Jul 16, 2024 · 1h 31m · a16z
Trump Vs. Biden: Tech Policy
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of 'The Ben & Marc Show,' venture capitalists Ben Horowitz and Marc Andreessen explain their decision to endorse Donald Trump over Joe Biden for the 2024 U.S. presidential election, citing the existential threats that current federal regulations, anti-tech antitrust policies, and proposed unrealized capital gains taxes pose to American startups and technological dominance.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. How this is scored →
The host as informed peer 0.0 Guest teaching 0.0 Guest disagreement 2.7 The host pushing back 0.0
speaking balance: gold is the host, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 1:10:20 Rejection of Unrealized Capital Gains Tax Proposal
Marc forcefully rejects the administration's unrealized capital gains tax proposal, calling its marketing dishonest and its structure destructive to venture capital.
Hardest push from the host ▶ 18:42 Pushback Against Monopoly Innovation ThesisMarc directly challenges Peter Thiel's framing that monopolies drive innovation, counter-arguing that monopolies stop innovating because they lack pressure.
Biggest teaching moment ▶ 45:30 Explaining Moore's Law vs FLOPS LimitsMarc breaks down why static compute FLOPS thresholds fail to account for hardware deflation, using the Sony PlayStation export control history as an example.
The host holds their own ▶ 50:25 Technical Breakdown of AI Math ModelsMarc demonstrates deep technical expertise by reducing AI foundation models to linear algebra and gradient descent algorithms taught in standard university courses.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | The host as informed peer | Guest teaching | Guest disagreement | The host pushing back | Why |
|---|---|---|---|---|---|---|
| The Little Tech Agenda and Bipartisan Engagement | 0 | 0 | 1 | 0 | Ben and Marc set up the podcast premise, explaining their non-partisan engagement with Washington figures on behalf of startup tech. | |
| Marc Andreessen's Political History and Evolution | 0 | 0 | 1 | 0 | Marc outlines his political history from supporting Clinton, Gore, and Obama to seeing tech animus emerge in recent political factions. | |
| Ben Horowitz's Background and the Strategic Power Triangle | 0 | 0 | 1 | 0 | Ben shares his left-wing family background while Marc details the strategic triangle connecting technology, economic growth, and military supremacy. | |
| Why Startups Drive Innovation Over Monopolies | 0 | 0 | 2 | 0 | Marc pushes back on Peter Thiel's thesis that monopolies foster innovation, arguing startups drive crucial technological breakthroughs. | |
| The Biden Administration's Hostility Toward Blockchain and Crypto | 0 | 0 | 3 | 0 | Ben details the technical promise of blockchain and criticizes SEC and FDIC regulatory actions against crypto startups. | |
| Blocked Access in Washington vs. Trump's Crypto Platform | 0 | 0 | 4 | 0 | Marc contrasts refused meetings with current regulators against Donald Trump's explicit inclusion of pro-crypto policies in the RNC platform. | |
| The AI Landscape, National Security, and Flawed Compute Limits | 0 | 0 | 3 | 0 | Ben and Marc discuss AI's strategic national security role and criticize executive order compute thresholds like 10 to the 26th FLOPS. | |
| Moore's Law, the AI Cartel, and Government Overreach | 0 | 0 | 4 | 0 | Marc argues compute limits create an incumbent AI cartel by ignoring standard hardware cost deflation driven by Moore's Law. | |
| Comparing Trump and Biden's Approaches to AI Regulation | 0 | 0 | 4 | 0 | Ben recounts a White House meeting where officials asserted authority to classify mathematics, contrasting this with Trump's deregulatory approach. | |
| Stifling Biotech Innovation and FTC Merger Roadblocks | 0 | 0 | 3 | 0 | Ben shares how FTC merger interventions blocked rare disease drug monetization, while Marc addresses defense technology acquisition barriers. | |
| Distinction Between Tax Rates and Tax Structure | 0 | 0 | 2 | 0 | Marc separates arguments over marginal tax rates from structural tax changes that disincentivize long-term capital creation. | |
| Critique of the Proposed Unrealized Capital Gains Tax | 0 | 0 | 5 | 0 | Marc offers an energetic refutation of proposed unrealized capital gains taxes, arguing they would systematically eliminate venture capital. | |
| Dot-Com Era Lessons and California Tax Impact | 0 | 0 | 3 | 0 | Ben recalls dot-com AMT tax disasters, while Marc explains how damaging capital gains incentives would destroy California's tax base. | |
| Historical Tax Creep and Broader Economic Risks | 0 | 0 | 3 | 0 | Marc warns that tax structures marketed toward high net-worth individuals historically expand downward over time to broader segments. | |
| Venture Capitalists Endorse Donald Trump for Technology Policy | 0 | 0 | 2 | 0 | Ben formally states their support for Donald Trump on tech policy and both reflect on Trump's reaction during the assassination attempt. | |
| Historic Bipartisanship vs Current Anti-Tech Regulatory Drift | 0 | 0 | 2 | 0 | Marc emphasizes that current anti-tech regulatory trends are optional choices not required for a successful presidency. |
Statements from this episode (43)
Horowitz: Donald Trump is the right choice for startups and Little Tech
“For a little tech we think Donald Trump is actually the right choice”
Horowitz: a16z met with Trump and White House, but Biden declined
“Mark mentioned we met with President Trump. We did meet with White House, many White House officials including Jeff Zeitz, the Chief of Staff and Jake Sullivan, the National Security Advisor, Gina Raimondo, the Commerce Secretary, and so forth. We have not met…”
Horowitz: a16z donates heavily to both Democratic and Republican parties
“And on that agenda we're pretty bipartisan in that we've donated a lot of money to both sides of the aisle.”
Andreessen: I supported Clinton in 1996, Gore in 2000, and Kerry
“I actually supported politically supported Clinton in, in 96. I supported Gore in 2000. And you know, at the time was very, very disappointed when he lost. And then you know, kind of through all of that, I also knew Senator Kerry, John Kerry, and supported him…”
Andreessen: Democratic presidential candidates in the 1990s were pro-tech and pro-startup
“The Democrats in those days you know, presidential, the presidential level were pro-business, they were pro-tech, they were pro-startup they were pro-America winning in, in, in tech markets they were pro-entrepreneurship,”
Andreessen: Military dominance requires leading both tech and the economy
“You can only have the world's leading military if you're the world's leading technology power and you're the world's leading economy.”
Andreessen: Capitalist flaws are ten times worse under communism
“Any criticism that can be leveled against the capitalist society or economy you can just 10 X it. And you know, whatever it is, whether it's environmental damage or quality of life or whatever, it's just worse under communism.”
Andreessen: Monopolies stop innovating and destroy innovation
“Monopolies stop innovating. Monopolies are just death to innovation because as you like to say, the motto of any monopoly is we don't I don't care because we don't have to.”
Andreessen: Google shelved 2017 transformer breakthrough until startups forced its hand
“Google invented the transformer in 2017 and then put it on a shelf. And then startups came in and sort of picked up that idea and ran with it, OpenAI and now Anthropic and others and many others now. And then as a consequence, Google has now been forced to rea…”
Horowitz: The SEC has sued over 30 a16z portfolio companies
“So they've sued, I think, over 30 of our companies.”
Horowitz: a16z never saw private company Wells Notices before crypto crackdown
“They've issued Wells Notices, which in our whole career we never saw a Wells Notice, which is kind of a form of a, of an SEC declaring they're investigating and going after a company for any private company, and these are all private companies.”
Horowitz: Worldcoin launched globally except in the U.S. due to regulations
“And they have launched their product everywhere in the world except the United States, because the United States of these, of this behavior and these laws”
Horowitz: Half of Buenos Aires residents frequently use Worldcoin
“It's something that half of the citizens of Buenos Aires use on a frequent basis, so, like, it's a really great, useful, important product that, you know, can make everybody's lives better, and we've just outlawed it in the United States, and it is you know, j…”
Horowitz: Elizabeth Warren is the only senator refusing to meet with a16z
“Elizabeth Warren, who refuses, similarly refuses to meet with us. The only senator who has refused to meet with us.”
Horowitz: The Biden administration subverted the rule of law to attack crypto
“They've basically subverted the rule of law to attack The crypto industry.”
Andreessen: AI will drive the biggest technological economic boom in history
“It's going to be a cornerstone technology for economic growth. Like if it's allowed to play, like if it's allowed to play out the way that it should, I think it's, you know, what's going to follow is at least the equivalent of the internet boom of the 19 ninet…”
Andreessen: U.S. Department of Defense classified AI as the third offset
“The Pentagon has already classified, the Department of Defense has already classified AI and autonomy as what they call the third offset, which means basically the cornerstone technology for the next generation of there have only been three offsets in the hist…”
Horowitz: Gina Raimondo and Jake Sullivan are fantastic on AI policy
“By the way, Gina Raimondo has been absolutely fantastic on her thinking on AI policy, how it relates to China and CFIUS and so forth, you know, as has Jake Sullivan, the National Security Advisor.”
Horowitz: Proposed federal compute limits threaten rapidly growing foundation model startups
“For little tech, which is, by the way, you know, everything that we've invested in foundation, not everything, but almost everything is growing incredibly fast and doing incredibly well, and these will be snuffed out by this kind of regulation.”
Andreessen: Andrej Karpathy's open-source GPT-2 costs under $100 to train
“And Andre Karpathy, who was a co-founder of OpenAI, who has left, actually now has an open source version of GPT-II where you can train your own GPT-II from scratch for less than 100 dollars in compute costs.”
Andreessen: GPT-2 scale AI models will run on smartphones within five years
“I think within five years, you're going to have models of this size on your phone.”
Andreessen: Proposed AI compute limits will entrench monopolies and destroy startups
“And so basically the regime that, you know, the government is threatening to put in place right now is going to, you know, by using this limit, they're going to basically enshrine the two or three companies that they believe are the only companies that matter …”
Horowitz: Nobody has built AI technology that is on the way to sentience
“Nobody has built anything anywhere that's on the way to sentience”
Andreessen: AI regulation should happen at the application level, not technology level
“The regulation should happen at the application level, not at the technology level.”
Andreessen: White House officials claimed they could classify math to control AI
“And literally this was, this is verbatim. This is we did, we classified a whole entire areas of physics in the nuclear era and made them state secret. Like, of the, like, theoretical physics, science physics. We classified them and made them state secrets and …”
Horowitz: Venture capital cannot fund rare disease cures due to $1B costs
“One of the things that's almost impossible to do from a venture capital standpoint is cure rare disease, because it costs a billion dollars to bring a drug to market, and then they don't all work, so, you know, multiply that. And there just aren't that many, i…”
Horowitz: Biden administration sued to block a16z portfolio's Sanofi drug deal
“We have a company with an incredible drug platform. They cured. A rare disease, like past phase one clinical trials, carried it, sell the drug to Sanofi because, you know, so they can get some of the money back to develop more things, and the Biden administrat…”
Andreessen: Defense prime contractors function primarily as political lobbying operations
“The whole industry is consolidated down to a small number of very large companies that are basically, basically they're large scale political lobbying operations.”
Andreessen: Proposed AI regulations will harm AI defense and intelligence startups
“The AI regulatory framework that's being threatened right now. You know, it's gonna directly hit the ability for you know, to do AI based defense and intelligence startups.”
Andreessen: German manufacturers are shutting down due to domestic energy shortages
“They're completely dependent on the Russians and they're actually de-industrializing. Like there are plants, you know, there are large German manufacturers who are shutting down right now because they literally Can I get energy?”
Horowitz: Nuclear energy is clean and far safer than coal or oil
“Nuclear is super clean. The new nuclear technology is extremely safe. I mean, the, and even the old technology is very safe compared to oil which is really kind of the alternative or coal”
Horowitz: Capital gains tax rates directly impact the affordable housing supply
“So if you're building new, we have a huge homeless problem. So You know, we want to be careful about, you know, people who build buildings and what they pay on these capital gains rates because it's going to affect how many kind of, how much affordable housing…”
Andreessen: Biden's proposed unrealized gains tax starts at a $100M threshold
“So it is a threshold of a hundred million dollars.”
Andreessen: Biden tax proposal calculates startup valuation using last round valuation
“In the black and white of the tax proposal, what they say is that the valuation of the startup for the purpose of calculating the gain is the greater of a number of options, but the, specifically the last round valuation.”
Andreessen: Venture capital will end under Biden's proposed unrealized gains tax
“And then number two, venture capital just ends. It's just over. Like firms like ours just like don't exist.”
Horowitz: Tow trucks repossessed Cisco employees' cars after dot-com tax debts
“And one of the things, so Cisco, which is probably the most stable, like monotonically increasing company in the industry a lot of the employees did something called exercise their option to convert them to capital gains. And when you do that, you're subject t…”
Andreessen: Top 1,000 taxpayers account for half of peak California tax revenue
“In the peak years up to half of total tax receipts for the state of California come from the top thousand individual taxpayers. Which is basically all tech.”
Andreessen: Proposed 25% unrealized capital gains tax rate will inevitably rise
“If this starts at a 25% annual unrealized capital gains tax, it's not going to stay at 25%. It's going to walk up.”
Andreessen: Unrealized gains tax threshold will drop to hit startup workers
“Inevitably this, the threshold is going to walk down and it's going to end. You just tell what's going to happen. It's going to go to 50 and then 20 and then five million and then one million. It's going to walk all the way down and it's going to hit, number o…”
Horowitz: A radical faction controls the Biden administration's tech policies
“These policies are from kind of the radical side, which is, you know, like it's a significant side of the Biden administration but it is, it's a powerful side, and they really are in charge I would say, you know, kind of much more than the moderates.”
Andreessen: Ben Horowitz and I had a three-hour dinner with Donald Trump
“Ben and I had dinner with the former president 10 days ago at Bedminster his golf club in New Jersey and had a three hour dinner.”