Musk origin story. I'm Jill Lepore. I'm a historian, a professor at Harvard. This episode is the fifth in a series I've been hosting about a new kind of capitalism called Muskism. Extravagant extreme capitalism, extraterrestrial capitalism, a form of capitalism influenced by fantasies that come from science fiction. It's all bound up with a tech bro vibe. Comic books and superheroes, fantasy and video games, the tech overlords as the Lords of the Rings. This episode is called the Doge Elon Musk Money, Cryptocurrency and the Rise of Techno Libertarianism As Donald Trump took office in 2017, Elon Musk had achieved phenomenal, really almost unbelievable success, especially with Tesla and SpaceX, both of which were headquartered in California. He was then a darling of the press. It seemed as though anytime Musk did anything at all, even just tweeting, newsroom phones lit up. He was a golden boy with super fans who adored him as a real life Tony Stark. Iron Man. Then came Covid. The Coronavirus. Panic is dumb, Musk tweeted on March 6, 2020. Days later, the governor of California announced that the state would shut down, that we direct a statewide order for people to stay at home. Musk was furious and we are confident that the people of the state of.
- [05:02]
Elon Musk
California will abide by it. They'll do the right thing.
- [05:05]
Jill Lepore
Musk vowed to keep his Tesla factory open, tweeting Free America. Now Elon Musk is escalating his fight with the California county, restarting a Tesla factory in Fremont despite a stay at home order there. Then, in protest of California's strict regulations, Musk announced that he was moving to lightly regulated Texas and had decided to build Tesla's gigafactory there too. We approached both Tesla and SpaceX for a response on several points in the series, but but at the time of the recording, we had not received a reply. One way or another, Musk had become a culture warrior, tweeting and tweeting and getting richer and richer. Meanwhile, during the pandemic, the contrast between the suffering of the masses and the vast increase of wealth among a Very few provoked a backlash in the US Senator Bernie Sanders proposed the Make Billionaires Pay Act, a one time tax on American billionaires to help cover the out of pocket medical expenses of ordinary Americans for for one year. Musk then got into a Twitter war with Sanders. Sanders claimed Musk's wealth had been made possible by billions of dollars in government subsidies for his corporations. Musk suggested that Sanders should leave him alone because Tesla is saving the planet. Musk may not have been saving the planet, but his influence, especially on markets, kept growing. Like a lot of people during the pandemic, Musk spent more time than ever online. The number of his Twitter followers skyrocketed. As CNBC reported in 2021, markets seem to hang on his every word.
- [06:42]
Justin Richmond
One thing we've learned lately is that when Elon Musk tweets, the news cycle follows him. And in fact, he does have a series of tweets in the past few minutes. Says I'm selling almost all physical possessions will own no house, says Tesla. Stock price is too high, imho, in my opinion. And now give people back their freedom. It's going to get attention. Stock now down almost 7%.
- [07:05]
Jill Lepore
This became a signature feature of muskism long before Musk bought Twitter. A single tweet by a single person, not an announcement from a central bank, could drive a stock price or hobble a currency market. In January 2021, after the insurrection at the US Capitol, Twitter banned Trump. With Trump gone, Musk became the loudest voice in the room. The love hate Twitter account to follow. He started tweeting about cryptocurrency, bitcoin, and a joke coin called dogecoin. If Trump's tweets destabilized American politics, Musk's tweets seemed to be destabilizing financial markets. A lot of headlines had to do with the fictive quality of money. After all, all forms of currency are acts of imagination, as Douglas Adams pointed out so well in the Hitchhiker's Guide to the Galaxy.
- [07:59]
Douglas Adams
In fact, there are three freely convertible currencies in the universe. But the Altarian dollar has recently collapsed. The Flanian pobble bead is only exchangeable for other Flanian pobble beads, and the Triganic Pew doesn't really count as money. Its exchange rate of 6 Ningis to 1 Pew is simple. But since a Ningi is a triangular rubber coin 6,800 miles along each side, no one has ever collected enough to own one Pew. Ningis are not negotiable currency because the galactic Banks refuse to deal in fiddling. Small change from this basic premise. It's very simple to prove that the galactic banks are also the products of a deranged imagination.
- [08:37]
Jill Lepore
I've spent a lot of time in this investigation of Musk with Hitchhiker's Guide, because Musk read it as a kid growing up in South Africa and he cites it all the time. But Hitchhiker's Guide is a strange influence for muskism, partly because Adams was so brutally, gut wrenchingly funny about the arbitrariness of money and the follies of financial schemers and assorted idiot executives.
- [09:00]
Douglas Adams
If we could for a moment move on to the subject of fiscal policy. Fiscal policy. How can you have money if none of you actually produce anything?
- [09:08]
Justin Richmond
It doesn't grow on trees.
- [09:10]
Jill Lepore
And Adams was particularly devastating on the subject of the damage done to the natural world by advanced extractive capitalism.
- [09:17]
Douglas Adams
Since we decided a few weeks ago to adopt leaves as legal tender, we have of course, all become immensely rich. But we have also run into a small inflation problem on account of the high level of leaf availability, which means that I gather the current going rate has something like three major deciduous forests buying one ship's peanuts. So in order to obviate this problem and effectively revalue the leaf, we are about to embark on an extensive defoliation campaign and burn down all the forests. I think that's a sensible move to.
- [09:49]
Jill Lepore
Ensure that makes economic pure.
- [09:53]
Douglas Adams
Mushrooms.
- [09:56]
Jill Lepore
If you've been following the story of cryptocurrency, this scene from Hitchhiker's Guide might sound a little too on the nose. In 2021, Musk announced that Tesla was buying millions of dollars of Bitcoin and and that you could buy a Tesla with Bitcoin until he changed his mind. Citing the sort of environmental concerns that I looked into in an earlier episode of this series, it turns out that mining bitcoin really is burning down the forests. But you can buy Tesla merchandise with dogecoin, and maybe you can sway a presidential election. In the 2024 U.S. presidential election, nearly half of all corporate spending came from the cryptocurrency industry. Some of that money went to Democrats, but most of it went to Republicans. Among the billionaires celebrating the announcement of Doge, the Department of Government Efficiency, was the CEO of the cryptocurrency company Coinbase. Cryptocurrency is essentially money without government, a libertarian's dream. Doge's mandate is to reduce government spending and to eliminate government regulations. The second of these is a lot easier than the first, what dismantling regulations might mean for money is a story, though, that goes back to the beginning of those regulations. The kerfuffle over Bitcoin really dates to 1848 and the discovery of gold in California. A flood of gold wreaked havoc on the US Dollar. And so, as the federal government took on new powers, it adopted a gold standard, which set a rate for the price of paper currency. Europe then did the same thing. This ushered in a new era of global trade and, not incidentally, the grotesque economic inequality of the Gilded Age. Farmers and factory workers argued for a silver standard, but the US formally established the gold standard in the year 1900. That same year, a science fiction writer named Garrett P. Serviss imagined a different outcome in a novel called Moon Metal, in which gold is discovered at the South Pole, setting off a second gold rush.
- [12:09]
Garrett P. Serviss
Gold is going to be as plentiful as iron. If there were not such a flood of it, we might manage. But when they begin to make trouser buttons out of the same metal that is now locked and guarded in steel vaults, where will be our standard of worth? My dear fellow, I would as willingly face the end of the world as this that's coming.
- [12:32]
Jill Lepore
Just then, a sinister scientist discovers a mysterious new metal on the moon which he can beam to Earth by way of a particle ray and introduce as a new and more precious form of currency.
- [12:43]
Garrett P. Serviss
I can produce it in the pure form, abundantly enough to replace gold, giving it the same relative value the gold possessed when it was the universal standard. But that will make you the richest man who ever lived. Undoubtedly. Why, you will become the financial dictator of the whole Earth. Undoubtedly.
- [13:07]
Jill Lepore
Currency is always a worry. Its value is so contrived, so imaginary, but also so important. After the stock market crash of 1929, people took their money out of the banks and turned in their paper dollars for gold. In the 1930s, the US abandoned the gold standard, at least for the duration of the Depression, and prohibited the private ownership of gold. If you've been listening to X Men for the last few episodes, you'll remember that it was during this era that in Canada, Elon Musk's grandfather joined and became a leader of the technocracy movement. Founded on the belief that engineers could solve all political, social and economic problems. Technocrats did not believe in prices.
- [13:50]
Garrett P. Serviss
By price system is not meant merely the capitalistic system, which is only one variety of the species. It means the collapse and complete obsolescence of the entire method of distributing goods and services by means of a price.
- [14:08]
Jill Lepore
Technocrats didn't believe in prices because they didn't believe in any system not run by engineers. They wanted to get rid of both governments and banks.
- [14:17]
Garrett P. Serviss
There will be no place for politics or politicians, finance or financiers, rackets or racketeers.
- [14:25]
Jill Lepore
In place of prices and money, technocrats wanted to reimagine the entire economic system with a new currency, a unit of energy, an erg whose stability would eradicate the volatility of finance.
- [14:39]
Garrett P. Serviss
A dollar may be worth in buying power so much today and more or less tomorrow, but a unit of work or heat is the same in 1900, 1929, 1933, or the year 2000.
- [14:57]
Jill Lepore
The ERG never did replace the dollar, and the US formally abandoned the gold standard in 1976. But starting in 2009, people who want to trade in units other than dollars can buy bitcoins. Bitcoin, a cryptocurrency, isn't based on anything of value. Although not unlike the erg, it has some relationship to energy, the energy it takes to produce it. After Trump's election in 2016, the price of bitcoin skyrocketed higher than it had ever been before, and Trump withdrew the US from the Paris climate accords. But bitcoin's value, like the value of other money, only exists if you believe it exists. JP Morgan once suggested that bitcoin was poised to become the new gold standard.
- [15:42]
Ishwar Prasad
Cryptocurrencies were designed to make payments without a trusted third party, such as a government or a financial institution involved.
- [15:51]
Jill Lepore
Ishwar Prasad is an economist at Cornell University and a fellow at the Brookings Institute. He believes cryptocurrency has set off a revolution, a foundational change in finance, but that bitcoin itself has not met its objectives.
- [16:05]
Ishwar Prasad
Bitcoin has really ended up failing in what it was supposed to provide, which is a cheap, trustless medium of exchange. It turns out it is not anonymous, it turns out it is not cheap, and it is not very efficient. So bitcoin has ended up becoming a pure speculative asset.
- [16:23]
Jill Lepore
The technology underlying cryptocurrencies, Prasad argues, will have all kinds of effects on finance. It really is the future. But he's not persuaded that, as some advocates claim, cryptocurrencies will democratize finance.
- [16:37]
Ishwar Prasad
They've made it possible for people with very low incomes, very low levels of wealth, to get relatively easy access to digital payments and also to basic banking products. But the problem is that digital access is unequal and financial literacy is unequal. So you might give people easy access to a lot of products, but if you don't teach them the risks embedded in those products, then you might end up with the relatively less well off taking on much more risks than they realize that they're taking on, and the rich ending up being able to use these technologies much more to their advantage. So they become even better off than they are right now.
- [17:19]
Jill Lepore
Dogecoin, a cryptocurrency based on nothing except a meme about a dog, was started by a software engineer named Jackson Palmer as a joke. Palmer later wrote an article called My joke cryptocurrency hit $2 billion and something is Very Wrong, in which he said that cryptocurrency, for all its promise, had become nothing more than an unregulated penny stock market. In 2019, after people started tweeting that Musk should be the CEO of Dogecoin, he said it was his favorite cryptocurrency. Dogecoin's value skyrocketed. Musk kept tweeting about it, and up went its price. He started calling himself the Doge Father. Musk talked about Dogecoin on Clubhouse, an online chat room that was briefly popular with Silicon Valley.
- [18:10]
Justin Richmond
Occasionally I make jokes about Dogecoin. They were really just meant to be jokes. But Dogecoin was made as a joke to make fun of cryptocurrencies, obviously. But fate loves irony, and often, as a friend of mine says, the most ironic outcome is the most likely. Or I say the most entertaining outcome is often most likely. And arguably the most entertaining outcome. And the most ironic outcome would be that Dogecoin becomes the currency of Earth in the future.
- [18:38]
Jill Lepore
In 2021. Musk tweeted the single word doge under a picture of a SpaceX rocket in front of the moon. Doge to the moon became a rallying cry on April Fool's Day that year, Musk tweeted, SpaceX is going to put a literal Dogecoin on the literal moon. A joke, but also not a joke. Musk said that SpaceX will be accepting Dogecoin as payment. Was Musk a comic? The next month, Musk hosted NBC's Saturday Night Live. He appeared in nearly every scam as the Nintendo villain Wario, on trial for murdering Mario. He explained, I'm not evil, I'm just misunderstood. In a skit set in the Old west, he played a bandit named Liron.
- [19:24]
Justin Richmond
What if, instead of panning for gold, we just create our own currency?
- [19:28]
Elon Musk
Currency?
- [19:29]
Jill Lepore
Yeah. And what the heck would it be based on?
- [19:32]
Justin Richmond
Whatever we say it's based on, that ain't how money works. Money is a golden rock that we dig out of the ground.
- [19:42]
Jill Lepore
Then we hope no one kills us.
- [19:43]
Elon Musk
Before we trade it for pieces of green paper.
- [19:46]
Justin Richmond
It's a perfect system.
- [19:49]
Jill Lepore
It's a weird thing about being a historian. Everything reminds you of something else. Watching Elon Musk play Liron dressed like a cowboy. He looked exactly like an old photograph of his grandfather, the technocrat who worked as a cowboy and performed at rodeos doing rope tricks. The family likeness is uncanny. Musk is also named after that cowboy's father, his great grandfather, Elon. Muskism asks us to picture always the future. But I find it hard not to keep picturing the past. Yanked back, lassoed by likenesses on snl. Musk appeared, too, on the show's newscast as a cryptocurrency expert who can't give a straight answer. What is dogecoin?
- [20:35]
Justin Richmond
Well, it actually started as a joke based on an Internet meme.
- [20:39]
Jill Lepore
Okay, but what is dogecoin? Finally, he admits the truth.
- [20:44]
Justin Richmond
I keep telling you, it's a cryptocurrency you can trade for conventional money.
- [20:49]
Jill Lepore
Oh, so it's a hustle. Yeah, it's a hustle. Why didn't you say that?
- [20:53]
Justin Richmond
Man, don't fall to everybody. It's a hustle to the moon.
- [20:58]
Jill Lepore
That night, Dogecoin lost a third of its value. Me, I was left thinking about the ending to that old science fiction story, Moon Metal. From the year 1900.
- [21:08]
Garrett P. Serviss
The looting of the moon brought disaster to the robber planet. So mad were the efforts to get the precious metal that the surface of our globe was fairly showered with it. The air was filled with with shining dust. Until finally, famine and pestilence joined hands with financial disaster to punish the grasping world.
- [21:37]
Jill Lepore
At the end of Moon Metal, markets collapse until an international agreement leads to government control of currency. That is what governments do in the US through the Federal Reserve and and through the securities and Exchange Commission, the Biden administration prosecuted crypto companies for securities violations under rules that the crypto industry complained were unclear and misguided. The second Trump administration is considering freezing much of that litigation.
- [22:07]
Elon Musk
How much do you think we can rip out of this wasted $6.5 trillion Harris Biden budget?
- [22:16]
Justin Richmond
Well, I think we can do at least 2 trillion. Yeah.
- [22:20]
Jill Lepore
@ a Trump rally in Madison Square Garden in New York just before the election, Musk made some predictions about the Department of Government deficiency.
- [22:28]
Justin Richmond
We're going to get the government off your back and out of your pocketbook. America is not just going to be great. America is going to reach heights that it has never seen before.
- [22:46]
Jill Lepore
There is arguably a great deal of waste in the US Federal budget, though exactly where is the subject of rather heated dispute. And many argue there's an excess of regulation. Musk says that it takes longer to fill out the paperwork to build a rocket than it takes to actually build the rocket. Excessive regulations tie up all kinds of projects, including housing and parks, projects that benefit all kinds of people. So I'd be only too happy if something great, something wonderful were to come out of Doge. But it strikes me that a lot of what animates Musk in playing a role in the American federal government concerns not taxing and spending, but regulation of cryptocurrency. After all, the cryptocurrency industry helped get Trump elected, and it expected results. As CNBC reported just after the 2024 election, Bitcoin briefly surging to a new record high as investors bet that Donald Trump will deliver on his pro crypto promises. Just before he was inaugurated, Trump launched his own cryptocurrency dollar. Trump. By the day of the inauguration, its market value had soared to $10 billion. To understand all this, there's no better explainer than Marc Andreessen, a venture capitalist whose company, Andreessen Horowitz, has described itself as the world's biggest investor. And in cryptocurrency, the Biden administration cracked down on crypto scams. Andreessen says the Biden administration also put pressure on banks not to work with crypto companies in a deliberate bid to stifle the industry. Silicon Valley had long supported Democratic political candidates and in general, leaned left. But Andreessen was outraged by the Biden administration's interest in regulating both cryptocurrency and artificial intelligence. As he said on his podcast, the Mark and Ben show, in July 2024.
- [24:37]
Justin Richmond
This has been a brutal assault on a nascent industry that I've just. I've never experienced before. I'm in total shock that it's happened. It's been intensely frustrating that it's been impossible to make progress in this with the White House.
- [24:47]
Jill Lepore
That summer, Musk announced his support for Trump, as Andreessen described on another podcast called Honestly from the Free Press, Elon.
- [24:56]
Justin Richmond
Right then, Elon stepped up and said, yep, I'm for him. That was the big moment in our industry where the most important iconic figure in tech by far, you know, did that in that moment. And so that was the real shift.
- [25:07]
Jill Lepore
Andreessen speculated that Musk's endorsement was likely partly pragmatic.
- [25:12]
Justin Richmond
I'm not speaking for Elon, but Elon decided that he had to do this, because if not, he wasn't going to be able to launch rockets.
- [25:17]
Jill Lepore
Andreessen himself ranks pretty high on the list of the highest donors to the Trump campaign. He soon became a Trump intimate, recruiting people from Silicon Valley to work or to volunteer for the incoming administration. With Doge and within the Trump administration, Musk and Andreessen are achieving what the technocrats of the 1930s could only dream the technocracy. Andreessen is also the author of an excellent distillation of muskism, a treatise called the Techno Optimist Manifesto. Though it could equally have been called the Manifesto of Muskism. It consists of a list of statements. We can advance to a far superior way of living and of being. We have the tools, the systems, the ideas. We have the will. We believe. This is why our descendants will live in the stars. If only we place our faith in the techno capital, machine and recent promises, we will become technological supermen. We are the apex predator. We believe in greatness. We believe in ambition, aggression, persistence, relentlessness, strength. Andreessen cites among his inspirations for this manifesto on the list of patron saints of techno optimism, Filippo tommaso Marinetti. In 1909, Marinetti wrote what he called the Futurist Manifesto. It's a list of statements. We want to sing the love of danger, the habit of energy and rashness. We want to exalt movements of aggression, feverish sleeplessness, the double march, the perilous leap, the slap and the blow with the fist. We want to sing the man at the wheel. We want to demolish museums and libraries, fight morality, feminism. Standing on the world's summit, we launch once again our insolent challenge to the stars. So same mojo, fists raised to the stars. Ten years after Marinetti wrote the Manifesto of Futurism, he co wrote the founding document of the movement led by Mussolini, the Manifesto of Fascism. Marc Andriesen, like any reasonable person, hates it when people call people they disagree with fascists. But here he cited the author of a fascist manifesto as a major inspiration for his own manifesto. Which is why, to me, at least, the future envisioned by techno libertarians happens to look chillingly like the very worst of the past. The 21st century is an age of technological wonder. It is in many ways tremendously thrilling. Tesla and SpaceX are engineering marvels, but I don't find muskism thrilling as political theory or social engineering. In 2021, the year Elon Musk became the Doge Father, Time magazine made an announcement. The person of the Year is Elon Musk. He is reshaping life on Earth and possibly life off Earth as well. And this is someone also who, in becoming the richest person in the history of the world this year, really speaks to the moment we're in. Not mentioned in the Person of the Year announcement was that at the time, two different women who were carrying Musk's babies were in the same hospital in Texas. Musk already had seven children, but he believes that a falling birth rate is a civilizational threat and he means to solve it. He seems particularly fond of a son born in 2020 during the pandemic when Musk himself underwent a kind of rebirth. He's often photographed carrying on his shoulders this beautiful little blond boy and sometimes even brings him along to press interviews. What's your name?
- [29:15]
Justin Richmond
What's your name?
- [29:17]
Jill Lepore
Actually, I'm gonna show you.
- [29:21]
Justin Richmond
Should we help President Trump?
- [29:22]
Jill Lepore
Yeah. Next time on X, the astounding tale of Baby X. This is an I Heart podcast.