CEOInterviews.AIKeith Rabois and Eric Newcomer's Heated Conversation on Tech, Trump, and Tariffs

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Unknown0:00

What's the turnaround plan, man? They want these shares going up. You don't get shot for that. Like, this is America. This is shot for that. They're not abducting 5-year-old children. I mean, like that. Someone should sue you for that.

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Narrator0:11

Keith Rabois has been ranked among the top 10 venture capitalists in the world. His husband is in the Trump administration. He's buddies with Peter Thiel. His boss is the guy that kicked you off the beach in California. I've been talking to Keith since I started reporting on Silicon Valley. I simultaneously respect the hell out of him as an investor while being infuriated by his insufferable tweeting.

In this episode, which was hot off Keith hanging out with the vice president, JD Vance, we battled it out and didn't leave anything on the table. This is the Newcomer podcast.

H

Host0:49

Keith, welcome to the show.

K

Keith Rabois0:50

Pleasure to be with you.

H

Host0:52

All right. Do you want to talk about tech or politics more? That's the first question.

K

Keith Rabois0:57

Well, do you want to write about tech or politics more?

H

Host1:00

But you were saying just before we got on that politics is a little bit your junk food and tech...

K

Keith Rabois1:04

It's like tastes good, but it's not nutritious. My job is to find the next best founders, the next generation of iconic companies. It's not to be engaged in politics. Yes, as companies grow up, they have political interests, as we've all learned, and they have to engage in the political sphere, but that's not what I do for a living.

H

Host1:25

We'll get into both. I'm excited. We obviously have a long history. I've profiled you. You let me needle you sometimes, which I always enjoy. I feel like I'm conflicted in that I'm liberal while you're right-wing, but I like the contrarian, fighter, non-boring personality. So, I'm endlessly conflicted on you at once, celebrating your willingness to say whatever you think while sort of disagreeing with a ton of it. At least the non-tech pieces of it.

K

Keith Rabois1:52

Well, as you know, I work with colleagues who have disagreements as well.

H

Host1:57

Disagree. Yeah. All right. So, let's start with some big tech news. Brex sold to Capital One. I joked, you know, Eric Lyman's already been acquired by Capital One before obviously with his old company. Paribus. You were a series A investor in Ramp, a great investor when you were seed. Okay. And then you led the series A at Founders Fund. Okay. So, very biased. You also have exposure to Rippling which I want to talk about in this whole thing through Founders Fund as well. But starting with the Brex sale and what it means for Ramp. What is your take?

K

Keith Rabois2:31

Well, I'm excited because there's going to be one modern technology company. It's not going to be Capital One, right? The history of technology and financial services has never been led since the 1960s through large banks. That's not going to change because they acquired Brex. So if you want to build a finance organization for the 21st century or the 22nd century, are you going to rely upon a technology startup like Ramp or are you going to go to any bank in the world? You're not going to go to any bank in the world. So it's clear the future is Ramp or nothing.

H

Host3:05

What about Mercury?

K

Keith Rabois3:07

I'm not as familiar with them honestly, so I shouldn't really comment. We don't really interact with them or they don't seem to be competitive, but I don't have a lot of visibility for them.

H

Host3:16

I just bank with them. So I'm like, I agree with you that as a small growing company, I don't really want to go to a bank. I'm always having to call JP Morgan when I have some problem with that bank account, whereas Mercury ever since...

K

Keith Rabois3:28

Yeah, I don't know Mercury. I haven't used them. I haven't studied them and I don't know if they really conflict with my investments. So I unusually don't have an opinion.

H

Host3:38

Do you feel like you guys, Delian maybe a little bit more than you, but I think you danced on Brex's grave a little bit too much, aren't you? You're not in the celebrate founders?

K

Keith Rabois3:48

Well, no. I mean, look, they quit. That's a good outcome for them and probably for most of their employees. That's fine. We're in the business of building a trillion dollar company at Ramp. I will be very disappointed if they're not worth hundreds of billions. Like literally personally disappointed. And this is what we talk about as a board. When Eric Glyman and Zach Perret and I get together, it's like, look, we can skate to 100 billion, but our ambitions about changing society and changing the way organizations are built and the way finance works should propel us to a much broader, much bigger ambition and the compensation that's associated with that. So, I'm focused on the future of Ramp. I don't really care about Brex. People think about it as a corporate credit card that helps you cut spending. What gets them to the next level?

H

Host4:40

Yeah. So, the next level is pretty straightforward. The CFO does care about cutting expenses, right? CFOs, controllers on down. And we started there. We're going to save you time and money. But the CFO doesn't have the ability to stitch together all of their policies, which Ramp does do. Now you can take corporate policies and implement them on the cards programmatically but they don't recognize and reconcile like revenue against this data against costs against payroll. If you were the CFO's eyes and ears of the entire company and a CFO could literally run a large organization and have complete transparency, complete visibility, all the data integrations. That's the future. Someone's going to build a company where the CFO sits around and maybe has almost no colleagues for a public company because they have all the data plumbing together. That's why the bank can't build this. You know how many integrations you need to do on different data, structured data, unstructured data, how to synthesize it. You need a UI layer like...

K

Keith Rabois5:41

Eric and the founders of Ramp have clearly leaned into AI very strategically and both in marketing and in the actual product, which has been savvy.

H

Host5:51

That sort of leads us into now that Ramp and Brex, I mean there could be some collision obviously Capital One wants to compete with Ramp, but for the Silicon Valley story is it going to be Ramp and Rippling these days or do you see a head-to-head competition?

K

Keith Rabois6:07

Well, yeah. Again, you know, I'm not directly involved in Rippling, you're right. I was a GP at Founders Fund. We invested and the biggest regret of my career is and I've talked about in other podcasts is I gave Parker a term sheet for the seed round. It was just a little too cheap on the valuation.

H

Host6:22

Gary Tan guy.

K

Keith Rabois6:23

Gary Tan. Yeah. And Parker just wanted me to raise it a little bit and I didn't. And I still have nightmares like almost every day about this. Like, you know, Parker actually responded to one of my tweets about the nightmares.

H

Host6:33

So I love Rippling. I love Parker. I helped actually him close Matt to join the company. Matt McInnis. So, you know, I'm a big fan. I don't think there's as much overlap as people think. Yes, at the margin both companies have massive ambitions and anytime you have two companies with massive ambitions that have some directional overlap, there's probably some, you know, conflict at the margins, but it's not something I think of as like an existential fight.

K

Keith Rabois7:01

Right? You mean they both want to be the software of record for a business, right? I mean, Parker definitely wants to be the software of record, system of record. He's always been interested in that space forever.

H

Host7:16

Ramp, I don't think we think of it that way. We think we want to be the eyes, ears, and actions for the CFO. It's a little bit different. It's like imagine Workday but for a CFO is probably a better metaphor.

K

Keith Rabois7:28

So, Rippling, do you think Rippling's strategy of, you know, sort of cobbling one startup on top of another gets a little unfocused?

H

Host7:37

I don't see evidence of that let's say in metrics or performance. I think it can be dangerous as a strategy independent of Rippling if you try to do too many things. I think that is pretty precarious. And so you have to be very judicious and it's a function of, I use this metaphor barrels and ammunition. It's a function of talent. You can only do the number of things you can do in parallel is dictated by the number of barrels you have in a company. And if you have 10 barrels, you can do 10 things in parallel successfully and safely. If you have three and you try to do 10 things, you may break everything. And so I don't know how many barrels Parker has sitting around.

K

Keith Rabois8:16

And what is your read, do you think Deel broke the law?

H

Host8:22

You know, like I'll say I used to be a litigator. I have not read the pleadings. Like I've not personally read the docs.

K

Keith Rabois8:29

From the Twitter exchange like meeting the superficial feed I see, it does look that way. But again, I have not double clicked. I haven't had the time to double click and read all the stuff. If I really wanted to have an opinion, I would read the documents myself and I would have a strong opinion. I'm just too busy doing other things. I'm not an investor in Deel and I'm not really a direct, you know, participant in Rippling. So, I've just kind of, I track it, but I don't really have an opinion.

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Host8:56

Do you think Andreessen Horowitz is really bear hugging Deel? Like, do you think, you know, they were the board member on Synapse? Like, how much do you think investors need to hold a hard line against fraud or...

K

Keith Rabois9:11

You know, the lesson from Andreessen in some way and, you know, I'm a defender of Parker, was always support the founder. I don't know what are the limits of enabling. I think there's, you know, everybody has their definition of integrity. I think that's critical and, you know, I did a joint podcast recently. We talked about Jack Altman asked us like directly is there, you know, one thing that's like non-negotiable and we both have the same response immediately. It's like ethics, integrity. So, I don't think you compromise that. For example, like when Parker was pitching us for the seed round of Rippling, he only got two term sheets, by the way. Gary Tan and me were the only two term sheets. The key thing I wanted to hear and my partners wanted to hear is what lessons did he take away from his benefits. That was all we knew he'd be successful and he'd be able to get traction and he knows what he's doing. He knows how to build product and company. But the question for us was has he learned based upon that experience his benefits or is he going to do the same things and we obviously extended term sheet. So we believe that he had internalized some core lessons, it was a different person.

H

Host10:09

Let's move to AI. You know you've done some meaningful marketplace investments. What is the future of marketplaces in an AI era? Like do you see these sort of agents existing in marketplaces? Have we, it feels like Silicon Valley has moved on from marketplaces?

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Keith Rabois10:26

Well, I don't think in terms of labels like marketplaces. You're right. I invested in Affair and I like marketplaces but it's more that I found the founder fascinating and I felt like that there's a business opportunity and marketplace was a tactic to me. It's not like the Bill Gurley like writing about blog posts about marketplaces and looking for all these marketplaces. Like DoorDash is a marketplace in some ways but that wasn't what resonated with me. It was like Tony, you know, interned with me at Square. I thought Tony's phenomenal. I immediately grokked when he and Evan actually pitched me. Evan Moore pitched me on what DoorDash was, was this is the I'm hungry button on your phone. Kind of an Andrew Mason concept. It's like yeah I'm hungry. I can imagine people pressing this all the time. Now the hard part was could you deliver that food reliably across vast selection on time. But the demand was obvious and the marketplace just is a component. So I don't really think in terms of people's labels even AI which is, you know, the conventional label of the day, the du jour topic.

H

Host11:30

You've sort of pushed back a little bit on the AI everything or you have...

K

Keith Rabois11:34

About 70% of my investments over the last since I came back to Founders Fund, which is a little over two years, 70% of my investments are AI but I don't look and say I want to meet AI companies. The way they deliver value to some end customer is through the introduction of AI and that to me is the critical part. And then there's a set of questions around can they deliver this value sustainably, durably given all the progress in technology, you know, through labs and new labs and all that stuff, is there a durability there? But it's more to me the value proposition of what value you're creating for the world or for an industry and then what's the secret sauce that you're using that no one else, what's the why now and what's the sustainability, the accumulating advantages of why you can do this forever.

H

Host12:22

So let's make this tangible. You know one company I'm excited about and you're very invested in is Rogo. We had them on stage early at Cerebral Valley. That's true. Explain the theory behind Rogo and what...

K

Keith Rabois12:34

So in the short term I think you can think of Rogo as co-pilot for investment bankers. Like investment bankers do a lot of grunt work. Like we're in New York City, like a lot of people here are investment bankers. It's one of the worst jobs on the planet as far as I can tell but it's prestigious and lots of, you know, fancy college grads want to be I-bankers. What they do, you know, all day is create presentations. That's all they do. Stitch together these presentations 24/7, turn it around and, you know, pitch clients on like here's targets for you and all that stuff. It's a lot of grunt work but glorified grunt work and these people are compensated heavily but they work 24/7. Could you use AI to automagically generate these presentations with the proper data with the right target list? Absolutely. And so that's what we do is we make the life of investment bankers better, more accurate, faster and probably less expensive over time to customers.

H

Host13:24

How capable is it right now?

K

Keith Rabois13:26

It's really good. I mean like so there's really roughly 30 top tier investment banks in the world. I suspect we'll have almost all of them as customers.

H

Host13:35

They all want to know, they all want to make sure they're not missing something. That's not...

K

Keith Rabois13:38

Yeah, but we, so one thing we do differently at Rogo, we have always cared about from the beginning since I got involved. I led the series A. So, I got involved. We care about the usage metrics like literally MAU, DAU kind of consumer metrics. Like if you're building the right product, you want the entire banking team to be using you frequently, constantly and that's the right metric, not revenue. Revenue is a byproduct of succeeding. We don't just try to sell and then because there is a lot of budget, you know, allocated to AI and check this out. We don't care about that. We care about DAUs, MAUs.

H

Host14:10

What's the moat to protect them from OpenAI, a coastal investment or Anthropic?

K

Keith Rabois14:16

Great question. You know Gabe and I chat about this all the time like all the time. I think there's workflow moats. Like the construction of what an investment banker has to do is not just leveraging ChatGPT. Yes, that can be a useful ingredient. Secondly, there's data moats. There's a lot of proprietary data in this business. Like I was shocked actually after I met Gabe of how many successful startups or companies that have like hundreds of millions of dollars and are worth billions of dollars that are just proprietary financial services data. There's like, you know, something like five to 10 of these and...

H

Host14:49

I wasn't familiar with maybe all but maybe one of them.

K

Keith Rabois14:52

So, you need access to that data. Many or most of these companies are not giving it to OpenAI or Anthropic because they actually don't want to protect their own business. We actually do have the rights to use many of them through Rogo. So I think that's...

H

Host15:06

Bloomberg?

K

Keith Rabois15:07

Bloomberg I don't think we use.

H

Host15:09

I'm sure they would resist.

K

Keith Rabois15:11

Well, it's less important in different parts of banks. Use Bloomberg differently. The I-bankers are not as addicted to Bloomberg and Bloomberg chat as some other parts of the bank.

H

Host15:21

Okay.

K

Keith Rabois15:21

At least that's what I've been told.

H

Host15:22

Right. Right. Right. I haven't been an I-banker.

K

Keith Rabois15:24

Yeah.

H

Host15:25

But I had friends who, a lot of my friends growing up from college became I-bankers.

K

Keith Rabois15:29

Now lawyers are making big bucks. I mean obviously you've done very well but for a while it seemed like a foolish career if you're optimizing.

H

Host15:35

So literally this is the case. I started as a like high-end corporate Wall Street law firm in New York City at Sullivan & Cromwell.

K

Keith Rabois15:42

And what happened was all the smartest corporate attorneys, transactional attorneys became I-bankers. They all went to be like wanted to go work at Goldman because they make so much more money. But I was a litigator so I didn't have that option. So I had to go to tech. It was like I was a desperate, desperate, like height of the internet bubble January 2000.

H

Host16:01

And was PayPal the entry point?

K

Keith Rabois16:03

Well no I started at a company that no one remembers called Voter.com. It is actually a good idea. It was involving politics actually. Politics meets tech. You can see why it was interesting to me. And we were trying to personalize content back in 2000. The basic concept is a lot of people you say are you interested in politics? More than a majority of Americans say no, but most Americans have an issue or two that they care a lot about. Like it could be taxes or it could be abortion or it could be some foreign policy, Israel, Iran, whatever the case is. So the question was in the beginning of the internet sort of was could you narrowcast content that people would read and consume even if they rejected politics. So that was what we did and we're doing a pretty good job of it actually. Then the internet bubble occurred and we kind of built the startup assuming capital was cheap and oxygen and fuel would be forever available and that changed very quickly in March 2000 and then definitely changed forever in June of 2000 and we had a very young, sharp but young 19-year-old CEO dropout Duke. He wasn't willing to make dramatic changes which would have been required to save the company. I still think the idea generally is conceptually pretty sound.

H

Host17:14

But that was my first startup and as that company started struggling and I got frustrated the CEO for not being decisive. I called up my friend Peter Thiel and I said hey what do you think I should do? It was just pure advice and he said well I could introduce you to a lot, the company was more on the east coast. I was living in Boston in DC and Peter's like I could introduce you to a lot of people in Silicon Valley but why don't you just come work for us? I was like you know what do you want me to do? And six weeks later, I had already moved to California and started in the office of PayPal.

K

Keith Rabois17:47

This is a fraud question, but the PayPal mafia is all over the Epstein files with Reid and Elon fighting with each other. What do you make of the whole, what is your view on like how much we should be focused on this or not?

H

Host18:04

You know, I don't know. Oh, it's one of these again a topic that I have not like, yes I see in my feed Elon, it's hard to miss Elon. If a core question is like how does the world work you're a little closer to it than I am.

K

Keith Rabois18:17

I know some of the people not Epstein obviously never met him but I read, you know, these threads and I don't have the time to dive into like who said what about who and how true or false is it like that. Like I do need to concentrate on like what I do for a living.

H

Host18:37

This is just I feel like the answer is this is a loser to talk about or like how can you not be curious about it like America...

K

Keith Rabois18:46

Like pure amateur and I think some of the stuff with Elon Reid going back and forth as an amateur I can't tell the difference. Like I have opinions on some things I've read in the news about Epstein but it's more just I have opinions about like, you know, anything else in the news. How it gets to like how sincere is some of the fighting on Twitter, right? That's a fair question.

H

Host19:09

It feels like one of the main topics that they're just like weaponizing against each other when because it's like mutually assured destruction or they instead of mutually assured destruction where they would stay away from it. Now it's like everybody has put their foot on the gas and is just throwing accusations around fairly.

K

Keith Rabois19:25

I think that has changed. The dynamic seems to be very common. On, you know, that dynamic.

H

Host19:31

Are you out on Reid? Like I feel like it used to be there was sort of a friendly relationship between the right-wing members of the PayPal mafia.

K

Keith Rabois19:39

Yeah. I mean I haven't, I don't have any problems with Reid. He has in my opinion the wrong views on many topics, but I also think he's very good at what he does. He's funded some things that I think are a mistake and, you know, as he looks back on his life he'll realize he probably shouldn't have funded. But like lots of people have wrong views and sometimes they have epiphanies.

H

Host20:02

Right?

K

Keith Rabois20:03

Like sometimes people wake up and realize like I used to think X and now I think Y. Like this happens to people. So I'm somewhat optimistic.

H

Host20:11

This is I grew up in Macon, Georgia and, you know, I had all these Christian friends when I was an atheist and I'd be like, 'How can you think I'm going to go to hell?' And they'd say, 'Well, we think you're going to convert. You're going to be saved.' That's sort of what you're saying.

K

Keith Rabois20:22

Yeah. I'm holding out for a soul to be redeemed someday.

H

Host20:25

Yeah. So there's, I mean so I grew up actually the opposite way. I don't know if you know this. My parents were pretty liberal. They were like the impeach Nixon people running around. I was like if you watch the old...

K

Keith Rabois20:36

My parents were liberal to be clear. Have you ever seen Alex P. Keaton and Family Ties growing up? This is a great TV show about this like conservative preppy kid with like hippie parents. That was like my family growing up. So, you know...

H

Host20:47

I do think people do change though. I have seen important people in my life evolve their views and one of the reasons why I prioritize, you know, about topics, politics, whatever is occasionally you say something that resonates and that's a big deal. Like so for example I'll tell you how I became a conservative it's kind of interesting. I remember listening to my parents about all these views and then Ronald Reagan got elected and they were convinced that he was going to blow up the world. They're convinced that he hated Jewish people and then he got elected.

K

Keith Rabois21:22

Are you Jewish? I don't actually...

H

Host21:24

Extremely Jewish. Um meaning like...

K

Keith Rabois21:28

My daughter is now Jewish. So yeah. Anyway, one of those people say...

H

Host21:31

But so they had all these views about Reagan and literally he was going to have a nuclear, you know, again like anyway he got elected and like on day one everything started getting better. The hostages got returned from Iran, the economy started growing blah blah blah. America was back, you know, we won the hockey game, you know, all this stuff. So, so I was like, is that a story? That's a story. Like, so this is funny. What happened to me just got returned when he came back? So, well, it was because they were afraid of Reagan like were like, 'He's gonna bomb us. He's a bad guy.'

K

Keith Rabois21:59

No, they were like, 'He's going to bomb us. He's not fucking around.' It's a little bit like what they're going to see about Trump. Like, Trump's not screwing around like with Iran.

H

Host22:06

Yeah, that regime is going to end. It's just a question of how painful is it? And like period, like...

K

Keith Rabois22:12

It's going on for a long time. Like there's just to bite on Iran specifically. There's a funny dynamic on Twitter which is like people like Josh Wolf being why isn't the left talking about this more which I don't understand what we're supposed to be calling for like...

H

Host22:25

Well that's a good question of what you should do but it is absolutely the case that the current government is slaughtering innocent people it's terrible and right so like but the same people who are whining about other topics seem to be very...

K

Keith Rabois22:39

Normally you whine in America when you're trying to move the American regime. What are we supposed to whine about on Iran?

H

Host22:45

Well, I do think people should be protesting. Like there's official organizations that are supposed to protect civilians.

K

Keith Rabois22:51

Very, they were very critical of other parts of the Middle East and suddenly they're all dead silent. Like there's no protest at campuses. There's no celebrities wearing pins, none of this. It is a little interesting. I'd argue it's because of anti-semitism and a bunch of other reasons, but like fundamentally Josh isn't wrong at all. I still think though that doesn't give you the answer which is what are you going to do and I actually think this is a challenge for the administration. Like I know many of the people in the administration and...

H

Host23:20

Your husband is in the administration.

K

Keith Rabois23:22

Yeah. He doesn't work directly on this specific...

H

Host23:24

You are close to it but I know most, you know, Vance pretty well.

K

Keith Rabois23:29

Yeah, I know JD. We just, I just had JD over for dinner. And so I and I know Marco and I think he's phenomenal, too. And I know Scott and I think these are all great people. They're working on this, but if they ask me sometimes when friends of mine ask me, I have an idea. Like, here's what you should do. Ask me exactly what to do here. I'm not so sure I have the right answer.

H

Host23:51

You're like, I'm a dumb tech guy. I don't know what to do.

K

Keith Rabois23:53

No, no, no, no, no. You're like, no, I would never say that. No, I do have ideas. Like if you said, 'What would you do about healthcare?' I have some ideas. Or if you said like for example in Iran, I do have one specific idea that I think Trump should have done like a month ago is he should have absolutely, he said you know stop murdering protesters. He should have said you also must turn on the internet now.

H

Host24:13

Like he should have coupled the two and like...

K

Keith Rabois24:16

I think it would have been effective and then it would have been like transparent of like what's going on and it would have been harder for them to mask all the atrocities.

H

Host24:23

But they have still been killing protesters.

K

Keith Rabois24:25

Yeah. No, I know forced the red line. They're going to take action. Like I just think that a, it was a question of what action to take like that would be effective as opposed to taking action for action's sake. Like I think one thing the administration has done that's very impressive actually is many of us studied poli sci and things like that growing up and you had, we learned all, you take all these classes on the lessons of Vietnam and, you know, the more modern lessons from like other interventions and lots of did not go well. This administration before they took action in Venezuela literally consciously sat down and said all the mistakes that were made the last 30 or 40 years what were the root causes and then how do we avoid them and they have a checklist of like here's the things that...

H

Host25:05

First principles thing.

K

Keith Rabois25:06

Well like at least try like at least what can we learn from mistakes that the country has made so at least we don't repeat the same mistakes and then try to apply that to what are we going to do in Venezuela.

H

Host25:17

I think they're trying to, we'll see whether they do successfully figure out what went wrong with other interventions and wars and then how could you apply that to Iran to have a more successful outcome. And again, we'll see. But it's not easy. It's not like, oh, just put this troop there, just put that thing there. So, we'll see what they eventually do.

K

Keith Rabois25:37

But I like the psychological journey we were going on. You had liberal parents. They told you the sky was going to fall. It didn't fall.

H

Host25:42

It didn't fall. And I was like, well, maybe they're wrong about everything.

K

Keith Rabois25:46

And I started more, they were wrong about foreign policy first, actually.

H

Host25:50

As war interventionists at the time.

K

Keith Rabois25:52

Yeah. Like I was...

H

Host25:53

Like you supported the War in Iraq.

K

Keith Rabois25:55

You must have, I don't know that specifically about you, but just given...

H

Host25:59

Directionally probably at the time like I don't think I ever explicitly commented on it, but like probably like I think it's a fair, like the people, let's put it this way, the people in power were people I supported.

K

Keith Rabois26:10

Right? I mean Trump came in obviously sort of being anti-interventionist and now is interventionist.

H

Host26:15

No, I think that's somewhat, let's say superficial and not in a dismissive way to you, but just like a lot of people focus on a couple of his statements. He's old. He's an old school. My view is he's an old school Teddy Roosevelt meets McKinley.

K

Keith Rabois26:36

I've heard you say this. Yeah. And he's very interventionist. Teddy Roosevelt was very interventionist. But defined to a smaller set of things like I'm going to care about this and if I care about this, you're screwed. Like you do not, like but I'm not going to try to do everything and fix the world in every possible place simultaneously. But if I tell you don't do that, you don't want to do that. That's like Trump. More like Trump, but more like the big stick. You know the famous thing about Teddy that speaks softly. He doesn't, Trump doesn't follow the speak softly part but the big stick definitely part and so in the territorial expansion from the, you know, from McKinley, like, you know, like Seward's Folly on down and Louisiana Purchase like this country was built on territorial expansion actually people also forgot that. So I don't think Trump is like...

H

Host27:25

You want us to take Greenland.

K

Keith Rabois27:26

Oh definitely. I mean not take, well no like so let's be careful. We definitely need to have strategic assets and leverage.

H

Host27:36

We already had that. We could, let me give you an example. Trump is talking about like making us territory.

K

Keith Rabois27:42

Yeah. Well, let me give you a very specific illustration of sometimes why the media doesn't communicate things well. So they say, 'Okay, we already have the bases or we have the right to the bases or whatever.' The truth is when you have a base somewhere, and we learn this in the Middle East all the time. If you want to read about it, read about Qatar, Turkey bases. We have bases there. If you just have a base, you need the host country's permission to use that for an active operation. So Turkey can say no, even though we have a base there, you can't use our airspace to fly your planes. Well, Qatar can say no. And for a lot of regional reasons, they often do. If you have actual sovereignty on the base, Denmark or Greenland cannot say no to the US launching a military operation. And that is indispensable and it's very different. And so I think that is fundamental.

H

Host28:26

We've never had an issue with NATO reject, like NATO is not like some of the countries are a little soft like Turkey's technically a NATO country so actually yes false of the drama NATO as an institution...

K

Keith Rabois28:39

I didn't say, I didn't say there hasn't been a NATO country that's caused us like difficulty. I did not say that. I did not say that about an individual NATO country.

H

Host28:47

Illustration but NATO as an organization is like controlled by the United States it's a vehicle.

K

Keith Rabois28:53

Technically controlling it but so okay so that's one thing is we definitely need military control of some bases there, especially because the as the Arctic has melted like the, the, the Russ, you see those plots people have on the internet of like where the missiles go, where the subs go. So, we definitely need to stop that. Second, the other big initiative for this administration is supply chain for minerals. Like China's been using that as a very aggressive like sort of piece of leverage against the United States. And so the from JD on down to Jacob are working on mineral supply chain. Greenland has some minerals and we definitely need access to that. There could lots of other ways to get access to it. You don't have to like take over the country or anything. He was never going to invade the country. That was like silly like that was not going to happen. But and it is in my view it is perfectly fine to use economic leverage to achieve goals. Like if we have the biggest economy in the world and it's growing the fastest, we can definitely tell other countries.

H

Host29:55

A loser to alienate Europe. Like it's useful.

K

Keith Rabois29:58

You're alienating us.

H

Host29:59

Well, that's...

K

Keith Rabois30:00

Yeah, JD is more right than wrong about this. Meaning like Europe is harassing Jews. So if you're a Jewish person in the UK, in France, you need to get out like now. Like this is really bad. Like I hope we do things to encourage those people to move to the United States so they're safe. Second, they are cracking down on US companies like X and harassing them or, you know, and that's going to have to stop like we are going to use economic, this administration is going to use what Jacob likes to call economic statecraft which is we're going to use our economy.

H

Host30:36

European treatment of Jewish people but we're getting closer and closer to the Middle East which has been extremely hostile. Well, I think the whole point is like we're gonna have more Abraham Accords, but it's like a different set of standards for one country from the other, which is supposed to be what?

K

Keith Rabois30:51

Well, you'd be safer in Israel than in Europe by far.

H

Host30:53

Israel if...

K

Keith Rabois30:55

Um you'd be safer in the UAE actually as a Jewish person than in any European country.

H

Host31:02

I'm pretty sure of that.

K

Keith Rabois31:03

What's safe is, you know, very loose.

H

Host31:06

I would travel to the UAE without security. I would not travel to Paris without security.

K

Keith Rabois31:11

Really? You wouldn't go to Paris?

H

Host31:12

100%. No.

K

Keith Rabois31:13

Like you're worried you're gonna get kidnapped or what's...

H

Host31:15

Yeah, I would if people identified me as a, you could not wear a yarmulke like in Paris at all. You will definitely be assaulted. Like everybody is terrified. Jewish star. Like I would not walk down the streets of London or Paris with a Jewish star. I would definitely wear one in the UAE and maybe even Saudi Arabia. I don't know that for...

K

Keith Rabois31:33

My wife is I mean pretty clearly Jewish. We spent two weeks in Paris. Didn't she wear...

H

Host31:39

It doesn't, I don't want to, it's an awkward subject because I don't want to speak for how other people feel afraid. You know, the liberal in me comes out not to tell you Jacob's mom left Paris. They were born and raised lived in Paris forever and they had to escape. They literally had to move just because the anti-semitism.

K

Keith Rabois31:58

So we're, you're going to see that so we give up the European alliance now. You're, we're just let, they're breaking it. We're breaking. You're moving on.

H

Host32:06

They need to rethink their first principles of like what values do they support? Like do they believe in free speech or not? That's a fundamental tenet of the United States.

K

Keith Rabois32:15

Is it?

H

Host32:16

Yes.

K

Keith Rabois32:16

All right. That I want to get to free speech. I honestly was surprised free speech wasn't sort of a core driver that foreign policy was sort of the first starter.

H

Host32:25

Well, there wasn't this libertarian authoritarian like suppression of free speech back when I was growing up. Like if you're like a liberal, it's classic liberal. Like the ACLU and all these people were like very pro speech. Like they were the ones, you know, suing like Illinois to let the Nazis protest, right? It was a leftwing...

K

Keith Rabois32:43

Yeah. The left wing was more free speech. So there wasn't like this authoritarian like we're going to stop and suppress ideas we don't like. It didn't really exist. Certainly not from the left. So like, you know...

H

Host32:54

And therefore you didn't need to but you therefore, well it wasn't...

K

Keith Rabois32:57

I'm not trying to drag this up but you obviously had a very famous example where you used a word and you said it was about testing the borders of free speech.

H

Host33:03

Well Stanford was very different. So I grew up in high school in college before there was no like constraints on speech. No one even thought this a good idea. Then all you show up Stanford and like everybody's on this like crusade to crack down on ideas that were not what we used to call back then the term was multicultural.

K

Keith Rabois33:21

Right. It's changed various vocabulary.

H

Host33:24

But like that was like a rude awakening. Like I'd never even seen people like the thought that way that were but there was, you know, Stanford in the 80s was at the cutting edge of like the woke movement. We didn't call it that back then but it was and, you know, I was pretty resistant to that but and so were, you know, several of my friends who, you know, went on to do interesting things. But...

K

Keith Rabois33:46

But they called for a lot of, I mean what David Sacks and Peter Thiel wrote out against date rape. There are a lot of things that they have sort of disavowed.

H

Host33:57

So David wrote an article. Honestly, I personally have not read that in 30 years. So I don't, I don't read.

K

Keith Rabois34:04

For someone who gets very schooled on the issues you want to talk about, not...

H

Host34:08

Sure. Well, exactly. I talk about things I know something about. You want to talk about Iran, I know a decent amount about it. You want to talk about the Middle East, I know a decent amount about it. You want to talk about persecution of Jewish people, I know a lot about it. There's lots, there's a billion topics like so yes when I was young I used to read the encyclopedia like literally cover to cover like that's what we do for read every volume. I don't have an early language...

K

Keith Rabois34:28

I don't have time. I serve on 16 boards. I don't have time to read every issue.

H

Host34:32

Let's drill in on free speech. I won't make you. Litigation said many years ago...

K

Keith Rabois34:36

No but we did at the Stanford Review we wrote like anti-multicultural things without a doubt and I think with the benefit of history, look lots of 16, 17, 18, 19, 20-year-olds will write things that don't look perfect with the benefit of history. But I think there's going to be a lot of things the Stanford Review published that look great. Like I wrote a piece like for the Stanford Review on the brilliance of Ronald Reagan's foreign policy. That was my first piece. That's the title. The brilliance of Ronald Reagan's foreign policy. That now looks profound. Like this was when the Cold War was at its height and I was like Ronald Reagan's going to fix this.

H

Host35:09

He did.

K

Keith Rabois35:10

Do you want the United States have a policy of basically letting white immigrants into the United States and not other races? My views on this are it has nothing to do with race. It is a pure talent question. I think the most talented people on the planet we should admit to the United States wherever they're from like whether it's an O-1 visa or whatever you want to call it. Like we need to be a magnet for...

H

Host35:29

But we're letting, you know, white South Africans come. It does feel...

K

Keith Rabois35:33

There is a political asylum question there which also might be relevant to the Jewish people. Like if you're persecuted and fear death like we may grant asylum.

H

Host35:41

But I think at some point look at what the Trump administration is doing. It feels like they are preferencing white people.

K

Keith Rabois35:48

I don't think that and I think they also, you can correct me if I'm wrong, but my impression was that they let in 37 people, right?

H

Host35:54

I mean, but a lot of these 16 million illegal immigrants against 37 people. Which one should we be focused on?

K

Keith Rabois36:02

The...

H

Host36:03

I think it's 37 people.

K

Keith Rabois36:06

The Trump administration does not want to, they're not like really supporting H-1B visas particularly.

H

Host36:12

There's controversy within the administration. I think there's people...

K

Keith Rabois36:14

who are more enthusiastic about a magnet for talent.

E

Eric Newcomer36:17

JD Vance is moving away from that.

K

Keith Rabois36:19

I think so. I think there's a lot of pressure on reducing. There's definitely been abuses of H-1B visas where there has been a clear substitution.

E

Eric Newcomer36:33

To the extent tech was misled about what Trump was going to do. I mean, he goes on the All-In podcast. He's like, 'We're going to give everyone...' and then it isn't happening. Like, we're a year in.

K

Keith Rabois36:44

Well, yeah, we're a year in a four. He has accomplished almost everything else in year one, which is very impressive. Minnesota, the economy is not. He said he was going to bring down inflation. Not like it is. There's no inflation. Look at inflation. It's like we're much... go to the economy. I use true inflation.

E

Eric Newcomer37:03

Yes. Trump visas, O-1 visas.

K

Keith Rabois37:06

I personally think we should expand O-1 visas like probably 3x them, right? That's my opinion.

E

Eric Newcomer37:10

That is something we are aligned on. We want immigration, certainly elite immigration. People tweet at me like, 'Oh, you just repeat whatever the administration says.' No, like I actually think we should triple O-1 visas.

K

Keith Rabois37:23

It doesn't seem like it's going to happen.

E

Eric Newcomer37:25

We'll see. I mean, I think the administration does definitely want to fix lots. Everybody on all sides of the spectrum thinks our immigration process is a mess. I don't know anybody who's like, 'Oh, this is the system we should have.' So the question is, can you create an alliance of people who want to fix this to get enough votes to change that? But I think Trump, as he said on All-In, is more progressive about bringing talented people to the United States. Now, there is a tricky issue with the CCP. China has been sending people here and there clearly have been examples of imported material espionage. And so I think that poses another layer to this of what are we going to do about the CCP sending people here designed to conduct industrial or otherwise espionage. So that's also a very complicated...

K

Keith Rabois38:17

That's a very complicated... and then like, so let's talk about immigration. You want to talk about crazy immigration. We currently have allowed, and maybe in the last month this has changed, but as of a month ago this was not true. You could as an Iranian citizen go study nuclear physics at MIT. I know this is a fact.

E

Eric Newcomer38:36

That's insane. Why are we educating the nuclear physicists of Iran? We should want them to stay here, right?

K

Keith Rabois38:43

Well, maybe the problem is we didn't figure out a way to keep... I don't know that citizens of an enemy state, like Iran is technically an enemy state, foreign adversary defined in law by Congress.

E

Eric Newcomer38:53

I feel like you're bringing up a lot of edge cases.

K

Keith Rabois38:55

But no, but this is failing to deliver on the core.

E

Eric Newcomer38:59

They aren't delivering on the core thing. The core thing they ran on is we're going to shut down the southern border. Day one, fixed.

K

Keith Rabois39:05

Like literally fixed. Obama. There were fewer illegal immigrations during Obama. No, no, no, no. Zero. What Obama claims credit for, and I can walk you through the stats here, is he said we had more deportations. The reason he can claim that, the stat is very misleading, but here's the definition he's using. If you tried to be an illegal immigrant and come from Mexico during the Obama administration, if they caught you and they turned you around, they called that a deportation. The current definition is if you're in the interior of the United States. So Obama had many more stop you, but they counted that statistically. It's true that they did actually turn you around. So it's not a bad thing, but the statistics are apples and oranges and everybody who studied this would agree with me like this is...

E

Eric Newcomer39:50

So it's... but they're both good. I mean, Obama, like look, if you read Clinton's speeches on immigration or Obama's speeches on immigration, they sound like Trump. Like this is a very modern change in the Liberal Democratic Party, their views on immigration.

K

Keith Rabois40:05

I think people could accept certainly freezing the border.

E

Eric Newcomer40:09

Yeah.

K

Keith Rabois40:10

I think the interior work, I mean, you were a lawyer.

E

Eric Newcomer40:13

Yeah.

K

Keith Rabois40:13

So you understand that there are lots of laws that people aren't following. Speeding, whatever. And then there also there are people with green cards that we have the right to revoke, but then there's no reason to like scare the shit out of them when they were allowed to be here. They had a green card or they had some other...

E

Eric Newcomer40:32

To be here as long as they didn't break any sort of agreement with...

K

Keith Rabois40:37

Well, we do have different rules on green cards. Like Rubio talks about this a lot. If you're a guest, you don't have the same rights as the person who owns the home. And I think we stopped enforcing that and Rubio and the State Department is enforcing that. So if you're on a green card, your ability to criticize the United States is different than an American citizen. And I think that's very reasonable.

E

Eric Newcomer41:00

It creates a terrible free speech culture in the United States.

K

Keith Rabois41:03

Not necessarily. The woman, by the way, I think you had sort of pushed back on the idea that the woman who was pushed out of the United States over an op-ed, that it was just the op-ed, and then evidence did come out that it was just the op-ed. Do you concede that one?

E

Eric Newcomer41:16

No, actually, send me the evidence and I'll look at it. But I do think Marco was right.

K

Keith Rabois41:22

We have scarce number of green cards and we should choose. It's perfectly proper to choose people who support the United States to allocate the green cards to. I don't think you can do that for American citizens. You shouldn't. The government shouldn't choose. But the government does have discretionary rights for people who are visitors just like at your dinner guest. But we're creating a right to a green card.

E

Eric Newcomer41:43

You have to sort of have fidelity to the Republican Trump administration right now. Do you align with their views? They want to be able to scrub the social media of people coming into the United States.

K

Keith Rabois41:53

You're cheering out. That is insane.

E

Eric Newcomer41:55

It's not insane.

K

Keith Rabois41:56

It's insane in the context of an administration that very much cares about fidelity to a specific...

E

Eric Newcomer42:02

Well, that's your interpretation.

K

Keith Rabois42:03

You don't think that's what all your business friends are doing.

E

Eric Newcomer42:06

Tim Cook is literally bringing him like golden gifts. Okay. You cannot pretend that kissing up people...

K

Keith Rabois42:12

Like Hunter Biden like...

E

Eric Newcomer42:15

Hunter Biden that had like a small random contract with the CCP.

K

Keith Rabois42:20

Are you... you deny that like business leaders today obviously see, and we're starting to see this break because we literally just saw...

E

Eric Newcomer42:26

I don't think it's going to break but like keep going, keep going.

K

Keith Rabois42:28

Business leaders feel like they need to cozy up to Trump in a way that is unprecedented in modern American history.

E

Eric Newcomer42:34

I think business leaders in tech feel the need to cozy up to Trump. But let me explain why. They all spent infinite amount of money in 2016 and 2020, depending on which year and sometimes both, funding democratic opposition. And I don't think a successful CEO should be that binary with their money like across an organization. Google, 98% of all contributions went to Democrats. That is not acceptable. And so they do need to do some correction to that. Facebook, Mark spent 600k personally trying to elect Joe Biden. You can't do that without creating enemies. So I think some of it is a recalibration.

K

Keith Rabois43:16

Some, I think... well, show me how many tech executives or how many companies, how many tech companies can you find that had 70% or more greater Republican contributions?

E

Eric Newcomer43:26

But some of these were just employees. Like employees are allowed to be left-wing.

K

Keith Rabois43:29

Well, you are allowed to be left-wing, but I think if you're going to get... if you're...

E

Eric Newcomer43:34

You are, I guess this is...

K

Keith Rabois43:35

Well, you got to be careful then. Like I don't think like see...

E

Eric Newcomer43:39

The government is going to come after you.

K

Keith Rabois43:41

Well, you don't...

E

Eric Newcomer43:42

That is not the enterprise Republican party.

K

Keith Rabois43:45

Be an ideological supporter as a company. And like so for example, like there's lots of companies in New York, Fortune 500. Would Citibank ever give 90% of its money just to one side? No. But you're talking about Pepsi employee donations.

E

Eric Newcomer44:01

Yes. But through a PAC, so it's organized.

K

Keith Rabois44:04

Well, it depends.

E

Eric Newcomer44:05

Depends. But the ones you were saying about tech companies...

K

Keith Rabois44:10

On what data set you're looking at, but the company does have usually organizes a PAC at least for their leadership. And so it's not totally like just random atoms. I agree the random atoms is slightly different than when the company orchestrates it. But if the company orchestrates, then you have to be a little bit more judicious. We agree they're dancing for Trump. So you think they have to make up for past sort of...

E

Eric Newcomer44:31

Some do. Some definitely have to make up for sins. Like if you try like you could argue...

K

Keith Rabois44:36

People are literally getting pardoned for criminal acts based on just showing up at Mar-a-Lago. Do you disagree with that?

E

Eric Newcomer44:43

Well, I don't think that's actually true.

K

Keith Rabois44:45

You don't think we have a major pardon issue going on in the United States right now?

E

Eric Newcomer44:49

Well, I do think... here's a bipartisan comment. I think we need to reform the pardon system. Like you saw what Biden did. I think everybody found that outrageous.

K

Keith Rabois44:58

Pardon himself when clearly Trump was gonna go for retribution. Who indicted Trump on all these fake charges. Every single one of them has been thrown out. Every single one. And they're all... as a lawyer and as a litigator I know.

E

Eric Newcomer45:11

They've been thrown out because the new justice department came in and threw them out. No judges ultimately threw them out. Like so the New York State one, the Justice Department had nothing to do. The New York State Court of Appeals, which is all liberals, it's 100% liberal.

K

Keith Rabois45:21

They threw it out because he is now the president and it was going to make it so... made this shit up. Like, so let's talk about New York. Happen to know this. Well, they changed the statute of limitations. Then they took a paper offense, which is typically a misdemeanor, and said, 'We're going to now change the law.' So, if you have this paper records offense, and we're changing the statute of limitations, so we go back to this paper he might have filed. We're going to now change it into a crime. But this is...

E

Eric Newcomer45:47

New York is... yes. Or Georgia. Same thing in Georgia. Georgia is the independent prosecutor, the special appointee like that. Those were legitimate. The confidential classified documents handling was... and he was definitely obstructing like those things were happening.

K

Keith Rabois46:02

Oh, you mean like Joe Biden both as vice president...

E

Eric Newcomer46:05

Proactively returned them. It was once there was a... there are legal standards, there are different things.

K

Keith Rabois46:11

Like Hillary Clinton...

E

Eric Newcomer46:13

Hillary had all these documents. What about... what I'm saying with that is like look, if politicians of both parties do something, it's unfair to harass and prosecute the last...

K

Keith Rabois46:25

What is your take on the $500 million going to Trump's crypto company?

E

Eric Newcomer46:30

That's stupid. Like, he shouldn't have done that. It's just... I know it's stupid.

K

Keith Rabois46:35

See, I'm neutral. Like, I think I don't think they should do that. Like, I just...

E

Eric Newcomer46:40

Corrupt. But it is a scale of corruption never seen in American history.

K

Keith Rabois46:43

Well, I think you should ruin history a little bit. But like Harding I'm sure had like... if you're just inflation and you know maybe Johnson getting... I don't even know if it's corruption. I just don't think the optics are a good idea. Like I think if they're going to be president focused on achieving things, why bother with the distraction? Like that's my opinion.

E

Eric Newcomer47:00

It's ruining capitalism. Like it's creating a world where fraud wins.

K

Keith Rabois47:05

But let me give you the pushback. If you were like a MAGA conservative and you want to push back, you say of all the modern presidents, the only one who became less wealthy by being in office is Donald Trump. Every other president became more wealthy after being president. So, you know, it's actually true.

E

Eric Newcomer47:21

So, get wealthy while he's president.

K

Keith Rabois47:23

No, but like the point is he's actually gone down in net worth because he served. Every other president, Obama went from like 200k to 200 million. Like this is very common.

E

Eric Newcomer47:33

I don't know if this is still true. This 500 million is a lot of wealth for him.

K

Keith Rabois47:37

Well, does it go to all the... who does it go to? I don't know. Like...

E

Eric Newcomer47:40

It's a lot.

K

Keith Rabois47:42

Anyway, I don't think personally I don't think they should have done it.

E

Eric Newcomer47:45

Are you...

K

Keith Rabois47:45

I don't think whoever made the decision... I don't think it's a distraction from achieving things.

E

Eric Newcomer47:50

Are you still a China hawk?

K

Keith Rabois47:51

Yes.

E

Eric Newcomer47:52

And the Trump administration is giving China our most valuable AI.

K

Keith Rabois47:56

Well, there's debate within the administration as you can see.

E

Eric Newcomer47:58

That's happening, right?

K

Keith Rabois47:59

Well, no, it's not approved. It's not approved. Like they don't have the...

E

Eric Newcomer48:04

What's your prediction?

K

Keith Rabois48:06

I don't think they're going to get the chips.

E

Eric Newcomer48:08

Oh, really?

K

Keith Rabois48:09

Oh, I personally hope they don't get the chips.

E

Eric Newcomer48:11

Is this wish casting or knowledge?

K

Keith Rabois48:13

No, I think there's like... it has been delayed. So, there's a number of people who have to sign off on this stuff. There's like a review process and you're right correctly stating that the Trump administration gave the first level blessing but there's several other departments have to sign off on that and that hasn't happened.

E

Eric Newcomer48:31

To the... to the number one thing if you were China hawk you would not want them...

K

Keith Rabois48:35

I agree with you.

E

Eric Newcomer48:36

It is the most China dovish thing you could do.

K

Keith Rabois48:39

I agree with you. You know David Sacks is very smart and very knowledgeable, has a completely different perspective. You should debate it with David.

E

Eric Newcomer48:47

David and I are... I mean I'm having David come on the podcast.

K

Keith Rabois48:50

He should. I mean he should... he can articulate his view. I understand his view. I don't agree with his view and that's fine. Like we can both be conservatives and debate it, right?

E

Eric Newcomer48:59

But he has a very strong perspective that has logic to it. He is super sharp. Jensen and David's views are very strong. I happen to have a different view and I'm willing to critique it.

K

Keith Rabois49:09

I mean I think we should have, you know, a globalist policy, but I think we should extract from China. Facebook should be able to operate there. I think we need to... I personally am a China hawk. I believe that we need to lock down dual use technology for lots of reasons with respect to China and the CCP. But I understand friends of mine and friends of mine in the administration have slightly more nuanced or different perspectives on this and you know that's what they're empowered to do. But my personal views are similar to yours. A lot of this, I mean the corruption I think is terrible and you know chips, you know foreign policy people can disagree, it's very debated.

E

Eric Newcomer49:52

I think saying no innocent person was involved with...

K

Keith Rabois49:57

I thought that was pretty dark.

E

Eric Newcomer49:59

Well, you can... but it's obvious he was an agitator that...

K

Keith Rabois50:02

Agitated free protest assembly.

E

Eric Newcomer50:05

That was not a protest. You're just lying to your readers.

K

Keith Rabois50:08

Readers... let's talk about it.

E

Eric Newcomer50:10

Yeah, that was not a protest. That was an organized obstruction of an ICE operation. There was no protesters. So if you want a new show...

K

Keith Rabois50:17

They're observers. I wrote a newsletter that we just lived through this era where people like Elon were calling...

E

Eric Newcomer50:24

Wait, did you watch independent media? Independent citizen journalists? And here he is. He's recording what's happening.

K

Keith Rabois50:32

And then with his phone. No. No. In the first video, he's not recording. He's fucking kicking.

E

Eric Newcomer50:37

Okay.

K

Keith Rabois50:37

Okay. So you admit he like two weeks before he was out. Now he's in.

E

Eric Newcomer50:41

Now you're just like, 'Oh, he's a wreck.' YOU DON'T GET SHOT for that. Like this is America.

K

Keith Rabois50:44

You do get shot.

E

Eric Newcomer50:47

So do... what city do you live? What city? What city do you live in?

K

Keith Rabois50:50

This city.

E

Eric Newcomer50:50

Okay. You live in New York City.

K

Keith Rabois50:52

Go downstairs, walk up to any New York police officer. Literally anyone. You can sample however you want. Go to five. It's actually better than one. Three to five. And ask them what they would have done differently. And you're going to be shocked. They actually acted... they don't like the result. Like just to be clear, let's be totally clear. The result was very unfortunate. The process... if you ask any police officer in an urban city what they trained and what they would have done in that exact circumstance...

E

Eric Newcomer51:17

People in Houston are always going to have a very giving attitude towards people having to make...

K

Keith Rabois51:23

But I've watched this happen. This happened in Miami. So I was in Miami the week after and I watched my neighbors talking to people. People love the police in Miami. We have a really great police force. But anyway so I watched my neighbors actually talking...

E

Eric Newcomer51:35

This whole argument could still be made and he could still be innocent. Well, innocent. He was a felon. Innocent from a perspective of should you be shot? I'm not debating that with you. But some people...

K

Keith Rabois51:46

You don't think he should have been shot?

E

Eric Newcomer51:47

No. But I do know that he...

K

Keith Rabois51:49

And do you think he gave them cause to be shot?

E

Eric Newcomer51:51

Yes. Yes.

K

Keith Rabois51:52

By carrying a weapon?

E

Eric Newcomer51:54

No, definitely not. But you cannot... The first thing you learn... Do you grow up in a city, too?

K

Keith Rabois51:59

I grew up in Macon, Georgia, which actually has a high crime rate.

E

Eric Newcomer52:02

Okay, great. One of the first things you learn is you do not get in a violent altercation with police under any circumstance. Like this is talked... one of the reason why minorities have not supported the protests in Minnesota is they all know that they tell their kids at 7 years old if the police pull you over do not get in a fight. Like that's the first thing you learn as a kid in an urban environment. He clearly resisted arrest. Now, being armed when you're resisting arrest is...

K

Keith Rabois52:29

He'd been in the vicinity of pepper spray and pepper spray.

E

Eric Newcomer52:33

Yeah, but he was still hiding...

K

Keith Rabois52:35

And there were six of them. They taken his gun. And they shot him in the back.

E

Eric Newcomer52:40

No, they shot him in the front.

K

Keith Rabois52:41

No, they shot him in the back.

E

Eric Newcomer52:42

But the officer... the only legal question is really simple and we'll eventually get to the bottom of this. This will eventually become out in public domain. Is did the officers who fired the shots, the two that fired the shots apparently, did they know the gun was taken away or not? That...

K

Keith Rabois52:58

They're certainly going to say they don't know.

E

Eric Newcomer52:59

Well, no, but like you'll be able to tell like I don't know.

K

Keith Rabois53:01

You need to be threatened. They were not being threatened.

E

Eric Newcomer53:03

You don't have to be threatened as a police officer. That's false. That is not the correct argument. That is not legally true. You do not... the Supreme Court ruled... nothing. Like literally, this is not the standard. But if they knew he didn't have a weapon...

K

Keith Rabois53:17

The Supreme Court ruled that you need to bring in like the totality of the circumstances that have happened and nothing... and that is not what happened here. There was not... he wasn't threatening them. He was recording and then he helped pick up a woman from the street.

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Eric Newcomer53:31

Anybody who violently... arrest... he was violently resisting arrest. You cannot do that. You cannot do that. Period. He was... there was six on one like he was still intentionally... like tells people you drive this way. ICE... this was border control.

K

Keith Rabois53:50

I know that's true. That is true.

E

Eric Newcomer53:54

It has just become an American convention that the people doing border control are ICE. Okay, if that is the territory where you can find some... if that's the ground you can find some wind to defend yourself, that is such a small piece of this.

K

Keith Rabois54:07

The issue is very simple and straightforward. If the officers, the border patrol authorized by Trump shot an American in the back doing the most patriotic thing he can, observing the totalitarian use of authority.

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Eric Newcomer54:21

He was in the middle of the street. He's a patriot.

K

Keith Rabois54:23

No, he's not a patriot. Nobody believes this. And when we...

E

Eric Newcomer54:26

Yes, I sincerely believe it.

K

Keith Rabois54:27

You're going to look so fucking stupid when we release his signal chats like this was an orchestrated...

E

Eric Newcomer54:31

Oh my god. The idea that yes, of course they're following ICE. They're...

K

Keith Rabois54:34

No, they're not following ICE. He was in the middle of the street interfering with operation. That is a felony. It's actually punished by 8 to 9 years. That offense before resisting arrest, which has a 20 year...

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Eric Newcomer54:43

Interfering by picking someone up.

K

Keith Rabois54:45

No. If you're in the middle of the street, you cannot.

E

Eric Newcomer54:47

He was on the sidewalk when they...

K

Keith Rabois54:48

Let's do a thought experiment.

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Eric Newcomer54:50

If right downstairs we go down the studio and the police, the New York Police Department is trying to arrest somebody and either one of us, white, you know, all-American, whatever, goes in the middle of the street while the police New York Police Department is trying to arrest somebody. Will those officers grab us violently? Absolutely. 100%.

K

Keith Rabois55:07

But they shouldn't shoot him.

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Eric Newcomer55:09

Well, they should not happen. Let's follow this through. Like the thought experiment is worth doing.

K

Keith Rabois55:15

They shouldn't shoot us.

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Eric Newcomer55:16

Depending though what we... how we react when they throw us down violently. They might. Not intentionally, but they might. Like if one of us were to grab... like if one of us were to grab...

K

Keith Rabois55:27

You think I already... I don't have this positive view of the police as like the right bar for authority.

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Eric Newcomer55:33

So I do.

K

Keith Rabois55:34

Okay. Even so, I think this exceeds what the police would do. There was a great video that is like if ICE came to New York at least it's like I feel like the NYPD would stand up for us because they're like we're the ones that are supposed to shoot New Yorkers, not ICE.

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Eric Newcomer55:48

Oh my god, you have such a distorted view of...

K

Keith Rabois55:50

You should be anti-authoritarian. You're in tech like why are you... I feel like what I don't understand why do you like authority?

E

Eric Newcomer55:58

I like law and order.

K

Keith Rabois55:59

You're supposed to be a disruptor.

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Eric Newcomer56:00

I am a disruptor but you don't get to violate the law. If you do, the law is... Trump... no, then you... so the people are learning the wrong lesson. So my parents... let's talk about my parents in the 60s and 70s.

K

Keith Rabois56:10

When they didn't like the law. What did the Vietnam people do?

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Eric Newcomer56:13

Protest.

K

Keith Rabois56:14

They protested, wrote songs, created music.

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Eric Newcomer56:16

And they were willing to get arrested. Martin Luther King.

K

Keith Rabois56:19

Sure.

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Eric Newcomer56:19

Like civil rights, you know...

K

Keith Rabois56:21

I'm going to get arrested. I'm not going to resist arrest. So if you... the way to show a law is unfair or wrong or whatever your perspective is is more like the 1960s and '70s, I would support that. But like fighting against police is a very bad idea.

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Eric Newcomer56:35

I just think it is very hard to comply with six officers at once putting pressure on your body.

K

Keith Rabois56:40

This is how you comply. Like literally tell me you don't know a four-year-old kid that... I just think you're getting afraid. They're attacking you. Your body is barely in control.

E

Eric Newcomer56:49

Police officer confronts you. If you're in a car, you put your hands on the steering wheel and the hands visible on the steering wheel. You learn that first thing at driver ed like literally sophomore year high school. Then if you're not, if the police confronts you and it looks like they're agitated, what do you do?

K

Keith Rabois57:04

You agree that they're in Minnesota because Minnesota is politically hostile to Trump.

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Eric Newcomer57:08

No, I think... well, it depends how you define here. Politically hostile meaning they're not actively turning over criminals to ICE. I'd agree with that is true.

K

Keith Rabois57:19

They wanted them out of prison.

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Eric Newcomer57:21

Yeah, they want them...

K

Keith Rabois57:21

And they're also making claims that they're not in prison when they are.

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Eric Newcomer57:24

Yeah, I don't totally understand that. Like fundamentally I do agree with you that the... the extra officers in Minnesota are because Minnesota decided for whatever set of reasons to not take the criminals in the prison and just hand them over, which is the historical precedent even under Obama. Like this came out recently that Obama used to have actually an ICE agent in every prison.

K

Keith Rabois57:47

Like literally sitting in the prison waiting for them.

E

Eric Newcomer57:50

So like again people are being somewhat hypocritical here. So here's another example. Okay. So, you don't like the shooting of an American like you know stuff too. So, where were you in the Obama administration? You know, ICE under Obama shot 59 people, 23 died.

K

Keith Rabois58:08

Right?

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Eric Newcomer58:09

So, that's like 10x the amount have died under the Trump administration. Where were you complaining?

K

Keith Rabois58:16

I... where were your friends?

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Eric Newcomer58:18

I mean, obviously incidents become symbolic.

K

Keith Rabois58:21

Yeah. Sure. So, you know, I agree. I totally own that this is representative of a bunch of themes in the United States. And some of these themes we focus on and some we don't. Hypocrisy, but I am not...

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Eric Newcomer58:31

It's okay if Obama does. It's great if Obama does it, but Trump does...

K

Keith Rabois58:35

I support abolishing ICE. So, you're like... it's... I'm happy to...

E

Eric Newcomer58:39

So, John L is...

K

Keith Rabois58:40

It is an institution.

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Eric Newcomer58:43

Chicago professor does stats about crime mostly.

K

Keith Rabois58:47

He published the stats about the error rate of Trump's ICE. Like how many times have they made a mistake of any type and then the error rate under Obama using the same stats. Trump's ICE is 5x less error-prone.

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Eric Newcomer58:58

I saw a stat that what like the immigration officials in Minnesota committed more crimes than like the immigrants in the same period of time.

K

Keith Rabois59:05

I doubt that.

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Eric Newcomer59:07

I doubt that. I mean like look so you should look and one of the things the administration is getting better at is these people they're deporting are really bad. Like these are like child...

K

Keith Rabois59:19

Op-ed writers.

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Eric Newcomer59:21

They literally have these criminals in the middle of the street in the cold. They're abducting 5-year-old children.

K

Keith Rabois59:27

They're not abducting 5-year-old children. I mean like that. Someone should sue you for that. So because you know what happened? Do you actually know what happened? Tell me what happened. Yes. So they were arresting correctly or deporting correctly a father who was illegal and a criminal like a bad criminal. He had a 5-year-old in the house. They asked the mom would she take care of him? And she said no. So what are they going to do? You have to get rid of the criminal. And the mom says, 'I don't want my 5-year-old.' So you know what they did? They picked up the 5-year-old and put him in the library. Like this is literally what happened.

E

Eric Newcomer1:00:00

What kind of speech culture are you encouraging? You're lying to a 5-year-old.

K

Keith Rabois1:00:05

They only had a 5-year-old cuz the mom said, 'I won't take care of him.' The mom literally said no.

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Eric Newcomer1:00:10

You're creating the circumstances of these immediate seizures.

K

Keith Rabois1:00:13

Well, you know what happened in New York City? Imagine we go downstairs again and I'm a mom with a 5-year-old and I run away and say I don't want my 5-year-old get arrested right away.

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Eric Newcomer1:00:22

Don't you think just this sort of like hair trigger people should be sued over speech is a deterrent to free speech in the United States?

K

Keith Rabois1:00:29

100%. So you said it.

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Eric Newcomer1:00:31

By the way, where were you in the Biden administration when they lost 139,000 kids? They literally lost 139,000 kids. Where were you? If you're worried about one 5-year-old, there's 139,000 people that somehow kids were running around. I think it's insane to be upset that we're mad about the optical situation when Trump is doing everything he can to highlight that he's taking an aggressive stance in interior states. Like he is creating the... he's painting a picture to be responded... like let's look at Texas. So there's 10x or more deportations from Texas than Minnesota.

K

Keith Rabois1:01:07

Zero incidents. You know why? Because the Texas... no, they're not running around trying to make a scene in Texas. I would love... I'd love them to show the same attitude that they're doing in Minnesota where they have people terrorizing the community in Texas and let the people of Texas... obviously I would feel terrible for the actual immigrants... protest on the sidewalks. You cannot interfere.

E

Eric Newcomer1:01:29

He was on the sidewalk with...

K

Keith Rabois1:01:31

No, he was in the middle of the street obstructing traffic.

E

Eric Newcomer1:01:33

You suggested on Twitter that Vinod Khosla wasn't your boss. He's your boss.

K

Keith Rabois1:01:37

Not really. He would say he's not.

E

Eric Newcomer1:01:40

He has high firing power. He's the...

K

Keith Rabois1:01:42

I don't think so.

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Eric Newcomer1:01:44

Okay.

K

Keith Rabois1:01:44

I don't think... I haven't read our LP agreement in a while, but I don't think...

E

Eric Newcomer1:01:47

I find it hard to believe the guy... and then you guys are peers or...

K

Keith Rabois1:01:52

Yeah. I mean, he's... he's like default, but actually in practice Samir actually runs day-to-day at Khosla.

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Eric Newcomer1:01:58

I appreciate you going back and forth. I need to ask about Opendoor because there's a set of people... I don't cover the public markets but obviously I feel like there's some people watching this show it's like oh you have...

K

Keith Rabois1:02:07

Opendoor... you haven't asked about it.

E

Eric Newcomer1:02:09

I can't go anywhere without talking about...

K

Keith Rabois1:02:11

Yeah exactly. What's the turnaround plan man? They want these shares going up. Is it still a meme stock? What's...

E

Eric Newcomer1:02:16

Well it was never a meme stock. What it was is there were retail investors, normal people could see the vision and the upside potential of the company better than professional investors which I think is a great thing by the way. I'm a big fan of retail investors even before I got involved, reinvolved in Opendoor. I think like the whole purpose of a stock market, let's take a step back. Why do we have a stock market? It's so that we can efficiently allocate resources. That's what you learn in econ or whatever. Consumers voting with their feet saying I want more dollars to go to Palantir or I want more dollars to go to pick your favorite company, Opendoor, is a great thing because consumers should get a voice in where do resources get allocated. So I think it's great when retail people participate. So I think the company had been broken and couldn't communicate its vision purpose at all. And fortunately some set of retail people figured it out that like here's the high level argument. Residential real estate has not been affected by technology. Period. It's still... homes are still basically bought and sold the same way they have forever. It's the largest asset class in the world. What's the chance in the next 20 years that that's true? Pretty low. What's the single best company with the best opportunity to improve through technology the process of buying a home? It's Opendoor. That's the investment hypothesis. Now, delivering on that is very difficult. Requires lots of orchestrated talented people working together and innovating. The fact that the company wasn't able to communicate that and convey that is intellectually bankrupt. The fact that some retail investors figured it out is great. That's what propelled the stock to increase because they're like, 'Hey, I don't like my real estate agents. I don't like the real estate process. I want this fixed. I'm going to give my money effectively to support a company that wants to do this.' And then Carrie takes over with an explicit vision of making the process of buying and selling homes easier and encouraging home ownership. The company's mission is to encourage more people to be homeowners because when you're a homeowner, you're a better citizen. Like there's lots of evidence in every possible way. And so we want to encourage home ownership and we're in the process.

K

Keith Rabois1:04:27

But what's going to cause like an inflection point? Like I feel like a lot of this is still sort of the big... the...

E

Eric Newcomer1:04:32

So we have this cool thing that actually as far as I know no other public company has done. So, every Tuesday night, we update our metrics on like how many homes we bought. It's called the accountability index or something. You can just watch it every Tuesday night at 6 p.m. And, you know, since he's taken over in October, we massively increased our growth. We secondarily, this will play out, you know, more as we do earnings on the profits, but we're doing better than we ever have. We're better at pricing. Our pricing engine was broken. It wasn't using any modern AI techniques. Like basically the company had been in like maintenance mode from a technology perspective for like 3 to 5 years and he's already in like four months or so fixed huge fraction of that. And then you'll see us doing some creative things as well that are a little bit beyond the core of just buying and selling homes, adjacent... people call it technology adjacent products and services. We're basically following the Carvana playbook truthfully which is intentional. Carvana is 100... well they're probably down a bit but they're recently a hundred billion dollar company allowing you to get an instant offer for your auto, more competitive market and smaller market TAM than Opendoor actually. So we want to follow their playbook. I've always been a fan of the Carvana model since 2016. I've been like we're on the Carvana... why can't we just follow the Carvana model? Like we should communicate this to investors blah blah blah. Anyway so that's what we're doing. I think it'll be successful but obviously you know we have a whole new executive team like literally a whole new executive team. So Carrie started four months ago. We have new CFO, new president, new COO. So it's not going to... all the metrics aren't going to change like immediately, but they're all moving in the right way.

K

Keith Rabois1:06:13

What is this patch by the way?

E

Eric Newcomer1:06:15

It's a brand. It's like your producer said don't wear any branded clothes like for the podcast. I'm like...

K

Keith Rabois1:06:24

I didn't know if it was like...

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Eric Newcomer1:06:26

Yeah, it was like...

K

Keith Rabois1:06:26

No, it's like a Golden Goose or whatever the sneaker brand is. Okay. If the... I mean if the... and we're about to wrap up, but like if the Democrats win the midterms, is that a repudiation of Trump or... well historically the out of power party has won midterms. So the historical precedent would be that. I do think it depends on the magnitude like there's... I don't think that's going to happen by the way. I think the Republicans will absolutely control the Senate. The House is more volatile in many ways, partially with all redistricting left to right. I don't even know, no one even knows like who's voting for who, but I think the House will be more volatile. But as far as I can tell, the economy is improving a lot and people are starting to notice. Like I saw the right track, wrong track metric. Is your family better off? All those are moving a lot in the last two years.

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Eric Newcomer1:07:13

You're predicting Republicans win the Senate. What about...

K

Keith Rabois1:07:15

Win the Senate and maybe even gain seats. The House is probably a 50-50 deal, but I think the first derivative... because I think people do care about their pocketbook like the conventional wisdom in politics. I think Trump will be successful. Also, one of the magics... there's several pieces of magic which we didn't talk about Trump. Like there's lots of things to criticize. I'll grant you like trust me... you can criticize him but people haven't focused enough on the magic of Trump. He is excellent at motivating people who don't vote often to vote. And when he's not on the ballot, which is typically the case in a midterm, the Republican party suffers because they're voting for him. They're not voting for Republicans. I think he... now there's so much evidence of this. He understands that. And he understands if he wants to accomplish his goals for the last two years, he needs to loom large. He needs Republicans... otherwise there's stuff he can do in foreign policy and there but fundamentally to move the needle and I think he ran for president to move the needle since he got shot.

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Eric Newcomer1:08:15

So he moves immigration officials out of Maine to make it a little friendlier. Clearly not a winner.

K

Keith Rabois1:08:21

He will do well. But I think it really does matter if the economy continues to grow.

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Eric Newcomer1:08:26

But you're predicting close call.

K

Keith Rabois1:08:28

I think we're going to... I think the Republicans we will win the House, but it's not obvious. I think the Senate I'm very confident in. But anyway, I think it would be...

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Eric Newcomer1:08:37

And we're going to continue to have free and fair elections in the United States.

K

Keith Rabois1:08:40

Oh yeah. Well, we're trying to pass voter ID. Like...

E

Eric Newcomer1:08:43

So don't you think passports would be good for Democrats? Like...

K

Keith Rabois1:08:47

More Democrats have passports than Republicans?

E

Eric Newcomer1:08:49

I'm fine with passports. Give me a library card. I'm probably fine with that. Like I just think it's insane. You can't go to a pharmacy literally downstairs and buy Sudafed without an ID.

K

Keith Rabois1:08:58

But you think Trump will run for a third term?

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Eric Newcomer1:09:00

No. I don't think so. For lots of reasons. I think he enjoys like occasionally, you know, how I should say this... annoying people. Like he likes tweeting people, like teasing people.

K

Keith Rabois1:09:17

Well, it's hard to know when he's joking. I think the literally serious thing hasn't been true.

E

Eric Newcomer1:09:22

No, but I think you get a feel for when...

K

Keith Rabois1:09:25

He did some of the tariffs. People thought he was joking.

E

Eric Newcomer1:09:27

No, I... well, I never thought he joked about tariffs. Like I believe in tariffs, but actually believes in tariffs. Is one of the things we're very aligned on. But I knew he really strongly believed in it and wanted the... key was to get a Treasury Secretary and commerce secretary who believed in tariffs because a lot of Wall Street people like are blind about the benefits of tariffs. And so he got a team that believes in tariffs and that's why they were able to execute and that's why we're seeing the dividends. The re-industrialization is very real, the investment in America. But more importantly, the trade deficit has changed radically in nine months. Nobody almost nobody including his most positive supporters thought he could change it that quick and that fast. So tariffs are great. I think you're going to see...

K

Keith Rabois1:10:07

You go all day. I mean it's driving Canada into China's arms as we...

E

Eric Newcomer1:10:10

Well Canada doesn't have a choice like they can fake this. He already... I think Carney already canceled that deal. He announced it.

K

Keith Rabois1:10:16

There are different pieces of it that are coming.

E

Eric Newcomer1:10:18

I mean like look... anyway we clearly see the political world very differently. I appreciate you coming on.

K

Keith Rabois1:10:23

That is fair.

E

Eric Newcomer1:10:24

We'll check in after the midterm campaign. It'll be great.

K

Keith Rabois1:10:28

Well, at least on China.

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Eric Newcomer1:10:29

We both are bullish on, I don't know, capitalism and tech. But the rest of it we'll both be big investors.

K

Keith Rabois1:10:36

You don't like fraud, but you're willing to tolerate the candidate who's pardoning a bunch of people. I don't know.

E

Eric Newcomer1:10:42

I think all... by definition all pardons in history are to people who are convicted. And so Trump does not have the most pardons.

K

Keith Rabois1:10:49

All right. All right. Keith, thanks so much for coming on The Newcomer.

E

Eric Newcomer1:10:52

Pleasure.

K

Keith Rabois1:10:53

Thanks so much for listening to The Newcomer podcast. I'm Eric Newcomer. Follow us on Substack at newcomer.co. Hope you enjoyed the episode. See you next week.

Keith Rabois and Eric Newcomer's Heated Conversation on Tech, Trump, and Tariffs

About Keith Rabois