I think we're in the early innings very clearly of an industrial revolution. We're seeing lots of new job creation. We're seeing lots of growth. So far, you can see that you're making every person more valuable. Right now, we have 7 million unfilled vocational jobs in this country. Everyone always complains online. Like, of course, people are angry. They're losing their jobs. Like, hey, unemployment's low, but there's lots of ways you can get a job right now if you're willing to work. I think our culture has a problem with people not willing to work. People who can't find work is different. I think we have to understand what an industrial revolution is and what productivity growth means. So if you look at America, about every 90 years, we've destroyed about half the jobs. But you know what? If we didn't destroy those jobs, we would all be a lot poorer, right? You always tell people if you want everyone to have jobs, we'd ban farm tools and we would not have time, most of us, to be doing podcasts. We would instead be farmers. So what do you think that does to us as humans?
It's obvious thanks to what's happening in AI, both on the new therapies and curing diseases and on how you run healthcare administration and services, we can make healthcare so much better and so much cheaper. So much cheaper, like less than half cost, everyone does better. But what's the most money in government? It's healthcare entitlements. That's by far the most money in government. So of course they started hooking up some of like, you know, Medicare, Medicaid to the NGOs. And then I think we have to like watch all the data at the NGOs really carefully with using Treasury, see the data at CMS for like what they said they were supposed to be doing. You're going to find tons of fraud there. All this stuff that would have been like the 2030s, 2040s, 2050s, it's all being accelerated into the next few years.
All right. Palantir guy, ATVC guy, University of Austin guy, on financial news shows guy all the time. What else? Lonsdale, before we begin, Joe Lonsdale as I pour tequila.
I'm excited to try your tequila, Dave. Only my coolest friends have tequila. I hear this. This is very good. We also have a policy institute in 20 states, the Cicero Institute, but yes, those you know. And this week it was very big for Palantir. You saw yesterday, we think, you know, I don't know if you saw the net income of the company this quarter is higher than the revenue was a year ago. So it's growing so fast that actually it's like net income, net income was higher than revenue a year ago. It's crushing it.
Well, in that case, at some point, I'm not going to start the conversation with this. I am going to ask you once again exactly what Palantir does because you get a lot of different answers. And then we can compare, we can compare your answer in this sit-down to when we did this about a year ago in that chair and we'll see if they match up. But first, cheers, my friend. Welcome back. And you, I think I can call you a Rubin Report veteran now because you've been, you've been...
At least the third time. Yeah. So, let's see.
It's very good. I like it.
Come on. And once you let that breathe a little bit, like it's just the best you've ever had. And I was on the first time I really talked about the process and everything publicly was on your podcast at your place. Can you get this like at the grocery store or something?
We're at some stores in Florida right now. Mostly selling online.
But that's a lot, you get to buy online because you couldn't used to buy alcohol online a few years ago. Well, one of the things, maybe I can get some sage wisdom from you. One of the things I'm trying to figure out is do you just go totally new school and direct to consumer online and yeah, you got to wait two or three days but you're going to get your tequila, or do you break into this sort of quasi-mafioso business that's old school and you got to pour a ton of money just to get on the shelf and everything else. And that's what I'm challenging.
I mean, I'd find some distributors and let them get them to invest alongside you, man. Make friends, man. That's like...
I only knew some investors, some who've invested in other things that I've done who I might be sitting with right now. You got to figure it out. That's a tough, that's a tough business because you got to like go bar to bar and stuff. I've had a bunch of friends who... this is really good. So, yeah.
Yeah. Well, we will see. But this is not about tequila. What we're going to talk about today. We're going to talk, what I really want to focus with you is some of the positivity around tech in the future because one of the things that I'm seeing in the last, let's say since the beginning of the year, has been just sort of a negativity around everything. Even from people on the right, like the left has a certain grievance thing that everyone knows. The right used to not have that. And there's a weird thing happening right now that I think there's a tech negativity which the left definitely has. Bernie's constantly railing against AI and all that. But I would say I'm a world-weary optimist. I watch your videos all the time. You're an optimist. You're like, America's crushing.
Yeah. So, so can we, let's start with that. What are some of the positive things that we should see right now in the country and in tech and then we'll go from there.
Yeah. And it does bother me that the right has this weird Thor-worldism that's kind of like coming up on its side too because we know the left is that way, but it's like partially encroaching into what should be like the pro-liberty positive side. Listen, like what is working? Productivity growth is just really getting going. You're seeing it very dramatically in smaller areas that are scaling quickly. So, you know, in my view, you know, Kevin Warsh, who's going to be the new chairman of the Federal Reserve, I'm very excited about. He's a friend and he's going to spend a lot of the time at the bank trying to quantify these things, which I think is very important for us to quantify, is the productivity is finally going way up again, which by the way, that's the only way we all get wealthier is you do more with less, right? Productivity growth.
And is that purely tech and AI? Is that the reason behind it?
The AI, I mean there's lots of other things that are just good in our nation that are working when you deregulate, when you...
No, but I mean in terms of the productivity.
It's AI. It's AI. It's applying better ways of doing things which I mean we're in the, I think we're in the early innings very clearly of an industrial revolution. We've been through these before. We've seen what they do. It's just massively good for the average person. Like you can troll people and try to pretend that they're bad. Like I think our schools will still teach that robber barons were evil and that was an evil period. But if you look like 1870 to 1900, look at the median American working-class person. They're more than twice as wealthy in that, in one generation. Twice as wealthy in real terms. And this is probably going to happen even faster this time. And we're seeing that, we're seeing lots of new job creation. We're seeing lots of growth. And I think it's just going to accelerate the next couple.
So how do we break that paradigm or the mentality around that, that the robber barons were evil even though as you pointed out they were giving all these people jobs and then within a generation their lives changed and that there's going to be aversion. I get why, I can do all the dystopian thing. We did it last time here. I can do all of the horrible ways that tech and AI in the future can go awry. I'm just not interested in it right now. What I'm interested in is the positives, but that's what we're going to have to work.
We need to learn about like the mind viruses that are attacking us, right? So the mind virus out there is based on like the most basic thing that we've had forever, which is envy. If you look at the third world, for look at the world for 10,000 years, primitive societies, you have envy and you try to tear down, you know, what's working. And this is being, this is a natural human instinct that's being completely weaponized on the left and a little bit now in certain parts of the right as well. Is there, is, and this envy is a sin and it is the crab mentality to pull down the crab that's trying to climb the bucket. This is why one of the main reasons why the third world's broken. We should not be bringing it back in our society. That's, that's America's proud of success. America's proud. I want you to make tons of money and build a giant basketball court. As we were talking about earlier, this is a good thing for...
The best indoor basketball court I have ever seen at someone's home. It is, I am not a jealous person. When I stepped onto your indoor court, I was like, 'This is what I've got to have.' So, but that, no, but the point is I have something to aspire to. You, when I said that to you right before we sat down, you said, 'Okay, make it happen.' And that's the point. I will make it happen. I'm going to have an indoor basketball court at some point in my life. Yeah. Thank you. I will have one. But all right. So, so how do we do that though? Like I get it. We can message it properly and you know we have America's 250th birthday coming and I think that'll kind of give a little extra juice to it, but is this, is this education first? Do our politicians need to change? Like how do you envision the ecosystem around just getting things so that people can see a better future?
Yeah, I mean it is cultural, right? And it's really important our leaders model this correctly. It's really important our leaders reject this very clearly. I think some people on the right are doing, I think some people could do a better job of doing it. You know, it's our education system though as well. Our education system is teaching all the wrong things. This is one of my obsessions. You know, Thomas Jefferson believed that the single point of public education was to train the populace to be free citizens to oppose despotism. That was the single point. Today, it's the opposite.
It's literally the opposite.
It's literally the opposite. It's literally the far left and the commies are running this and making us guilty and making us pro-authoritarian in the system. So, it's like this is why school choice is so important. This is why we have to fight for our education system.
Yeah. So if we're painting that, if we're trying to paint that positive vision, the easy version I guess on the other side is oh but robots will take our jobs. They will do all of our tasks and there will be no, there will be no meaning left. You hear, you hear a lot of this mostly coming from the left but a little bit from the right.
Meaning, meaning, I like arguing dignity of work. This is extremely important to me. Ironic having the left talk about meaning and dignity of work when they're paying millions of people not to work right now. So that's like really bad for our culture. I think they've destroyed certain parts of our inner city culture by paying people not to work.
Um, so, so I agree with the dignity of work, but you know, so far it's definitely not been true. So far you can see that you're making every person more valuable. Right now we have 7 million unfilled vocational jobs in this country. Everyone always complains online like, 'Of course people are angry. They're losing their jobs.' Like, unemployment's low. But if you don't have a job, there's lots of really great training programs. We should make them even better by the way. We should make them accountable. But there's lots of ways you can get a job right now if you're willing to work. I think our culture has a problem of people not willing to work. There's another culture, people who can't find work. That's different, right? So, but what, what in terms of the easy version is like, okay, but the Amazon delivery guy is going to be replaced by a robot or a drone and that, you know, you're going to go to McDonald's and instead of paying someone $15 an hour, it'll just be a robot, which that's already happening with iPads and that kind of stuff. Like, so how do you, how do you refute stuff that people are going to kind of see first, right?
Well, so, so, so I think, I think we have to understand what an industrial revolution is and what productivity growth means. So if you look at America, about every 90 years, maybe even slightly faster, we've destroyed about half the jobs, right? And this is a very important point, right? Because like there's people with last names of Cooper or Smith or Boer. That's a cool one.
Yeah. Yeah. I got it. I got it.
And they did cool things.
They did cool things. And there, by the way, there was a lot of hard things to do.
Hard things. There's a lot of dignity in that work. There was a lot of art in that work. I think it's kind of sad that there's not as many of these really cool coopers and boers around. There's still people, but there's not the jobs. But you know what? If we didn't destroy those jobs, we would all be a lot poorer, right? You always tell people if you want everyone to have jobs, we'd ban farm tools and we would not have time, most of us, to be doing podcasts. We would instead be farming and you would never get your basketball court, right?
So, so what do you think the relationship between the people that want to lean into all of this and the technologists behind it should be with the government right now? Because that seems to be a big one.
Well, and this gets really complicated. I think government should be smaller in general because whenever you give government power, it gets captured. Now, there's exceptions. We need defense to be functional. If you're going through an industrial revolution and it completely changes what's possible in defense, then we have to be investing a lot in that right now to stay ahead of the bad guys because there are bad guys in the world. This is the tough thing about being a libertarian. If you're like very pro-liberty, right?
I don't know if I'm a libertarian, but I'm very pro-liberty.
Yes. And I want government to be small, but I also want to like crush the Islamists and the commies, which means we have to invest in it. So, you need some relationship to build and invest, which we're obviously doing defense side. You need some relationship to teach the FDA, for example, how to use AI to approve all the new therapies that are coming from this industrial revolution. You need some relationship to, right now Palantir's helping them find fraud across the board working with SBA with Kelly Loeffler and with USDA with Secretary Rollins and all these really talented leaders and we're finding tons of fraud and that's important for us to help them. But in general I'd say you want the government to be smaller and not to be involved in doing most of these things.
Right. So, all right. So, since you brought up Palantir there, so one of the things that you said to me about Palantir last time was that in some ways the success of what Palantir and companies like it accomplishes is that people think we don't need it because there are things that you guys are doing to stop certain levels.
Oh, yeah. When you stop terror and things like that and then we don't hear about it, so everyone's like, 'Oh, everything's fine.' However, under the hood, a whole bunch of stuff happened.
Oh, yeah. So, so once again, what is Palantir?
It's like two separate, it feels like two separate topics because you gave me, you gave me attacks and then fraud. Yeah. You know, actually, interestingly, the DNA of Palantir came out of the anti-fraud work at PayPal, right? So, the Chinese and Russian mafia were stealing massive amounts of money from PayPal. I think it got to like seven or eight million a month back when that was a lot of money, right?
Still, I mean, it's still even whatever, even maybe it's an accounting error now, but you know,
But that used to be enough. It destroyed all the competitors to PayPal basically because if you opened it up enough that anyone could send, could send money and steal from it really easily then it wouldn't work and if you tried to ask them for enough information no one wanted to use it. So it was this really hard problem and figured out how to build all these investigative tools at PayPal. I was an intern there. I got no credit for PayPal, but I learned from this area and then we partnered with my roommate Stefan who I'm seeing down here in Florida and Peter Thiel and brought Alex and we built this thing and we applied it after 9/11 to the government and the idea was how do we build platforms that solve the really hard problems to allow you to use all the data the government gathers. It was almost $40 billion a year was being spent to gather data then but they couldn't use the data. They weren't allowed to see things like if they'd had Palantir it would have been very easy to stop 9/11. That was the whole point. And then the goal was to build it to catch all the terrorists and...
Because in essence you guys are looking at all of the patterns and communication.
And you're also just allowing people who might not have a computer science degree themselves who might work for one of the parts of the government. There's a million analysts in the government in different parts of the CIA and NCTC and FBI and NSA and the DIA, right? There's all these places where people's job is to look at data and stop the bad guys. And they didn't have the right tools. They didn't have the right permissions. So how do you build the best possible technology for them to do that? And it turns out we had to solve a lot of very hard technical problems to do that. And then a lot of the problems we solved that kind of built these ontologies and like made the information work together. It actually made it so you can apply AI very easily on top of the data. So Palantir was in a really strong position. You could say it's lucky as well. Had a lot of talent, but it was lucky that when AI came along, it was able to then take that and help companies, help governments use this new AI stuff.
How do you, I asked Peter the same thing when he sat in that chair, but how do you balance your libertarian-ish ideas with that you're working with the government when it comes to data and you know people's private...
So, so, so I think a lot of people don't realize that Palantir was founded as a civil libertarian company, right? So Palantir was replacing systems that were just taking all the data and letting anyone access whatever they wanted. So if you say without Palantir what was there before us, it was these systems without, they weren't tracking things, didn't have audit trails, couldn't watch the watcher, didn't have really clear rules about who's allowed to see what, weren't enforcing the law. And Palantir was a way to bring everything in a way that to enforce the law and to make sure you're only allowed to see what you're allowed to see. And you know, the law changes, Palantir changes what you could see. But that was, it's, you see what I'm saying, like more sophisticated technology actually enforces civil liberties which it's very, people don't get this. We actually had a civil liberties group in the company that we launched in like 2006, 2007 and we were explaining like here's how we're going to make it so you can catch the bad guys and follow the law and stop letting people break the law.
Do you ever worry that it could just grow so big that ultimately no one will know who's watching the watchers? You know,
Well, the way, Star Trek episode, yeah. And I'm not a Star Trek guy, but the way the company's set up is it has full audit trails for who did what. And the point is that you have to have these things that can't be deleted that are kept somewhere that other senior people can see to watch what people were doing. Right? So the whole point is it makes it much, much easier to see what everyone in the CIA and your part of the CIA that you have access to is doing if you're the leader and then for the leaders to then see that. So, I mean there's no perfect solution in the world but when technology is smarter and better and more innovative it actually does help secure these things. The analogy for example in the regulatory state, technology helps get rid of a lot of really dumb stuff. It makes it more transparent, makes it harder for regulators to do corrupt things. Right? So there's just all these ways in which technology is just like making a more efficient solution for what is enforcing civil liberties.
Can you mention one or two of the things that you guys have done on the security side in the last year? You had something to do with the Maduro raid, right?
Was that sort of, I think it's kind of... I founded the company 23 years ago. I've been running it for a long time and you know, Palantir, I think one thing that it's public that Palantir is doing is this is like Palantir has run a lot of the targeting systems for the US government for a very long time and is helping deploy AI through there. So I think it's public that Anthropic was deployed via Palantir. Palantir has all the frameworks and all the tools and all the ontology and stuff and then the LLM underneath powering it and whatnot was Anthropic and that combination was able to help people iterate and figure out what's going on. So just imagine, I can't give you the exact, but imagine like Israel hacked all of the cameras to watch what's going on in like Tehran or something and then they also broke into maybe companies doing logistics and they have all the data for what shipped where and maybe they have other sources of data as well to kind of give a sense of who people are and what they're doing. You can bring all of that data in, use Palantir's ontology, use Anthropic, and then help figure out, oh wait a second, based on everything going here, this is clearly a missile storage facility that's 300 miles outside of Tehran. Wait a second. Based on this, this is probably where these bad guys are all, I call them bad guys. I don't feel like that. They are bad guys. Like this is where they're all meeting.
They're not great people usually.
They're really bad guys. Really bad people.
Everyone's afraid to say bad guys now, but there are bad guys. Good guys.
People in the West just don't understand how bad these guys are.
They just executed another guy who's like a father of twins for owning a Starlink, which I feel very guilty about because a lot of my friends and I sponsored trying to give Starlinks to help the counter, you know, the revolution movement inside there. But it's, and they're doing horrible things. But yes. So, so, so, so, so Palantir is public, was used to take all the data and help. Now, it's not like Palantir's making the final decision. Like, there's people making decisions. I get all these trolls online like, 'You killed a girls' school.' Like, no. Palantir and Anthropic together helped get all the data, helped. Now, there might have been some case where there was a mistake made where there was a fake radar and this is with the Palestinianism sort of thing where they get you to attack innocents, which is terrible.
Yeah. Yeah. So, all right. So, now you, that's the military side of this thing. Can you give me an example of how it's used sort of on the fraud side of things?
Yeah. Well, I mean it's analogous, that was the original DNA, right? Is you get all the data together and you figure out what's going on. So, you know, I think FDA, there's lots of SNAP benefits they give out and there's all sorts of things they're working with and then some of the data might go through NGOs and then the NGO data might be in Treasury. So you need to have somebody that hooks up and talks to IRS and Treasury about what the NGOs are reporting and then see what the SNAP data says you're supposed to be giving based on what they're doing and then see if it matches and see if it's legit or not. One I'm really excited about right now is hopefully doing that with like CMS with Medicaid because a lot of the Democrats hooked up all these NGOs to the most, the most money in the country is in medical healthcare entitlements. And so they hooked up hundreds of billion plus to their NGOs, to their friends, right? We saw this, this is public. Like the California Democratic leaders got $20 billion for their green NGOs that, you know, Georgia, Stacey Abrams got what, $2 billion to give out free appliances to inner city. This is the whole thing's a joke, right? It's all just like money laundering to their friends. And so, and they got addicted to this money from the Obama administration. That's when they first started doing this.
And so now you say, so they're addicted to the money. They want as much as possible. What's the most money in government? It's healthcare entitlements, right? That's by far the most money in government. So of course they start hooking up some of like, you know, Medicare, Medicaid to the NGOs. And then I think we have to like watch all the data at the NGOs really carefully with using Treasury, see the data at CMS for like what they said they were supposed to be doing. You're going to find tons of fraud there.
Okay, so let's back up for a second. So let's say we get a more peaceful world and we get some of the fraud out and via AI people, the mundane tasks that people don't want to do so often are taken care of and they can still find some dignity and work there's still something they're doing, but we've taken care of most of those things and we're basically feeling safe and we have a more functional government. What do you think that actually looks like as a society? It's almost hard to envision if things really were better.
We just build so many cool things. And by the way, most of Palantir's revenue is commercial now. It's helping companies build things, helping supply chains. I'll give you an example I love separately in Palantir. So, Joby Aviation, you're probably following a little bit. It's the electric vertical takeoff and landing. Trump administration approved 12 states for this year. We're going to be flying people around, testing it. So it's real. It's happening. It's great. It's going forward. These are some of like the best airplane designers in the world because this company is so exciting and you know, JoeBen Bevirt runs it, just is a whiz. So people there used to do things in aerospace. It took three months to redo an airplane design. Now with AI you're doing it in an afternoon. And so I think what a lot of people don't realize, so this company for example already has flown and tested hydrogen fuel cell powered flight which is like six times more efficient per weight overall if you look at the conversion and the lightness which is, and it's perfectly safe and so this is just a much better version of fuel we're going to use for airplanes and then they've already started testing like way more efficient planes. So, and stepping back just all this stuff that would have been like the 2030s, 2040s, 2050s, it's all being accelerated into the next few years.
So, what do you think that does to us as humans? Like if, and on top of longevity stuff and that AI medical reasons that we're going to live longer.
Things are just going to be, it's like things are just going to start growing again. Like for since 1970s, our planes haven't gotten that much better. It's been annoying. We've kind of been stuck in this like lawyer-dominated, like kind of just sclerotic kind of civilization that's like slowly crumbling and we can't build things. We're going to start building things again. It's going to be great. It's going, I think it just breaks the woke right. It breaks the left because people are just going to be part of a civilization that's working and they're going to be positive because it's just going to be growing. Do you think that cyclical thing, I mean you sort of referenced this, but that the cyclical thing is just, it's baked into human society sort of that it gets good and it gets bad and it gets good and it gets bad. Do you think there's like any way around that? Can you really run one that goes for a longer period of time?
There's always going to be some cycles. I think we had a lot of self-owns. I think the fiat currency thing in the early '70s is bad. There's something about how we empowered lawyers that's not necessarily great. There's just, there's all this stuff that seemed to happen in the early '70s that really made the returns go to capital instead of to labor, which is not what you want. I mean, I have a lot of capital. I like the capital gets returns. I think it screws up our culture. Yeah. And our society when labor is like, I think when you print too much money, right, it's like not fair to labor in terms of that. So, I think there's all these things we did that were just...
were just kind of broke and made it more bureaucratic starting in the 70s. And I think this new AI wave should allow us to break out of that if we fight really hard and don't let the left take over. How is this also going to affect education? Because I know you care an awful lot about education. You're doing the thing with your wife, but also you've been integrally involved in University of Austin.
I'm the founding chairman there.
Yeah. And I spoke there and it was only a few months after speaking at Oxford doing an Oxford debate which is thought of as you know the world's best debate. And I'm not blowing smoke up here, but I was so much more impressed with the students that you guys had there than Oxford. It was completely night and day. I mean 180 opposite. Those kids were so impressive. The question during the Q&A, you remember it was like they asked some really hard questions and they were poking and prying and sitting with them after and it was very very different than what I experienced at Oxford.
We have some, I appreciate that, we have amazing students. University of Austin, and think about it. You have to have really high scores to go there and you have to be the sort of person that's opting in to go to a new university. Most people are too afraid to do that. So by default you're surrounded by awesome entrepreneurs who have the courage to go to something new. Now, whenever there's something new, there's going to be a few weird people. There's going to be things that are wrong. There's a bunch of geniuses there, though. And it's cool. It's about half STEM, half philosophically minded, you know, kind of literature, classically minded people. And we're actually just finishing the STEM building next to the Boring Company in Austin. I built this thing out for like robotics, mechanical engineering, and the SpaceX and Boring Company guys are helping us. It's really cool.
So, you're doing something underground, I assume.
I got to do a tunnel that comes from next door. I'm obsessed with the tunnels. They're way cooler than...
Yeah. What's going on with the tunnels? I mean...
Vegas is opening up even more. It's already open, but a bunch more is opening the next month or two. You're going to be able to go from the airport to all your favorite hotels. Yeah. It's, they're crushing it.
Is it weird that we thought that the future was going to be all the flying, you know, Peter always says they promised us flying cars. We got, you know, widgets on the phone or something, but like we thought it was all going to be up there and that but actually so much of it is happening underground.
At scale. It's just Elon's right. Like at scale, tunnels are just much more efficient for everyone. It gets through the traffic. I'll still be flying the Jobys. We'll do both. We do both in Austin.
Yeah. Yeah. Yeah. You're going to have a couple of those. That's where you're going to see that. You're going to fly that thing to your basketball.
It's like an Uber. It's like an Uber, though. You just press a button. It'll come. You can have it, too.
Just live in a red state. If you're in a blue state, that's going to take longer, I think. We'll see. Although the New York digits test one. We'll see.
Well, all right. So, let's dive in on that. So, obviously you're in Texas. We're here in Florida now. Yeah. We're watching Cali and New York disintegrate on a million. Well, first off, do you grade either one of them better or worse than the other, or do you think they're like their sort of level of degradation is comparable?
You're also a hell of a tequila drinker, my friend.
Oh, this is good. Yeah. All right. All right. That's...
I am mostly Irish on my father's.
Yeah. Three of these. We'll find out what you really think. Okay.
