Lex Fridman Podcast - #239 - Niall Ferguson: History of Money, Power, War, and Truth

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The following is a conversation with Neil Ferguson,

one of the great historians of our time,

at times controversial and always brilliant,

whether you agree with him or not.

He’s an author of 16 books on topics covering

the history of money, power, war, pandemics, and empire.

Previously at Harvard, currently at Stanford,

and today launching a new university here in Austin, Texas

called the University of Austin,

a new institution built from the ground up

to encourage open inquiry and discourse

by both thinkers and doers,

from philosophers and historians

to scientists and engineers,

embracing debate, dissent, and self examination,

free to speak, to disagree, to think,

to explore truly novel ideas.

The advisory board includes Steven Pinker, Jonathan Haidt,

and many other amazing people with one exception, me.

I was graciously invited to be on the advisory board,

which I accepted in the hope of doing my small part

in helping build the future of education and open discourse,

especially in the fields of artificial intelligence,

robotics, and computing.

We spend the first hour of this conversation

talking about this new university

before switching to talking about

some of the darkest moments in human history

and what they reveal about human nature.

This is the Lex Friedman podcast.

To support it, please check out our sponsors

in the description.

And now, here’s my conversation with Neil Ferguson.

You are one of the great historians of our time,

respected, sometimes controversial.

You have flourished in some of the best universities

in the world, from NYU to London School of Economics,

to Harvard, and now to Hoover Institution at Stanford.

Before we talk about the history of money, war, and power,

let us talk about a new university.

You’re a part of launching here in Austin, Texas.

It is called University of Austin, UATX.

What is its mission, its goals, its plan?

I think it’s pretty obvious to a lot of people

in higher education that there’s a problem.

And that problem manifests itself

in a great many different ways.

But I would sum up the problem

as being a drastic chilling of the atmosphere

that constrains free speech, free exchange,

even free thought.

And I had never anticipated

that this would happen in my lifetime.

My academic career began in Oxford in the 1980s

when anything went.

One sensed that a university was a place

where one could risk saying the unsayable

and debate the undebatable.

So the fact that in a relatively short space of time,

a variety of ideas, critical race theory or wokeism,

whatever you want to call it,

a variety of ideas have come along

that seek to limit and quite drastically limit

what we can talk about strikes me as deeply unhealthy.

And I’m not sure, and I’ve thought about this

for a long time, you can fix it

with the existing institutions.

I think you need to create a new one.

And so after much deliberation,

we decided to do it.

And I think it’s a hugely timely opportunity

to do what people used to do in this country,

which was to create new institutions.

I mean, that used to be the default setting of America.

We sort of stopped doing that.

I mean, I look back and I thought,

why are there no new universities?

Or at least if there are,

why do they have so little impact?

It seems like we have the billionaires,

we have the need, let’s do it.

So you still believe in institutions,

in the university, in the ideal of the university?

I believe passionately in that ideal.

There’s a reason they’ve been around for nearly a millennium.

There is a unique thing that happens

on a university campus when it’s done right.

And that is the transfer of knowledge between generations.

That is a very sacred activity.

And it seems to withstand major changes in technology.

So this form that we call the university predates

the printing press, survive the printing press,

continue to function through the scientific revolution,

the enlightenment, the industrial revolution to this day.

And I think it’s because,

maybe because of evolutionary psychology,

we need to be together in one relatively confined space

when we’re in our late teens and early twenties

for the knowledge transfer between the generations

to happen.

That’s my feeling about this,

but in order for it to work well,

there needs to be very few constraints.

There needs to be a sense

that one can take intellectual risk.

Remember, people in their late teens and early twenties

are adults, but they’re inexperienced adults.

And if I look back on my own time as an undergraduate,

saying stupid things was my MO.

My way to finding good ideas

was through a minefield of bad ideas.

I feel so sorry for people like me today,

people age 18, 19, 20 today,

who are intellectually very curious

ambitious, but inexperienced

because the minefields today are absolutely lethal.

And one wrong foot and it’s cancellation.

I said this to Peter Thiel the other day,

imagine being us now.

I mean, we were obnoxious undergraduates.

There’s nothing that Peter did at Stanford

that Andrew Sullivan and I were not doing at Oxford.

And perhaps we were even worse,

but it was so not career ending

to be an absolutely insufferable,

obnoxious undergraduate then.

Today, if people like us exist today,

they must live in a state of constant anxiety

that they’re going to be outed for some heretical statement

that they made five years ago on social media.

So part of what motivates me

is the desire to give the me’s of today a shot

at free thinking and really,

I’d call it aggressive learning,

learning where you’re really pushed.

And I just think that stopped happening

on the major campuses because whether at Harvard

where I used to teach or at Stanford where I’m now based,

I sense a kind of suffocating atmosphere of self censorship

that means people are afraid

to take even minimal risk in class.

I mean, just take, for example,

a survey that was published earlier this year

that revealed this is of undergraduates

in four year programs in the US.

85% of self described liberal students

said they would report a professor

to the university administration

if he or she said something they considered offensive.

And something like 75% said they do it

to a fellow undergraduate.

That’s the kind of culture

that’s evolved in our universities.

So we need a new university in which none of that is true,

in which you can speak your mind, say stupid things,

get it completely wrong and live to tell the tale.

There’s a lot more going on, I think,

because when you start thinking about

what’s wrong with a modern university,

many, many more things suggest themselves.

And I think there’s an opportunity here

to build something that’s radically new in some ways

and radically traditional in other ways.

For example, I have a strong preference

for the tutorial system that you see at Oxford and Cambridge,

which is small group teaching

and highly Socratic in its structure.

I think it’d be great to bring that to the United States

where it doesn’t really exist.

But at the same time,

I think we should be doing some very 21st century things,

making sure that while people are reading and studying

classic works, they’re also going to be immersed

in the real world of technological innovation,

a world that you know very well.

And I’d love to get a synthesis of the ancient and classical,

which we’re gradually letting fade away

with the novel and technological.

So we wanna produce people who can simultaneously

talk intelligently about Adam Smith,

or for that matter, Shakespeare or Proust,

and have a conversation with you about where AI is going

and how long it will be before I can get driven here

by a self driving vehicle,

allowing me to have my lunch and prepare

rather than focus on the other crazy people on the road.

So that’s the dream that we can create something

which is partly classical and partly 21st century.

And we look around and we don’t see it.

If you don’t see an institution

that you really think should exist,

I think you have a more responsibility to create it.

So you’re thinking including something bigger

than just liberal education,

also including science, engineering and technology.

I should also comment that I mostly stay out of politics

and out of some of these aspects of liberal education

that’s kind of been the most controversial

and difficult within the university.

But there is a kind of ripple effect of fear

within that space into science and engineering

and technology that I think has a nature

that’s difficult to describe.

It doesn’t have a controversial nature.

It just has a nature of fear

where you’re not, you mentioned saying stupid stuff

as a young 20 year old.

For example, deep learning, machine learning

is really popular in the computer science now

as an approach for creating artificial intelligence systems.

It is controversial in that space

to say that anything against machine learning,

saying, sort of exploring ideas that saying

this is going to lead to a dead end.

Now, that takes some guts to do as a young 20 year old

within a classroom to think like that,

to raise that question in a machine learning course.

It sounds ridiculous because it’s like

who’s going to complain about this?

But the fear that starts in a course on history

or on some course that covers society,

the fear ripples and affects those students

that are asking big out of the box questions

about engineering, about computer science.

And there’s a lot, there’s like linear algebra

that’s not going to change,

but then there’s like applied linear algebra,

which is machine learning.

And that’s when robots and real systems touch human beings.

And that’s when you have to ask yourself

these difficult questions about humanity,

even in the engineering and science and technology courses.

And these are not separate worlds in two senses.

I’ve just taken delivery of my copy of the book

that Eric Schmidt and Henry Kissinger have coauthored

on artificial intelligence,

the central question of which is,

what does this mean for us broadly?

But they’re not separate worlds in C.P. Snow’s sense

of the chasm between science and arts,

because on a university campus,

everything is contagious from a novel coronavirus

to the behaviors that are occurring

in the English department.

Those behaviors, if denunciation becomes a norm,

undergraduate denounces professor,

teaching assistant denounces undergraduate,

those behaviors are contagious

and will spread inextricably first to social science

and then to natural sciences.

And I think that’s part of the reason why

when this started to happen,

when we started to get the origins of disinvitation

and cancel culture,

it was not just a few conservative professors

in the humanities who had to worry,

everybody had to worry,

because eventually it was going to come

even to the most apparently hard stem part of the campus.

It’s contagious.

This is something Nicholas Christakis should look at

because he’s very good at looking at the way

in which social networks like the ones that exist

in a university can spread everything.

But I think when we look back and ask,

why did wokeism spread so rapidly

and rapidly out of humanities

into other parts of universities?

And why did it spread across the country

and beyond the United States

to the other English speaking universities?

It’s because it’s a contagion.

And these behaviors are contagious.

The president of a university I won’t name said to me

that he receives every day at least one denunciation,

one call for somebody or other to be fired

for something that they said.

That’s the crazy kind of totalitarianism light

that now exists in our universities.

And of course the people who want to downplay this say,

oh, well, there only have been a hundred and something

in disinvitations or,

oh, there really aren’t that many cases.

But the point is that the famous events,

the events that get the attention

are responsible for a general chilling

that as you say, spreads to every part of the university

and creates a very familiar culture

in which people are afraid to say what they think.

Self censorship, look at the heterodox academy data on this

grows and grows.

So now a majority of students will say,

this is clear from the latest heterodox academy surveys,

we are scared to say what we think

in case we get denounced, in case we get canceled.

But that’s just not the correct atmosphere

for a university in a free society.

To me, what’s really creepy

is how many of the behaviors I see

on university campuses today are reminiscent

of the way that people used to behave in the Soviet Union

or in the Soviet block or in Maoist China.

The sort of totalitarianism light

that I think we’re contending with here,

which manifests itself as denunciations,

people informing on superiors.

Some people using it for career advantage.

Other people reduced to helpless desperate apology

to try to exonerate themselves.

People disappearing metaphorically, if not literally.

All of this is so reminiscent of the totalitarian regimes

that I studied earlier in my career

that it makes me feel sick.

And what makes me really feel sick

is that the people doing this stuff,

the people who write the letters of denunciation

are apparently unaware that they’re behaving exactly

like people in Stalin’s Soviet Union.

They don’t know that.

So they clearly have,

there’s been a massive educational failure.

If somebody can write an anonymous

or non anonymous letter of denunciation and not feel shame.

I mean, you should feel morally completely contaminated

as you’re doing that, but people haven’t been taught

the realities of totalitarianism.

For all these reasons, I think you need to try

at least to create a new institution

where those pathologies will be structurally excluded.

So maybe a difficult question.

Maybe you’ll push back on this,

but you’re widely seen politically as a conservative.

Hoover Institution is politically conservative.

What is the role of politics at the University of Austin?

Because some of the ideas, people listening to this,

when they hear the ideas you’re expressing,

they may think there’s a lean to these ideas.

There’s a conservative lean to these ideas.

Is there such a lean?

There will certainly be people who say that

because the standard mode of trying to discredit

any new initiative is to say,

oh, this is a sinister conservative plot.

But one of our cofounders, Heather Heying,

is definitely not a conservative.

She’s as committed to the idea of academic freedom as I am.

But I think on political issues,

we probably agree on almost nothing.

And at least I would guess.

But politics, Max Weber made this point a long time ago,

that politics really should stop at the threshold

of the classroom, of the lecture hall.

And in my career, I’ve always tried to make sure

that when I’m teaching,

it’s not clear where I stand politically,

though of course undergraduates

insatiably curiously want to know,

but it shouldn’t be clear from what I say

because indoctrination on a political basis

is an abuse of the power of the professor,

as Weber rightly said.

So I think one of the key principles

of the University of Austin will be

that Weberian principle that politics

is not an appropriate subject

for the lecture hall, for the classroom.

And we should pursue truth

and enshrine liberty of thought.

If that’s a political issue, then I can’t help you.

I mean, if you’re against freedom of thought,

then we don’t really have much of a discussion to have.

And clearly there are some people

who politically seem quite hostile to it.

But my sense is that there are plenty

of people on the left in academia.

I think of that interesting partnership

between Cornel West and Robbie George,

which has been institutionalized in the Academic Freedom Alliance.

It’s bipartisan, this issue.

It really, really is.

After all, 50 years ago, it was the left

that was in favor of free speech.

The right still has an anti free speech element to it.

Look how quickly they’re out to ban critical race theory.

Critical race theory won’t be banned

at the University of Texas.

Wokism won’t be banned.

Everything will be up for discussion,

but the rules of engagement will be clear.

Chicago principles, those will be enforced.

And if you have to give a lecture on,

well, let’s just take a recent example,

the Dorian Abbott case.

If you’re giving a lecture on astrophysics,

but it turns out that in some different venue

you express skepticism about affirmative action,

well, it doesn’t matter.

It’s irrelevant.

We want to know what your thoughts are on astrophysics

cause that’s what you’re supposed to be giving a lecture on.

That used to be understood.

I mean, at the Oxford of the 1980s,

there were communists and there were ultra Tories.

At Cambridge, there were people who were so reactionary

that they celebrated Franco’s birthday,

but they were also out and out communists

down the road at King’s College.

The understanding was that that kind of intellectual diversity

was part and parcel of university life.

And frankly, for an undergraduate,

it was great fun to cross the road

and go from outright conservatism,

ultra Torism to communism.

One learns a lot that way.

But the issue is when you’re promoting

or hiring or tenuring people,

their politics is not relevant.

It really isn’t.

And when it started to become relevant,

and I remember this coming up

at the Harvard history department late in my time there,

I felt deeply, deeply uneasy

that we were having conversations

that amounted to, well, we can’t hire X person

despite their obvious academic qualifications

because of some political issue.

That’s not what should happen at a healthy university.

Some practical questions.

Will University of Austin be a physical in person university

or virtual university?

What are some in that aspect where the classroom is?

It will be a real space institution.

There may be an online dimension to it

because there clearly are a lot of things

that you can do via the internet.

But the core activity of teaching and learning

I think requires real space.

And I’ve thought about this a long time,

debated Sebastian Thrun about this many, many years ago

when he was a complete believer in,

let’s call it the metaversity to go with the metaverse.

I mean, the metaversity was going to happen, wasn’t it?

But I never really believed in the metaversity.

I didn’t do MOOCs because I just didn’t think you’d,

A, be able to retain the attention,

B, be able to cope with the scaled grading that was involved.

I think there’s a reason universities have been around

in their form for about a millennium.

You kind of need to all be in the same place.

So I think answer to that question

definitely a campus in the Austin area.

That’s where we’ll start.

And if we can allow some of our content

to be available online, great, we’ll certainly do that.

Another question is what kind of courses

and programming will it offer?

Is that something you can speak to?

What’s your vision here?

We think that we need to begin more like a startup

than like a full service university from day one.

So our vision is that we start with a summer school,

which will offer provocatively the forbidden courses.

We want, I think, to begin by giving a platform

to the professors who’ve been most subject

to council culture and also to give an opportunity

to students who want to hear them to come.

So we’ll start with a summer school

that will be somewhat in the tradition

of those institutions in the interwar period

that were havens for refugees.

So we’re dealing here with the internal refugees

of the work era.

We’ll start there.

It’ll be an opportunity to test out some content,

see what students will come and spend time in Austin to hear.

So that’s part A.

That’s the sort of, if you like, the launch product.

And then we go straight to a master’s program.

I don’t think you can go to undergraduate education

right away because the established brands

in undergraduate education are offering something

it’s impossible to compete with initially

because they have the brand, Harvard, Yale, Stanford,

and they offer also this peer network,

which is part of the reason people want so badly

to go to those places, not really the professors,

it’s the classmates.

So we don’t wanna compete there initially.

Where there is, I think, room for new entrance

is in a master’s program.

And the first one will be in entrepreneurship

and leadership.

Because I think there’s a huge hunger

amongst people who want to get into,

particularly the technology world,

to learn about those things.

And they know they’re not really going to learn

about them at business schools.

The people who are not going to teach them leadership

and entrepreneurship are professors.

So we want to create something that will be a little like

the very successful Schwarzman program in China,

which was come and spend a year in China

and find out about China.

We’ll be doing the same, essentially saying,

come and spend a year and find out about technology.

And there’ll be a mix of academic content.

We want people to understand some of the first principles

of what they’re studying.

There are first principles of entrepreneurship

and leadership, but we also want them to spend time with

people like one of our cofounders, Joe Lonsdale,

who’s been a hugely successful venture capitalist

and learn directly from people like him.

So that’s the kind of initial offering.

I think there are other master’s programs

that we will look to roll out quite quickly.

I have a particular passion for a master’s

in applied history or politics in applied history.

I’m a historian driven crazy by the tendency

of academic historians to drift away from

what seemed to me the important questions

and certainly to drift away from addressing

policy relevant questions.

So I would love to be involved in a master’s

in applied history.

And we’ll build some programs like that

before we get to the full liberal arts experience

that we envisage for an undergraduate program.

And that undergraduate program is an exciting one

cause I think we can be innovative there too.

I would say two years would be spent doing

some very classical and difficult classical things,

bridging those old divides between arts and sciences.

But then there would also be in the second half

in the junior and senior years,

something somewhat more of an apprenticeship

where we’ll have centers, including a center

for technology engineering mathematics

that will be designed to help people make that transition

from the theoretical to the practical.

So that’s the vision.

And I think like any early stage idea

we’ll doubtless tweak it as we go along.

We’ll find things that work and things that don’t work.

But I have a very clear sense in my own mind

of how this should look five years from now.

And I don’t know about you.

I mean, I’m unusual as an academic

cause I quite like starting new institutions

and I’ve done a bit of it in my career.

You got to kind of know what it should look like

after the first four or five years

to get out of bed in the morning

and put up with all the kind of hassles of doing it.

Not least the inevitable flack that we were bound to take

from the educational establishment.

And I was graciously invited to be an advisor

to this University of Austin.

And the reason I would love to help

in whatever way I can is several.

So one, I would love to see Austin,

the physical location flourish intellectually

and especially in the space of science and engineering.

That’s really exciting to me.

Another reason is I am still a research scientist at MIT.

I still love MIT and I see this effort

that you’re launching as a beacon

that leads the way to the other elite institutions

in the world.

I think too many of my colleagues

and especially in robotics kind of see,

don’t see robotics as a humanities problem.

But to me, robotics and AI will define much of our world

in the next century.

And for, not to consider all the deep psychological,

sociological, human problems associated with that.

To have real open conversations, to say stupid things,

to challenge the ideas that,

of how companies are being run, for example.

That is the safe space.

It’s very difficult to talk about the different

questions about technology when you’re employed

by Facebook or Google and so on.

The university is the place to have those conversations.

That’s right, and we’re hugely excited

that you want to be one of our advisors.

We need a broad and an eclectic group of people.

And I’m excited by the way that group has developed.

It has some of the, some of my favorite intellectuals

are there, Steve Pinker,

for example, but we’re also making sure

that we have people with experience in academic leadership.

And so it’s a happy coalition of the willing,

looking to try to build something new,

which as you say, will be complimentary

to the existing and established institutions.

I think of the academic world as a network.

I’ve moved from some major hubs in the network to others,

but I’ve always felt that we do our best work,

not in a silo called Oxford, but in a silo

that is really a hub connected to Stanford,

connected to Harvard, connected to MIT.

One of the reasons I moved to the United States

was that I sensed that there was more intellectual action

in my original field of expertise, financial history.

And that was right.

It was a good move.

I think I’d have stagnated if I’d stayed at Oxford.

But at the same time, I haven’t lost connection with Oxford.

I recently went and gave a lecture there

in honor of Sir Roger Scruton,

one of the great conservative philosophers.

And the burden of my lecture was the idea

of the Anglosphere, which appealed a lot to Roger,

will go horribly wrong if illiberal ideas

that inhibit academic freedom spread

all over the Anglosphere.

And this network gets infected with these,

I think, deeply damaging notions.

So yeah, I think we’re creating a new node.

I hope it’s a node that makes the network overall

more resilient.

And right now there’s an urgent need for it.

I mean, there are people whose academic careers

have been terminated.

I’ll name two who are involved.

Peter Boghossian, who was harassed out of Portland State

for the reason that he was one of those intrepid figures

who carried out the grievance studies hoaxes,

exposing the utter charlatanry going on

in many supposedly academic journals

by getting phony gender studies articles published.

This is genius.

And of course, so put the noses out of joint

of the academic establishment

that he began to be subject to disciplinary actions.

So Peter is going to be involved.

And in a recent shocking British case,

the philosopher Kathleen Stock has essentially

been run off the campus of Sussex University in England

for violating the increasingly complex rules

about discussing transgender issues and women’s rights.

She will be one of our advisors.

And I think also one of our founding fellows

actually teaching for us in our first iteration.

So I think we’re creating a node that’s badly needed.

Those people, I mean, I remember saying this

to the other founders when we first began

to talk about this idea to Barry Weiss

and to Panna Canellos as well as to Heather Haying.

We need to do this urgently because there are people

whose livelihoods are in fact being destroyed

by these extraordinarily illiberal campaigns against them.

And so there’s no time to hang around

and come up with the perfect design.

This is an urgently needed lifeboat.

And let’s start with that.

And then we can build something spectacular

taking advantage of the fact that all of these people have,

well, they now have very real skin in the game.

They need to make this a success.

And I’m sure they will help us make it a success.

So you mentioned some interesting names

like Heather Haying, Barry Weiss, and so on.

Steven Pinker, somebody I really admire.

He too was under a lot of, quite a lot of fire.

Many reasons I admire him.

One, because of his optimism about the future.

And two, how little of a damn he seems to give

about like walking through the fire.

There’s nobody more zen about walking through the fire

than Steven Pinker.

But anyway, you mentioned a lot of interesting names,

Jonathan Haidt is also interesting there.

Who is involved with this venture at this early days?

Well, one of the things that I’m excited about

is that we’re getting people from inside and outside

the academic world.

So we’ve got Arthur Brooks, who for many years

ran the American Enterprise Institute very successfully,

has a Harvard role now teaching.

And so he’s somebody who brings, I think,

a different perspective.

There’s obviously a need to get experienced academic leaders

involved, which is why I was talking to Larry Summers

about whether he would join our board of advisors.

The Chicago principals owe a debt

to the former president of Chicago.

And he’s graciously agreed to be in the board of advisors.

I could go on.

It would become a long and tedious list.

But my goal in trying to get this happy band to form

has been to signal that it’s a bipartisan endeavor.

It is not a conservative institution

that we’re trying to build.

It’s an institution that’s committed to academic freedom

and the pursuit of truth that will mean it when it takes

Robert Zimmer’s Chicago principles

and enshrines them in its founding charter.

And we’ll make those something other than honored

in the breach, which they seem to be at some institutions.

So the idea here is to grow this organically.

We need, rather like the Academic Freedom Alliance

that Robbie George created earlier this year,

we need breadth.

And we need to show that this is not

some kind of institutionalization

of the intellectual dark web, though we

welcome founding members of that nebulous body.

It’s really something designed for all of academia

to provide a kind of reboot that I think we all agree is needed.

Is there a George Washington type figure?

Is there a president elected yet?

Or who’s going to lead this institution?

Panos Kanellos, the former president of St. John’s,

is the president of University of Austin.

And so he is our George Washington.

I don’t know who Alexander Hamilton is.

I’ll leave you to guess.

It’s funny you mentioned IDW, Intellectual Dark Web.

Have you talked to your friend Sam Harris about any of this?

He is another person I really admire

and I’ve talked to online and offline quite a bit

for not belonging to any tribe.

He stands boldly on his convictions

when he knows they’re not going to be popular.

Like he basically gets canceled by every group.

He doesn’t shy away from controversy.

And not for the sake of controversy itself,

he is one of the best examples to me

of a person who thinks freely.

I disagree with him on quite a few things,

but I deeply admire that he is what it looks

like to think freely by himself.

It feels to me like he represents

a lot of the ideals of this kind of effort.

Yes, he would be a natural fit.

Sam, if you’re listening, I hope you’re in.

I think in the course of his recent intellectual quests,

he did collide with one of our founders, Heather Haying.

So we’ll have to model civil disagreements

at the University of Austin.

It’s extremely important that we should all

disagree about many things, but do it amicably.

One of the things that has been lost sight of,

perhaps it’s all the fault of Twitter

or maybe it’s something more profound,

is that it is possible to disagree in a civil way

and still be friends.

I certainly had friends at Oxford

who were far to the left of me politically,

and they are still among my best friends.

So the University of Austin has to be a place

where we can disagree vehemently,

but we can then go and have a beer afterwards.

That’s, in my mind, a really important part

of university life, learning the difference

between the political and the personal.

So Sam is, I think, a good example, as are you,

of a certain kind of intellectual hero

who has been willing to go into the cyber sphere,

the metaverse, and carve out an intellectual space,

the podcast, and debate everything fearlessly.

His essay, it was really an essay on Black Lives Matter

and the question of police racism,

was a masterpiece of 2020.

And so he, I think, is a model of what we believe in.

But we can’t save the world with podcasts,

good though yours is,

because there’s a kind of solo element

to this form of public intellectual activity.

It’s also there in Substack,

where all our best writers now seem to be,

including our founder, Barry Weiss.

The danger with this approach is, ultimately,

your subscribers are the people who already agree with you,

and we are all, therefore,

in danger of preaching to the choir.

I think what makes an institution like University of Austin

so attractive is that we get everybody together,

at least part of the year,

and we do that informal interaction at lunch, at dinner,

that allows, in my experience, the best ideas to form.

Intellectual activity isn’t really a solo voyage.

Historians often make it seem that way,

but I’ve realized over time that I do my best work

in a collaborative way,

and scientists have been better at this

than people in the humanities.

But what really matters,

what’s magical about a good university,

is that interdisciplinary, serendipitous conversation

that happens on campus.

Tom Sargent, the great Nobel Prize winning economist and I,

used to have these kind of random conversations

in elevators at NYU or in corridors at Stanford,

and sometimes they’d be quite short conversations,

but in that short, serendipitous exchange,

I would have more intellectual stimulus

than in many a seminar lasting an hour and a half.

So I think we want to get the Sam Harris’s

and Lex Friedman’s out of their darkened rooms

and give them a chance to interact

in a much less structured way than we’ve got used to.

Again, it’s that sense that sometimes

you need some freewheeling, unstructured debate

to get the really good ideas.

I mean, to talk anecdotally for a moment,

I look back on my Oxford undergraduate experience

and I wrote a lot of essays and attended a lot of classes,

but intellectually, the most important thing I did

was to write an essay on the Viennese satirist Karl Kraus

for an undergraduate discussion group called the Canon Club.

And I probably put more work into that paper

than I put into anything else,

except maybe my final examinations,

even although there was only really one senior member

present, the historian Jeremy Cato,

I was really just trying to impress my contemporaries.

And that’s the kind of thing we want.

The great intellectual leaps forward, occurred,

often in somewhat unstructured settings.

I’m from Scotland, you can tell from my accent,

a little at least.

The enlightenment happened in late 18th century Scotland

in a very interesting interplay between the universities,

which were very important, Glasgow, Edinburgh,

St Andrews, and the coffee houses and pubs

of the Scottish cities where a lot of unstructured discussion

often fueled by copious amounts of wine took place.

That’s what I’ve missed over the last few years.

Let’s just think about how hard academic social life has become.

That we’ve reached the point that Amy Chewer

becomes the object of a full blown investigation

and media storm for inviting to Yale Law School students

over to her house to talk.

I mean, when I was at Oxford, it was regarded

as a tremendous honor to be asked

to go to one of our tutors homes.

The social life of Oxford and Cambridge

is one of their great strengths.

There’s a sort of requirement to sip

unpleasant sherry with the dons.

And we’ve kind of killed all that.

We’ve killed all that in the US because nobody

dares have a social interaction with an undergraduate

or exchange an informal email in case

the whole thing ends up on the front page of the local

or student newspaper.

So that’s what we need to kind of restore,

the social life of academia.

So there’s magic.

We didn’t really address this sort of explicitly.

But there’s magic to the interaction between students.

There’s magic in the interaction between faculty,

the people that teach.

And there’s the magic in the interaction

between the students and the faculty.

And it’s an iterative process that changes everybody involved.

So it’s like world experts in a particular discipline

are changed as much as the students,

as the 20 year olds with the wild ideas,

each are changed and that’s the magic of it.

That applies in liberal education,

that applies in the sciences too.

That’s probably maybe you can speak to this,

why so much scientific innovation

has happened in universities.

There’s something about the youthful energy

of like young minds, graduate students,

undergraduate students that inspire

some of the world experts

to do some of the best work of their lives.

Well, the human brain we know is at its most dynamic

when people are pretty young.

You know this with your background in math,

people don’t get better at math after the age of 30.

And this is important when you think about

the intergenerational character of university.

The older people, the professors have the experience,

but they’re fading intellectually

from much earlier than anybody really wants to admit.

And so you get this intellectual shot in the arm

from hanging out with people who are circa 20,

don’t know shit, but brains are kind of like cooking.

I look back on the career I’ve had in teaching,

which is over 25 years at where Cambridge, Oxford,

NYU, Harvard, and I have extremely strong relationships

with students from those institutions

because they would show up,

whether it was at office hours or in tutorials

and disagree with me.

And for me, it’s always been about encouraging

some act of intellectual rebellion,

telling people, I don’t want your essay to echo my views.

If you can find something wrong with what I wrote, great.

Or if you can find something I missed that’s new, fantastic.

So there is definitely, as you said,

a magic in that interaction across the generations.

And it’s extraordinarily difficult, I think,

for an intellectual to make the same progress

in a project in isolation

compared with the progress that can be made

in these very special communities.

What does a university do?

Amongst other things,

it creates a somewhat artificial environment

of abnormal job security,

and that’s the whole idea of giving people tenure,

and then a relatively high turnover, new faces each year,

and an institutionalization of thought experiments

and actual experiments.

And then you get everybody living

in the same kind of vicinity

so that it can spill over into 3 a.m. conversation.

Well, that always seems to me

to be a pretty potent combination.

Let’s ask ourselves a counterfactual question next.

Let’s imagine that the world wars happen,

but there are no universities.

I mean, how does the Manhattan Project happen

with no academia, to take just one of many examples?

In truth, how does Britain even stay in the war

without Bletchley Park,

without being able to crack the German cipher?

The academics are unsung, or partly sung heroes

of these conflicts.

The same is true in the Soviet Union.

The Soviet Union was a terribly evil and repressive system,

but it was good at science,

and that kept it in the game,

not only in World War II, it kept it in the Cold War.

So it’s clear that universities are incredibly powerful,

intellectual force multipliers,

and our history without them would look very different.

Sure, some innovations would have happened without them.

That’s clear.

The Industrial Revolution didn’t need universities.

In fact, they played a very marginal role

in the key technological breakthroughs

of the Industrial Revolution in its first phase.

But by the second Industrial Revolution

in the late 19th century,

German industry would not have leapt ahead

of British industry if the universities

had not been superior.

And it was the fact that the Germans institutionalised

scientific research in the way that they did

that really produced a powerful, powerful advantage.

The problem was that,

and this is a really interesting point

that Friedrich Meinlka makes in Die Deutsche Katastrophe

for the German Catastrophe,

the German intellectuals became technocrats, homo faber,

he says.

They knew a great deal about their speciality,

but they were alienated from, broadly speaking, humanism.

And that is his explanation,

or one of his explanations for why

this very scientifically advanced Germany

goes down the path of hell led by Hitler.

So when I come back and ask myself,

what is it that we want to do with a new university,

we wanna make sure that we don’t fall into that German pit

where very high levels of technical and scientific expertise

are decoupled from the fundamental foundations

of a free society.

So liberal arts are there, I think,

to stop the scientists making Faustian pacts.

And that’s why it’s really important

that people working on AI reach Shakespeare.

I think you said that academics are unsung heroes

of the 20th century.

I think there’s kind of an intellectual,

a lazy intellectual desire to kind of destroy

the academics, that the academics are the source

of all problems in the world.

And I personally believe that exactly as you said,

we need to recognize that the university

is probably where the ideas that will protect us

from the catastrophes that are looming ahead of us,

that’s where those ideas are going to come from.

People who work on economics can argue back and forth

about John Maynard Keynes.

But I think it’s pretty clear

that he was the most important economist

and certainly the most influential economist

of the 20th century.

And I think his ideas are looking better today

in the wake of the financial crisis

than they have at any time since the 1970s.

But imagine John Maynard Keynes without Cambridge,

you can’t because someone like that doesn’t actually exist

without the incredible hothouse

that a place like Cambridge was in Keynes’s life.

He was a product of a kind of hereditary

intellectual elite, it had its vices.

But you can’t help but admire the sheer power of the mind.

I’ve spent a lot of my career reading Keynes

and I revere that intellect, it’s so, so powerful.

But you can’t have people like that

if you’re not prepared to have King’s College Cambridge.

And it comes with redundancy.

I think that’s the point.

There are lots and lots of things

that are very annoying about academic life

that you just have to deal with.

They’re made fun of in that recent Netflix series,

The Chair.

And it is easy to make fun of academic life.

Tom Sharp’s Porterhouse Blue did it.

It’s an inherently comical subject.

Professors at least used to be amusingly eccentric.

But we’ve sort of killed off that side of academia

by turning it into an increasingly doctrinaire place

where eccentricity is not tolerated.

I’ll give you an illustration of this.

I had a call this morning from a British academic

who said, can you give me some advice

because they’re trying to decolonize the curriculum.

This is coming from the,

diversity, equity and inclusion officers.

And it seems to me that what they’re requiring of us

is a fundamental violation of academic freedom

because it is determining ex ante

what we should study and teach.

That’s what’s going on.

And that’s the thing that we really, really have to resist

because that kills the university.

That’s the moment that it stops being

the magical place of,

being the magical place of intellectual creativity

and simply becomes an adjunct

of the ministry of propaganda.

I’ve loved the time we’ve spent talking about this

because it’s such a hopeful message

for the future of the university

that I still share with you

the love of the ideal of the university.

So very practical question.

You mentioned summer.

Which summer are we talking about?

So when, I know we don’t wanna put hard dates here

but what year are we thinking about?

When is this thing launching?

What are your thoughts on this?

We are moving as fast as our resources allow.

The goal is to offer the first of the forbidden courses

next summer, summer of 2022.

And we hope to be able to launch an initial,

albeit relatively small scale master’s program

in the fall of next year.

That’s as fast as humanly possible.

So yeah, we’re really keen to get going.

And I think the approach we’re taking

is somewhat imported from Silicon Valley.

Think of this as a startup.

Don’t think of this as something that has to exist

as a full service university on day one.

We don’t have the resources for that.

You did billions and billions of dollars

to build a university sort of as a facsimile

of an existing university,

but that’s not what we want to do.

I mean, copying and pasting Harvard or Yale or Stanford

would be a futile thing to do.

They would probably, you very quickly end up

with the same pathologies.

So we do have to come up with a different design.

And one way of doing that is to grow it organically

from something quite small.

Elon Musk mentioned in his usual humorous way on Twitter

that he wants to launch

the Texas Institute of Technology and Science, TITS.

Some people thought this was sexist

because of the acronym, TITS.

So first of all, I understand their viewpoint,

but I also think there needs to be a place

for humor on the internet, even from CEOs.

So on this podcast, I’ve gotten a chance

to talk to quite a few CEOs.

And what I love to see is authenticity.

And humor is often a sign of authenticity.

The quirkiness that you mentioned

is such a beautiful characteristic

of professors and faculty in great universities

is also beautiful to see as CEOs, especially founding CEOs.

So anyway, the deeper point he was making

is showing an excitement for the university

as a place for big ideas in science, technology, engineering.

So to me, if there’s some kind of way,

if there is a serious thought that he had behind this tweet,

not to analyze Elon Musk’s Twitter like it’s Shakespeare,

but if there’s a serious thought,

I would love to see him supporting the flourishing of Austin

as a place for science, technology,

for these kinds of intellectual developments

that we’re talking about,

like make a place for free inquiry, civil disagreements,

coupled with great education and conversations

about artificial intelligence, about technology,

about engineering.

So I’m actually gonna,

I hope there’s a serious idea behind that tweet

and I’m gonna chat with him about it.

I do too.

Most of the biggest storms in teacups of my academic career

have been caused by bad jokes that I’ve made.

These days, if you wanna make bad jokes,

being a billionaire is a great idea.

I’m not here to defend Elon’s Twitter style

or sense of humor.

He’s not gonna be remembered for his tweets, I think.

He’s gonna be remembered

for the astonishing companies that he’s built

and his contributions in a whole range of fields

from SpaceX to Tesla and solar energy.

And I very much hope that we can interest Elon

in this project.

We need not only Elon, but a whole range of his peers

because this takes resources.

Universities are not cheap things to run,

especially if, as I hope,

we can make as much of the tuition

covered by scholarships and bursaries.

We want to attract the best intellectual talent

to this institution.

The best intellectual talent

is somewhat randomly distributed through society.

And some of it is in the bottom quintile

of the income distribution.

And that makes it hard to get to elite education.

So this will take resources.

The last generation of super wealthy plutocrats,

the generation of the Gilded Age of the late 19th century,

did a pretty good job of funding universities.

Now Chicago wouldn’t exist, but for the money of that era.

And so my message to not only to Elon,

but to all of the peers, all of those people

who made their billions out of technology

over the last couple of decades is this is your time.

I mean, and this is your opportunity

to create something new.

I can’t really understand why the wealthy of our time

are content to hand their money.

I mean, think of the vast sums Mike Bloomberg

recently gave to Johns Hopkins to established institutions.

When on close inspection, those institutions

don’t seem to spend the money terribly well.

And in fact, one of the mysteries of our time

is the lack of due diligence

that hard nosed billionaires seem to do

when it comes to philanthropy.

So I think there’s an opportunity here

for this generation of very talented, wealthy people

to do what their counterparts did in the late 19th

and early 20th century and create some new institutions.

And they don’t need to put their names on the buildings.

They just need to do what the founders of Chicago,

University of Chicago did,

create something new that will endure.

Yeah, MIT is launching a college of computing

and Stephen Schwarzman has given quite a large sum of money,

I think in total, a billion dollars.

And as somebody who loves computing,

as somebody who loves MIT, I want some accountability

for MIT becoming a better institution.

And this is once again,

why I’m excited about University of Austin

because it serves as a beacon.

Look, you can create something new

and this is what the great institutions

of the future should look like.

And Steve Schwarzman is also an innovator.

The idea of creating a college on the Tsinghua campus

and creating a kind of Rhodes program

for students from the Western world

to come study in China was Steve’s idea.

And I was somewhat involved,

did some visiting, professing there.

It taught me that you can create something new

in that area of graduate education

and quite quickly attract really strong applicants

because the people who finished their four years

at Harvard or Stanford know that they don’t know a lot.

And I, having taught a lot of people in that group,

know how intellectually dissatisfied they often are

at the end of four years.

I mean, they may have beautifully gamed the system

to graduate summa magna cum laude,

but they kind of know they’ll confess it

after a drink or two.

They know that they gamed the system

and that intellectually it wasn’t

the fulfilling experience they wanted.

And they also know that an MBA from a comparable institution

would not be a massive intellectual step forward.

So I think what we want to say is,

here’s something really novel, exciting,

that will be intellectually very challenging.

I do think the University of Austin has to be difficult.

I’d like it to feel a little bit like

surviving Navy SEAL training to come through this program

because it will be intellectually demanding.

That I think should be a magnet.

So yeah, Steve, if you’re listening,

please join Elon in supporting this.

And Peter Thiel, if you’re listening,

I know how skeptical you are about the idea

of creating a new university because heaven knows,

Peter and I have been discussing this idea for years

and he’s always said, well, no, we thought about this

and it just isn’t gonna work.

But I really think we’ve got a responsibility to do this.

Well, Steve’s been on this podcast before.

We’ve spoken a few times, so I’ll send this to him.

I hope he does actually get behind it as well.

So I’m super excited by the ideas

that we’ve been talking about that this effort represents

and what ripple effect it has on the rest of society.

So thank you.

That was a time beautifully spent.

And I’m really grateful for the fortune

of getting a chance to talk to you

at this moment in history

because I’ve been a big fan of your work

and the reason I wanted to talk to you today

is about all the excellent books you’ve written

about various aspects of history through money, war,

power, pandemics, all of that.

But I’m glad that we got a chance to talk about this,

which is not looking at history, it’s looking at the future.

This is a beautiful little fortuitous moment.

I appreciate you talking about it.

In the book, Ascent of Money,

you give a history of the world through the lens of money.

If the financial system is a evolutionary nature,

much like life on earth,

what is the origin of money on earth?

The origin of money predates coins.

Most people kind of assume I’ll talk about coins,

but coins are relatively late developments.

Back in ancient Mesopotamia,

so I don’t know, 5,000 years ago,

there were relations between creditors and debtors.

There are even in the simplest economy

because of the way in which agriculture works.

Hey, I need to plant these seeds,

but I’m not gonna have crops for X months.

So we have clay tablets

in which simple debt transactions are inscribed.

I remember looking at great numbers of these

in the British Museum

when I was writing The Ascent of Money.

And that’s really the beginning of money.

The minute you start recording a relationship

between a creditor and a debtor,

you have something that is quasi money.

And that is probably what these

clay tablets mostly denoted.

From that point on,

there’s a great evolutionary experiment

to see what the most convenient way is

to record relations between creditors and debtors.

And what emerges in the time of the ancient Greeks

are coins, metal, tokens,

sometimes a valuable metal, sometimes not,

usually bearing the imprint of a state or a monarch.

And that’s the sort of more familiar form of money

that we still use today for very, very small transactions.

I expect coins will all be gone

by the time my youngest son is my age,

but the money that I have is still there.

My youngest son is my age,

but they’re a last remnant of a very, very old way

of doing simple transactions.

And when you say coins, you mean physical coins.

I’m talking about coins have been rebranded

in the digital space as well.

Yeah, not coin based coins, actual coin coins.

You know, the ones that jangle in your pocket

and you kind of don’t know quite what to do with

once you have some.

So that became an incredibly pervasive form

of paying for things.

Money’s just a, it’s just a crystallization

of a relationship between a debtor and a creditor.

And the coins are just very fungible.

Whereas a clay tablet relates to a specific transaction,

coins are generic and fungible.

They can be used in any transaction.

So that was an important evolutionary advance.

If you think of financial history,

and this was the point of the ascent of money,

as an evolutionary story, there are punctuated equilibria.

People get by with coins for a long time,

despite their defects as a means of payment,

such as that they can be debased, they can be clipped.

It’s very hard to avoid fake or debased money

entering the system.

But coinage is still kind of the basis of payments

all the way through the Roman Empire,

out the other end into the so called dark ages.

It’s still how most things are settled

in cash transactions in the early 1300s.

You don’t get a big shift until after the Black Death,

when there’s such a need to monetize the economy

because of chronic labor shortages

and feudalism begins to unravel,

that you just don’t have a sufficient amount of coinage.

And so you get bills of exchange.

And I’m really into bills of exchange,

because, and this I hope will capture your listeners

and viewers imaginations,

when they start using bills of exchange,

which are really just pieces of paper saying,

I owe you over a three month period

while goods are in transit from Florence to London,

you get the first peer to peer payment system,

which is network verified,

because they’re not coins,

they don’t have a King’s head on them.

They’re just pieces of paper.

And the verification comes in the form of signatures.

And you need ultimately some kind of guarantee

if I write an IOU to you, bills of exchange,

I mean, you don’t really know me that well,

we only just met.

So you might wanna get endorsed by, I don’t know,

somebody really credit worthy like Elon.

And so we actually can see in the late 14th century

in Northern Italy and England and elsewhere,

the evolution of a peer to peer network system

of payment.

And that’s actually how world trade grows,

because you just couldn’t settle

long oceanic transactions with coinage.

It just wasn’t practical.

All those treasure chests full of the balloons,

which were part of the way in which the Spanish empire worked

really inefficient.

So bills of exchange are an exciting part of the story.

And they illustrate something I should have made more clear

in the ascent of money,

that not everything used in payment needs to be money.

Classically, economists will tell you, oh, well, money,

money has three different functions.

It’s you’ve heard this a zillion times, right?

It’s a unit of account, it’s a store of value,

and it’s a medium of exchange.

Now, there are three or four things

that are worth saying about this, and I’ll just say two.

One, it may be that those three things are a trilemma,

and it’s very difficult for anything to be all of them.

This point was made by my Hoover colleague,

Manny Rincon Cruz last year,

and I still wish he would write this up as a paper

because it’s a great insight.

The second thing that’s really interesting to me

is that payments don’t need to be money.

And if we go around, as economists love to do,

saying, well, Bitcoin’s not money

because it doesn’t fulfill these criteria,

we’re missing the point

that you could build a system of payments,

which I think is how we should think about crypto

that isn’t money, doesn’t need to be money.

It’s like bills of exchange.

It’s network based verification,

peer to peer transactions without third party verification.

When it hit me the other day

that we actually have this precedent for crypto,

I got quite excited and thought,

I wish I had written that in the Ascent of Money.

Can you sort of from a first principles,

like almost like a physics perspective,

or maybe a human perspective,

describe where does the value of money come from?

Like where is it actually, where is it?

So it’s a sheet of paper or it’s coins,

but it feels like in a platonic sense,

there’s some kind of thing

that’s actually storing the value.

As us, a bunch of ants are dancing around and so on.

I come from a family of physicists.

I’m the black sheep of the family.

My mother’s a physicist, my sister is.

And so when you asked me to explain something

in physics terms, I get a kind of little part of me dies

because I know I’ll fail.

But in truth, it doesn’t really matter

what we decide money is going to be.

And anything can record, crystallize

the relationship between the creditor and the debtor.

It could be a piece of paper, it can be a piece of metal.

It can be nothing, can just be a digital entry.

It’s trust that we’re really talking about here.

We are not just trusting one another.

We may not, but we are trusting the money.

So whatever we use to represent

the creditor debtor relationship,

whether it’s a banknote or a coin or whatever,

it does depend on us both trusting it.

And that doesn’t always pertain.

What we see in episodes of inflation,

especially episodes of hyperinflation,

is a crisis of trust, a crisis of confidence

in the means of payments.

And this is very traumatic for the societies

to which it happens.

By and large, human beings,

particularly once you have a rule of law system

of the sort that evolved in the West

and then became generalized,

are predisposed to trust one another.

And the default setting is to trust money.

Even when it depreciates at a quite steady rate

as the US dollar has done pretty much uninterruptedly

since the 1960s, it takes quite a big disruption

for money to lose that trust.

But I think essentially what money should be thought of as

is a series of tokens that can take any form we like

and can be purely digital,

which represent our transactions as creditors and debtors.

And the whole thing depends on our collective trust to work.

I had to explain this to Stephen Colbert once

in the Colbert Show, the old show that was actually funny.

And it was a great moment when he said,

so Neil, could I be money?

And I said, yes, we could settle a debt

with a human being that was quite common in much of history,

but it’s not the most convenient form of money.

Money has to be convenient.

That’s why when they worked out

how to make payments with cell phones,

the Chinese simply went straight there from bank accounts.

They skipped out credit cards.

You won’t see credit cards in China,

except in the hands of naive tourists.

How much can this trust bear

in terms of us humans with our human nature testing it?

I guess the surprising thing is the thing works.

A bunch of self interested ants running around

trading in trust.

And it seems to work except for a bunch of moments

in human history when there’s hyperinflation,

like you mentioned.

And it’s just kind of amazing.

It’s kind of amazing that us humans,

if I were to be optimistic and sort of hopeful

about human nature, it gives me a sense

that people want to lean on each other.

They want to trust.

That’s certainly, I would say probably now,

a widely shared view amongst evolutionary psychologists,

network scientists.

It’s one of Nicholas Christakis’s argument

in a recent book.

I know economic history broadly bears this out,

but you have to be cautious.

The cases where the system works are familiar to us.

Because those are the states and the eras

that produce a lot of written records.

But when the system of trust collapses

and the monetary system collapses with it,

there’s generally quite a paucity of records.

I found that when I was writing Doom.

And so we slightly are biased in favor of the periods

when trust prevailed and the system functioned.

It’s very easy to point to a great many episodes

of very, very intense monetary chaos,

even in the relatively recent past.

In the wake of the First World War,

multiple currencies, not just the German currency,

multiple currencies were completely destroyed.

The Russian currency, the Polish currency.

There were currency disasters all over

Central and Eastern Europe in the early 1920s.

And that was partly because over the course

of the 19th century, a system had evolved

in which trust was based on gold

and rules that were supposedly applied by central banks.

That system, which produced relative price stability

over the 19th century, fell apart

as a result of the First World War.

And as soon as it was gone, as soon as there was no longer

a clear link between those banknotes and coins and gold,

the whole thing went completely haywire.

And I think we should remember that the extent

of the monetary chaos from certainly 1918

all the way through to the late 1940s.

I mean, the German currency was destroyed

not once but twice in that period.

And that was one of the most advanced economies

in the world.

In the United States, there were periods

of intensely deep deflation.

Prices fell by a third in the Great Depression.

And then very serious price volatility

in the immediate post World War II period.

So it’s a bit of an illusion.

Maybe it’s an illusion for people who’ve spent most

of their lives in the last 20 years.

We’ve had a period of exceptional price stability

since this century began in which a regime

of central bank independence and inflation targeting

appeared to generate steady below 2% inflation

in much of the developed world.

It was a bit too low for the central bankers liking.

And that became a problem in the financial crisis.

But we’ve avoided major price instability

for the better part of 20 years.

In most of the world, there haven’t really been

that many very high inflation episodes

and hardly any hyperinflationary episodes.

Venezuela’s one of the very few, Zimbabwe’s another.

But if you take a 100 year view or a 200 year view,

or if you want to take a 500 year view,

you realize that quite often the system doesn’t work.

If you go back to the 17th century,

there were multiple competing systems of coinage.

There had been a great inflation that had begun

the previous century.

The price revolution caused mainly by the rise

and caused mainly by the arrival of new world silver.

I think financial history is a bit messier

than one might think.

And the more one studies it, the more one realizes

the need for the evolution.

The reason bills of exchange came along

was because the coinage systems had stopped working.

The reason that banknotes started to become used

more generally first in the American colonies

in the 17th century, then more widely in the 18th century

was just that they were more convenient than any other way

of paying for things.

We had to invent the bond market in the 18th century

to cope with the problem of public debt,

which up until that point had been a recurrent source

of instability.

And then we invented equity finance

because bonds were not enough.

So I would prefer to think of the financial history

as a series of crises really that are resolved

by innovations and in the most recent episode,

very exciting episode of financial history,

something called Bitcoin initiated a new financial

or monetary revolution in response, I think,

to the growing crisis of the fiat money system.

Can you speak to that?

So what do you think about Bitcoin?

What do you think it is a response to?

What are the growing problems of the fiat system?

What is this moment in human history

that is full of challenges that Bitcoin

and cryptocurrency is trying to overcome?

I don’t think Bitcoin was devised by Satoshi,

whoever he was, for fear of a breakdown

of the fiat currencies.

If it was, it was a very far sighted enterprise

because certainly in 2008,

when the first Bitcoin paper appeared,

it wasn’t very likely that a wave of inflation was coming.

If anything, there was more reason

to fear deflation at that point.

I think it would be more accurate to say

that with the advent of the internet,

there was a need for a means of payment

native to the internet,

typing your credit card number into a random website.

It’s not the way to pay for things on the internet.

And I’d rather think of Bitcoin as the first iteration,

the first attempt to solve the problem

of how do we pay for things

in what we must learn to call the metaverse,

but let’s just call it the internet for old time’s sake.

And ever since that initial innovation,

the realization that you could use computing power

and cryptography to create peer to peer payments

without third party verification,

a revolution has been gathering momentum

that poses a very profound threat

to the existing legacy system of banks and fiat currencies.

Most money in the world today is made by banks,

not central banks, banks.

That’s what most money is, it’s entries in bank accounts.

And what Bitcoin represents

is an alternative mode of payment

that really ought to render banks obsolete.

I think this financial revolution

has got past the point at which it can be killed.

It was vulnerable in the early years,

but it now has sufficient adoption

and has generated sufficient additional layers.

I mean, Ethereum was in many ways

the more important innovation

because you can build a whole system of payments

and ultimately smart contracts on top of ether.

I think we’ve now reached the point

that it’s pretty hard to imagine it all being killed.

And it’s just survived an amazing thing,

which was the Chinese shutting down mining

and shutting down everything.

And still here we are, in fact, cryptos thriving.

What we don’t know is how much damage

ill judged regulatory interventions are going to do

to this financial revolution.

Left to its own devices,

I think decentralized finance provides

the native monetary and financial system for the internet.

And the more time we spend in the metaverse,

the more use we will make of it.

The next things that will happen, I think,

will be that tokens in game spaces like Roblox

will become fungible.

As my nine year old spends a lot more time

playing on computer games than I ever did,

I can see that entertainment

is becoming a game driven phenomenon.

And in the game space, you need skins for your avatar.

The economics of the internet, it’s evolving very fast.

And in parallel,

you can see this payments revolution happening.

I think that all goes naturally very well

and generates an enormous amount of wealth in the process.

The problem is there are people in Washington

with an overwhelming urge to intervene

and disrupt this evolutionary process.

Partly, I think out of a muddled sense

that there must be a lot of nefarious things going on.

If we don’t step in, many more will go on.

This, I think, greatly exaggerates

how much criminal activity is in fact going on in the space.

But there’s also the vested interests at work.

It was odd to me, maybe not odd,

perhaps it wasn’t surprising,

that the Bank for International Settlements

earlier this year published a report,

one chapter of which said this must all go, must all stop.

It’s all gotta be shut down

and it’s gotta be replaced by central bank digital currency.

And Martin Wolf in the Financial Times read this

and said, I agree with this.

And one suddenly realized that the banks are clever.

They had achieved the intellectual counterattack

with almost no fingerprints on the weapon.

I think central bank digital currency is a terrible idea.

I can’t imagine why we would want to copy a Chinese model

that essentially takes all transactions

and puts them directly under the surveillance

of a central government institution.

But that suddenly is a serious counterproposal.

So on the one side, we have a relatively decentralized,

technologically innovative internet native system

of payments that has the possibility to evolve,

to produce a full set of smart contracts,

reducing enormously the transaction costs

that we currently encounter in the financial world

because it gets rid of all those middlemen

who take their cut every time you take out a mortgage

or whatever it is.

That’s one alternative.

But on the other side, we have a highly centralized system

in which transactions will by default

be under the surveillance of the central bank.

It seems like an easy choice to me,

but hey, I have this thing about personal liberty.

So that’s where we are.

I don’t think that the regulators can kill web three.

I think we’re supposed to call it web three

because crypto is now an obsolescent term.

They can’t kill it,

but they can definitely make it difficult

and throw a lot of sand into the machine.

And I think worst of all,

they can spoil the evolutionary story

by creating central bank digital currency

that I don’t think we really need.

Or we certainly don’t need it in the Chinese form.

Do you think Bitcoin has a strong chance

to take over the world?

So become the primary,

you mentioned the three things that make money, money,

become the primary methodology

by which we store wealth, we exchange.


No, I think what Bitcoin is,

this was a phrase that I got from my friend,

Matt McLennan at First Eagle,

an option on digital gold.

So it’s the gold of the system,

but currently behaves like an option.

That’s why it’s quite volatile

because we don’t really know

if this brave new world of crypto is gonna work.

But if it does work, then Bitcoin is the gold

because of the finite supply.

What role we need gold to play in the metaverse

isn’t quite clear.

I love that you’re using the term metaverse.

This is great.

Well, I just like the metaversity

as the antithesis of what we’re trying to do in Austin.

But can you imagine I’m using it sarcastically?

I come from Glasgow where all novel words

have to be used sarcastically.

So the metaverse, sarcastic.

But see, the beauty about humor and sarcasm

is that the joke becomes reality.

I mean, it’s like using the word Big Bang

to describe the origins of the universe.

It becomes like that.

It will.

After a while, it’s in the textbooks

and nobody’s laughing.

Yeah, well, that’s exactly right.

Humor is sticky.

Yeah, I’m on the side of humor,

but it is a dangerous activity these days.

Anyway, I think Bitcoin is the option of digital gold.

The role it plays is probably not so much store of value.

Right now, it’s just nicely not very correlated asset

in your portfolio.

When I updated the Ascent of Money,

which was in 2018, 10 years after it came out,

I wrote a new chapter in which I said,

Bitcoin, which had just sold off after its 2017 bubble,

will rise again through adoption

because if every millionaire in the world

has 0.2% of his or her wealth in Bitcoin,

the price should be $15,000.

If it’s 1%, it’s $75,000.

And it might not even stay at 1%

because, I mean, look at its recent performance.

If your exposure to global stocks had been hedged

with a significant crypto holding,

you would have aced the last few months.

So I think the non correlation property

is very, very important in driving adoption.

And the volatility also drives adoption

if you’re a sophisticated investor.

So I think the adoption drives Bitcoin up

because it’s the option of digital gold,

but it’s also just this nicely not very correlated asset

that you wanna hold.

In a world where, what the hell?

I mean, the central bank’s gonna tighten.

We’ve come through this massively disruptive effort

of the pandemic, public debt soared,

money printing soared.

You could hang around with your bonds

and wait for the euthanasia of the Rontier.

You can hang on to your tech stocks

and just hope there isn’t a massive correction

or dot, dot, dot.

Well, and it seems like a fairly obvious strategy

to make sure that you have at least some crypto

for the coming year, given what we likely have to face.

I think what’s really interesting is that

on top of Ethereum,

a more elaborate financial system is being built.

Stable coins are the interesting puzzle for me

because we need off ramps.

Ultimately, you and I have to pay taxes in US dollars.

And there’s no getting away from that.

The IRS is gonna let us hold crypto

as long as we pay our taxes.

And the only question in my mind is

what’s the optimal off ramp to make those taxes,

make those tax payments?

Probably it shouldn’t be a currency invented by Facebook.

Never struck me as the best solution to this problem.

Maybe it’s some kind of Fed coin

or maybe one of the existing algorithmic stable coins

does the job.

But we clearly need some stable off ramp.

So you don’t think it’s possible for the IRS

within the next decade to be accepting Bitcoin

as tax payments?

I doubt that.

Having dealt with the IRS now

since when did I first come here, 2002,

it’s hard to think of an institution less likely

to leap into the 21st century when it comes to payments.

No, I think we’ll be tolerated, crypto world will be tolerated

as long as we pay our taxes.

And it’s important that we’re already at that point.

And then the next question becomes,

well, does Gary Gensler define everything as a security?

And do we then have to go through endless

regulatory contortions to satisfy the SEC?

There’s a whole bunch of uncertainties

that the administrative state excels at creating

because that’s just how the administrative state works.

You’ll do something new.

Hmm, I’ll decide whether that’s a security

but don’t expect me to define it for you.

I’ll decide in an arbitrary way and then you’ll owe me money.

So all of this is going to be very annoying.

And for people who are trying to run exchanges

or innovate in the space, these regulations will be annoying.

But the problem with FinTech is it’s different from tech,

broadly defined.

When tech got into eCommerce with Amazon,

when it got into social networking with Facebook,

there wasn’t a huge regulatory jungle to navigate.

But welcome to the world of finance,

which has always been a jungle of regulation

because the regulation is there to basically entrench

the incumbents.

That’s what it’s for.

So it’ll be a much tougher fight than the fights

we’ve seen of other aspects of the tech revolution

because the incumbents are there and they see the threat.

And in the end, Satoshi said it very explicitly.

It’s peer to peer payment without third party verification.

And all the third parties are going, wait, what?

We’re the third parties.

So there is a connection between power and money.

You’ve mentioned World War I from the perspective of money.

So power, money, war, authoritarian regimes.

From the perspective of money,

do you have hope that cryptocurrency can help resist war,

can help resist the negative effects

of authoritarian regimes?

Or is that a silly hope?

Wars happen because the people who have the power

to command armed forces miscalculate.

That’s generally what happens.

And we will have a big war in the near future

if both the Chinese government and the US government

miscalculates and they unleash lethal force on one another.

And there’s nothing that any financial institution

can do to stop that any more than the Rothschilds

could stop World War I.

And they were then the biggest bank in the world by far

with massive international financial influence.

So let’s accept that war is in a different domain.

War would impact the financial world massively

if it were a war between the United States and China

because there’s still a huge China trade on.

Wall Street is long China, Europe is long China.

So the conflict that I can foresee in the future

is one that’s highly financially disruptive.

Where does crypto fit in?

Crypto’s obvious utility in the short run

is as a store of wealth, of transferable wealth

for people who live in a world

of transferable wealth for people who live

in dangerous places with failing,

not just failing money, but failing rule of law.

That’s why in Latin America,

there’s so much interest in crypto

because Latin Americans have a lot of monetary history

to look back on and not much of it is good.

So I think that the short run problem that crypto solves

is, and this goes back to the digital gold point,

if you are in a dangerous place with weak rule of law

and weak property rights,

here is a new and better way to have portable wealth.

I think the next question to ask is,

would you want to be long crypto

in the event of World War III?

What’s interesting about that question

is that World War III would likely have

a significant cyber dimension to it.

And I don’t want to be 100% in crypto

if they crash the internet,

which between them, China and Russia might be able to do.

That’s a fascinating question,

whether you want to be holding physical gold

or digital gold in the event of World War III.

The smart person who studied history

definitely wants a bit of both.

And so let’s imagine World War III

has a very, very severe cyber component

to it with high levels of disruption.

Yeah, you’d be glad of the old shiny stuff at that point.

So diversification still seems like

the most important truth of financial history.

And what is crypto?

It’s just this wonderful new source of diversification,

but you’d be nuts to be 100% in Bitcoin.

I mean, I have some friends

who are probably quite close to that.

Close to 100%, yeah.

I’d mar the balls of steel.

Yeah, in whatever way that balls of steel takes form.

You mentioned smart contracts.

What are your thoughts about,

in the context of the history of money,

about Ethereum, about smart contracts,

about kind of more systematic at scale

formalization of agreements between humans?

Well, I think it must be the case

that a lot of the complexity in a mortgage is redundant.

That when we are confronted with pages and pages

and pages and pages of small prints,

we’re seeing some manifestation

of the late stage regulatory state.

The transaction itself is quite simple.

And most of the verbiage is just ass covering by regulators.

So I think the smart contract,

although I’m sure lawyers will email me

and tell me I’m wrong,

can deal with a lot of the plain vanilla

and maybe not so plain transactions that we want to do

and eliminate yet more intermediaries.

That’s my kind of working assumption.

And given that a lot of financial transactions

have the potential at least to be simplified,

automated, turned into smart contracts,

that’s probably where the future goes.

I can’t see an obvious reason

why my range of different financial needs,

let’s think about insurance, for example,

will continue to be met with instruments

that in some ways are 100 years old.

So I think we’re still at an early stage

of a financial revolution that will greatly streamline

how we take care of all those financial needs that we have,

mortgages and insurance leap to mind.

Most households are penalized

for being financially poorly educated

and confronted with oligopolistic

financial services providers.

So you kind of leave college already in debt.

So you start in debt servitude

and then you got to somehow lever up

to buy a home if you can,

because everybody’s kind of telling you you should do that.

So you and your spouse,

you are getting even more leveraged

and your long one asset class called real estate,

which is super illiquid.

I mean, already I’m crying inside at the thought

of describing so many households financial predicament

in that way, and I’m not done with them yet

because, oh, by the way,

there’s all this insurance you have to take out

and here are the providers that are willing to insure you

and here are the premiums you’re gonna be paying,

which are kind of presented to you.

That’s your car insurance, that’s your home insurance.

And if you’re here, it’s the earthquake insurance.

And pretty soon you’re just bleeding money

in a bunch of monthly payments to the mortgage lender,

to the insurer, to all the other people that lent you money.

And let’s look at your balance sheet, it sucks.

There’s this great big chunk of real estate

and what else have you really got on there?

And the other side is a bunch of debt,

which is probably paying too high interest.

The typical household in the median kind of range

is at the mercy of oligopolistic

financial services providers.

Go down further in the social scale

and people are outside the financial system altogether.

And those poor folks have to rely on bank notes

and informal lending with huge punitive rates.

We have to do better than this.

This has to be improved upon.

And I think what’s exciting about our time

is that technology now exists that didn’t exist

when I wrote The Ascent of Money to solve these problems.

When I wrote The Ascent of Money, which was in 2008,

you couldn’t really solve the problem I’ve just described.

Certainly you couldn’t solve it

with something like microfinance.

That was obviously not viable.

The interest rates were high,

the transaction costs were crazy, but now we have solutions

and the solutions are extremely exciting.

So FinTech is this great force for good

that brings people into the financial system

and reduces transaction costs.

Crypto is part of it, but it’s just part of it.

There’s a much broader story of FinTech going on here

where suddenly you get financial services on your phone,

don’t cost nearly as much as they did

when there had to be a bricks and mortar building

on main street that you kind of went humbly

and beseeched to lend you money.

I’m excited about that

because it seems to me very socially transformative.

I’ll give you one other example of what’s great.

The people who really get sculpted in our financial system

are senders and receivers of remittances,

which are often amongst the poorest families in the world.

The people who are like my wife’s family in East Africa

really kind of hand to mouth.

And if you send money to East Africa

or the Philippines or Central America,

it’s the transaction costs are awful.

I’m talking to you, Western Union.

We’re going to solve that problem.

So 10 years from now,

the transaction costs will just be negligible

and the money will go to the people who need it

rather than to rent seeking financial institutions.

So I’m on the side of the revolution with this

because I think the incumbent financial institutions globally

are doing a pretty terrible job

and middle class and lower class families lose out.

And thankfully, technologically,

technology allows us to fix this.

Yeah, so FinTech can remove a lot of inefficiencies

in the system.

I’m super excited myself,

maybe as a machine learning person in data oracles.

So converting a lot of our physical world into data

and have smart contracts on top of that.

So that no longer is there’s this fuzziness

about what is the concrete nature of the agreements.

You can tie your agreement to weather.

You can tie your agreement to the behavior

of certain kinds of financial systems.

You can tie your behavior to, I don’t know,

I mean, all kinds of things.

You can connect it to the body

in terms of human sensory information.

Like you can make an agreement

that if you don’t lose five pounds in the next month,

you’re going to pay me $1,000 or something like that.

I don’t know.

It’s a stupid example, but it’s not going to happen.

It’s a good example, but it’s not

because like you can create all kinds of services

on top of that.

You can just create all kinds of interesting applications

that completely revolutionize how humans transact.

I think, of course, we don’t want to create a world

of Chinese style social credit

in which our behavior becomes so transparent

to providers of financial services,

particularly insurers that when I try to go into the pub,

I’m stopped from doing so.

Every time you take a drink, your insurance goes up.

Right, or my credit card wouldn’t work

in certain restaurants because they serve ribeye steak.

I fear that world because I see it being built in China.

And we must at all costs make sure

that the Western world has something distinctive to offer.

It can’t just be, oh, it’s the same as in China.

Only the data go to five tech companies

rather than to Xi Jinping.

So I think that the way we need to steer this world

is in the way that our data are by default

are by default vaulted on our devices

and we choose when to release the data

rather than the default setting

being that the data are available.

That’s important, I think,

because it was one of the biggest mistakes

of the evolution of the internet

that in a way the default was to let our data be plundered.

It’s hard to undo that,

but I think we can at least create a new regime

that in future makes privacy default

rather than open access default.

In the book, Doom, The Politics of Catastrophe,

your newest book, you describe wars, pandemics

and the terrible disasters in human history,

which stands out to you as the worst

in terms of how much it shook the world

and the human spirit.

I am glad I was not around in the mid 14th century

when the bubonic plague swept across Eurasia.

As far as we can see, that was history’s worst pandemic.

Maybe there was a comparably bad one

in the reign of the emperor Justinian,

but there’s some reason to think it wasn’t as bad.

And the more we learn about the 14th century,

the more we realize that it really was across Eurasia

and the mortality was 30% in some places,

50% in some places higher.

There were whole towns that were just emptied.

And when one reads about the Black Death,

it’s an unimaginable nightmare of death

and madness in the death with flagellant orders

wandering from town to town.

Town to town seeking to ward off divine retribution

by flogging themselves,

people turning on the local Jewish communities

as if it’s somehow their fault.

That must have been a nightmarish time.

If you ask me for an also random runner up,

it would be World War II in Eastern Europe.

And in many ways, it might have been worse

because for a medieval peasant,

the sense of being on the wrong side of divine retribution

must have been overpowering.

In the mid 20th century,

you knew that this was manmade murder

on a massive industrial scale.

If one reads Grossman’s Life and Fate,

just to take one example,

one enters a hellscape

that it’s extremely hard to imagine oneself in.

So these are two of the great disasters of human history.

And if we did have a time machine,

if one really were able to transport people back

and give them a glimpse of these times,

I think the post traumatic stress would be enormous.

People would come back from those trips

even if it was a one day excursion with guaranteed survival

in a state of utter shock.

You often explore counterfactual and hypothetical history,

which is a fascinating thing to do,

sometimes to a controversial degree.

And again, you walk through that fire gracefully.

So let me ask maybe about World War II or in general,

what key moments in history of the 20th century

do you think if something else happened at those moments,

we could have avoided some of the big atrocities,

Stalin’s Baltimore, Hitler’s Holocaust,

Mao’s Great Chinese Famine?

The great turning point in world history

is August the 2nd, 1914,

when the British cabinet decides to intervene

and what would have been a European war

becomes a world war.

And with British intervention,

it becomes a massively larger and more protracted conflict.

So very early in my career,

I became very preoccupied with the deliberations

on that day and the surprising decision

that a liberal cabinet took to go to war,

which you might not have bet on that morning

because there seemed to be a majority of cabinet members

who would be disinclined and only a minority,

including Winston Churchill, who wanted to go to war.

So that’s one turning point.

I often wish I could get my time machine working

and go back and say, wait, stop.

Just think about what you’re going to do.

And by the way, let me show you a video of Europe in 1918.

So that’s one.

Can we linger on that one?

That one, a lot of people push back on you

because it’s so difficult.

So the idea is, if I could try to summarize,

and you’re the first person that made me think

about this very uncomfortable thought,

which is the ideas in World War I,

it would be a better world if Britain stayed out of the war

and Germany won.


Thinking now in retrospect at the whole story

of the 20th century,

thinking about Stalin’s rule of 30 years,

thinking about Hitler’s rise to power

and the atrocities of the Holocaust,

but also like you said on the Eastern front,

the death of tens of millions of people through the war

and also sort of the political prisoners

and the suffering connected to communism,

connected to fascism, all those kinds of things.

Well, that’s one heck of an example

of why you’re just like fearless

in this particular style

of exploring counterfactual history.

So can you elaborate on that idea

and maybe why this was such an important day

in human history?

This argument was central to my book, The Pity of War.

I also did an essay in virtual history about this

and it’s always amused me that from around that time,

I began to be called a conservative historian

because it’s actually a very left wing argument.

The people in 1914 who thought Britain should stay

at the war were the left of the Labour Party,

who split to become the Independent Labour Party.

What would have happened?

Well, first of all, Britain was not ready for war in 1914.

There had not been conscription.

The army was tiny.

So Britain had failed to deter Germany.

The Germans took the decision

that they could risk going through Belgium

using the Schlieffen Plan to fight their two front war.

They calculated that Britain’s intervention

would either not happen or not matter.

If Britain had been strategically committed

to preventing Germany winning a war in Europe,

they should have introduced conscription 10 years before,

had a meaningful land army

and that would have deterred the Germans.

So the Liberal government provided the worst of both worlds,

a commitment that was more or less secret to intervene

that the public didn’t know about.

In fact, much of the Liberal Party didn’t know about,

but without really the means

to make that intervention effective,

a tiny army with just a few divisions.

So it was perfectly reasonable to argue

as a number of people did on August the 2nd, 1914,

that Britain should not intervene.

After all, Britain had not immediately intervened

against the French Revolutionary armies back in the 1790s.

It had played an offshore role, ultimately intervening,

but not immediately intervening.

If Britain had stayed out,

I don’t think that France would have collapsed immediately

as it had in 1870.

The French held up remarkably well

to catastrophic casualties

in the first six months of the First World War.

But by 1916, I don’t see how France could have kept going

if Britain had not joined the war.

And I think the war would have been over perhaps

at some point in 1916.

We know that Germany’s aims

would have been significantly limited

because they would have needed to keep Britain out.

If they’d succeeded in keeping Britain out,

they’d have had to keep Britain out.

And the way to keep Britain out was obviously

not to make any annexation of Belgium,

to limit German war aims,

particularly to limit them to Eastern Europe.

And from Britain’s point of view, what was not to like?

So the Russian Empire is defeated

along with France.

What does that really change?

If the Germans are sensible

and we can see what this might’ve looked like,

they focus on Eastern Europe,

they take chunks of the Russian Empire,

perhaps they create as they did

in the piece of Brest Litovsk,

an independent or quasi independent Poland.

In no way does that pose a threat to the British Empire.

In fact, it’s a good thing.

Britain never had had a particularly good relationship

with the Russian Empire after all.

The key point here is that the Germany that emerges

from victory in 1916 has a kind of European union.

It’s the dominant power of an enlarged Germany

with a significant middle Europa,

whatever you want to call it,

customs union type arrangement with neighboring countries,

including one suspects, Austria, Hungary.

That is a very different world from the world of 1917, 18.

The protraction of the war for a further two years,

it’s globalization,

which Britain’s intervention made inevitable.

As Philip Zelikow showed in his recent book

on the failure to make peace in 1916,

Woodrow Wilson tried and failed to intervene

and broker a peace in 1916.

So I’m not the only counterfactualist here.

The extension of the war for a further two years

with escalating slaughter, the death toll rose

because the industrial capacity of the armies grew greater.

That’s what condemns us to the Bolshevik revolution.

And it’s what condemns us ultimately to Nazism

because it’s out of the experience of defeat in 1918

as Hitler makes clear in Mein Kampf

that he becomes radicalized and enters the political realm.

Take out those additional years of war

and Hitler’s just a failed artist.

It’s the end of the war that turns him into the demagogue.

You asked what are the things

that avoid the totalitarian states.

As I’ve said,

British nonintervention for me is the most plausible

and it takes out all of that malignant history

that follows from the Bolshevik revolution.

It’s very hard for me to see how Lenin gets anywhere

if the war is over.

That looks like the opportunity

for the constitutional elements,

the liberal elements in Russia.

There are other moments at which you can imagine history

taking a different path.

If the provisional government in Russia

had been more ruthless,

it was very lenient towards the Bolsheviks,

but if it had just rounded them up

and shot the Bolshevik leadership,

that would have certainly cut the Bolshevik revolution off.

One looks back on the conduct of the Russian liberals

with the kind of despair at their failure

to see the scale of the threat that they faced

and the ruthlessness that the Bolshevik leadership

would evince. There’s a counterfactual in Germany,

which is interesting.

I think the Weimar Republic destroyed itself

in two disastrous economic calamities,

the inflation and then the deflation.

It’s difficult for me to imagine Hitler

getting to be Reich Chancellor

without those huge economic disasters.

So another part of my early work explored

alternative policy options that the German Republic,

the Weimar Republic might have pursued.

There are other contingencies that spring to mind.

In 1936 or 38, I think more plausibly 38,

Britain should have gone to war.

The great mistake was Munich.

Hitler was in an extremely vulnerable position in 1938,

because remember, he didn’t have Russia squared away

as he would in 1938.

As he would in 1939.

Chamberlain’s mistake was to fold instead of going for war

as Churchill rightly saw.

And there was a magical opportunity there

that would have played into the hands

of the German military opposition and conservatives

to snuff Hitler out over Czechoslovakia.

I could go on.

The point is that history is not some inexorable narrative,

which can only end one way.

It’s a garden of forking paths.

And many, many junctions in the road,

there were choices that could have averted

the calamities of the mid 20th century.

I have to ask you about this moment,

before you said I could go on,

this moment of Chamberlain and Hitler,

snuff Hitler out in terms of Czechoslovakia.

And we’ll return to the book Doom on this point.

What does it take to be a great leader

in the room with Hitler,

or in the same time and space as Hitler,

to snuff him out, to make the right decisions?

So it sounds like you put quite a bit of a blame

on the man, Chamberlain,

and give credit to somebody like a Churchill.

So what is the difference?

Where’s that line?

You’ve also written a book about Henry Kissinger,

who’s an interesting sort of person

that’s been throughout many difficult decisions

in the games of power.

So what does it take to be a great leader in that moment?

That particular moment, sorry to keep talking,

is fascinating to me,

because it feels like it’s man on man conversations

that define history.

Well, Hitler was bluffing.

He really wasn’t ready for war in 1938.

The German economy was clearly not ready for war in 1938.

And Chamberlain made a fundamental miscalculation

along with his advisors,

because it wasn’t all Chamberlain.

He was in many ways articulating the establishment view.

And I tried to show in a book called War of the World

how that establishment worked.

It extended through the BBC, into the aristocracy,

to Oxford.

There was an establishment view.

Chamberlain personified it.

Churchill was seen as a warmonger.

He was at his lowest point of popularity in 1938.

But what is it that Chamberlain gets wrong?

Because it’s conceptual.

Chamberlain is persuaded that Britain has to play for time

because Britain is not ready for war in 1938.

He fails to see that the time that he gets,

that he buys at Munich is also available to Hitler.

Everybody gets the time

and Hitler’s able to do much more with it

because Hitler strikes the pact with Stalin

that guarantees that Germany can fight a war

on one front in 1939.

What does Chamberlain do?

Build some more aircraft.

So the great mistake of the strategy of appeasement

was to play for time.

I mean, they knew war was coming,

but they were playing for time,

not realizing that Hitler got the time too.

And after he partitioned Czechoslovakia,

he was in a much stronger position,

not least because of all the resources

that they were able to plunder from Czechoslovakia.

So that was the conceptual mistake.

Churchill played an heroic role in pointing out

this mistake and predicting accurately

that it would lead to war on worse terms.

What does it take?

It takes a distinct courage to be unpopular.

And Churchill was deeply unpopular at that point.

People would listen to him in the House of Commons

in silence.

On one occasion, Lady Astor shouted, rubbish.

So he went through a period of being hated on.

The other thing that made Churchill a formidable leader

was that he always applied history to the problem.

And that’s why he gets it right.

He sees the historical problem

much more clearly than Chamberlain.

So I think if you go back to 1938,

there’s no realistic counterfactual

in which Churchill’s in government in 1938.

You have to have France collapse

for Churchill to come into government.

But you can certainly imagine a Tory elite

that’s thinking more clearly about the likely dynamics.

They haven’t seen this, I guess, problem of conjecture,

to take a phrase from Kissinger,

which is that whatever they’re doing in postponing the war

has the potential to create

a worse starting point for the war.

It would have been risky in 1938,

but it was a way better situation

than they ended up with in 1939, a year later.

You asked about Kissinger,

and I’ve learned a lot from reading Kissinger

and talking to Kissinger since I embarked

on writing his biography a great many years ago.

So I think one of the most important things I’ve learned

is that you can apply history to contemporary problems.

It may be the most important tool that we have

in that kind of decision making.

You have to do it quite ruthlessly and rigorously.

And in the moment of crisis, you have to take risk.

So Kissinger often says in his early work,

the temptation of the bureaucrat is to wait for more data,

but ultimately the decision making

that we do under uncertainty can’t be based on data.

The problem of conjecture is

that you could take an action now and incur some cost,

an avert disaster, but you’ll get no thanks for it

because nobody is grateful for an averted disaster.

And nobody goes around saying, wasn’t it wonderful

how we didn’t have another 9 11.

On the other hand, you can do nothing,

incur no upfront costs and hope for the best.

And you might get lucky, the disaster might not happen.

That’s in a democratic system, the much easier path to take.

And I think that the essence of leadership is to be ready

to take that upfront cost, avert the disaster

and accept that you won’t get gratitude.

If I may make a comment, an aside about Henry Kissinger.

So he, I think at 98 years old currently has still got it.

He’s brilliant.

It’s very, very impressive.

I can only hope that my brain has the same durability

that his does because it’s a formidable intellect

and it’s still in as sharp form as it was 50 years ago.

So you mentioned Eric Schmidt’s in his book

and he reached out to me that he wanted to do this podcast.

And I know Eric Schmidt, I’ve spoken to him before.

I like him a lot, obviously.

So they said, we could do a podcast for 40 minutes

with Eric, 40 minutes with Eric and Henry together

and 40 minutes with Henry.

So those are three different conversations.

And I had to like, I had to do some soul searching

because I said, fine, 40 minutes with Eric.

We’ll probably talk many times again.

Fine, let’s talk about this AI book together

for 40 minutes.

But I said, what I wrote to them is that I would hate myself

if I only have 40 minutes to talk to Henry Kissinger.

And so I had to hold my ground, went back and forth

and in the end decided to part ways over this.

And I sometimes think about this kind of difficult decision

in the podcasting space of when do you walk away?

Because there’s a particular world leader

that I’ve mentioned in the past

where the conversation is very likely to happen.

And as it happens, those conversations could often be,

unfortunately this person only has 30 minutes now.

I know we agreed for three hours, but unfortunately,

and you have to decide, do I stand my ground on this point?

I suppose that’s the thing that journalists

have to think about, right?

Like, do I hold onto my integrity

in whatever form that takes?

And do I stay my ground

even if I lose a fascinating opportunity?

Anyway, it’s something I thought about

and something I think about.

And with Henry Kissinger, I mean,

he’s had a million amazing conversations in your biography,

so it’s not like something is lost,

but it was still nevertheless to me

some soul searching that I had to do

as a kind of practice for what to me

is a higher stakes conversation.

I’ll just mention it as Vladimir Putin.

I can have a conversation with him

unlike any conversation he’s ever had,

partially because I’m a fluent Russian speaker,

partially because I’m messed up in the head

in certain kinds of ways that make

for an interesting dynamic,

because we’re both Judo people,

we both are certain kinds of human beings

that can have a much deeper apolitical conversation.

I have to ask to stay on the topic of leadership.

You’ve, in your book, Doom,

have talked about wars, pandemics throughout human history,

and in some sense, saying that all of these disasters

are manmade.

So humans have a role in terms of the magnitude

of the effect that they have on human civilization.

Without taking cheap political shots,

can we talk about COVID 19?

How will history remember the COVID 19 pandemic?

What were the successes,

what were the failures of leadership of man, of humans?

Doom was a book that I was planning to write

before the pandemic struck.

As a history of the future based in large measure

on science fiction.

It had occurred to me in 2019

that I had spent too long not reading science fiction,

and so I decided I would liven up my intake

by getting off history for a bit and reading science fiction.

Because history is great at telling you about the perennial

problems of power.

Putin is always interesting on history.

He’s become something of a historian recently

with his essays and lectures.

But what history is bad at telling you is,

well, what will the effects of discontinuity

of technology be?

And so I thought I need some science fiction

to think more about this,

because I’m tending to miss the importance

of technological discontinuity.

If you read a lot of science fiction,

you read a lot of plague books,

because science fiction writers are really quite fond

of the plague scenario.

So the world ends in many ways in science fiction,

but one of the most popular is the lethal pandemic.

So when the first email came to me,

I think it was on January the 3rd

from my medical friend, Justin Stebbing,

funny pneumonia in Wuhan, my antennae began to tingle

because it was just like one of those science fiction books

that begins in just that moment.

It begins in just that way.

In a pandemic, as Larry Brilliant,

the epidemiologist said many years ago,

the key is early detection and early action.

That’s how you deal with a novel pathogen.

And almost no Western country did that.

We know it was doable because the Taiwanese

and the South Koreans did it, and they did it very well.

But really no Western country got this right.

Some were unlucky because super spreader events

happened earlier than in other countries.

Italy was hit very hard very early.

For other countries, the real disaster came quite late.

Russia, which has only relatively recently

had a really bad experience.

The lesson for me is quite different from the one

that most journalists thought they were learning last year.

Most journalists last year thought,

Trump is a terrible president.

He’s saying a lot of crazy things.

It’s his fault that we have high excess mortality

in the United States.

The same argument was being made by journalists in Britain,

Boris Johnson, dot, dot, dot,

Brazil, Jair Bolsonaro, dot, dot, dot,

even India, Narendra Modi, the same argument.

And I think this argument is wrong in a few ways.

It’s true that the populist leaders said many crazy things,

and broadly speaking gave poor guidance

to their populations.

But I don’t think it’s true to say

that with different leaders,

these countries would have done significantly better

if Joe Biden had magically been president a year earlier.

I don’t think the US would have done much better

because the things that caused excess mortality last year

weren’t presidential decisions.

They were utter failure of CDC to provide testing.

That definitely wasn’t Trump’s fault.

Scott Gottlieb’s book makes that very clear.

It’s just been published recently.

We utterly failed to use technology for contact tracing,

which the Koreans did very well.

We didn’t really quarantine anybody seriously.

There was no enforcement of quarantine.

And we exposed the elderly to the virus

as quickly as possible in elderly care homes.

And these things had very little to do

with presidential incompetence.

So I think leadership is of somewhat marginal importance

in a crisis like this,

because what you really need

is your public health bureaucracy to get it right.

And very few Western public health bureaucracies

got it right.

Could the president have given better leadership?


His correct strategy, however,

was to learn from Barack Obama’s playbook

with the opioid epidemic.

The opioid epidemic killed as many people

Obama’s watch as COVID did on Trump’s watch.

And it was worse in a sense

because it only happened in the US.

And each year it killed more people

than the year before, over eight years.

Nobody to my knowledge has ever seriously blamed Obama

for the opioid epidemic.

Trump’s mistake was to put himself front and center

of the response to claim that he had some unique insight

into the pandemic and to say with every passing week,

more and more foolish things

until even a significant portion of people

who’d voted for him in 2016 realized that he’d blown it,

which was why he lost the election.

The correct strategy was actually to make Mike Pence

the pandemic czar and get the hell out of the way.

That’s what my advice to Trump would have been.

In fact, it was in February of last year.

So the mistake was to try to lead,

but actually leadership in a pandemic

is almost a contradiction in terms.

What you really need is your public health bureaucracy

not to fuck it up.

And they really, really fucked it up.

And that was then all blamed on Trump.

Jim Fallows writes a piece in the Atlantic that says,

well, being the president’s like flying a light aircraft,

it’s pilot error.

And I read that piece and I thought,

does he really after all the years he spent writing

think that being president is like flying a light aircraft?

I mean, it’s really nothing like flying a light aircraft.

Being president is you sit on top of a vast bureaucracy

with how many different agencies, 60, 70,

we’ve all lost count.

And you’re surrounded by advisors,

at least a quarter of whom are saying, this is a disaster.

We have to close the borders.

And the others are saying, no, no,

we have to keep the economy going.

That’s what you’re running on in November.

So being a president in a pandemic

is a very unenviable position

because you actually can’t really determine

whether your public health bureaucracy

will get it right or not.

You don’t think to push back on that,

just like being Churchill in a war is difficult.

So leaving Trump by an aside,

what I would love to see from a president

is somebody who makes great speeches

and arouses the public to push the bureaucracy,

the public health bureaucracy,

to get their shit together,

to fire certain kinds of people.

I mean, I’m sorry, but I’m a big fan of powerful speeches,

especially in the modern age with the internet.

It can really move people.

Instead, the lack of speeches

resulted in certain kinds of forces

amplifying division over whether to wear masks or not,

or it’s almost like the public picked some random topic

over which to divide themselves.

And there was like a complete indecision,

which is really what it was,

fear of uncertainty materializing itself

in some kind of division.

And then you almost like busy yourself

with the red versus blue politics,

as opposed to some, I don’t know,

FDR type character just stands and say,

fuck all this bullshit that we’re hearing.

We’re going to manufacture 5 billion tests.

This is what America is great at.

We’re going to build

the greatest testing infrastructure ever built,

or something, or even with the vaccine development.

But that was what I was about to interject.

In a pandemic, the most important thing is the vaccine.

If you get that right,

then you should be forgiven for much else.

And that was the one thing

the Trump administration got right,

because they went around the bureaucracy

with Operation Warp Speed

and achieved a really major success.

So I think the paradox of the 2020 story

in the United States is that the one thing that mattered most

the Trump administration got right,

and it got so much else wrong

that was sort of marginal,

that we were left with the impression

that Trump had been to blame for the whole disaster,

which wasn’t really quite right.

Sure, it would have been great

if we did Operation Warp Speed for testing,

but ultimately vaccines are more important than tests.

And this brings me to the question

that you raised there of polarization and why that happened.

Now, in a book called The Square and the Tower,

I argued that it would be very costly for the United States

to allow the public sphere to continue to be dominated

by a handful of big tech companies,

that this ultimately would have more adverse effects

than simply contested elections.

And I think we saw over the past 18 months

just how bad this could be,

because the odd thing about this country

is that we came up with vaccines with 90 plus percent efficacy

and about 20% of people refused to get them

and still do refuse for reasons that seem best explained

in terms of the anti vaccine network,

which has been embedded on the internet for a long time,

predating the pandemic.

Renny DiResta wrote about this pre 2020.

And this anti vaccine network has turned out

to kill maybe 200,000 Americans

who could have been vaccinated,

but were persuaded through magical thinking

that the vaccine was riskier than the virus.

Whereas you don’t need to be an epidemiologist,

you don’t need to be a medical scientist

to know that the virus is about two orders

of magnitude riskier than the vaccine.

So again, leadership could definitely have been better.

But the politicization of everything

was not Trump’s doing alone.

It happened because our public sphere has been dominated

by a handful of platforms whose business model

inherently promotes polarization,

inherently promotes fake news and extreme views,

because those are the things that get the eyeballs

on the screens and sell the ads.

I mean, this is now a commonplace.

But when one thinks about the cost

of allowing this kind of thing to happen,

it’s now a very high human cost.

And we were foolish to leave uncorrected

these structural problems in the public sphere

that were already very clearly visible in 2016.

And you described that, like you mentioned,

that there’s these networks that are almost like

laying dormant, waiting for their time in the sun,

and they stepped forward in this case.

And that those network effects just disservice catalyst

for whatever the bad parts of human nature.

I do hope that there’s kinds of networks

that emphasize the better angels of our nature,

to quote Steven Pinker.

It’s just clearly, and we know this

from all the revelations of the Facebook whistleblower,

there is clearly a very clear tension

between the business model of a company like Facebook

and the public good, and they know that.

I just talked to the founder of Instagram.

Yes, that’s the case, but it’s not,

from a technology perspective,

absolutely true of any kind of social network.

I think it’s possible to build,

actually I think it’s not just possible,

I think it’s pretty easy if you set that as the goal,

to build social networks

that don’t have these negative effects.

Right, but if the business model is we sell ads,

and the way you sell ads is to maximize user engagement,

then the algorithm is biased

in favor of fake news and extreme views.

So it’s not the ads, a lot of people blame the ads.

The problem I think is the engagement,

and the engagement is just the easiest,

the dumbest way to sell the ads.

I think there’s much different metrics

that could be used to make a lot more money

than the engagement in the long term.

It has more to do with planning for the long term,

so optimizing the selling of ads

to make people happy with themselves in the long term,

as opposed to some kind of addicted like dopamine feeling.

And so that’s, to me that has to do with metrics

and measuring things correctly

and sort of also creating a culture

with what’s valued to have difficult conversations

about what we’re doing with society,

all those kinds of things.

And I think once you have those conversations,

this takes us back to the University of Austin,

kind of once you have those difficult human conversations,

you can design the technology that will actually make

for help people grow,

become the best version of themselves,

help them be happy in the long term.

What gives you hope about the future?

As somebody who studied some of the darker moments

of human history, what gives you hope?

A couple of things.

First of all, the United States

has a very unique operating system.

Which was very well designed by the founders

who’d thought a lot about history

and realized it would take quite a novel design

to prevent the republic going the way of all republics

because republics tend to end up as tyrannies

for reasons that were well established

by the time of the Renaissance.

And it gives me hope that this design has worked very well

and withstood an enormous stress test in the last year.

I became an American in 2018, I think one of the most

important features of this operating system

is that it is the magnet for talent.

Here we sit, part of the immigration story

in a darkened room with funny accents.

A Scot and a Russian walk into a recording studio

and talk about America, it’s very much like a joke.

And Elon’s a South African and so on,

and Teal is a German.

And we’re extraordinarily fortunate

that the natives let us come and play

and play in a way that we could not

in our countries of birth.

And as long as the United States continues

to exploit that superpower, that it is the talent magnet,

then it should out innovate

the totalitarian competition every time.

So that’s one reason for being an optimist.

Another reason, and it’s quite a historical reason

as you would expect from me.

Another reason that I’m optimistic

is that my kids give me a great deal of hope.

They range in age from 27 down to four,

but each of them in their different way

seems to be finding a way through this crazy time of ours

without losing contact with that culture

and civilization that I hold dear.

I don’t want to live in the metaverse

as Mark Zuckerberg imagines it.

To me, that’s a kind of ghastly hell.

I think Western civilization is the best civilization.

And I think that almost all the truths

about the human condition can be found

in Western literature, art, and music.

And I think also that the civilization

that produced the scientific revolution

has produced the great problem solving tool

that eluded the other civilizations

that never really cracked science.

And what gives me hope is that

despite all the temptations and distractions

that their generation had to contend with,

my children in their different ways

have found their way to literature

and to art and to music, and they are civilized.

And I don’t claim much of the credit for that,

I’ve done my best,

but I think it’s deeply encouraging

that they found their way to the things

that I think are indispensable for a happy life,

a fulfilled life.

Nobody, I think, can be truly fulfilled

if they’re cut off from the great body

of Western literature, for example.

I’ve thought a lot about Elon’s argument

that we might be in a simulation.

No, no, there is a simulation, it’s called literature.

And we just have to decide whether or not to enter it.

I’m currently in the midst of the later stages

of Proust’s great A l´heure échec du temps perdu,

and Proust’s observation of human relationships

is perhaps more meticulous than that of any other writer.

And it’s impossible not to find yourself identifying

with Marcel and his obsessive, jealous relationships,

particularly with Albertine.

It’s the simulation.

And you decide, I think, as a sentient being,

how far to, in your own life,

reenact these more profound experiences

that others have written down.

One of my earliest literary simulations

was to reenact Jack Kerouac’s Trippin on the Road

when I was 17, culminating in getting very wasted

in the Hanging Gardens of Xochimilco, not to be missed.

And it hit me, just as I was reading Proust,

that that’s really how to live a rich life,

that one lives life, but one lives it

juxtaposing one’s own experience

against the more refined experiences of the great writers.

So it gives me hope that my children do that a bit.

Do you include the Russian authors in the canon?

Yes, I don’t read Russian,

but I was entirely obsessed

with Russian literature as a schoolboy.

I read my way through Dostoevsky, Tolstoy, Turgenev,

I, Chekhov.

I think of all of those writers,

Tolstoy had the biggest impact

because at the end of War and Peace,

there’s this great essay on historical determinism,

which I think was the reason I became a historian.

But I’m really temperamentally a kind of Turgenev person,

oddly enough.

I think if you haven’t read those novelists,

I mean, you can’t really be a complete human being

if you haven’t read the Brothers Karamazov.

You’re not really, you’re not grown up.

And so I think in many ways,

those are the greatest novels.

Raskolnikov, remember Raskolnikov’s Nightmare

at the end of Crime and Punishment,

in which he imagines in his dream

a world in which a terrible virus spreads.

Do you remember this?

And this virus has the effect of making every individual

think that what he believes is right.

And in this self righteousness,

people fall on one another and commit appalling violence.

That’s Raskolnikov’s Nightmare, and it’s a prophecy.

It’s a terrible prophecy of Russia’s future.

Yeah, and coupled with that is probably the,

I also like the French, the existentialists, all that.

The full spectrum and German’s Hermann Hesse

and just that range of human thought

as expressed in the literature is fascinating.

I really love your idea that the simulation,

like one way to live life

is to kind of explore these other worlds

and borrow from them wisdom

that you then just map onto your own lives.

You almost like stitch together your life

with these kind of pieces from literature.

The highly educated person is constantly struck by illusion.

Everything is an illusion to something that one has read.

And that is the simulation.

That’s what the real metaverse is.

It’s the imaginary world that we enter when we read,

empathize, and then recognize in our daily lives

some scrap of the shared experience

that literature gives us.

Yeah, I think I’ve aspired to be the idiot

from Prince Mishkin from Dostoevsky

and in aspiring to be that,

I have become the idiot, I feel, at least in part.

What, you mentioned the human condition,

does love have to do?

What role does it play in the human condition?

Friendship, love.

Love is the drug.

Love is, this was the great Roxy music line

that Brian Ferry wrote.

And love is the most powerful

and dangerous of all the drugs.

The driving force that overrides our reason.

And of course, it is the primal urge.

So what a civilized society has to do

is to prevent that drug, that primal force

from creating mayhem.

So there have to be rules like monogamy

and rituals like marriage that reign love in.

And make the addicts at least more or less under control.

And I think that’s part of why I’m a romantic

rather than a Steve Pinker, enlightenment rationalist.

Because the romantics realized that love was the drug.

It’s like,

the difference in sensibility between Handel and Wagner.

And I had a Wagnerian phase when I was an undergraduate.

And I still remember thinking that in,

as old as Lieberstod,

that Wagner had got the closest to sex

that anybody had ever got in music,

or perhaps to love.

I’m lucky that I love my wife and that we were,

by the time we met, you know, smart enough to understand

that love is a drug that you have to kind of take

in certain careful ways.

And that it works best in the context of a stable relationship

it works best in the context of a stable family.

That’s the key thing.

That one has to sort of take the drug

and then submit to the conventions

of marriage and family life.

I think in that respect, I’m a kind of tamed romantic.

Tamed romantic.

That’s how I’d like to think of myself.

The degree to which your romanticism is tamed

can be then channeled into productive work.

That’s why you are a historian and a writer

is the best that love is channeled through the writing.

So if you’re going to be addicted to anything,

be addicted to work.

I mean, we’re all addictive,

but the thing about workaholism

is that it is the most productive addiction.

And rather that than drugs or booze.

So yes, I’m always trying to channel my anxieties

into work.

I learned that at a relatively early age,

it’s a sort of massively productive way

of coping with the inner demons.

And again, we should teach kids that

because let’s come back to our earlier conversation

about universities.

Part of what happens at university

is that adolescents have to overcome all the inner demons.

And these include deep insecurity

about one’s appearance, about one’s intellect,

and then madly raging hormones

that cause you to behave like a complete fool

with the people to whom you’re sexually attracted.

All of this is going on in the university.

How can it be a safe space?

It’s a completely dangerous space by definition.

So yeah, I learned teaching young people

how to manage these storms,

that’s part of the job.

And we’re really not allowed to do that anymore

because we can’t talk about these things

for fear of the Title IX officers kicking down the door

and dragging us off in chains.

And like you said, hard work

and something you call work ethic in civilization

is a pretty effective way to achieve, I think,

a kind of happiness in a world that’s full of anxiety.

Or at least exhaustion so that you sleep well.

Well, there is beauty to the exhaustion too.

That’s why running, there’s manual work

that some part of us is built for that.


I mean, we are products of evolution

and our adaptation to a technological world

is a very imperfect one.

So hence the kind of masochistic urge to run.

I like outdoor exercise.

I don’t really like gyms.

So I’ll go for long punishing runs in woodland,

hike up hills.

I like swimming in lakes and in the sea

because there just has to be that physical activity

in order to do the good mental work.

And so it’s all about trying to do the best work.

That’s my sense that we have

some random allocation of talent.

You kind of figure out what it is

that you’re relatively good at

and you try to do that well.

I think my father encouraged me to think that way.

And you don’t mind about being average at the other stuff.

The kind of sick thing

is to try to be brilliant at everything.

I hate those people.

Should really not worry too much

if you’re just an average double bass player, which I am,

or kind of average skier, which I definitely am.

Doing those things okay

is part of leading a rich and fulfilling life.

I was not a good actor,

but I got a lot out of acting as an undergraduate.

Turned out after three years of experimentation at Oxford

that I was, broadly speaking,

better at writing history essays than my peers.

And that was my edge.

That was my comparative advantage.

And so I’ve just tried to make a living

from that slight edge.

Yeah, that’s a beautiful way to describe a life.

Is there a meaning to this thing?

Is there a meaning to life?

What is the meaning of life?

I was brought up by a physicist and a physician.

They were more or less committed atheists

who had left the Church of Scotland

as a protest against sectarianism in Glasgow.

And so my sister and I were told from an early age

life was a cosmic accident, and that was it.

There was no great meaning to it, and I can’t really

get past that.

Isn’t there beauty to being an accident at a cosmic scale?

Yes, I wasn’t taught to feel negative about that.

And if anything, it was a frivolous insight

that the whole thing was a kind of joke.

And I think that atheism isn’t really a basis

for ordering a society, but it’s been all right for me.

I don’t have a kind of sense of a missing religious faith.

For me, however, there’s clearly some embedded

Christian ethics in the way my parents lived.

And so we were kind of atheist Calvinists

who had kind of deposed God, but carried on behaving

as if we were members of the elect in a moral universe.

So that’s kind of the state of mind that I was left in.

And I think that we aren’t really around long enough

to claim that our individual lives have meaning.

But what Edmund Burke said is true.

The real social contract is between the generations,

between the dead, the living, and the unborn.

And the meaning of life is, for me at least,

to live in a way that honors the dead,

seeks to learn from their accumulated wisdom

because they do still outnumber us.

They outnumber the living by quite a significant margin.

And then to be mindful of the unborn

and our responsibility to them.

Writing books is a way of communicating with the unborn.

It may or may not succeed, and probably won’t succeed

if my books are never assigned

by work professors in the future.

So what we have to do is more than just write books

and record podcasts, there have to be institutions.

I’m 57 now.

I realized recently that succession planning

had to be the main focus of the next 20 years

because there are things that I really care about

that I want future generations to have access to.

And so the meaning of life I do regard

as being intergenerational transfer of wisdom.

Ultimately the species will go extinct at some point.

Even if we do colonize Mars, one senses

that physics will catch up with this particular organism,

but it’s in the pretty far distant future.

And so the meaning of life is to make sure

that for as long as there are human beings,

they are able to live the kind of fulfilled lives,

ethically fulfilled, intellectually fulfilled,

emotionally fulfilled lives

that civilization has made possible.

It would be easy for us to revert to the uncivilized world.

There’s a fantastic book that I’m going to misremember.

Milosz is the captive soul, the captive mind rather,

which has a fantastic passage.

He was a Polish intellectual who says,

Americans can never imagine what it’s like

for civilization to be completely destroyed

as it was in Poland by the end of World War II,

to have no rule of law, to have no security of even person,

nevermind property rights.

They can’t imagine what that’s like

and what it will lead you to do.

So one reason for teaching history

is to remind the lucky Generation Z members

of California that civilization is a thin film.

And it can be destroyed remarkably easily.

And to preserve civilization

is a tremendous responsibility that we have.

It’s a huge responsibility.

And we must not destroy ourselves,

whether it’s in the name of wokeism

or the pursuit of the metaverse.

Preserving civilization and making it available,

not just to our kids, but to people we’ll never know,

generations ahead, that’s the meaning.

And do so by studying the lessons of history.

Right, not only studying them, but then acting on them.

For me, the biggest problem is,

how do we apply history more effectively?

It seems as if our institutions, including government,

are very, very bad at applying history.

Lessons of history are learned poorly, if at all.

Analogies are drawn crudely.

Often the wrong inferences are drawn.

One of the big intellectual challenges for me

is how to make history more useful.

And this was the kind of thing that professors used to hate,

but really practically useful,

so that policymakers and citizens

can think about the decisions that they face

with a more historically informed body of knowledge.

Whether it’s a pandemic, the challenge of climate change,

what to do about Taiwan.

I can’t think of a better set of things to know

before you make decisions about those things

than the things that history has to offer.

Well, I love the discipline of applied history,

basically going to history and saying,

what are the key principles here

that are applicable to the problems of today?


And how can we solve that?

The great philosopher of history, R.G. Collingwood,

said in his autobiography, which was published in 1939,

that the purpose of history was to reconstitute

past thought from whatever surviving remnants there were,

and then to juxtapose it with our own predicament.

And that’s that juxtaposition of past experience

with present experience that is so important.

We don’t do that well.

And indeed, we’ve flipped it

so that academic historians now think their mission

is to travel back to the past with the value system of 2021

and castigate the dead for their racism and sexism

and transphobia and whatnot.

And that’s exactly wrong.

Our mission is to go back and try to understand

what it was like to live in the 18th century,

not to go back and condescend to the people of the past.

And once we’ve had a better understanding,

once we’ve seen into their lives, read their words,

tried to reconstitute their experience,

to come back and understand our own time better,

That’s what we should really be doing.

But academic history has gone completely haywire,

and it does almost the exact opposite

of what I think it should do.

And by studying history, walk beautifully, gracefully

through this simulation, as you described,

by mapping the lessons of history into the world of today.

We have virtual reality already in our heads.

We do not need Oculus and the metaverse.

This was an incredible, hopeful conversation

in many ways that I did not expect.

I thought our conversation would be much more

about history than about the future,

and it turned out to be the opposite.

Thank you so much for talking to me today.

It’s a huge honor to finally meet you, to talk to you.

Thank you for your valuable time.

Thank you, Lex, and good luck with Putin.

Thanks for listening to this conversation

with Neil Ferguson.

To support this podcast,

please check out our sponsors in the description.

And now, let me leave you with some words

from Neil Ferguson himself.

No civilization, no matter how mighty it may appear

to itself, is indestructible.

Thank you for listening, and hope to see you next time.