Balaji Srinivasan - Episode #369

Summary

YOUR WELCOME with Michael Malice – Ep #369: Balaji Srinivasan
Podcast Date: June 25, 2025
Guest: Balaji Srinivasan

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Episode Overview

In this highly anticipated episode, Michael Malice welcomes technologist and entrepreneur Balaji Srinivasan, acclaimed author of The Network State. Together, they explore how technological progress and internet-enabled communities are driving forward new models for freedom, governance, and even nationhood itself. The conversation journeys from the failures of legacy political systems to practical blueprints for creating “cloud countries”—decentralized, opt-in communities merging online and real-world presence. Balaji brings detailed analysis, historical context, and actionable optimism, offering a real-world framework for those seeking alternatives to traditional statehood.

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Key Discussion Points & Insights

1. The Need for Practical Solutions, Not Just Theory

• Malice introduces the central frustration with liberty-focused political discourse: “Why are we wasting our time having purity spirals on Twitter where, right now, Freedom Cities are being implemented?”
  (04:10)

• Friedman’s Challenge: Citing Patri Friedman, Malice notes, “We have the tools to implement and move liberty forward in our lifetime in enormous ways… Why not just do it?”
  (03:27)

• Balaji’s Response: “Cloud first, land last, but not land never. For years people have wanted a blank slate to build from scratch—and now, for the first time, it’s possible”
  (05:05)

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2. The Network State Blueprint

What Is a Network State?

• Definition: “A network state is a social network that crowdfunds territory and co-lives together. It's effectively a decentralized country.”
  (16:08, 17:03)

• The Physical Social Network: Online communities crowdfund and purchase real-world territory, building new, purpose-driven societies from scratch.

Building Steps and Feasibility

• Starting Small: “At the beginning, it's just a LARP... but over time, as you get more and more people, once you have 250 you can take over a building. People underestimate the power of a few hundred people offline.”
  (18:13)

• Trajectory: Individual → friends/fans (dozens), to hundreds (shared housing), scaling to thousands and eventually millions.

Attracting Pioneers

• Frontier Mindset: “The frontier is a filter.” – Malice
  (19:49)

• Balaji: “This will attract the kind of person who's early to Bitcoin, who's early to a startup... Internet company, Internet currency, now we have Internet community.”
  (19:52)

Historical Precedence and Precedent

• “Most countries are small countries; 38 have less than a million people.”
  (21:44)
• Decentralized communities already do deals with countries (e.g., Tuvalu (.tv), Bit.ly, Nevada with Tesla, El Salvador with Bitcoin).
  (25:00)

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3. Why Now? A Historical and Technological Perspective

The U-Turn of History

• “History is running in reverse. We are living through an age of growing decentralization without really seeing it.”
  (22:01, 34:27)

• Graphs show centralization peaked circa 1950, followed by rapid redecentralization post-1991 with the fall of empires and rise of the internet.
  (36:09–39:27)

• Notable Analogy:

  • “When the American empire breaks down, we’re going to see a huge surge of new countries.”
    (44:37)

• Technological Re-decentralization:

  • “You go from mass production to the iPhone, which puts it in your hand, from uniparty to fragmentation.”
    (47:51)

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4. The Cloud vs. The Land

• “We have freedom in the cloud but not on the land... you can build a billion-dollar business online just by hitting keys, but you need a billion permits to build a house in San Francisco.”
  (09:51)

• Comment on the scale of possibility: If only a fraction of large online communities step offline and co-invest in real-world projects, radical new polities are possible.

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5. Profitability and Pragmatism

• “If it’s not economically feasible, it’s not feasible.”
  (13:13)

• SaaS: Society as a Service:

  • Social media platforms monetize at $10–$40/person/year; countries at thousands. Network states can scale that curve.
    (30:27–31:22)

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6. “Depoliticization” and Community

• “You can almost depoliticize... you don’t even realize the extent to which your back is up in the US, because everything is politics all the time. Here, you can just focus on building cool stuff.”
  (59:30)

• Malice: “Normal conversations will be exciting, as opposed to, you’re going to have to be on because you’re dealing with some normie and their programming from CNN or Fox or whatever.”
  (59:00)

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7. The Sovereign Collective vs. The Sovereign Individual

• “Even Steve Jobs, as sovereign as anyone, wrote near his death how utterly dependent he was on the entire society. I believe in the 'sovereign collective.'”
  (60:45, 61:20)

• Notable Steve Jobs quote read by Balaji:

  “I do not make any manual clothing. I speak language I did not invent... I love, admire my species and totally depend on them for my life and well being.”
  (61:23)

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8. Exit and Order After Chaos

• “I preach anarchism for the statist and statism for the anarchist. You want to be libertarian enough to exit the existing society, but pragmatic or collective enough to build a new one.”
  (62:43, 64:57)

• Drawing from the collapse and birth of new countries after the British, French, Soviet empires, Balaji posits that the US is next for redecentralization.
  (44:37, 47:51)

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9. Bitcoin, Post-American World, & The Next Poles of Power

• “I do think after Orange Man, Orange Coin... Bitcoin maximalism is what will inherit the mantle after MAGA.”
  (80:14, 80:43)

• The likely next global axis: “Chinese communism versus Bitcoin maximalism. CCP versus BTC. Total control versus total freedom.”
  (87:43)

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10. Internet as The Next New World

• “The Internet is to America what America was to Britain. It started off British, but became its own thing... the Internet was American, but is now its own global civilization.”
  (67:00–67:33)

• Advice to global founders: “I tell every Indian founder, do not go to the US anymore... Build in India, UAE, Singapore, NS... we should have a place where we can build the next Googles and Facebooks.”
  (69:34–70:29)

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Notable Quotes & Memorable Moments

• Malice on practical liberty:

  “When you have a government which forces us all to listen to the same music all the time, no one is happy and you get antagonism.” (08:05)

• Balaji, the filter of frontiers:

  “The frontier is a filter.” (19:49)

• On rule of code:

  “People would kill each other for millions of dollars, let alone trillions. Bitcoin has gotten people to agree on that without firing a shot.” (28:31)

• On America's increased polarization:

  “After 1991, Americans had no one to fight, so they fought themselves.” (40:51)

• On The New Axis of geopolitics:

  “China vs. the Internet: hardware vs. software.” (29:16)

• On Trump:

  “Democrats identify democracy as Democrat… Republicans identify American as red American implicitly… the issue is people are trying to identify these things at the level of the state when it's actually at the level of the network.” (77:38–79:41)

• Malice on Americanism:

  “This—to me—is Americanism at its best... seeing a space that is empty and using your drive and entrepreneurship… to create something great in this space.” (53:09)

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Important Timestamps

• Network State explained and visualized: 16:08–19:52
• Scale of digital communities vs. real-world countries: 21:21–22:48
• Historical graph—center of world economy shifts: 36:09–39:27
• Collapse of civilizational centralization: 44:37–47:51
• Depoliticizing community and the role of ‘sovereign collective’: 59:26–62:43
• Bitcoin as the next “successor ideology” after MAGA: 80:14–84:16
• Geopolitical “network” boundaries explanation: 79:00–80:14
• Pitch for the working community in Singapore / invitation: 57:04–58:37

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Tone & Flow

The episode is energetic, idea-dense, and geekily optimistic—both speakers blend libertarian-leaning critique of current systems with historical and technical rigor. Malice provides humor and context (“deadlifts named after Kevin Deadlift”), while Balaji’s tone is analytical and determined, always circling the conversation back to concrete possibilities and the unprecedented power of the internet to reshape societies.

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Conclusion

This conversation is a call to turn internet-based liberty movements into real, lived, practical communities. Balaji’s vision offers a path away from endless theory and Twitter arguments toward the physical realization of networked freedom—decentralized “countries” for the 21st century and beyond. For those seeking post-partisan, scalable ways to “build instead of complain,” this episode offers a concrete blueprint, historical orientation, and inspiration.

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Further Reading & Resources:

• The Network State
• Network School (ns.com)
• Michael Malice’s “Not Sick of Winning”
• Conference info: October 2025, Singapore

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For more engaging episodes, subscribe to YOUR WELCOME with Michael Malice.

Transcript

[Progressive Insurance Announcer]

This episode is brought to you by Progressive Insurance. Do you ever find yourself playing the budgeting game? Well, with a name your price tool from Progressive, you can find options that fit your budget and potentially lower your bills. Try [e-mail], progressive Casualty Insurance Company and affiliates. Price and coverage match limited by state law. Not available in all states, day or night.

[Balaji Srinivasan]

VRBoCare is here 24. 7 to help make every part of your stay seamless. If anything comes up or, or you simply need a little guidance. Support is ready whenever you reach out from the moment you book to the moment you head home. We're here to help things run smoothly because a great trip starts with the right support. And hey, a good playlist doesn't hurt either,

[Michael Malice]

folks. My new book, Not Sick of Winning A History of President Trump's first 100 days is available now. Just head over to notsickofwinning.com to buy it on Amazon. Good afternoon. Michael Malice here. Let that be your welcome for the next hour. My next guest is someone. This is the most awaited guest we've had on the show. I've been trying for, literally before COVID five years to get him on. He is the author of the network State. I met him, he used to be with Mark Andreessen's firm, CTO at Coinbase. I met him at a party and we had a long conversation and he blew me away. And the reason I haven't said your name is I've been told that on good authority that's a microaggression for a white person to mispronounce a foreigner's name. So can you please tell everyone how to pronounce your name correctly?

[Balaji Srinivasan]

Sure, it's, it's biology, but a lot of people, whatever, if you'll call me, as long as I don't actually care, you know, just, you can get it out however you want. But it's biology. If, if, if you, if you mind, like, like biology, well, that's, you know, it's actually nominative determinism, you know, that is, have you.

[Michael Malice]

Not in this context.

[Balaji Srinivasan]

So nominative determinism is like, if you're, you know, if your last name is winner, then you might be a winner. So that probably prompted me to get into genetics and so on and so forth because of its adjacency to the word biology. So that's actually what I started my career in.

[Michael Malice]

It's funny you said that, because one of my proudest moments, I was on Rogan and I've been working with Janae Marie Crock as a fitness coach. And I said, there's like five people who have lifts named after them. There's the Arnold Press named after Arnold Schwarzenegger. Pendley Rose after Coach, I think John Pendley. Crock rose after Matt Kroc. And Deadlifts named after Kevin Deadlift. And Rogan's like, the deadlift's named after Kevin Deadlift. I'm like, no, it was.

[Progressive Insurance Announcer]

But.

[Michael Malice]

It was such a. But if that was to the kid's name, there's really one path forward for him only.

[Balaji Srinivasan]

Yes, that's right. No, no, your deadpan is very good because people at first say they're wondering if you're serious, which is. Which is a good skill anyway. All right, so. Well.

[Michael Malice]

No, no, no. You're not running this conversation. Calm down, come down. I got. I got a lot of questions for you, and I want you to know why they should listen to you.

[Balaji Srinivasan]

Go, go, go, go.

[Michael Malice]

My good friend Patrick Friedman, who you probably know, he lives here in Austin as well. He is the grandson, Milton Friedman, son of David Friedman. He said something once to me in the last couple of years which blew my mind, which he says, I'm sick of arguing about theory. We're in a place where we can move. We have the tools to implement and move liberty forward in, in our lifetime in enormous ways. And when he said that, it just really kind of. It's such an obvious thing, but it really took me aback. I'm like, yeah, why? Why we wasting our time having purity spirals on Twitter where right now Freedom Cities are being implemented? Crypto is a great example of this. And you, when I talked to you at a party, you sat me down and you were the only person I have met ever, who had a path, step by step, to achieving liberty. And every single one of these steps sounded completely feasible to me. So it wasn't like, you know what we're going to do? We're going to elect like this person as president and all this Congress, and then everyone's going to be educated and involved. And it's like, that's not. None of those things are happening. Or maybe one will. So I was so impressed with your blueprint, which is the basis of the network state, because one of the things I always talk about when I talk about liberty is, you know, this kind of passport world we have is like horse and buggy technology in a post cell phone world. And you really laid it out. So I know you have a presentation. You're the first guest we ever had who actually has A not a PowerPoint, but a series of slides. But I'm going to hand the floor over to you because I was so taken aback and I was so excited that the viewers get to hear what I heard, one on one. Which just five years later, I'm still kind of like, in awe.

[Balaji Srinivasan]

Well, you know, that's very kind of you, Michael. I appreciate that. And before I get into it, I think, you know, Patrick's done a lot for freedom. I think, you know, it's a bunch of folks. And I think the pathway, just very briefly, and then I'll go into the slide deck, is cloud first, land last, but not land never. The thing is that for many years, people have wanted, why does Elon want a Mars colony? Why does Teal? And why did Patriot want seasteading? They want that clean slate to be able to build where just nobody else is there. It's the same reason you want a blank sheet of paper. It's the same reason you want, like, an open document with nothing there. It's not because, you know, you don't think other books are great or, you know, that other code is great, that's fine, but you just want a clean sheet of paper. Completely reasonable thing. I mean, that's why we incorporate new companies. That's why we build new buildings, right? Like, sometimes you want to be able to do it from scratch. And also if you can't do it from scratch, you may not be able to actually do it because doing it from scratch means you need to know everything, for example, from plumbing, if it's a building, or, you know, there's a lot of details that go into a book. For example, when you, when you did your book, doing it from scratch taught you something, right? That, that reading one wouldn't, wouldn't tell you. So the, the issue is that all of these other things, like, you know, seasteading or Mars or, you know, Sealand, for example, they all kind of started with either a technological breakthrough or the land. And so kind of far future. And then the more conventional ways are winning wars or revolutions or elections, which are very difficult to do. I'm not saying it's impossible, but I also wouldn't advise starting a war or a revolution, even an election. You know, it's contentious and it's not obvious that you actually have control over the outcome. People vote and they think they have control, right? So what is the seventh wave? It's not Mars if it's not seasteading. If it's not, you know, let's call it micronations. Like Sealand if it's not war, it's not revolution selection. I call it the cloud country. And I wrote a [e-mail] on this and the concept is very simple. It is, you have an online community, for example, you're an influencer or there's a creator and you organize it to crowdfund territory offline and you start co living together and it's, it actually just starts there. And the reason that should be feasible is you have tens of thousands, hundreds of thousands, millions of followers, often online. Those people actually often, often share your diagnosis of what's ill with the modern world. Right. And, and, and they're also in the us there's all these abandoned small towns, there's these banded college campuses. And actually around the world, for example, Japan has Ikea and Anada. Have you heard that term before?

[Michael Malice]

Have not.

[Balaji Srinivasan]

It's like it's abandoned farmland. Abandoned. Because unfortunately Japan is this fertility crisis. Right? Yes. So there's actually, you know, very nice stuff out there now. It's all, it's often run down in some way. Nothing is ever completely perfect. You need to have a frontier mindset, you know, when to an abandoned town that hasn't been there for a while, you need to be ready to deal with pests or.

[Michael Malice]

Can I interject here?

[Balaji Srinivasan]

Yeah, but it's.

[Michael Malice]

There's two kinds of people, right? At least one is okay, this is run down, whatever. And the other is what a great opportunity. Like I can take this and I can make this something wonderful and exciting and beautiful. And just to your point earlier about how what I regard as the malevolence of politics, if you have, if 1,000 of us have the same rough worldview and we can argue about the edges and you over there have a different worldview, why are we locked into the same polity? Like I don't know what kind of music you listen to, I don't care. I want you to listen to music that you enjoy and go to the concerts that you enjoy. And maybe you could tell me, hey, I have this concert. Great time, great. I don't like that band. I love it that you had a great time. But when you have a government which forces us all to listen to the same music all the time, no one is happy and. And you get antagonism.

[Balaji Srinivasan]

That's right. That's right. And basically I think the key, insofar as there's a contribution that I've made, it is the fractal frontier. So you know, the whole thing about America in the 1800s was this wide open frontier and you could go and build there. In 1890, as you know, the frontier closed. And that actually people at the time said, oh boy, it's like, it's like the octagon, you know, the steel cage match descending. With the frontier closed, no escape. Everybody had to punch it out. And that was the 20th century with World War I and World War II and all these wars. It's like a steel cage match match. Right? But then in 1991 actually the, you know, commercial traffic on the Internet was legalized. That was actually a critical thing we know about the fall of communism. You know, you've run your book, the White Bill is a great book, but actually. And also you may know India liberalized at that time, Many countries went away from communism. But something that's less appreciated, that frankly should be like a first class thing that everybody knows about. Have you ever heard of the NSF acceptable Use Policy?

[Michael Malice]

No, maybe not by that term.

[Balaji Srinivasan]

One of the most important regulations that was ever sunset, essentially until basically the early 90s, commercial traffic was prohibited on the Internet because it was just an edu and military network. And they said there was going to be spams and scam and malware and porn if you allowed commercial traffic in the Internet. And of course they were right. But, but, but we also got, you know, all the dot coms and we got cryptocurrency and we got everything else. And I think the good outweighed the bad by a lot of. And that was because essentially the Internet was communist in a sense before 1991, and then it became capitalist. Okay. So that led to this explosion of activity on the digital frontier. And we have now this paradoxical moment where you can build a billion dollar business online just by hitting keys, but you need a billion permits to build a house in San Francisco. Right? Right. So we have freedom in the cloud, but not on the land. Right. And the thing is though, the scale of the cloud, the sheer scale of it is really just mind crushing. Like if you put up a Tweet and it 20,000, 50,000 views, that's like okay for a tweet, right? But have you ever seen 50,000 people in person? Right?

[Michael Malice]

No, I don't think I have.

[Balaji Srinivasan]

Well, it's like, it's like basically half a football stadium. Right? It's like, like an NBA game would be like 35, 000 people. Right, okay. And, and you know, if you have, there's a great actual. If you Google lime crowd sizes, okay. There's, there's a page that just Shows like what different crowd sizes look like.

[Michael Malice]

Oh, okay.

[Balaji Srinivasan]

And if you scroll all the way to the bottom, you'll see like, what is 170,000 people look like? It looks like a packed NASCAR, you know, kind of stadium. And sometimes before I go to tweet, you know, like, if you have like a million million something followers, it's almost like imagining you're going up to the mic at the center of a football team being like, oh, say Ken, right? Okay, what's my point? Point is the cloud is mind crushing scale. It's absolutely insane how big it is, right? And if you can just take one out of a hundred of and you can get them to actually take a risk and do something rather than just posting and come with you to go and build up a small town, right, that's being abandoned, that real estate is cheap and you can roll up your sleeves and be a man and not just be an electrical engineer, but be an electrician, not just be a chemical engineer, but be a plumber. That's literally what we're doing here [e-mail] and you can go and check that out. Network School, which you're building, and this is a global movement, by the way. Like, obviously, you know, I'm very sympathetic to Americans and spent a lot of time in America, but if you're Canadian, if you're European, if you're British, if you're, you know, like Australian, wherever you're from, right? Indian, Japanese. We have people actually from a hundred countries at Network School where we're actually doing this. So I could talk about that. That Network School is like oper, the operationalization of Network State. But actually before, before I go into that, let me actually give a quick talk so I can explain these concepts from scratch with some visuals. Please go. All right, great. Let's put these slides on screen. All right. All right. So the Network State we've started.

[Michael Malice]

Before you get into this, I also want to give you another compliment.

[Balaji Srinivasan]

Please.

[Michael Malice]

Every single day on social media, you hear no one's offering solutions. No one's offering solutions. Those are our solutions. Can you. Do you have any reason why that is? And they're not wrong. Is it just that it's easier to complain that it is to build. It's hard to recon, Recon. Reconfigure our base, you know, assumptions.

[Balaji Srinivasan]

It is easier to complain than to build. Also, social media sets it up such that complaining gets incentivized. Right? Right. That's right. But I do think that you should win off Twitter to win on Twitter.

[Michael Malice]

Yes, yes, yes.

[Balaji Srinivasan]

Right. So like Elon wins off Twitter, right? That is say he wins with SpaceX rockets and he posts them. Even if they blow up. Who cares? He's building rockets, you know. Right. And, and many of them don't blow up. Obviously he's get, he's number one in the world on that. So I think the other thing is the, the buttons basically the, the user interface that you've got on, on current iteration social media. To give an analogy, imagine if you had a hundred people, you know, like, like during the BLM riots. And so someone's telling them, oh, go and burn down that building. Right? That, that complete paralyzes. One guy grabs a rock, the guy grabs matches and that building is toast by the morning. Right. People are, you know, good at that. But if you take those hundred people and you say build a building, right?

[Michael Malice]

Oh yeah, you're right.

[Balaji Srinivasan]

That's way harder. Right? Because you know, first of all, they may not have the skill. Second, that costs money. Who's the architect who has a blueprints that is a coordinated process where crucially burning down the building, when you go back and look at it again with new eyes, it paralyzes. None of these people needs to like each other. You know, one guy may just be smashing wheel that doesn't even do anything, but the guy's Bernie. So that's that destruction paralyzes. But building requires serial communication. You have to have a leader. And so, so right, so Twitter is like more the burning than the building because everybody can yell at somebody in a different way. Right. There's no, there's no obligation. Whereas to build something you need a different interface than Twitter. It looks right. So, so just the structure of it is something which is, which did not conduce to that. Now what's funny is something like GitHub or even like Google Docs allows multiple editors to create things at the same time. There's some control over it. You can make something useful there. Anyway, so, so that's part of it. But okay, yes. Now let's go into how do we actually start new countries? Right. Okay, so this is the concept of network state. And basically I'm just going to establish three premises. Starting new countries is possible. And I'll talk about why now and then talk about what next. Right. So starting a country is possible. And so, you know, I wrote this book, it's@the networkstate.com this is version, you know, 1.0. Right. We're gonna, we're on version 2.0 and I, I also have actually a [e-mail] the network school, if you go there. This is actually putting theory into practice. Okay, so premise start new countries is possible, preferable and profitable. Let me start with possible. Okay. And I only list profitable because if it's not economically feasible, it's actually not feasible. Right, right. But possible. Right. Are new countries even possible? So the thing is we know that Google, you know, a new company, started out of a garage, right. Within our lifetimes. And a new community, Facebook, started out of dorm room Zuck just basically built that from scratch. And a new currency, Bitcoin, started from a message board. Right. So could we build new countries? Could we build what I call network states? And just to be very concrete about what does a network state look like? This is what a network state looks like. And it is a physical social network. Okay. That's to say it's a social network where the clusters of people around the world crowdfund territory and co live together. So this is an example network state with 1,729,314 people. It owns subdivisions in Tokyo, Mumbai, Delhi, New York, wherever. Its annual income is $157 billion across all of its people. And it's got this square meter footprint. And this is a way that you can get something that has the population, annual income and real estate footprint of a legacy country. The key distinction is just like bitcoin's a decentralized currency and network seats a decentralized country.

[Michael Malice]

So how are you calculating that square meters in terms of what land they have?

[Balaji Srinivasan]

It's just what they own property buys.

[Michael Malice]

Okay, so literally just my house would count towards that or your house or something like that.

[Balaji Srinivasan]

Exactly, that's right. Now eventually, when you own a large enough bit of territory, you may be able to negotiate a special economic zone and some gradual measure of sovereignty. Okay, Right. And when I say gradual, gradual is a very important word because it's not. There's many degrees of intermediate between 0 and 1. Right? That's right. If for example, you just got a zone where self driving cars are legal and actually non self driving cars are not legal, that would completely. You don't have to change every law. In fact, you want to keep all the existing laws because you don't need to change the law on assault or graffiti or whatever. You keep all those the same, those are all being debugged code that's been there for many, many years. But just you change that law. If you just change that law in self driving, everything else changes the entire geography of the Town changes, all kinds of things change. Right? So you make these very selective edits in these special economic zones.

[Michael Malice]

Biology is not talking pipe dreams. This has already started happening. Yes, we have already passed this point. Oh, am I cutting, am I getting ahead of you?

[Balaji Srinivasan]

No, you're absolutely right. But basically you're right, this is not. But I want to show the reason I say this is I like to be very concrete and achievable. Right. We know social networks exist, we know crowdfunding exists. So social network that crowdfunds territory and co lives, lives. All three of those things exist. Just we have to put them together. Right. So how do we get to a million people? Well actually you can start with for example one guy in this example in Japan and he has you know, 17 people and then 172 he recruits them over the Internet. They start co living together and at the beginning it's just a larp, right? Almost it's just like a group of people that's like an online community that decides to co live and, and it's just a scale larp. But, but over time as you get more and more people, Once you have 250 people, you can take over a building. Right? That's the thing is offline scale is so much more powerful than people think. A few hundred people offline is so much bigger than 250 views online because a 250 person apartment building can be afforded by 250 people. And what you find by the way when doing this is that it's just, it's both much more rewarding and it's more challenging to coordinate people in the physical world towards a common goal. But it's actually like the roll up your sleeves of the old America. What America was, right. And what, what the Internet can, can revive again.

[Michael Malice]

And I also want to point out something else that you, that that kind of goes with that which is this is going to attract a certain type which validates that kind of growth and it's going to for other people who don't think in these terms their eyes are going to glaze over. This is crazy Internet stuff. It's not for me. Correct, it's not for you. So leave us alone path, no one's bothering you.

[Balaji Srinivasan]

That's right. The frontier is a filter.

[Michael Malice]

Yes.

[Balaji Srinivasan]

Right. So this will attract the kind of person who's early to bitcoin. This attract the kind of person who's early to a startup. I think of this as the third kind of thing. Internet company, Internet currency. Now we have Internet community.

[Michael Malice]

Yes,

[Progressive Insurance Announcer]

this episode is brought to you by Progressive Insurance. Do you ever find yourself playing the budgeting game? Well, with a name your price tool from Progressive, you can find options that fit your budget and potentially lower your bills. Try [e-mail], progressive Casualty Insurance Company and affiliates. Price and coverage match, limited by state law, not available in all states. This episode is brought to you by Progressive Insurance. Do you ever find yourself playing the budgeting game? Well, with a name your price tool from Progressive, you can find options that fit your budget and potentially lower your bills. Try [e-mail], progressive Casualty Insurance Company and affiliates. Price and coverage match, limited by state law, not available in all states.

[Balaji Srinivasan]

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[Michael Malice]

Let's get back to the show.

[Balaji Srinivasan]

So now if we get to 1 million, why does that put us within country range? So a key concept, non obvious is most countries are small countries. So these are, if you define a country as a UN member, the majority of countries actually have less than 10 million people. In fact there's 38 that have less than 1 million people. People and almost a dozen that have like less than, less than 100k. Right.

[Michael Malice]

Oh wow. Okay.

[Balaji Srinivasan]

And so that's actually, you know, because we're, we're used to thinking about the US and Russia and China and so on. So for just giant things. But most countries just have sovereignty. And we've built social networks, I've built social networks, apps, funded all kinds of things that are way bigger than this. Right. Online.

[Michael Malice]

Right.

[Balaji Srinivasan]

Okay. So most countries are small countries, number one. And actually, and this is a very surprising graph to a lot of people, the minimum number of countries in the world was around 1950. That was peak centralization, a concept we'll come back to. The number of new countries actually increased almost 4x since 1945. And that's because I'll get to this because the British Empire, the French Empire and then the Soviet empire broke down. And as the centralized states started metabolizing and breaking down, you got these new countries. We've actually been living through, in a weird way, an age of growing decentralization without really seeing it. Right. Okay. And the third point is cryptocurrencies. We know they rank with fiat currencies. This is a Fun site called fiatmarketcap.com and here you see bitcoin between the Turkish lira and the Chilean peso at the time of the screenshot. Right.

[Michael Malice]

So they know she must be spinning in his grave.

[Balaji Srinivasan]

Yeah, the flippening. Right, okay, exactly. So if you put those together. Right, could crypto countries rank with fiat countries? And if we got a network state with 1,729,314 people, it would be intermediate between Lafayette and Bahrain. Okay. And the only thing is, it'd be global and decentralized. That's the thing, is we changed. Just like bitcoin, the key innovation was decentralization. Right. So also this is how, in part, we may be able to solve the birth of dearth. Because you'll have all these type A personalities that want to rank on the leaderboard.

[Michael Malice]

That's right.

[Balaji Srinivasan]

And so we want to be a fast growing thing and we combine both. You know, you have to do recruiting. You have to recruit, but you also reproduce. Right. So you do both. So could crypto countries rank before you

[Michael Malice]

get into the next thing, you also kind of hit to something else. This is going to bring something that sadly, we're lacking very much in America, which you have over there in Singapore, which is a strong level of patriotism.

[Balaji Srinivasan]

Yes.

[Michael Malice]

People are invested in making their community grow. It's not a tragedy. The commons, it's like, hey, this is on my shoulders and I really have the capacity and the desire to, to make my nation something excellent for the sake of me and my community.

[Balaji Srinivasan]

That's right. You can call it libertarian nationalism in the sense of. It's really proposition nationalism in a new way. Right. It's like, you know, if you're founding something, then you recruit people who believe in those founding principles. And that ideological filter is actually itself a glue that keeps people together because they understand why they're there and their purpose. And we know that that works like for building gigantic companies. I mean, like Amazon alone, by the way, has a million employees. And there's faults of Amazon, but it's also actually this amazing thing that was built from scratch. And again, it's bigger than most, than many countries. Right. It's bigger than like 40 countries around the world just in terms of people. So it's possible to do. Okay, all right, so this is now this is where that, that dashboard I showed it would rank over here if we had it there right now. Now, a key concept is sufficient traction means diplomatic recognition. Okay. And what I mean by that is let's say you could get this thing to 100,000 or a million people. Why do I think you could get a measure of diplomatic recognition? The reason is the land is already doing deals with the cloud. Okay. So for example, there's Tuvalu and it's the TV domain. It did deal with Godaddy. There's Nevada to deal with Tesla for the Gigafactory. Of course, you know, naive Bukele of El Salvador essentially, in a sense did a deal, quote unquote with Bitcoin, but he just adopted Bitcoin. Right. So given this, that, you know, you have companies and currencies that are being adopted by, by, by offline cities and counties and countries. I do think that a crypto community could do a deal with an offline community. Right. I think that's very possible.

[Michael Malice]

And let me give a couple other examples where so people can understand this very easily. You have the Cayman Islands where people basically establish some residency. There's no reason that the Cayman ons are special, but they're like, we're going to give you something no one else does. People who have money and interest, they're like, okay, I'm going to make a deal with you. Everyone recognizes it, it's fine. Switzerland is a classic example of this with their banking stuff. Example. People don't realize they don't use it as much anymore. Bitly was Libya. Bit ly, which was.

[Balaji Srinivasan]

Right.

[Michael Malice]

URL shortener was Libya using their kind of suffix to work on the Internet. So there's lots of examples. People think this might be too heady where this has just already been the norm.

[Balaji Srinivasan]

This is the norm. Exactly. And most people don't get this. But small countries are actually relatively cash and talent poor. And in the cloud we're actually cash and talent relatively rich, but we're land and sovereignty poor. Right, Right. So that's an amazing deal. Right? You know, the offline small countries, there's like all these small countries with less than 10 million people that have a flag and they have the, you know, they have sovereignty. And we can just go in and do a deal with them and do a memorandum of understanding and set up a, you know, community. And by the way, you don't have to start by inking a deal with the sovereign, as I'll get to. I think you start with other kinds of things and then eventually you get there. But. But when you have sufficient traction, you can get to the bank recognition. That's my point. Okay. All right. So that's why I think it's possible to start new countries. And why is it preferable? Well, one way of thinking about it is there's both a push and a pull. All right? So, you know, if you have, you know, this is Sri Lanka, this is Venezuela, this is Panama. Like, all the printing, all of the monetary devaluation, there's a lot of chaos in a lot of countries around the world that people don't necessarily appreciate the scale of it. Giant crowds, swirling crowds have just seen their economies destroyed or what have you. And these powerless people, they now have an alternative to failed states potentially. Right. Because the. The network works for them. Right. And on the other side, something else. Sorry.

[Michael Malice]

Because I just really want to get. Because people not following this. In a lot of these countries, people complain about the states where it's like, you know, you have two awful choices. In a lot of these countries, the two choices. They even have one choice, or the two choices are horrific, even by, like, American bad standards.

[Balaji Srinivasan]

Yeah, yeah.

[Michael Malice]

Like cancer and aids, and you alternate and it just. And everyone pays the price. And the people at the top just skim off the top. It's. It's really horrific. So a lot of these people who are. Have a lot of something to offer are starved because they're trapped in this state, literally and figuratively, where there's nothing that they can do about it. So this would give them a way out to kind of use their talents to help everyone.

[Balaji Srinivasan]

That's right, exactly. And I think basically an important concept also is, like, the Constitution, as amazing as it is, doesn't export over the world, but the blockchain does.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

Okay. So that's the key thing is, like, whether you're in Latin America, Africa, the Middle East, India, North America, Japan. One of the amazing things about bitcoin is whether people are Japanese or Chinese. If they're Israeli, Palestinian, Democrat, Republican, Indian, Pakistani, they agree on the state of the bitcoin blockchain. Like, who owns what bitcoin. Right. Like just that. That part. And that means trillions of dollars in property has been agreed upon without firing a shot. And people would kill each other for millions of dollars, let alone trillions. Right, right. So. So that is so remarkable because we actually have rule of code. Just as Delaware becomes unpredictable and Elon has to move out of Delaware, just as the old system is melting down all the rule of law, you know, they've Abolished the police and so on. The new one is booting up, which is rule of code.

[Michael Malice]

Yes.

[Balaji Srinivasan]

And, and actually will get us eventually an even larger global market. As I'll get to in a different talk, I do think the Internet is the one thing that has the economic scale requisite to compete with China. Okay. And I think that's actually going to be the ultimate axis. China versus the Internet, like hardware versus software and so on and so forth. And we'll come back to that. But over here. So just coming back, why are new countries preferable? Powerless people, you've got, you know, they now have an alternative to failsuits and ambitious people now have an alternative in the form of frontier societies. Because since humanity's original migration, you know, whether it was, you know, out of Africa or to America or to the moon, you know, the power user has wanted to push the limits. And this is actually the same as the crypto coalition. And the reason I say that is like, you know, crypto has the powerless who just are trying to hang on to a bank account and the power user is trying to push the limits of what a bank account even is. Right. And that's like a U shaped coalition. And if you're like a middle class person and you know, your, your, your credit card at Starbucks, it just works for you. You don't really see the value of crypto. Right? But if you're trying to move millions of dollars around the world in a second, or you're trying to just hold on to your money without the government seizing it, then you need crypto.

[Michael Malice]

Right?

[Balaji Srinivasan]

And so network states are valuable for those people who aren't satisfied with their existing countries because they want to improve them or they want to actually have a functioning one. Okay, all right, third point. Why is it profitable? This is last but not least. It's just another form of saying it's possible because it's economically possible, economically feasible. So this is a fun graph where I've taken several different kinds of things and put them on the same graph. This is the annual revenue per user of nation states, social networks and network states. Okay, so let me explain this graph. This accesses people and this is annual revenue per user, per capita. Okay? So. Or it's annual variable per user or per capita. We'll get to that. So down over here are the, the, the social networks. Okay, so this is 100 million, a billion. So it's a log scale. This is Meta, WeChat, TikTok, LinkedIn, Snapchat, Twitter, Weibo. That's not a way but it's like the Chinese Twitter, there's Yelp, and these all have monetization in the tens of dollars per person. So Facebook, at the time I made this, was at like 3 something billion users. Meta was 3 billion users, and it made like 30, $40 per person, which is huge. Across 3 billion people. You're talking 90, $120 billion. But it's actually, you know, it's a relatively small amount across a very large number of people. Right, right. Then over here, these are the small countries, right? So Singapore, Estonia, Israel, you know, Switzerland. So on these have like, on the order of just, you know, a few million people, one less than 10. But their revenue per user, in the sense of tax revenue, is tens of thousands of dollars per person per year. Okay. And here are the superpowers, the US And China. And actually, it's sort of satisfying to have them in the upper right corner. It kind of says it's a useful kind of graph where they have the combination of lot of monetization per person and also very large size. So that's why they have these giant militaries and so and so forth. Right. And then over here are the potential network states. Right. So they would start where you've got, you know, a population that's like, you know, 1 to 10 million or certainly less than that, and a revenue of on the order of $1,000 per person per year. But they could scale up on this axis as you start going into the physical world, and they could eventually, you know, they could get very big. Right, because think about how many users WhatsApp has, how many users, you know, Instagram has. These are big, multi billion, you know, person things at this point. Right. So this is a new SaaS society as a service. Okay, Right. All right. So that's why it's economically feasible, because you could make a lot of money doing this. You could invest in these, and rather than going horizontally on this axis, you might go vertically and then outward and upward like this. Okay, all right, so now, why now? Now, now, let me get. I just went to the technical. Now let's talk about the stuff that you might be more, not more, but comparably interested in, which is a historical and this may be new stuff. I'm not sure we talked about this before. Okay, so why now? Because I think history is running in reverse. So what do I mean by that? Basically, I mentioned that, you know, Back then, in 1890, the Western Frontier closed and now the Internet frontier opened. But there's lots and lots of things in the World that are kind of in a mirror moment where the new thing that's happening is like the opposite of what happened, like, you know, in the past. Let me give some examples. So back then, Spanish flu today, COVID 19, this was heavily censored and this was heavily covered. Right. Back then you had the captains of industry. Today you have the tech founders. Right? The 1800, okay. Back then, the journos defeated the founders. Okay. Ida Tarbell brought down John D. Rockefeller. But Elon. Net Net is defeating the journos. Right. Okay. Back then, the New York Times was actually siding with Stalinist Russia versus Ukraine. As you're, as you're aware, they choke. They helped choke out uk. Now they've reinvented themselves as the champion of Ukraine, which is like Der Stermer, you know, reinventing itself as like, you know, Israel's newspaper or something. Right. Is that funny? Right? It's true.

[Michael Malice]

I, I just think that's quite an extreme analogy, but yes, I follow you.

[Balaji Srinivasan]

Yeah. Yeah. So. So it's basically like, you know, and so now NYT is on Ukraine side versus Russia. Right? So that's a flipping. Right, so that's it. Right, Go ahead.

[Michael Malice]

No, no, I was agreeing with you. That's a good, that's about. Great, great point. That before, it's like there's nothing H. Durante was saying that the Russians just have to tighten their belts. There's no famine. And now it's just like, you know, the Ukrainians. Excuse me. Are just tightening their belts. And now it's like the Ukrainians are the heroes, you know, the Russ. Russia is the new Hitler.

[Balaji Srinivasan]

Yeah, exactly. That's right. Okay, so in here, this is this amazing, amazing image from the late 1800s, okay. That shows Uncle Sam laden with. Okay. And China is the market. Right. It's like this is stereotypical Chinaman, you know, that from as they called them at that time. And they have all of these signs that say wanted, like 10 million rails and, you know, 2 million fans and whatever. And so the US was a manufacturing superpower and China was just the passive market.

[Michael Malice]

Wow.

[Balaji Srinivasan]

Crazy, right?

[Michael Malice]

Yeah, it's just, it's just fascinating. Yeah. Because these are the receipts.

[Balaji Srinivasan]

These are receipts. That's right. So now, of course, that's flipped around completely. And China ships goods to America. Right. Okay. Back then, Russia was a senior partner to China. Now today, China is a senior partner to Russia.

[Michael Malice]

Right.

[Balaji Srinivasan]

Yeah, Right. Back then, you had a British answer man running India. Now you had an Indian answer man reading Britain. Right. I, I, by the way, to your audience, I'm not saying that in a triumphless way. I'm just saying it's just like, like, you know, it's like a reversal, right?

[Progressive Insurance Announcer]

Wait a minute.

[Michael Malice]

And both of these men, I'm sure, had a certain predilections that we don't need to discuss.

[Balaji Srinivasan]

No comment. I actually don't know that, you know, but so we can see history. Now let me say what, what this is quantitatively I gave, I give examples of it qualitatively. So quantitatively, this is one of the most important graphs in my view of, of the world, okay? And it says a lot. It's thousands of years economic history and just a few bullet points or data points. So essentially, if you took the center of mass of the world economy, okay? And this is obviously an approximate thing because, you know, China doesn't exist in its current form. So you're approximating Beijing as a capital. You're approximating, you know, India was only unified in modern days. And so. But if you just take rough approximation of the, these economic centers and you do your best calculation of kind of what the center of mass is, the weighted average of the latitude and launch of these things, you have something where the center of mass, the global economy was basically in the middle of Eurasia, right? Why is that? That's because Europe was a thing, but so was India, so was China. That's why Marco Polo sought out China. That's why Columbus took the risk to go to India. That's why the Mongols and the Huns at various points were able to defeat Europeans militarily. That's why the Arabs were able to invade Andalusia. There was a degree of military and economic parity across Eurasia, right? And at some points, you know, for example, the Mongols had the syrup and they had actually a technological advantage, right? Okay. So then with the Industrial Revolution, the center of the world economy rocketed out to Europe, right? And then with all their weapons, everybody beat each other's brains in, right? And then 1950 was actually peak centralization and peak Westernization. It was the moment where you had the minimum number of sovereign jurisdictions in the world, the maximum amount of centralization, all these roll ups into these giga states, right? All the city states got rolled up, okay? And basically this era over here from 1950 to 1991 is actually extremely historically aberrant and unusual because this is not how the world used to be. And then what happened is after the, the end of communism and once Vietnam turned capitalist, China turned capitalist, India turned capitalist, Russia turned at least less communist, you Know, you know, and so on and so forth. With Eastern Europe turned capitalist, this whole thing just started rocketing back to where it was much faster than it came. And this happened in thousands of years. This happened in hundreds of years, and this happened in tens of years within our lifetime. Yeah. Okay. And so this is already. This is not a projection anymore. This already flipped, right? This already happened. Okay. This was a projection that was made in, you know, 15 years ago. It's actually moved faster than that. So this is an example of quantitatively history literally moving in reverse. You have like a U curve, right. It's like, if you look at it from the side, it's like a U. Here's another example of a U curve if you squint a little bit, where marginal tax rates in the US Are actually maximum in the mid century, and then they've fallen since then. You know, the. The Soviet Union had 100 marginal tax rates, but under, you know, the economy FDR built, it got all the way up to 90% of the U.S. right. So it wasn't communism, but it was actually very, very confiscatory. And it was hard to build a fortune in the mid 20th century. Right. Okay. Okay. And when people talk about, quote, inequality rising, what it really means is the state controls less of people's money than it used to. So it's, it's, you know, the, the income is being redecentralized to individuals rather than into this state. Right?

[Michael Malice]

Yes.

[Balaji Srinivasan]

Here's another thing. Quantitative things running reverse. Back then, China was 1/10th US steel production. Now it's 10x. Okay.

[Michael Malice]

Okay.

[Balaji Srinivasan]

Back then, America was ideologically unified. So what is this graph? This is showing congressmen, okay. And an edge between them, between Democrats and Republicans, is if they voted the same way, on the same belt. They both voted yes. Together, for example. Okay. And FDR actually did build a uni party. He. He did unify the country. Right. And then over time, and by the Internet was actually. It just accelerated this. But polarization, it had started even before the Internet. Like you had. The Fairness Doctrine was repealed. And so you had gradual, you know, fragmentation because this level of unity in such a large country is actually difficult. Right?

[Michael Malice]

Yeah.

[Balaji Srinivasan]

So, of course, it started fragmenting. And by 2011, you had street party line votes with Democrats, with Democrats, Republicans, Republicans. Okay. And now America itself is ideologically disintegrating. This is actually a map for your

[Michael Malice]

last point for people to appreciate this. It was not at all uncommon in the 90s to have Democrats who were pro life, prominent Democrats who were pro life, Got Harris Wofford from Pennsylvania and prominent Republicans who are pro affirmative action. These were not at all like deal breakers to be big shots in either party. And now it's a complete non starter for either of those views and either those two parties.

[Balaji Srinivasan]

That's right. And one way of thinking about it is after 1991, Americans had no one to fight, so they fought themselves, right? Yes, right.

[Michael Malice]

And so find themselves by opposition. And once that opposition goes away, they segregate out. I talk about, there's a book called the Nurture Assumption, which talks about when you have groups of kids and adults, the kids see themselves as kids, and the second the adults leave, it's boys and girls.

[Balaji Srinivasan]

That's right. Yes, that's right. So now this is a different data set. This is actually Twitter data from 2017. And it showed that. See, this was showing Congress, right, at the level of Congress. So when it polarizes at the level of leadership, that eventually gets reflected or is reflected by the population's polarization. So, so this was Twitter data. And each node represents a user and an edge between them is whether or not they friended or followed each other or followed each other and the size of the nodes, the number of followers, and they're colored blue or red by whether the researcher could infer they were pro Trump or pro Clinton. This is a 2016 election right afterwards. And the thing is, I'm saying America's ideologically disintegrating, but this is actually 2017 now. It's ideologically disintegrated. Yes, because Twitter actually doesn't exist anymore. It's a Tower of Babel. We only have Gab and X and Truth on the right. And we have Blue sky and Mastodon and Threads and Tick Tock on the left. Right? And so like the digital secession has already happened. Like, you know, J.D. vance going into Blue sky, which you saw the other day, 80,000 people or something blocked him in one day. Right? That is something where it's, it's, you know, e unum pluribus. It's not one country. You know, I know that's not the correct Latin, but you know what I mean? So out of, out of. It's not out of many one. It's out of one, many. So, yeah, and the issue is here, what people don't fully get, I think is nowadays everything happens Internet first and then it's printed out in the fiscal world. For example, you do a, you do a Google document and you hit print if it's important. Okay. Or less. Less obviously you go to Amazon. You fill up a cart online, you edit it, and then you hit a button and it's printed out at your door. Or you go to an Uber and you. You tap a but and then it's printed out and the car arrives and you go and get it. Right. So when we see this level of digital separation that's happening there, that means America's due for something. I don't consider it actually a civil war. I think of it as actually something more chaotic than that. I think this American partition. Do you know what Indian partition was?

[Michael Malice]

No, but I mean, I. I'm the main person who's been normalizing the idea of national divorce.

[Balaji Srinivasan]

So.

[Michael Malice]

Yes.

[Balaji Srinivasan]

Okay, so basically partition in India was this kind of chaotic event in 1947 when India got independence. And basically Pakistan, India, the borders are just announced two days after independence. And then all of these Hindus had to get out of Pakistan, and Muslims went into Pakistan and people were shooting and stabbing each other. All kinds of scores were being settled. Crazy violence and so on, on. There are a million people died, mass migration. And even if people kind of knew it was coming, like at a. At a high level, it was just a surprise that that happened, especially because Hindus and Muslims actually had lived side by side for a long time without issues in India. And then just polarization and ethnic tensions rose. The reason I mentioned that is that was something that was like semi organized. It wasn't a civil war because it wasn't uniformed. Right, right. Instead it was like kind of there were governments. Right. There were. There was political stuff, but it was like basically sort of this kind of thing, blue versus red. It was more like blm. It's more like, you know, the kinds of riots and things that we're seeing, which is not really organized, but it's clearly ideological, despite the fact that it's disorganized. Does that make sense? Right.

[Michael Malice]

Yes, of course.

[Balaji Srinivasan]

Okay, so that is. This is America being. Having ideologically disintegrated. And because America's ideologically integrated, that's why we're going to see new countries. And let me explain. Remember this graph from before? Right. Yeah. So the reason this happened as we were talking about, is the British Empire broke down and the French Empire broke down, and then the Soviet Empire broke down. And that was a huge thing over here. Right. So when the American empire breaks down, we're going to see a huge surge of new countries. And so to explain why, if we go backward in time, we mentioned that this was the minimum number of. Of jurisdictions. Right. If you go backward in time, it actually looks like this. This is another U curve, and I'll explain why. This is what Germany looked like before Bismarck.

[Michael Malice]

Oh, wow.

[Balaji Srinivasan]

Yeah. Okay. There's lots of principalities. Like the, the. The German question was how Germany's going to be unified, was Prussia's role in Germany, and so on and so forth. Right. Like, this is actually what France was before the revolution. This is what Italy was before Garibaldi. You know, it's funny, the United Kingdom, we know, it's England, Scotland, Wales and Northern Ireland. But less well known is that Germany's a union, France is a union, Italy's a union. These are all like roll ups of city states that in the United States

[Michael Malice]

until the Civil War, you were a citizen of each of the states, not really a citizen of America.

[Balaji Srinivasan]

Exactly. So this concept, like, that's why, if you think about it, why is the, like the term union? It's in the United States, it's in the European Union, it's in the United Arab Emirates, it's actually in the official name of India. It's called the Indian Union, and so on and so forth. Russia calls itself the Russian Federation. Right?

[Michael Malice]

Yeah.

[Balaji Srinivasan]

That's because it's actually really hard to unify these kinds of things, you know, and then it's also really hard to break away. But basically, you know, it's like the, the Chinese proverb, the empire long. The empire long united must divide, long divided, must unite. Right. Okay. Okay. But this is what. If you go backwards in time, you had lots of independent principalities in Germany. This is what India looked like.

[Michael Malice]

Okay.

[Balaji Srinivasan]

The princely states, okay. It looked fractal. If you zoom in, you had all these kinds of things like this. Right. And the reason for that is maps. In Europe and India, maps are actually a technology. Right. Like, if you think about it, like, clean lines on a map are really artificial. In the real world, they're crossing mountain ranges across the rivers. Right? Right. So the way the world was organized before the modern era was not by geography but by community. Right. So it was much more network than state. It was like the network of the people who shared your language and so on. And that could be actually much more dispersed than you might think, as opposed to necessarily physically concentrated. Of course, there's a value to physical concentration as well, but it turned out to be very fractal. Right. Okay. So the point is, when you go backwards in time, Germany, India, all kinds of places look like this. Right. And so the number of independent jurisdictions was very, very high. Right. And so that's surprising to People, that's not their mental model of the past. Right. More independent states that we go back in time, and that's 1950 was basically peak centralization over here. This is like the minimum number of jurisdictions ever. So the time that we think of as normal, like 1950, is actually the most abnormal time perhaps in world history ever.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

Okay. And one way to think about it is the world was decentralized, then this centralized fist of communism. Right. Centralized so many things. And actually fascism as well, and actually even democratic capitalism, which was the least bad of the three. But it was a centralizing force, Right? Yes. And then you get re. Decentralization. Okay. Now this is also something that's technological. So you go from mass production to the iPhone, which puts all this in the palm of one's hand. But you also go from the uniparty to fragmentation. So it's both the technological and political phenomenon of redecentralization. That's why history is running in reverse. But we aren't done redecentralizing, basically, when the American empire breaks down. And in fact, this is something where actually all four tribes, blue, red, tech, and China, all are essentially against the current status quo, because obviously red is against the deep state.

[Michael Malice]

Yes.

[Balaji Srinivasan]

Blue, however, is against the Trump administration.

[Michael Malice]

Right.

[Balaji Srinivasan]

Tech is against a regulatory state, and China's against US Hegemony.

[Michael Malice]

Yes.

[Balaji Srinivasan]

That means it's almost like a solar eclipse where all four of those forces are pointed down in a way that they haven't within our lifetime time. Right. And that means that the current, like, Republicans want to withdraw. I mean, we'll see what happens with the current war and so and so forth. You know, it's in real time. But I think on balance, telling Europe you have to pay for your own stuff, on balance, telling Japan that it can't buy US Steel, on balance, the tariffs, on balance, the student tourist visas, worker visas, you know, reducing them or cutting them off, on balance, these things are going to mean that the US Is withdrawing from the world and becoming, for lack of a term, less globalist. Right? Yes. Fine. I think there's going to be a lot of negative impacts of that as well. I don't think people fully realize that we can talk about that, but let's just call that a phenomena that is happening. That means the rest of the world is now, like, sort of blinking and being like, well, America is no longer here. All right, how do we figure things out? And lots of things will revert to a different kind of configuration without US Pressure being there there. Right.

[Michael Malice]

That's Right.

[Balaji Srinivasan]

Okay. So that's redecentralization. And you know, yes, the world is multipolar. And now the downside of this is when like some stabilizing force that was there, even if it's bad, if it goes away, do you just get chaos? Right. Because when the fall of the Soviet Union happened, you had many different kinds of outcomes. Some places did great. Estonia, Eastern Europe and so on. Others very much not so much. Like Chechnya, you know, Central Asia, Tajikistan. There was a giant civil war just in Tajikistan. Right.

[Michael Malice]

Turkmenistan. Yep.

[Balaji Srinivasan]

Right. All this kind of stuff. Right? Okay.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

So there's a guy, actually this guy is the president of Kazakhstan, or he was at the time. This quote, he said if the right of nations to self determination was realized in reality on the entire globe, over 600 states would emerge on Earth instead of 193. Of course it would be chaos. So he's also seeing up and to the right.

[Michael Malice]

Doesn't he look like if someone crossed Trump and G into one person?

[Balaji Srinivasan]

Well, well, he's got, I mean, the thing is he lived through the fall of the Soviet Union. That's why his hair is all gray. Right. He lived through all this stuff. So he, he saw this kind of stuff happening.

[Michael Malice]

Right, of course, yeah, yeah.

[Balaji Srinivasan]

So he's. So he, he knows that this, that there would be if that actual. Right. So for example, if the Basques got a state, if the Catalonians got a state. Right, sure. If the Kurds got a state, if every group that said they want a state got a state, they didn't necessarily have to get in the same place. It might be chaos. Okay.

[Michael Malice]

And the other thing is, look, just think back to when we overthrew the British in the US it wasn't at all clear what the constitution was going to be look like or whether there would be one. Everyone's like, all right, we're not members of the British Empire anymore. Now what?

[Balaji Srinivasan]

Now what? Exactly.

[Michael Malice]

Right there was that window where they could have gone any direction it could.

[Balaji Srinivasan]

Exactly. That's right. So maybe he's right that there might be chaos, but maybe we can forge order of the cast. Maybe that's what's next. Okay, and so what next? So basically, so I wrote this book on the Network State. I held this conference. Actually, it's going to happen again. October 3, 2025 4th annual network see a conference. So go, go to ns.com conference.

[Michael Malice]

Where's that going to be located?

[Balaji Srinivasan]

Singapore.

[Michael Malice]

Okay, cool.

[Balaji Srinivasan]

So, and then I've opened Network School. And so Network school [e-mail]. you can come there. So basically this opening day over here,

[Michael Malice]

I gotta ask you, I gotta ask you. I know you've done well for yourself and you don't have to answer this question if you don't want to.

[Balaji Srinivasan]

Sure.

[Michael Malice]

But would you feel comfortable telling us how much ns.com cost?

[Balaji Srinivasan]

Oh, it was affordable. I was able to get it. Yeah, but it's great.

[Michael Malice]

Affordable is a contextual term.

[Balaji Srinivasan]

It was affordable for me.

[Michael Malice]

Okay. That doesn't answer anything, but that's fine.

[Balaji Srinivasan]

Sure. So I can afford it.

[Michael Malice]

Okay, thank you.

[Balaji Srinivasan]

So define this one. So it's, it's still early. Early and. But we start new companies and so we start new companies, new communities, new, new currencies. I think we can give new countries a try. And so come to ns.com. check it out. There's tons more I can say, but let me, let me pause there. Okay,

[Michael Malice]

let's get back to the show. So I think what, I know this is going to upset a lot of people, but I say this in the best way possible. This. And maybe you're not going to like this either, but I'm sure you're going to step. What I mean by it, this to me is Americanism at its best. The idea of. Go ahead. Sorry.

[Balaji Srinivasan]

Yeah, go good. Say what you're going to say.

[Michael Malice]

And I'll say, I was saying, seeing a space that is empty and using your drive and entrepreneurship and pulling yourself up metaphorical bootstraps and otherwise and being like, I'm going to create something great in this space and it's going to be lasting and permanent and it's going to be a shining example to people all over the world.

[Balaji Srinivasan]

I think that's right. And I think, you know, it's funny, there's in a sense, I think of what we're doing as the version 3.0.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

Or the version 5. Right. So if you have Greece, Rome, Britain, America, then the Internet. And so if you say version 3.0, you have the United Kingdom of England, Scotland, Wales and Northern Ireland. You have the United States and then you have the network states. And the thing about that is this can actually scale around the world peacefully. Right. Where it's just communities opting in self termination, crowdfunding of territory, not. I mean, bitcoin has gone to trillions of dollars without a bullet fired. Right, Right. So it draws from India's tradition of nonviolent independence. It draws from Lee Kuan Yew on the city states. It draws from, you know, Herzl and you know, starting new countries with a book. It draws from America and. And the Constitution. It draws from Dubai, actually, in terms of building new cities from scratch. Right. And it draws from many different strains of thought without necessarily endorsing everything that comes from every different strain. You can take the good pieces. And I. I do think of this. I mean, of course, I love America. I love the country that, you know, we. That I grew up in, that I spent much of my life in. I think it has. I. I think this. I mean, the problem with this is when we talk about Uncle Sam, and if I say Uncle Sam isn't going to make it, then people say, what, you want Uncle Sam to die? Our beloved uncle. Right. And I'm like, actually, he's very sick, and he's $175 trillion in debt. And, you know, I can point to the polarization. I can point to the fact that all these cities are burning. Go ahead.

[Michael Malice]

There's being an oncologist and being a murderer.

[Balaji Srinivasan]

That's exactly right. And so by being 10,000 miles away and by just building something literally on the other side of the world, I'm about as far away from America as I can be physically. And I'm just trying to, in my own way, show, you know, you know, what the opposite of a fire is. It's a crystal structure, right? Because a fire is like contagious anarchy and disorder, and it burns. But when a crystal structure really works, it goes like this and a beautiful order like. Like a. Like a diamond crystal goes like. That's like contagious order. It's like the positive side of things, right? So we're building a crystal structure which shows. And actually, if I could predict a website, can I project a website? Let me see if I can do that. So you see this opening day. So we have. Can you see that video that's going on screen? Yeah. So we actually have done exactly what I said, summoned the followers from around the world, and we've just been taking over this. Our first node is like this. Basically this place that China built overseas that they abandoned. And so China's lost our gain. There's this, you know, was that metallic I just saw? That's Vitalik. Yeah, Vitalik and Brian Johnson. Right. So we've just taken over this gigantic abandoned island right off the coast of Singapore. And we've got. So these are all basically famous tech founders, you know, CEOs, executives, we have drones, we have. We have an awesome gym here. Everybody's getting jacked. Right? Look at that. Is that cool? Right? We have, you know, that's Brian Johnson's son actually is Brian Johnson Yoga Studio. And so, yeah, we have kids, actually. It's good for kids. We've got this beautiful. Isn't this cool? Right?

[Michael Malice]

Yeah.

[Balaji Srinivasan]

And we've actually. We're actually doing it right. This is like, you know, we've got our outdoor talks and we've got, you know, people play chess. It's just. It's just awesome. You know, you can just kind of work and have fun. And, you know, we have, you know, a few parties and stuff like that. We have bonfires. Right. And yeah, this is what we're doing. Right. So this is our drone shot showing some of the island. You see that?

[Michael Malice]

Wow.

[Balaji Srinivasan]

Is that cool?

[Michael Malice]

Yes, very, Extremely.

[Balaji Srinivasan]

So we're actually really putting theory into practice. And if this works. So your viewers go to ns.com appliedentist.com, you can say you saw. Saw this on Michael Malice's show and you can come visit for a day or a week or a month. A month is a good time to visit because that's kind of. You get into the flow of it and so and so forth. And we have lots of people, you know, maybe 30, 40% of people come from the U.S. we have people from more than 100 countries, though. We have people from Uzbekistan. We have people from Panama. We have people from Korea. You know, Korea went left recently and so far left and anti May go anti crypto. So we had Koreans come. We're like, I want. I want to get out of this place now, you know, for a while. We have Ukrainians and we have Russians. We have Indians and Pakistanis. Right. We have basically people from all over who are pro tech, pro builder, and they want to leave some of the old, you know, issues at home and just show how we can build society together. Right.

[Michael Malice]

Can I say something else? I'm guessing a lot of these people have something in common, which is they're going to be high openness and probably somewhat low on agreeableness, which means you're going to be.

[Balaji Srinivasan]

I would. I would not say they're low on agreeableness because like law agreeableness, I mean,

[Michael Malice]

they speak their minds and, and they, you know, where you stand with them. Not that they're obnoxious, per se.

[Balaji Srinivasan]

Yeah, yeah, yeah, exactly. So mezzanine baby unrealness. Right.

[Michael Malice]

The point being people who are attracted to this on a social level, it's just desirable because, you know, you're not going to have to bite your tongue. You're not going to have to worry that every single conversation is going to degenerate into Trump that you can talk about. Even when I talk about tech stuff, the normal conversations will be exciting as opposed to you're going to have to be on because you're dealing with some normie and they're programming from CNN or Fox or whatever.

[Balaji Srinivasan]

Yeah. So one way of thinking about it is you can almost depoliticize.

[Michael Malice]

Yes.

[Balaji Srinivasan]

Right. Okay. So. So it's something where you don't even realize the extent to which your back is up in the US because everything is politics all the time. And so. So you can just focus on building cool stuff. And you don't necessarily need to know everybody's position on abortion because it's simply not the axis that matters.

[Michael Malice]

Right, right.

[Balaji Srinivasan]

What matters is can we build this up as a community together? Number one. And one thing I will say is it's funny, you know, when you play basketball, you dribble with your right hand, if you're right handed, but it's useful to learn how to dribble with your left as well, because it makes you more versatile. And so in many ways this will sound funny, but there are blind spots that as sympathetic as I am to technolibertarianism, capitalism, and so of course I'm sympathetic to that. For example, the Sovereign Individual. It's a great book, but ultimately I believe in the sovereign collective. And the reason for that is even Steve Jobs, who is this amazing person, obviously an amazingly sovereign individual, as close as it could be. He had this email that he wrote near the time of his death actually, to himself. Do you know his famous email where he said he doesn't make his own food or make his own chair? Go ahead.

[Michael Malice]

He said this. This is from Steve Jobs.

[Balaji Srinivasan]

From Steve Jobs, yeah.

[Michael Malice]

People come at me all the time on Twitter and they say, if you're anarchist, utopia became real, you'd be the first person killed. And I'm like, you're right. I wouldn't do my own security. Just like I wouldn't make my own medicine. I wouldn't do my own accounting, I wouldn't grow my own food. Like, why? Like, I would have people for all this and you need a mess of help to stand alone. These would just be voluntary communities and voluntary matrices, as opposed to, I have to go through the state and get subpar quality at a price I can't even argue about.

[Balaji Srinivasan]

Yeah, I'm going to actually. Let me up. Let me upload this image to you right now. One second. Okay, can you see the screen there?

[Michael Malice]

Yes, that's right. Yes.

[Balaji Srinivasan]

I grow a Little of the food I eat of little I do grow a jump, breed or perfect the seeds. I do not make any manual clothing. I speak language, did not invent or refine and not discover the mathematics I use. I protect our freedoms and laws. I did not conceive or legislate. I moved my music. Right. I was helpless. Helpless. Right. I love, admire my species living dead and totally depend on them for life and well being.

[Michael Malice]

So the thing about. I like it sent from my iPad. Because it is his iPad.

[Balaji Srinivasan]

Yeah, yeah, exactly. That's right. So, so the thing is, if somebody as genuinely great as an individual, because he was genuinely, you know, as sovereign individual as you could imagine.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

Could, could come to that conclusion. What that means is the sovereign collective is like thesis, antithesis, synthesis. You know, that's, that's something I believe in. Like it's, you know, for example, you have this failing Fed and this failing centralized state. And I do believe in bitcoin. It's a, it's like the fire alarm, it's a fire exit to get the heck out of this burning building. But then we're outside in the rain and we're happy we didn't die in that burning building. Right. But we don't just be outside forever decentralized and scattered. We need to like recentralize and rebuild, you know, and, and so that's kind of, you know, somebody said, which is interesting and I, and I don't know if I would have phrased it exactly this way. They said that I, that I preach anarchism for the statist and statism for the anarchist.

[Michael Malice]

I like that.

[Balaji Srinivasan]

Yeah, that's funny. Right. And you know, you could even say like I would neither myself an anarchist or a statist. But I do think minarchism is good. With that said, someone like Lee Kuan Yew would basically use tools from all over the political chessboard. You know what's funny is if you like, and this will sound funny, but at some point, you know, if you run a large enough tech platform, for example, you actually see the entire panoply of things because the libertarian founder who built something that's got 100 million people on it, ends up rebuilding something looks a lot like a state.

[Michael Malice]

Yes, that's right.

[Balaji Srinivasan]

And the reason is you, you know, 100 million people, like that's a huge. They'll call us all kinds of crazy crimes and stuff. There's lots of things, you just have to set them as defaults. Like as a small example, libertarian model, you know, the political compass, like the bottom right Corner is libertarian. Yes. Libertarian model is you give people the chance to opt in or opt out. You offer them an incentive for doing everything.

[Michael Malice]

By the way, did you realize the COVID of the white pill is the

[Balaji Srinivasan]

political compass, Is that right?

[Michael Malice]

I didn't realize the women correspond to the four quadrants. Yeah.

[Balaji Srinivasan]

Oh wow, that's great. Callback. Okay, good. I'll go look at that. Okay, so political compass, lower right corner, I think in general make people opt in or opt out, give them some incentives. So there's a lot of good to that. That's my default. But if you're operating a website like a large website, and every single change, you gave people the option to opt in and opt out and so on and so forth, it'd be completely infeasible and you just cause all kinds of political this, that. So you'd actually do it Elizabeth Warren style and you just kind of implement the change and just state top down in a sense and just done. Right. They don't have a choice and if they don't like it, they leave. Right, right, that's right. And that's actually sometimes the right solution for certain kinds of things. Right. And now you can massively overuse that. Sure. And the check on that kind of power is the ability to exit and go to another society and so on. But the point being that if you draw from around the political compass, you want to be libertarian enough, I think, to exit the existing society, but pragmatic or collective enough to build a new one, if that makes any sense.

[Michael Malice]

Right, yeah, it's a lot of sense.

[Balaji Srinivasan]

And so it's more like a. I think there's two ways that one can exit in that way. One is sort of a. You can't just be against something, you have to be for something, number one. And then number two is one thing you were saying about lower. I, I actually do think mezzanine agreeableness is good because the point isn't to like yell at each other in a new place. You can yell at each other on X. Sure. The point is like minimum necessary disalignment or maximum possible alignment. A better way to put it to build this new thing. Anyway, coming back. So the goal is one more thing.

[Michael Malice]

I think the low agreeableness becomes higher agreeableness when you're with like minded people.

[Balaji Srinivasan]

Yeah, yeah, exactly. That's right. Exactly. The thing is it's. It's rationalness.

[Michael Malice]

Yeah, right, right.

[Balaji Srinivasan]

Or rationality rather. I disagree with people I consider irrational and I agree with people I consider rational and I see no need to Squabble with other people who also want to get to Mars and do awesome things. Right. And what's cool is this is like, oh, here's one other aspect that I think is surprising to Americans, but that I learned in the early 2010s. So I taught a MOOC with more than 200. You know what a MOOC is?

[Michael Malice]

No.

[Balaji Srinivasan]

A massively open online course.

[Michael Malice]

Okay.

[Balaji Srinivasan]

So I taught a massively open online course in the early 2010s, when university was first starting to put that stuff online with 250,000 students, which is actually big even for today. It was actually the first MOOC that taught bitcoin crowdfunding. And so. And so back when bitcoin is double digits. Okay, So a lot of people got into bitcoin through that. Okay, okay. Among other things, taught about other things. And in that course, I was like, who are these students? That's a lot of people. And so I just randomly sampled people, and I just talked to them every week. You know, I pick, like, 10, 20, 30 people. Right. And I talked to, you know, for example, some guy from Romania. And it was really interesting what he. So he spoke English with an accent, but he spoke English. He's very conversant in Internet memes. He's like. Like, oh, scumbag Steve. Good guy, Greg. You know, he knew all that, right?

[Michael Malice]

Yeah.

[Balaji Srinivasan]

But what he didn't know were the New York Knicks or hot dogs. Right. Or, I don't know, like, subway stations in the. Like, that kind of stuff. And I was like, wow. Like, we think of the Internet as America, but in the Internet is its own thing, its own language. Exactly. And the key concept I realized was the Internet is to America as America was to Britain. Yeah, it started off British. It owes a debt to Britain. Of course, it's always, I mean, like, there's some late unpleasantness, but basically, America's fundamentally friendly towards Britain and respects Britain, but it became its own thing. Right. And it was kind of more global, more both egalitarian and capitalist. Like, Britain had the Magna Carta and Britain had free trade, but the US had. Was a bit more egalitarian and more capitalist, right? Yes. And it brought in more different kinds of peoples, and it made more money, and it was just like, more, more, more. Right. And the Internet is actually to America what America was to Britain. It started off American. It started off with American IPs and so on. In fact, this question, by the way, of is the Internet American? Will be one of the most important questions of the next 10 years. And at first, people think it's ill posed because they say of course it's American because it started out American with DARPA and whatnot. Aren't all the big tech companies American? Aren't all the big tech companies in America? And so on and so forth, blah, blah. There's some truth to that. But you can ask the question a different way, which is if I say what does the, the Polish Internet look like? The Korean Internet, the Indian Internet, immediately you can see there are non American parts of the Internet number one. And then number two is if you actually zoom in, most of those tech companies, most of their users are non American. Most of their revenue comes from abroad. Most, many of their employees, more than 50% are immigrants or you know, children immigrants, like definitely more than 50% depending on how you count. And with few exceptions like SpaceX, which are like statutorily obligated to hire Americans, but most of them are drawing from a global talent pool, especially if you include overseas employees, which, which are a lot. And, and then you know, there's 425 cities around the world that have a unicorn last I checked. So the Internet has actually taken some of the best American values. And it's, it's of course it's a libertarian values of, of freedom and capitalism and contracts and so on, but actually it's also some of the, and this is, hear me out for what I'm going to say, okay? The progressive values of equality, science, media, even democracy. Because the Internet is a peer to peer network where we're all equal on the Internet.

[Michael Malice]

That's right, yeah.

[Balaji Srinivasan]

And the thing about that is that's something where like an Indian immigrant, you know, nowadays, like I tell every Indian founder, do not go to the US anymore and instead build in India, build in the UAE, build in Singapore, build at NS. There's like 50 other countries that are digital nomad programs. Or you can build in India, you don't need to do it anymore. In fact, India's improved a lot, right? I like Bangalore more than sf. I've posted photos, it's improved so dramatically. The crucial thing is it's getting fractally better, right? India still has slum still and so on, but it's like so much less number one. And everything that's new is nice. It's like an Apple store or something. And the old stuff is bad. California is the opposite. All the old stuff is beautiful, these amazing buildings. And the new stuff are the homeless cabins in Shantowns. Right? Okay, that's right. Point, the point that being why do I tell Indian founders not to come to the U.S. it's because. Because they're founders, they're CEOs. The left hates them and wants to Luigi them.

[Michael Malice]

Right.

[Balaji Srinivasan]

And because they're immigrants. I understand why. You know, the right is like, look, we're full up. I don't want. You know. That's a nice way of putting it. A lot of them just don't like Indians anymore. Okay, fine. I never want to go where I'm not welcome. And I would not want Indians to try to bet their life on something where H1BS are closing up. And so. But, but those folks are smart and they're hardworking and talented, and we should have a place where we can build the next Googles and Facebooks and so on. If the US doesn't want to be the place for that, fine, we have another location for that. So we have these Internet pockets, these Internet communities, and that's where we can kind of take the culture of Silicon Valley and implement it somewhere else. Which is what. What I'm doing. Let me pause here.

[Michael Malice]

Or the culture of what Silicon Valley should be.

[Balaji Srinivasan]

I guess what it should be. Yes.

[Michael Malice]

Let's get back into it.

[Balaji Srinivasan]

The problem is Silicon Valley is actually. It's not as left as Wokeness pushed it to be in the 2010s, and it's not as right as MAGA kind of did. It's kind of its own thing because it's internationalist and capitalists.

[Michael Malice]

It's just.

[Balaji Srinivasan]

That's right. It's fundamentally focused on building stuff. Right. And that just won't fall into any ideological camp, you know, or it won't neatly fall into an ideological camp. Okay, let me just.

[Michael Malice]

Like Lee Kuan Yew, he's. It's hard to pigeonhole him ideologically because he's very much a multiculturalist, but he's also an authoritarian strongman in a sense. So, like, where are you going to put him on that compass?

[Balaji Srinivasan]

Okay, so actually I want. I want to. Some equivalent with those words. Right. Okay.

[Michael Malice]

I'm using it very loosely.

[Balaji Srinivasan]

So I use an example I wouldn't call. I would actually say so many people. Let me postulate. Actually, people often say dictatorship, but they can't. They can't distinguish leadership from dictatorship. I know you can, strong man.

[Michael Malice]

I didn't say dictator.

[Balaji Srinivasan]

No, no, no, no. But, but let me, let me. Actually, I just want to comment on that just for a second. Right, so let's say we have a trichomization.

[Michael Malice]

Wait, can I say something? One thing before you continue. If you Ever want to get someone from Singapore, living in Singapore excited, just say the words Lee Kuan Yew and their eyes light up like yours just did.

[Balaji Srinivasan]

Okay? Yes, yes. So, okay. Receivership. Receivership, leadership, dictatorship. So receivership is a useful term. Receivership is a corporate term where a company's bankrupt and actually the titular CEO isn't really running it. There's an external group of people, creditors or whatever, who are running it. Right, right. So that was like the Biden administration, right?

[Michael Malice]

Yes.

[Balaji Srinivasan]

That was a receivership where you had a senile figurehead who couldn't even walk for years. It was obvious that he was like completely incoherent. And it was like an unseen bunch of puppeteers, string pullers, whatever. They were just writing his memos and pushing in front of this drooling, you know, senile man to sign. Right? So that's the democrat ideal, is receivership. Okay? And now that's why once you understand that when they, when they say dictatorship, they identify any leadership as dictatorship because they prefer receivership where they can implement power without accountability. Right?

[Michael Malice]

Yes.

[Balaji Srinivasan]

Okay. So lky, actually his big advantage that actually most people underrated is other Asian leaders like park in South Korea or Chiang Kai Shek in Taiwan delivered comparable growth. But what they couldn't do actually is they couldn't argue in English. That's actually Lee Kuan Yew's superpower was he didn't shoot people, right? He what? He, he. Instead he argued in English. He was really eloquent. He sued the journals, he won the suits against journals. He was all about winning the argument in English. And actually, if you, if you look at that, that is, you know, all of the sort of right of center strong men who have, you know, they won a tactical victory or a military victory, they just couldn't make their case in English. Right. Pinochet, Salazar, Franco, you know, like Park, Chiang Kai Shek, all those guys had to resort to shooting because they couldn't win the argument verbally. Now, I know that's much easier said than done. Okay, sure, of course, yes. But like Reagan, and I know people also want to crap on Reagan today, but Reagan could make the argument in English as well as, of course, you believe in a strong defense, right?

[Michael Malice]

Yes, yes.

[Balaji Srinivasan]

And I think that's a really underrated thing, right? Because in general, very, very roughly, the right is visual, the left is verbal. You know, the right is concrete and the left is abstract and so on. And when the right gets animated, it just says, oh, all that verbal stuff is B.S. and you know, let's just smash whatever. Right. But it's not B.S. actually, you need both. Right? You, you actually, that's why I'm ultimately a centrist. You know, like for example, I'll give you one concrete example. Like this Greenland thing, okay. I, I, I think that's actually a very bad thing. And here's why is it rather than like threaten to invade Greenland or take it over or what have you, if the administration had just said, hey Denmark, let's do a 10 year visa deal where basically any American without a criminal record can get a visa to go and invest in Greenland and we can renew it every 10 years with no mus or fuss. It's like that would have easily gotten done. Right. There's something similar to that. I think it's called like, let me get this right. I think it's like the Danish American Friendship Treaty. Dutch American Friendship Treaty. Right. So, so basically the, you know, something like this, the D, the Dutch American Friendship Treaty is something where just about any American can kind of get in there if you're self employed, no maximage. You know the point, point being that the US did not need to threaten military. You know what it's like, it's like you're at a store and there's like a candy bar and you pull out a gun.

[Michael Malice]

Right?

[Balaji Srinivasan]

Yeah. Why'd you do that? You could have just like had a very standard unremarkable deal to get that. Yeah, maybe you'll get a few more candy bars, but maybe not. Honestly, maybe you just, you made the relationship poison.

[Michael Malice]

Especially because the, the Danish were very eager to deal with. There was no contrary. They're like, hey, okay, like you want to extract these minerals and arctics above arctic conditions, we're going to get a cut. Everyone wins.

[Balaji Srinivasan]

Great.

[Michael Malice]

Yeah. You want to put more troops there and protect our borders.

[Progressive Insurance Announcer]

Okay.

[Michael Malice]

Like it's not going to cost us anything.

[Balaji Srinivasan]

Exactly, exactly. That's right. Similarly for the Canadian thing, the huge own goal. Frankly, I don't know if you've seen this graph. Do you see the graph of like

[Michael Malice]

what happens with the polling?

[Balaji Srinivasan]

Yeah. With the Canadian polling, unfortunately, like yes, collapse is collapsed because it was a complete own goal where you could all literally. Trump just didn't have to say anything about Canada. Right? It would and it would mean fine. Right. And instead he's got a hostile blue power on the northern border that's going to maybe ally with China. Right, right. And so already has. Right. So why do you do that? Why? Why? This is the right wing failure mode. I think when you go to maga, you are basically for exact. Actually, you know, the way I'll put it, Democrats identify democracy as Democrat, right? And they're always confused when more than 50 of the votes go the other way. They literally think democracy means ruled by Democrats. Right?

[Michael Malice]

Yeah, correct.

[Balaji Srinivasan]

And a lot of Republicans identify American as red American implicitly. But they get confused. They're like, why are 50 blue Americans? That's not real America. Just like, like when, when Republicans win election, Democrats say, that's not really democracy, that's dictatorship or whatever. Right. And in the biggest issue, though, is that a lot of the, the signaling around America, America is really red America. And unfortunately, they haven't realized that red Canada and red UK and so on are actually their natural allies. So instead they've said, you know, not just FU to blue America and blue Canada, fine. But they said FU to red Canada too, who are their natural allies. Right? And that's just total mistake because then you've got all three quadrants aligned against you. You, you managed to make the conservative Canadians into enemies as well for no reason whatsoever. Right. That I, I don't think is strategically smart. And, and that's why, you know, I would, I would really consider myself a centrist in that sense. Because you want diplomacy. Diplomacy is good. Right. It's cheaper, too. It's cheaper, it's smarter. It's, you know. Right. Like minimum necessary enemies. Why make enemies unnecessarily? You know, especially of, like, conservatives in Canada, they're also suffering under, like Trudeau,

[Michael Malice]

and now they're suffering worse in many ways than Americans by far.

[Balaji Srinivasan]

Exactly. So this is like, you know, or the problem is people are trying to identify these things at the level of the state when it's actually at the level of the network work. The issue is not America versus Canada. It's red Americans and red Canadians versus Blue Americans and blue Canadians. Right. And so it's, it's like when people post a thing about, you know, when Britain was throwing people in jail, right? They're like, oh, well, it sucks for them. We have free speech and so on. Actually, it's like blue Americans working with blue Britons to throw red burdens in jail and they should just support the red burdens. But they haven't really realized that their genuine borders don't line up with the borders on a map. They're the borders of a network, not the borders.

[Michael Malice]

And the other thing is the Brit, the Brits are the guinea pigs. So if could figure out a way to help the red. Stop it there. We don't ever have to worry about it coming here. Same with Canada.

[Balaji Srinivasan]

That's right. And I think. So now, what's good is we do have bitcoin. Right. And so bitcoin, I do think that. So people have thought you said, who's Trump's successor? Right. So just, you know, this is a funny statement. I don't mean this in a. In a negative way or anything, but I do think after Orange Man, Orange Coin. After. After Orange Man, Orange Coin.

[Michael Malice]

Oh, you're not wrong.

[Balaji Srinivasan]

Right. So after maga, Maximalism.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

Bitcoin Bitcoin maximalism is what's waiting in the wings that I think will inherit the mantle after maga, because I don't think MAGA is realistic about the debt that say they're still in a denial zone where, like, look, Elon said, did my best.

[Michael Malice]

Yeah, right.

[Balaji Srinivasan]

That's our best guy.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

Okay. I was at 99.9%. This is going to zero before the election last year. But you know what? Elon is really genuinely an N of one human being. And the reason I say that is in tech. I wrote this essay on this that I can share with you. Actually, I tweeted it. I'll share it with you. But basically, like, there's a lot of people who are very smart and they have a problem shipping, like a beige box that sits on a desk. You know, like. Like just electronics is just hard. And that's like, no moving parts. I mean, it's really, really difficult to. To make something work in the physical world. And Elon has not just one, but two Tesla and SpaceX. Multiple. I mean, not just moving parts. The complexity cannot be imagined of these things. He's running at the same time, along with neuralink and X and boring company. And he also Co founded OpenAI. It's like, I mean, even the, you know, like, he was the first investor in that and. And a bunch of other things. Right. It's actually insane. It's genuinely something where even a really diligent and focused person would need to live a life that was so disciplined to just do Tesla. Just Tesla. Of course. Right, right. And. And I say that because it's like, you know, you know, there's fewer unicorn founders than there are pro athletes. Do you know that? Right.

[Michael Malice]

Wow.

[Balaji Srinivasan]

So it's like, yeah, so like 1500 unicorns in the world, so like maybe a few thousand unicorn founders and there's like 10,000 pro athletes. Right. So, you know, I know a lot of these guys have funded a lot of these guys. I'm, you know, like basically I'm on a first team, whatever.

[Michael Malice]

Right.

[Balaji Srinivasan]

These are, these are my friends. Right, sure. And so among this community of people who are kind of like pro athletes, we're all like, Elon is Michael Jordan. He's just, he's just the best of us. And the better you are, the better. You understand how much better Elon is, right? Point. Point being that if Elon couldn't do it right. It cannot be done. Right.

[Michael Malice]

It's systemic.

[Balaji Srinivasan]

It's systemic. And the thing is, you know, how can you solve 175 trillion in compounding debt? But that's actual number. You know why it's not 36. You know why it's 175.3 because liabilities. Yeah, exactly. The, the US government. See if, if when you submit your financial statements, the sec, if you just did cash accounting, like you'd go to jail basically. Like you have to. If you take a lease that's got some long term liabilities, you need to report that stuff on your, on your, on your thing. Right. You know, it might be an oversight or something but like you, you, you definitely need to include that. The escarment though it does not include normally the, the obligations it's taken on in terms of Medicare, Medicaid, Social Security, all these entitlements. And when you actually take them on and you put the full number, it's like 175,175 trillion which when you're talking about an annual revenue that's in like the, the single trillions range and you've got a debt that's like 100x that it's over. Right. It's compounding also. Right. So what happens after that? That what happens is like at $100,000 for Bitcoin, everybody's happy. At a million dollars for Bitcoin, everybody's, Everybody's may not so happy. They're, they're. Some people could be really mad. Right. But that actually means that the full faith of credit is actually over. Right. And so this era will, you know, you know with Biden he was CNL and there's just mark to market and he was just done. So it was like, it was like obvious and then it was actually go ahead

[Michael Malice]

gradually then suddenly.

[Balaji Srinivasan]

That's right, that's right. So what, what comes after MAGA in my view is maximalism. Right. Bitcoin maximalism is, it's clearly something where it's the undercurrent. Bitcoin is a shared thing among many on the right. And I understand people have Hope and whatnot. And let's see what happens. Okay. I'm extremely skeptical, for example, that the tariffs will work. Actually, I think, I think they've already not worked. You know why? In many ways, for example, in every country around the world, the guys who were exporting to the US were the most pro American people in that country, right? These were like leaders, you know, captains of industry in like Vietnam, in Uruguay, whatever, whatever country you want. If they're exporting to the U.S. that means they have customers in the U.S. friends in the U.S. employees in the U.S. they're the people at every step in their respective countries that were arguing for better relations with America, more cooperation with America and so on, so forth. Every single one of those people around the world just got like a bullet, right. Or a bunch of bullets. Businesses destroyed because they had a trade relationship with America. Right. And they had to, they were undercut domestically. So that, that means, unfortunately, just like the wokes ended up building the anti woke coalition, what MAGA is doing is it's building the post American coalition. All these countries, all these people, because that's, I mean America's only 4% of the world and MAGA is only 77 million people. It's 1% of the world. Right. It, it's already in a huge fight with the blue Americans for you know what it is, right. So, and, and tariffs of all the things you could do that increases the cost for US Manufacturers, what you wanted to do is actually reduce regulation that decreases costs. Obviously, like no manufacturers, not a single manufacturer who's brought in said, hey, I mean the analogy would be I am going to increase the price of your iPhone by 60%. Now you have an incentive to build Apple. Right? That's literally what it is, right. I mean it's an incentive for some definition of an incentive. But like the, the, the numbers are not even close to correlate. It's like billions of dollars to build Apple. So when you're getting a part from overseas, you just want some maple syrup, you don't want the full maple tree. Right. And you may not be able to build that overnight for sure. So point being, I think, I think many different factions unfortunately are going to be disappointed. And I think after that it's going to be all maximalism. On the other side, I think the Democrats are going to turn to Chinese communism.

[Michael Malice]

Yeah.

[Balaji Srinivasan]

And I think, you know, if you're seeing Tim Walls talking about China being the intermediary, I had a whole article on this. How Newsom, you know, goes to China, you know, Saying Nixon goes.

[Michael Malice]

I pointed out, and I'm sure you agree, that there's a huge segment of the Democratic base who are happier under Covid restrictions and who want that regimented society. And in fact, when I brought this up on Fox News and on social media, no one pushed back. Everyone's like, oh shit, you're absolutely right. If this was on the ballot, a huge chunk of those blue people, this would be their top in the ranked choice voting.

[Balaji Srinivasan]

Yeah. And the thing is, basically Newsom has realized if he doesn't have D.C. he gets she.

[Michael Malice]

Yeah, right. Yeah.

[Balaji Srinivasan]

Okay, so with Newsom walls, others making kind of noises towards China, I think that's going to be the medium term axis. That's, that's one version of China versus the Internet. Right. Chinese communism versus Bitcoin maximalism.

[Michael Malice]

Yeah, yeah.

[Balaji Srinivasan]

CCP versus btc. Total control versus total freedom.

[Michael Malice]

Yes. Yeah, I'm going to have to cut you off there because we've gone very long, but I am so glad to have finally had you on the show. You just blew my mind when we met and you blew it today as well. So thank you so much for taking the time. Go to the networkstake.com pick up the book. I'm gonna send you my address.

[Balaji Srinivasan]

Do I get ns.com what's that? Yes, go to the network.

[Michael Malice]

Hold on again, please go to the networkstake.com which was cheaper to buy than NS.com to get the book. Will you get me a semi signed copy?

[Balaji Srinivasan]

I will absolutely send you a signed copy. Second version.

[Michael Malice]

Yes, yes, I go to ns.com I think you talked me into. I have some couple of very good friends in Singapore getting my ass on a flight all the way over there for October assuming. Assuming I pass muster. I know the guy who runs it, so maybe I have it in there so I could get in. But I'm so glad you were here and you really. I think a lot of people who watch this show are excited for a framework that takes the ideas that I've been talking about for years and shows what it would look like in reality instead of arguing about who would build the roads and can marginally decrease the size of the budget or so on and so forth. So thank you so, so much. This was just enormously informative. So we're running out of time. What has been your favorite part of this interview?

[Balaji Srinivasan]

Oh, it's a lot of it. It's actually good talking to you and also just. I mean, I mean you're kind of the network state is for people. A lot of the people in your audience, my audience who are fundamentally you want actually minimum necessary politics, right? Yeah. And and I think think that part where we realized oh, I think there's a part where we both realized depolitization is what we want and the way you get that is by building something outside on the frontier. Right. And that's what America was by the way. It was getting out of all the European wars and finding the frontier and getting over there. Right. So the Internet is the new new world and you can depoliticize by getting out of that and getting into building.

[Michael Malice]

You are welcome.

[Progressive Insurance Announcer]

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