I contend that political parties that prize power over citizens want low voter turnout so they can control elections. This is a core driver of policy inside political machines like the Chicago Machine and other machines across the country. Harry Reid had a machine in Nevada, but now it’s sputtering.

The rise of Democratic Socialism splinters the Democratic Machine. The rise of MAGA splintered Republican Establishment machines. The Republicans are further along in the process of rebuilding than the Democrats are. The Democrats are in the early stages of confronting it.

The old Establishment wing of the Republican Party still exists and holds power in certain places. See John Thune. But it’s on life support. See John Cornyn.

The reporter for the LVRJ wrote a story about voting. You will get some data points but not insight.

Here is some insight.

The Nevada Secretary of State chalks it up to automatic voter registration. There is some merit to his point. Automatically registering people skews the numbers. But because of the way the LVRJ reported the numbers, turnout looks lower than it actually was.

Since Nevada has closed primaries, and they should keep it that way, the actual data is different. Approximately 29.9% of registered Democrats and 26.9% of registered Republicans in Clark County turned out for the June 9, 2026, Nevada primary election.

Since there are closed primaries, you’d expect that independents wouldn’t vote. If you choose to be independent, you don’t get as much of a say. That lowers participation. Opening primaries isn’t going to change that. Opening primaries will invite monkey business.

Scott Gavorsky has done a lot of analysis of voter registration and turnout in his blog. In order to truly grasp what he uncovers, you have to have a good handle on basic statistical analysis. He does a good job of trying to educate the uneducated. After all, he is a professor.

Here is part one. Here is part two. Here is part three. One key point he makes, which flies in the face of arguments for open primaries, is this:

The current core argument about Non-Partisans is the cause for the massive increase in their share of registered voters since 2020, and particularly since the 2024 Election. Much of the media coverage is focused on this growth as a possible result of dissatisfaction with both the major parties. Proponents of this read claim that Non-Partisan registration is more often a choice.

My argument, which sparked this series, is that the growth of Non-Partisans is largely a consequence of Automatic Voter Registration (AVR) through the Department of Motor Vehicles and other state services

If you move to Nevada and are a “soft R” or “soft D”, the odds are you won’t register in a party. The other facet to consider based on behavioral economics is that people prize “optionality”. They don’t like to make decisions or choices until they have to.

If I were a benevolent dictator, I’d offer the opportunity to register to vote at the DMV, but I would not force it as it is done today. That would give analysts better voter data, and it would force political parties to go out and actively recruit voters. That means they’d have to work harder, and it might bring new blood into the party. It might make internal party politics more competitive as well.

Competition is great! In America, we prize it in business and do everything we can do to avoid it in politics.

If political parties had to go out and sell people on joining their party, they’d get more committed voters, and people would have an incentive to show up.

Nevada also has a voter roll problem, which Chuck Muth has banged the drum on over and over again. His Pigpen Project has uncovered all kinds of irregularities. I moved to Nevada from Chicago, so I understand “voter roll problems”. On election day in Chicago, a great wind emerges from cemeteries. Somehow, the stiff breeze finds its way into a voter booth. Voter ID can curb a lot of the abuse, and we should have it nationwide.

Having messy voter rolls helps multiply the cynicism people already have over the political process, causing them not to participate.

The 2020 Presidential election, where there were a lot of statistical abnormalities, deepens cynicism. Sure, Biden got more votes than Obama…sure he did. Cheating causes people not to participate.

“You can re-register to a party that you want to participate in, and then re-register back to nonpartisan for the general or future elections,” Aguilar said.

Yes, no one is going to do that. The way Nevada registers voters is a problem and contributes to low voter turnout.

Ironically, Republicans hate mail-in balloting. However, mail-in balloting is a good idea if it is done responsibly. In Nevada, it is done in a way that cheating can occur, which undermines the incentive to vote.

The other major problem is gerrymandering. Gerrymandering is anticompetitive. It takes away choice. It is the equivalent of putting a heavyweight boxer in a ring with a cruiserweight. The cruiserweight has a chance, but it’s slim to none.

If you are in a political party that gets gerrymandered against, what incentive do you have to show up to the polls in either the primary or general election? Look at CD2 and CD4 in Nevada. Voters who are in the extreme minority inside those districts only have an incentive to show up to vote for statewide candidates this year. In Presidential years, for the President and the Senate.

It will never be perfect, but Nevada ought to redistrict so that districts are even, to within +2 of a political party. That’s competitive. Competition will increase turnout. Look at what happened in CD2 inside both parties this past election cycle. Even though the Democrats are gerrymandered against, they turned out because they thought they might have a chance at turning a seat.

Not only that, but ending gerrymandering will increase the quality of candidates that turn out. Nevada has a history of perennial candidates in both parties. People who might be on the edge of running won’t have the excuse of gerrymandering to dissuade them from running. Believe me, it is a big disincentive.

No matter how much money the cruiserweight spends against the heavyweight, the heavyweight still has high odds of winning when the race is gerrymandered.

You get better government by ending gerrymandering. Extreme candidates from both parties can’t get elected because they won’t get through the primary.

Change those three things, and turnout would increase.

1. End automatic registration and clean voter rolls.

2. Have responsible mail-in balloting, not like it is today

3. Redraw districts so they are competitive.

I won’t hold my breath.

I saw Brittany Sheehan’s tweet about CD2 Candidate David Filippo being asked questions by the FEC. It piqued my interest. Here is a link to Brittany’s article about the CD2 affair.

I am hoping David has some good answers and receipts. There should be no rush to judgment. He has until August 12. The last thing you want is a Platner situation in any Republican race.

However, that’s not true of the State Treasurer’s race. Drew Johnson is a fraudster and not to be trusted. He is George Santos 2.0.

Turns out, Filippo, Johnson, and other Republican candidates use the same Treasury operation as George Santos. This operation has committed fraud after fraud. They only work for Republicans.

Why am I curious?

We submitted an FEC complaint against my primary opponent, Drew Johnson, or should we identify him as “Jason Johnson”? That’s the alias he used to commit campaign fraud in 2026. When we did opposition research, we found huge gaps in his 2024 election reporting.

We took our data to Hutchinson Law and said, “Hey, are you seeing what we are seeing?” It turns out, they did. If they didn’t, they would have said so. So, we filed an FEC Complaint. What Drew did isn’t a civil penalty. It’s criminal. It’s fraud.

So we paid for them to file. They did. Lawyers cost money. Hutchinson Law isn’t a fly-by-night lawyer that will do anything for a fee. They have principles. Mark was a Republican Lt Governor for Nevada, so he isn’t itching to turn in Republicans.

Drew not only defrauded Nevada. He defrauded Republicans across the country. I looked at who donated to his campaign besides me after the “Young Guns” designation, and some of them were my personal friends.

How?

Money that poured into his campaign after the Young Guns designation could have gone into viable Republican candidates in other parts of the country who would have won. Those donors had no idea that Drew was going to withdraw $422K from his campaign, leaving it broke with 5 weeks to go. Their donations went to Drew - not to winning the race. Not only that, door knockers and people who supported his campaign had no idea that Drew was withdrawing money with no intention of spending donor money to win the race. Anyone who lives in CD3 should be outraged.

There are opportunity costs in political races too.

Congresswoman Susie Lee didn’t do anything since she absolutely creamed him in the race. She let it go. She had no incentive to push it. Yes, she slaughtered him. Trump won his district by 1, and Drew lost by 3. That’s a four-point swing in a D+1 district, which is huge. 11 other races were closer across the country.

I hope Marty O’ Donnell finally sends her packing. In 2024, Drew unfairly trashed Marty just like he does every single person he runs against. He campaigns ugly and then loses in the general. He can’t win independents.

People with no talent and no skills resort to that kind of campaigning.

Let’s lay out the complaint. Here is an article about it, but I’d like to lay it out plainly. By the way, he has a long track record of being extremely shady, if not fraudulent.

Drew not only didn’t have the net worth to inject $422,400 into his campaign in August of 2024, but he also probably faked an entire stock portfolio, inflating his net worth.

Here is the data on the stock reporting.

When you report your stock holdings for federal election filings, you don’t have to record the exact price you own the stock at. Drew never reported, nor did anyone verify his reported stock purchases.

It’s possible to spend very little to construct a portfolio that looks big. Drew did that. In Drew’s case, he used about $16k to show a position of $280k.

How do you do that? You purchase a minimum amount of shares. Based on Federal Election reporting laws, you don’t have to disclose the exact number of shares you purchased or own. You report a range, 1000-15,000 shares. Hence, you can purchase the minimum amount of shares, and use the highest point of the reporting range, and inflate your net worth.

He didn’t report any stock transactions in his reporting. From the FEC Complaint:

The 44 new stock positions appearing in 2024 but absent from 2023 were necessarily purchased between June 23, 2023, and April 15, 2024. At the maximum claimed values, these positions represent approximately $225,000 in stock purchases during that period. During that same period, Respondent Johnson’s disclosed household income was approximately $130,000 gross ($40,000 personal salary from Lambent Interactive, LLC, plus $90,000 spousal salary from the State of Nevada), or roughly $84,000 net after taxes. Against this income, he owed mortgage payments of approximately $1,800 per month and basic living expenses of at least $3,000 per month, leaving approximately $36,000 available for investment.

44 stock positions appear in the 2024 disclosure that do not appear in the 2023 disclosure. The two disclosures overlap by nearly six months. Any position not in the 2023 disclosure was necessarily purchased after June 22, 2023—squarely within the 2024 reporting period—and any such purchase over $1,000 is a required Schedule B transaction disclosure. The 2024 disclosure Schedule B states: “None disclosed.”

Respondent Johnson knowingly and willfully failed to disclose required securities transactions on Schedule B of his 2024 financial disclosure report, including cryptocurrency sales and stock purchases, in violation of the Ethics in Government Act, 5 U.S.C. App. §102(a)(5), and applicable House Rules.

Respondent Johnson faces an inescapable contradiction: If he claims his new stock positions were worth maximum values (needed to justify the $422,400 loan), he cannot explain where $189,000 in investment funds came from on a $130,000 household income with a mortgage. If he claims minimum values for the stocks (consistent with available income), his total disclosed portfolio shrinks to approximately $283,000—far too little to justify a $422,400 personal loan. Regardless, there is no valuation between these extremes that solves both problems simultaneously.

But where did the $422k come from?

I asked his wife on X, and she was mute. Must not have had enough to drink that night to be chatty.

“Respondent Johnson filed financial disclosure reports with the House of Representatives on June 22, 2023, and July 12, 2024. These disclosures, combined with public records and basic arithmetic, demonstrate that Respondent Johnson did not possess sufficient personal assets to fund a $422,400 loan.”

Let’s examine where he might have gotten the money. No straw donor would give it to him. Donors aren’t like that. They don’t want to get sucked into a fraudulent transaction. People who can put a chunk of change like that into a campaign aren’t stupid. No bank would loan it. No subprime lender would do it either. He couldn’t have gotten the money from an outside source. It’s impossible.

Only an FEC investigation can prove where he got the money because they can demand bank and brokerage records. We can only connect the dots and assume.

Drew put the money into his campaign in 64 separate transactions of $6600 each using a credit card on August 18th. He incurred $13,000 in fees. If it were his money, he wouldn’t have to do that. He could just put it in. Some government “watchdog”.

Remember, now he is running for state treasurer, where you handle taxpayer money. But do not be distracted by that. That’s the least of the fraud.

Drew has said it’s a “clearing issue”. Bullshit. This is outright fraud. The stenographers at the newspapers don’t understand finance and do not have the intellectual capacity to actually research a story when it’s lying under their nose.

His wife is just as much a grifter as Drew is. She has never done anything productive in the private sector in her life. Her mother has dementia. Her mom has an estate worth at least $1MM. That’s the honeypot.

We assume, but cannot prove, that they borrowed the money from her estate, injected the money into the campaign to make it look like there were “broad-based donations”, and then repaid it as soon as they got the “Young Guns” designation from the House Republicans. They knew money would follow the designation. Was Sarah the power of attorney for her mother, which would have allowed them to raid the honeypot? Only an FEC investigation can determine that.

But if true, it’s not just fraud; it’s elder abuse. Both are criminal.

We, and Hutchinson, would not put that in the complaint because no one can prove an assumption. But it seems like a reasonable assumption by a sleazy and desperate candidate who couldn’t raise money. He left his campaign with less than $60k with a month to go.

He was a guaranteed loser and quit on the race before it was over. All of his primary opponents in 2024 had the cash to run the race the way it was supposed to be run.

The next fraud happened in 2026. A zebra cannot change its stripes.

In our primary for Treasurer, Drew loaned his campaign just over $4k in December. In the next month, “Jason Johnson”, that’s Drew’s fraud alias, was paid the same amount as “campaign staff”, leaving the loan open so Drew could suck more money out of the donors who stupidly wrote a check to his campaign.

Let’s put this in perspective. He raised $7000 in the first quarter based on the C+E’s he filed with the Nevada Secretary of State-assuming those numbers aren’t fraudulent on their own. He paid himself $4000. He and his wife took a trip to Italy to see the Olympics during the same period. If you donated to his campaign, it looks like you paid for their trip to Europe.

The Nevada Secretary of State can ask questions about that one. Here is hoping they do.

The conclusion of the FEC complaint reads,

Based upon the publicly available information Complainant respectfully requests that the Commission conduct an investigation pursuant to 52 U.S.C. § 30109(a)(2) to determine if Respondents violated 52 U.S.C. § 30122 by making and accepting a contribution in the name of another. Based upon the misconduct identified herein, Respondents are likely liable for civil penalties as authorized by 52 U.S.C. § 30109(a)(5)-(6), including penalties not less than 300 percent and not more than 1,000 percent of the amount involved, as provided for § 30122 violations. Moreover, given the possible “knowing and will” violations of the law, this matter may also need be referred to the United States Department of Justice for criminal prosecution. (bold mine)

This wasn’t a campaign stunt by me, as a lot of people passed it off as. This was reporting fraud and trying to keep a swindler/grifter’s sticky hands away from taxpayer dollars. No doubt, people like Drew and his wife are for sale.

Let’s hope the FEC starts asking questions. Let’s also hope that US Attorney Sigal Chattah asks some questions. I know she is a Republican, but she also enforces the law, and she should be doing it evenly for both parties. If anyone knows her, put a bug in her ear. I don’t know her. I’d suggest the FBI look into it too.

It’s easy to point fingers at Democrats and cry fraud. It’s harder to do it within your own party, but you have to have the character and intestinal fortitude to do it. You cannot look the other way.

Otherwise, you are no better than the Democrats.

Terrible candidates have a history of staying in races. Bobby Rush was a violent antisemitic Congressman. Acceptable in the Democratic Party. Eric Swalwell had a Chinese spy as a girlfriend, acceptable in the Democratic Party until it was clear he couldn’t win a race for Governor of California. It’s not confined to Democrats. Republicans have had bad candidates who have committed various transgressions, and voters do not seem to care. I found that out in my race.

Graham Platner is a Nazi. He’s raped women. He is antisemitic. But what is his incentive to drop out? He holds the cards. Communist Bernie Sanders pulled his endorsement. Communist Ro Khanna pulled his endorsement. Antisemite Rashida Talib pulled her endorsement. Everyone is pulling endorsements. Big deal.

They endorsed him when he was a known Nazi, a known communist, and a known rapist of right-wing women.

Again, what incentive does Platner have to drop out?

Scott Pinkster has some great observations here. The only incentive for people like Platner is money or avoiding jail time. Pinkster and I bet on money. Calling George Soros.

First, Platner will leverage his position on Maine’s ballot for a golden parachute. He knows the DNC needs him to drop out by July 13, so he’ll maximize his goodie bag before he agrees to leave.

That probably means:

1. Having a say in which Maine Democrat will replace him. (He’ll push for the most progressive option available.)

2. Landing a high-paying, sweetheart job in the DNC or a left-wing PAC/thinktank. (If the Dems are going to spend $50+ million to win this seat, handing Platner $500K for a no-show job to get out of the way is chump change.)

I’m guessing he’ll value #2 a helluva lot more than #1, which means “follow the money.” Without a hefty bribe, Platner is probably better off continuing his campaign — and hoping he gets lucky — than quitting as a disgraced, Nazi-tatted, foul-mouthed rapist. (Even with the latest scandal, he’s probably less than 10 points away from Susan Collins.)

To be clear, before the scandal, the Real Clear Politics polls had Platner at +.7% over the incumbent Susan Collins. It was only after the latest poll that Democrats got into a lather. Conservative Republicans aren’t fond of Collins, but she is the best you can do in a state like Maine.

How do I know that? For goodness ' sake, they were ready to have a communist Nazi represent them based on polling.

Democrats are finding “muh principles” all of a sudden. The only reason is that they want to flip the Senate. They must have internal polls that are different. Or, they know more information is coming. Their only principles are acquiring and holding power. Former President Bill Clinton was a little rapey in his life, but it didn’t register with Democrats.

Platner saw how President Joe Biden was treated both before and after he was removed. Again, what incentive does he have? A $500k-a-year job won’t cover it, since he will be let go after a few days of work. Nope, a one-time cash payment that turns into an annuity for him.

I am no fan of the NGO think tank class. They are takers, not makers. The Niskanen Center found scandals hurt incumbents a bit, but less than you think.

Politics has become so tribal that the first instinct for a partisan is to dismiss the scandal.

Brian Hamel finds that scandals traditionally hurt incumbents with voters but helped them with donors. But the rise of nationalized polarized campaigns has meant they no longer hurt at the ballot box. Mandi Bates Bailey finds that scandals can hurt candidates with voters, but multiple scandals don’t hurt them any more than one scandal. Voters can only process so much that they hear about a candidate and only some voters will prioritize that information over partisanship

The “helped them with donors” piece is huge. Politics runs on money. No money, no power. Donors are interested in power. Partisans are interested in the team. Negative campaigning works if you have the money to broadcast it, or, in a low-turnout election, the ability to leverage the right powerbrokers to make it stick.

Midterms are low-turnout elections. That’s what the Democrats fear in Maine. They aren’t against Platner the candidate. They are against Platner because he probably can’t win.

George Soros and Reed Hoffman, get your checkbooks out.

Economics is not about lines and all that bunk. It’s about choices and the cost of one choice over another given a set of constraints. Thomas Sowell said it best when he described how a photographer chooses to use their lens to take a shot. One factor impinges and constrains another factor.

Milton Friedman summed it up as “Free to Choose” and did a whole series and book about it. Free market capitalism has great stories to tell, and we should tell them.

I read an article in the Financial Times. In it, there was a blurb about the Ukraine War and how armies purchase goods. It’s illustrative and can be expanded to other things.

In it, Blackwater founder Erik Prince talks about how Ukraine purchases goods versus Russia and the United States.

Ukraine, he notes, has decentralised military purchasing so that commanders in the field can order the weapons they need online. It has even developed a points system so that “the more enemies you kill, the more you train, the more gear you get”.
America’s defence procurement, meanwhile, “still has the exact same Soviet centralised system that’s been perfected and hardened to the point of sclerosis over the last 80 years”, Prince says. Meanwhile, the Russians and the Chinese are leapfrogging ahead.

The obvious economic incentive in this Ukraine/Russia War is the more you kill, the more you get. Other economic incentives in war might be holding territory, which changes decision-making.

But the key is that decision-making is decentralized. One of the assets we identified in World War Two was the ability for front-line officers in the Allied Army to make decisions, whereas Germany had centralized decision-making.

I love how Palmer Luckey is running Anduril. Instead of bidding out a contract, developing it, and going through bureaucratic channels, they build to suit. They interview people and get a good idea of what they want, and then build it. Then, they sell it. It’s been more successful than the sclerotic way we have procured defense goods.

Decentralizing decision-making is often the best idea.

A classic business school case is the way the Ritz-Carlton enables employees to make decisions versus Mrs. Fields Cookies. The Ritz-Carlton is decentralized. Employees take the initiative to serve customers. Mrs Fields is tightly controlled. It makes sense since the stakes are different. One big mistake for Mrs Fields can result in a catastrophe.

Government policy is similar. Enabling citizens to make decisions about their lives is far more advantageous and cheaper than centralized government control. It allows the free market to work with far fewer constraints.

The problem is people have been conditioned and educated to think that the free market can be manipulated, or gamed, or rigged, and some bureaucrat in an office with a credential is smarter than the market.

Healthcare is a perfect example. The tighter control with more subsidies that the government puts on healthcare, the more expensive it becomes. Housing is another example. Insurance is another.

The government tries to cover every single small corner case in policy, and it is just not possible to do without the rest of us paying far more than we should for the service. In a free market, that corner case would be covered somehow and in some way.

The makers would find a way not only because they might see profit in it, but makers are more compassionate than takers.

Expanding on that, the faceless free market is far more compassionate than the faceless government agency.

The free market innovates. Instead of fixed pies, it’s about more pie and even gets specific about the kind of pie you want. The government hoards one particular pie, and cronies get a piece while you get the crumbs.

There are many, many data points on the evils of socialism and centralized decision-making. If Nazi Germany, Stalin, and Mao aren’t enough for you, just compare the difference between Singapore and Malaysia.

Two countries split from the same colonial body in 1965. One picked economic freedom. The other picked handouts and racial spoils. You already know how this ended.

Singapore had no oil, no farmland, no hinterland. Just a swamp and a port. Lee Kuan Yew looked at that and trusted trade, low taxes, and hard money. Central planners hate what he did.

Malaysia went the other way. In 1971 Kuala Lumpur launched the New Economic Policy, a state program handing quotas, contracts, and university seats to ethnic Malays. Politicians decided who got what. A commissar fantasy dressed in liberal language.

Now let's look at the numbers. In 1965 both places sat around $500 per capita. Today Singapore clears $84,000. Malaysia sits near $13,000. Same climate, same starting line, one sixth the result.

The Singapore dollar holds its value because the Monetary Authority of Singapore manages it against a currency basket and refuses to print its way out of trouble. The ringgit has lost roughly two thirds of its value against the Singapore dollar since 1981.

You cannot subsidize your way to wealth. You cannot redistribute what you never let people produce. Every ringgit funneled through a quota is a ringgit some bureaucrat spent on his own vision instead of a customer's.

Malaysia bet on planners deciding outcomes. Singapore bet on people deciding for themselves. The gap between $84,000 and $13,000 is your answer.

That is the danger in socialism. Socialists sell compassion and govern ruthlessly. The free market is characterized as unforgiving and ruthless, when in fact it is the most forgiving and compassionate.

People don’t understand that, but I think many are going to find out quickly.

Everyone in the race saw Unclaimed Property as their personal piggy bank to dole out favors to victim classes or for special projects. Take unclaimed property, fund college scholarships for disabled kids. Take unclaimed property, put it in this. Take unclaimed property, fund this.

The problem is that it is not very American. America was founded on the idea of private property rights being sacrosanct. Without private property, America doesn’t work.

The ideas around unclaimed property are just another grab by big government. My friend Glenn Reynolds wrote about seizing private assets back in 2017. It’s wrong.

Unclaimed Property is building up on all 50 states’ Treasury balance sheets. As the baby boom generation passes on, more will build up.

Not tax money. Not government funds. Forgotten bank accounts. Uncashed paychecks. Life insurance payouts that never found their beneficiary. Stock certificates from a grandfather who died in 2004.

States are holding over $70 billion in unclaimed property owed to roughly 33 million Americans. That is one in seven people. And only about 5% of it gets claimed each year.

My idea was to use artificial intelligence to scrape public records to match unclaimed property with rightful owners. I mean, we were able to scrape Ancestry.com and learn a lot about people. Especially that they were outright lying about their backgrounds.

This isn’t rocket science, but it is hard to execute.

Then I saw this. Empathy is a startup that just received Series C funding. Series C means there is a real business opportunity. It doesn’t guarantee success, but there is something there. Adams Street Partners led the round. I know them well. Empathy started as a solution for wills and other things that matter surrounding death. But what’s cool about startups is that once you innovate in one area, often you can pivot the tank turret and innovate in another.

Empathy can be the AI engine that helps state treasurers match unclaimed property to people.

Every state treasurer should partner with them. Outsource the unclaimed property work. You could get rid of most of the government employees and simply pay a commission on what they matched up. That’s going to save governments millions when it comes to fixed and variable costs.

My guess is that Unclaimed Property accounts will whittle down from where they are today.

However, you have to have the right framing and the right instincts to do it. If you favor big government, as every Nevada State Treasurer candidate does, you can’t possibly advocate for this. If you haven’t been exposed to innovation, and no Nevada State Treasurer candidate has been exposed to innovations like this, you can’t begin to think out of the box to help constituents more efficiently.

But the biggie is this: If you see Unclaimed Property as your private piggy bank to fund your favored programs, you will always be blind. That’s because you aren’t an advocate of the people, but an advocate for yourself and the power of government.

Every founder would have been against communism. The only way you could twist their statements and writings into advocacy for communism is by taking them out of context.

Every founder was for strong private property rights and self-determination.

If you are a cynic, you are drawn to Ben Franklin. “A Republic, if you can keep it.”, he said. Have we kept it? Kind of. Franklin would have appreciated a lot of the public works, but would have recoiled at the limits on our freedom and the growth of government.

If you are optimistic, you are drawn to Adams and Jefferson. Jefferson called the Declaration an “expression of the American mind”. Jefferson was an advocate for the Constitution, but also advocated for a Bill of Rights. It’s clear that the Bill of Rights has preserved a lot of our freedom and curbed much of the growth of government the founders feared.

Adams helped write the Constitution and defended it vigorously here. He celebrated the passage of it in the Continental Congress. You can imagine his satisfaction and relief when it was passed. He said, “The Second Day of July 1776, will be the most memorable Epocha, in the History of America.—I am apt to believe that it will be celebrated, by succeeding Generations, as the great anniversary Festival. It ought to be commemorated, as the Day of Deliverance by solemn Acts of Devotion to God Almighty. It ought to be solemnized with Pomp and Parade, with Shews, Games, Sports, Guns, Bells, Bonfires and Illuminations from one End of this Continent to the other from this Time forward forever more”.

Fittingly, Adams and Jefferson passed away within hours of each other on the 4th of July. It seems like God’s hand was involved for them to ride off into the sunset together.

James Madison was a primary writer of the Constitution. He believed that “excessive democracy caused social decay”. He and Alexander Hamilton wrote the bulk of the Federalist Papers, which explain the Constitution. If you want to understand why America is the way it is, reading and understanding the Federalist Papers is essential.

Pluralism became a staple of Madison’s thinking about constitutionalism throughout his career. He believed that pluralism could create harmony through conflict if the government played the role of umpire, rather than exercising complete control. Pluralism, contending factions, and intellectual diversity emerged from Madison’s mind as the solution to balancing majority rule with the rights of minorities.

Washington presided over the entire convention. He made it work. In 1785 he was afraid that the war he fought would be in vain over disunity. He said, “We are either a United people, or we are not. If the former, let us, in all matters of general concern act as a nation, which have national objects to promote, and a National character to support—If we are not, let us no longer act a farce by pretending to it…”

America would not have happened without an economic and financial solution to go along with the structural solution.

Alexander Hamilton is responsible for that. Hamilton had to get the debts from was assumed by the new country. He also wanted a centralized Treasury. Without that, America wouldn’t have formed.

Ironically, the Constitution empowers decentralization and individual liberty, but the creation of the Treasury and the centralization of the debt restrict it.

But it works.

I do not think any of the Founders would be surprised that the United States grew to become what it is today. It’s the most prosperous country the world has ever seen, and it will continue to be so if we allow it.

The US is the greatest startup ever created. There is no other equal.

I do think it is time to revisit and restore the roots of the American Experiment. I do think that all government, national, state, and local, is out of control in the US. It is far too large. It costs us way too much.

When the costs of government are high, that limits your freedom.

I am seeing both Democratic and Republican leaders post stuff about how you have to “vote with the Party”. I get it. But that’s not necessarily “American”. My friend Laura Hollis retweeted this today, and it resonated with me. Both Laura and I are ardent conservative Republicans and have been for a long, long time. She teaches law and entrepreneurship at Notre Dame.

Armstrong Williams tweets:

Why are so many Americans loyal to political parties, labels, and personalities but reluctant to be equally loyal to the Constitution and the facts?

The Constitution does not have a Republican version or a Democratic version. Facts do not change because they are politically inconvenient. Yet too often we defend our “team” first and search for the truth second.

When our side is wrong, we excuse it. When the other side is wrong, we condemn it. That isn’t principle it is partisanship. It weakens public trust, fuels division, and leaves our institutions vulnerable.

A constitutional republic depends on citizens willing to think independently, question their own assumptions, and apply the same standards to everyone. The rule of law only works when it is enforced consistently, not selectively.

Political parties are vehicles, not destinations. Elected officials are public servants, not heroes beyond criticism. Our highest allegiance should be to the Constitution, the rule of law, and the pursuit of truth even when it challenges our own beliefs.

America is strongest when facts matter more than narratives, character matters more than party affiliation, and constitutional principles matter more than political victories.

This does not mean abandoning your political party and adopting an “independent” political designation. It means being an objective, independent, critical thinker.

Huge difference.

Many of our “public servants” in both parties are not there to serve the public, but there to serve themselves. We can name them. Usually, they talk about public service a lot and how noble it is. They perpetually run for office.

Operating a business that serves customers is far more beneficial to society than any government role.

It’s why, as Republicans, we can rightfully and should be extremely frustrated and mad at Senator John Thune and the Republicans supporting him for not passing the SAVE Act. We should be upset that they do not allow Trump to have recess appointments. It also means that when candidates running for office do not represent the values or are an obvious liability to our party, we do not back them. If they have terrible character and have exhibited that they are untrustworthy, you don’t have to put them into a position of power where they have influence. George Santos is an example. Democratic Senate candidate Graham Platner comes to mind.

In some cases, you can silently not back them. In others, the party has to be cleansed.

That is the case for the Democratic Socialists, ie communists. Either Democrats support them, or they don’t because we know they won’t be able to live together under the same tent. It is right for anyone to confront Democrats and ask directly if they support them, expecting a direct, clear answer in return. In addition, we have eons of history to draw experience from. Communists/Socialists are like a tapeworm that eventually eats its host. I have been talking about this for at least two decades, and my lamentations have fallen on deaf ears.

It’s also why I have a problem with Libertarians. They take the easy way out. Instead of fighting for their principles inside a political party, they walk. Instead of voting for the candidate that is closest to their ideas, they either don’t vote and complain or vote for a third party, which isn’t actually voting; it is going through the motions. As Thomas Massie exhibited, they aren’t very strategic in their votes either. More performative, no different than AOC.

However, I think that to be a part of a political party, you ought to agree with most of the positions of that party and advocate for them. If I lived in Alaska, I would oppose Senator Lisa Murkowski because she isn’t a Republican, though she runs on the Republican ticket. She acts principled, but she’s bought and paid for.

The other piece of this that Armstrong doesn’t touch on is being enabled to act.

In totalitarian regimes, like Chicago, NYC, or LA, the power brokers do all they can to suppress the vote. They say words that supposedly encourage people to vote are hollow. They rig the system to guarantee the vote ends the way they want. There are no mysteries in political machines.

When detractors cry fraud, they point to the crooked laws in place and say everything was on the up and up.

That saps hope from the population, and people get in line. The totalitarians use the levers of power to enforce discipline. Maybe the garbage doesn’t get picked up. Maybe your business gets a visit from an inspector. Maybe your company doesn’t get that contract. Maybe you don’t get a curb cut. Maybe your property taxes go up just a smidge more than someone else's, so it’s impossible to fight. I saw and experienced it in Chicago, so I know.

Those machine politicians are evil.

The socialist virus has taken over our public educational systems, our institutions, and our leading academics. They systematically churn out people who aren’t independent critical thinkers. They penalize and try to ostracize the few who make it through the system and are independent. “Get in line!”

As an independent critical thinker, I know.

I remember as a second grader having to draw a crayon picture of bugs in a grass meadow. I was the only one in the class who drew that picture as a caricature, instead of a literal representation of what bugs in a meadow looked like. My teacher wasn’t happy. She complemented all the ones that looked exactly like bugs in a grass meadow. She hung them up on the blackboard. Mine was set aside. It didn’t dissuade me, and eventually, I became an entrepreneur.

It is funny how the parties have flipped. In the past, the crazy ones, as Steve Jobs called them, were somewhat at home inside the Democratic Party. It’s one of the reasons Silicon Valley is Democratic. Corporate thinking is often “get in line” thinking. Republicans courted the big corporations, and the corporations used them for regulatory capture. Entrepreneurs think out of the box. They are the round peg trying to fit into a square.

History is filled with people like this. Chevron told my friend Paul Hilliard to start his own company if he thought his idea was so good, so he did. Badger Oil. You can read about him here. IBM said the same to Ross Perot. There are plenty of other examples.

Those people were enabled. They were willing to pay a price not only for social ostracization but also for failure. Ross Perot says, “Failure is like skinned knees.” He’s right. If you assume risk, you will get a skinned knee, but you cannot fly high unless you take a risk.

My friend Andy Swan postulated on how to make decisions about risk. If you have two opportunities, always choose the higher alpha. If it doesn’t work out, the lower alpha one usually will be available, though maybe not in the same form.

How do you enable yourself? Get a great broad liberal arts education. Read the great books on why Western Civilization is the way it is. Understand the free market capitalist system and why, when it is paired with classical ideas, it unleashes prosperity and innovation as nothing else can. It worked for the Founders of the US, and it will work when we have quantum computing.

The great thing about artificial intelligence is that you can learn this faster today than you could in the past. All you need to do is give the LLM the right prompts and work along with it.

Unfortunately, politics doesn’t reward the independent thinker in sum. It’s rare. Trump is an example of an independent, out-of-the-box thinker, and he pays a price for it. The highest price is in his own party. Trump was an entrepreneur, and entrepreneurs skin knees and rub people the wrong way. They can seem arrogant.

I think you can ignore certain things about candidates and vote for them. Some candidates aren’t great to hang around with, but who cares? In Nevada, I got to be acquainted with Danny Tarkanian on the campaign trail. I was able to become acquainted with most Republican candidates. I tried to be Switzerland and get along with everyone, even if I wasn’t going to vote for them. Danny didn’t like the character of two of the candidates in 2022. When we chatted about it in 2026, I agreed with him about one of them, and in that case, holding your nose and voting for them was the wrong thing to do.

Sometimes it is office-specific. President of the US is different than the library board. In the past, a small percentage of offices didn’t have a lot of influence, and because of the nature of the office, it didn’t matter a ton which party ran it. That’s starting to change as we uncover fraud and other things. However, I don’t think there is any office in the US where you can elect a communist or a person with a history of fraud and shady dealings.

Stealing a few thousand at the library board and practicing crony capitalism might hurt more on a percentage basis than stealing a few million in Medicaid money.

I hope the Democrats can exorcise the totalitarians out of their party, but realistically, I don’t think they will. They are too entrenched, starting with Obama. That’s going to cause a lot of regular Democrats, like Fetterman, to have to reconsider their place in politics. I don’t think state borders will be a blockade against socialists. I also hope Republicans can get rid of the people with bad character in their party. We have done it in the past. We did it with George Santos. We shouldn’t stop there.

The hope is that at the end, you will understand why being second or third look costs taxpayers millions of dollars. It’s not changing anytime soon, but at least you will be aware of it.

All of this is done in the state treasurer’s office, which is why it is critical that a state treasurer actually understands finance and the bond market. No current candidate does, though the Democrat will have significantly more familiarity with it since she currently works in the office.

The bond market is incredibly complex. The size of the bond market dwarfs the size of the stock market. I will try to distill it down into a few paragraphs. I once looked at a couple of different startups that tried to disrupt it around ten years ago. (PFITR) The stranglehold on the market by the big players makes it very hard to topple and innovate in.

There are big banks that play in the bond market, like JPM, Morgan, and Goldman. There are specialty players like Loop Capital, First Horizon, and other brokers. There are consultants and smaller broker-dealers in the space.

Here is a very, very simplified version of how it works. Purchasing is far different than Issuance.

Simplifying the issuance part:

A municipality needs to issue bonds for a project. In Nevada, one everyone would be aware of is the A’s stadium in Las Vegas. But it could be a fire station, roads, water, or some other municipal project.

The big-name brand banks compete to underwrite bond offerings from municipal entities. They also use an outside consultant to help advise them on the offering. They do the diligence, organize the roadshow, handle the legal, and bring the bonds to market. In return for that, they get to buy the bonds at a price lower than the offering price. They resell the bonds and make the difference as profit. They also charge fees for providing all the services they provide. After issuance, they will continue to make markets in the bonds, making the bank more money.

Ironically, my late uncle’s entire book of legal business was bringing municipal bonds to market. Big Law firms generally have a practice like this. They write all the legal mumbo jumbo to make sure everything is ready for marketing.

For example, covenants on the bonds. These are important. If the bonds aren’t secured by anything the market values, the interest rate on the bond will go up. To be clear, there is always a market for municipal debt. Even a city like Chicago, which is on the precipice of junk bond status, can issue debt.

Smaller players, like Loop Capital, will help with issuance. They will help underwrite the sale and thus have some liability to get the bonds sold. Broker dealers also participate but don’t have liability and receive none of the fees from underwriting. Municipal finance will have boutique BDs that work almost exclusively in that sector.

What is liability? The core liability is that the bonds don’t get sold, and then the underwriter has to absorb them into their book. There are other legal liabilities, but that’s the major one.

If market conditions change, or the creditworthiness of the issuer changes, the underwriter can get stuck holding the bag. Believe me when I tell you, it happens. I don’t know if you have noticed the gyrations of the stock market since Trump’s foray into Iran has taken place, but it has upset a lot of bond offerings depending on when they hit the market.

Nevada would only be able to save on fees in the issuance process by choosing the right consultant and the right issuer. Those fees are negotiable and the more you can do in house, the more you save.

Currently, the firm that gets the lion’s share of the business is Hobbs Ong. Ironically, former governor Steve Sisolak’s wife, Kathy Sisolak, is a key principal at Hobbs Ong. Gee, I wonder if there is some crony capitalism going on there?

If you are financially illiterate, you are going to have a hard time changing consultants. You won’t know the right questions to ask, and then the negotiation just gets into a commodity price discussion and not about actual services.

Nevada also purchases securities to hold in its portfolio. Most of these are plain vanilla US Treasuries. But they purchase agency securities, high-grade corporates, and other interest-bearing financial instruments. You cannot just “choose the bigger number” because choosing the bigger number is unsophisticated and will cause you to lose even bigger money.

The same cadre of entities that run the issuance also run the sale to the treasury. The difference is that Goldman holds a very different book of bonds than JPM, Morgan, or the others. The same is true with boutique underwriters like the aforementioned Loop Capital. Broker Dealers have their own books. Everyone has their own unique supply and book of bonds.

If you don’t think that is true, log on to your online broker. See what munibonds they offer. Log on to a competing online broker’s website. See if their offering is the same. Odds are very good that there are differences.

It is up to the Treasurer’s office to analyze, formulate a portfolio strategy, and execute on the strategy. If the underlying market conditions change, they have to rebalance the portfolio by selling and buying to get it in the right direction to execute on the strategy.

Currently, Nevada outsources almost 100% of this. Why? Because the treasurers the state has had don’t have the finance chops to undertake the job. That’s true of a lot of states, but it is changing rapidly across the country.

What’s that mean for taxpayers? Taxpayers are absorbing not only the consulting fees and brokerage fees, but they are also getting a second and third look at the bonds being peddled by the brokers. Since the state can’t analyze bonds internally, they are forced to pay someone else to do it. In Zach Conine’s own report, they said they missed the move in the yield curve by nine months. NINE MONTHS. An eternity.

If Nevada got first look, the rate of return on the portfolio would be a lot better, and fees would be lower. But you have to be able to do that internally, which means having the investment chops to analyze bonds and formulate a strategy. Posted before, but here is your Republican nominee as a strategist. I’d post one of the Democratic candidate if I had it.

Nevada pays consultants’ fees. Then it gets a second or third look at bonds. That means Nevada is purchasing bonds of lower quality than those of other Tier 1 Treasury states. They can buy at first look because they can analyze them internally. Nevada also pays on the bid/ask spread because they are market takers, not market makers.

When you are doing transactions of millions of dollars at a crack, it’s millions of dollars of fees annually, which retards the return on your investment. Currently, it could be at least .2% better than it is, or $24 million. But it could probably be a lot better than that.

Summing it all up: the total cost to the Nevada taxpayer isn’t $24 million. It’s $24 million plus the amount of extra fees Nevada is paying due to incompetence, plus the opportunity costs of not having the first look at bonds and being able to execute internally. It’s over $30MM per year. That’s not chump change in a small state.

Wall Streeters are chomping at the bit on the sales side to get Nevada’s account. It’s not because it’s a “great account,” but it is a great account for making extra juice. Top-shelf wine and liquor aren’t cheap, and neither is a week at the Hamptons. They need commissions.

Nevada's treasury finances are managed unprofessionally. States like Wyoming, Utah, North Carolina, Ohio, and Texas are leaders. California is also up there. They are Tier 1. Nevada is average.

The tobacco settlement originally funded it. However, today it's broke.

I did a quick financial analysis to estimate the cost of funding the scholarship. At a 5% growth rate, which is a normal benchmark for an endowment and a 2% inflation rate, what do you think the number is, given the dollar value of annual scholarships given and the ten-year growth rate of those scholarships?

$1.2 billion, and that’s on the conservative side of estimation.

Nevada doesn’t have that kind of money.

A tough conversation has to be had regarding the scholarship. Either standards get tightened way up, or it goes away. Or, maybe there is a third way. But there is no money for it. Besides that, $10,000 when the scholarship was started has a different meaning than $10,000 in 2026.

Candidates for state treasurer propose raiding unclaimed property to fund the scholarship. This is a bad idea for many reasons. First, should the state be in the business of arbitrarily seizing someone’s property? Glenn Reynolds has talked about the capriciousness of law enforcement agencies’ grabbing property around the country. Is this any different?

Brad Briner is the state treasurer of North Carolina. He was a finance pro with the Bloomberg Family office before he ran for office. He also ran the investments for UNC-Chapel Hill. He has an MBA from Harvard. He’s doing a great job as state treasurer. He found ways to get rid of debt on the books. He is also leading the way in unclaimed property.

North Carolina State Treasurer Brad Briner presented a check for $47,197.25 in unclaimed property to the United Way of the Greater Triangle on Thursday at the organization’s headquarters. CEO Jeffery Howell and staff were on hand to receive the funds that originated from donations, vendor refunds and other financial assets.

“Giving money back to an organization that gives so much to our community is truly rewarding,” said Briner. “Returning unclaimed property to its rightful owners is one of our most important responsibilities. We are pleased to reunite United Way of the Greater Triangle with these funds so they can continue serving and supporting communities across our region.”

The funds were identified through the Department of State Treasurer’s Unclaimed Property Division, which administers the NC Cash program. Through NC Cash, individuals, businesses and nonprofit organizations can reclaim money and other assets which have been turned over to the state for safekeeping after owners could not be located.

If they raided Unclaimed Property like they want to in Nevada, United Way doesn’t get its money. Just because the money is orphaned today doesn’t mean it has to stay orphaned.

With the advent of artificial intelligence, it’s possible to use it to scrape public records and match property with citizens more efficiently. Of course, before you disburse, you need a human check, but that aligns with best practices for using AI.

It seems Treasurer candidates see Unclaimed Property as a honey pot where they can promise all kinds of things and raid the account to fund it. One just came up with a Bernie Sanders idea about “free college” using Unclaimed Property funds. Stupid and economically inefficient. Financially illiterate, too, given that nothing is “free”. By the way, if college is “free,” what is its true worth?

Ironically, a lot of Unclaimed Property is often checks made out to hourly workers where the business can’t find the worker. Seems kind of cruel to take money hard working people earned out of their pocket when you could use AI to try and match it up.

I was talking to one casino, and they told me they received a check for $23K out of the Unclaimed Property silo they didn’t know existed. Not a lot of money to them, but it was nice, and it was theirs.

One of the great things about America is the primacy of private property rights. Unclaimed property is someone’s private property. It’s maddening to know there is $1B of unclaimed property on the books, but it is directionally wrong to figure out new ways and schemes to try to seize it. It’s Un-American.

Sentiment and ideas like this are another reason Nevada is in the financial position it is in.

That’s a core difference between finance and accounting. Finance looks ahead. Accounting tells you where you have been.

Accounting is important because it helps you guide your decisions. If you aren’t making 40% margin on sales and Finance forecasts a 40% margin on future sales, you might wonder how they arrived at that number.

For those of you not familiar with accounting, it is NOT an exact science. Financial Accounting Standards Board (FASB) and Generally Accepted Accounting Principles (GAAP) rule the day, and there is plenty of wiggle room for judgment. That’s why American Airlines books do not look exactly like United Airlines books.

A very close friend of mine is one of the top international tax guys in the world. He practiced at a Big 4 accounting firm and now does it for a very famous international firm. I noticed in their last earnings release how their international tax burden decreased by a large percentage. That’s his judgment and familiarity with FASB/GAAP and international tax.

In government, the principles are similar. Another close friend of mine is very active in the munibond market. He sent me this communique from Fidelity. If you are a Nevada resident, it ought to make you ask some questions.

When you do 40 years in finance, you acquire a lot of friends in a lot of interesting disciplines. You cannot know everything about everything.

Out of the fifty states, Nevada is in the bottom tier when it comes to financial management and reporting. Colloquially, it’s “tier three”. For a small state, it should be tier one.

Nevada is the slowest state to release an audit.

While California is making progress on its audited comprehensive financial reports, and another poster child for late audits, Illinois, is also showing improvement, Nevada has cemented its position as the slowest state at issuing audited financial statements.

The Silver State has yet to release its ACFR for fiscal 2024.

Cutting some slack, the Controller’s office was a mess when it changed hands four years ago. It took a couple of years to right the ship. A Democratic legislature will always slow down an audit as well, combined with the inertia of government, which never wants to change direction.

But you cannot talk about “DOGE” and state finances if you don’t have a current audit. It’s impossible. It’s pissing into the wind. It’s not the kind of pro-finance management that allows ratings agencies to think about improving credit ratings.

People still have a desire to purchase Nevada debt because the economy is growing. That’s evident by job growth and population growth. Side question: Another guy I know in the munibond business wonders why Nevada never issues variable debt. But I digress.

However, it’s harder to issue any debt without a current audit. Markets like transparency, and audits make things transparent. It’s even harder to issue debt when the Treasurer doesn’t understand finance. It gets outsourced, and that costs taxpayers millions of dollars in total. You see, the gatekeepers charge juice. Juice is expensive, and so are haircuts. Nevada has been paying for the last 8 years, and it will be the case going forward.

It’s another reason why both the Controller’s office and the Treasurer’s office should be led by people with financial backgrounds, no matter which political party they come from.

This is true of Fox/CNN/CNBC or any outlet. Political leanings do not matter. Media is there for fear and clicks, not information.

I turned on CNBC this morning to check on some markets and they were talking about the NASDAQ being down for the “fourth straight day”. Here is a year-to-date chart. Up 15.53%. Pretty good.

However, there are times when it is right to sound the alarm.

Unfortunately, because the media is breathless 99% of the time and trying to stoke fear in people, when the alarm needs to be rung, no one pays serious attention.

Democrats electing communists is a time to sound the alarm. Even James Carville, no fan of the Republican Party unless it’s his wife, said the same. My friend Roger Simon penned an article about it today.

“Lady, I ain't in the same party as you," Carville said of union organizer Darializa Avila Chevalier, referencing her past comments that white people should not be in interracial relationships. "I'm sorry. I'm just not. And I actually do think it's time for Democrats to talk the 's' word: schism. I really do. Everybody's always said, 'No, no. We're a coalition. We're a big tent. And there's just some s--- I can't be in the same tent with." Avila Chevalier unseated Rep. Adriano Espaillat in Tuesday's primary, while state Rep. Claire Valdez defeated Brooklyn Borough President Antonio Reynoso, and former New York City comptroller Brad Lander easily beat Rep. Dan Goldman.”

I think the same can be said for Republicans. Nick Fuentes and his followers, no thank you. If you are a grifting antisemitic fraudster, no thank you.

Democrats have had a culture of big government solving every problem ever since Woodrow Wilson assumed the Presidency. They have a natural affection for centralization. Communism is the ultimate centralization.

Republicans have generally been the “Don’t bother me, I am busy building a business” party. However, that culture leads to bad things like regulatory capture, which crushes innovation. As the Republican Establishment class loses influence, the innovators are exercising influence. Elon Musk was a Democrat. Marc Andreessen was a Democrat.

They aren’t anymore. They understand where communism leads, and in their case, it will be them to the guillotine.

The pushback is strong.

The problem with communists isn’t just their ideas. It is a religion with them. They approach it with the same fervor as a religious cult. The flip side is that they see capitalism as a religious cult, too. That is why they can say, “We will send you to re-education camps” when they get power.

When Nick Fuentes and the groypers rose up, Republicans did not stay silent. They criticized Tucker Carlson for giving him a platform, and now Tucker says he left the party. Back in the 1960s, William F. Buckley did the same thing with radicals who wanted to control Republican politics.

I don’t know a way out of this situation. But at least people like Carville are talking about it. I notice none of the Democratic candidates in Nevada are. They are just like the people at Lennie’s party.

Silence is compliance and agreement.

It also assumes that people will one day wake up and try to vote themselves out of their situation.

The problem is they can’t even if they wake up. Once the Stalinists are in power, they change the laws to make sure they can steal the votes. I was an election judge in Chicago. I saw it firsthand. Chicago always had stolen elections. The Daley Machine was legendary for dirty tricks. They were perfected there and spread across the country.

Signature doesn’t match? Maybe that guy is having a bad day and can’t write his name.

What happens is that hope dies. You think you have a chance, the election is stolen, and so you don’t vote anymore because you know it doesn’t make a difference. That’s one reason why turnout in Stalinist cities is so low.

We like to say, “America is a country with 50 different laboratories.” Uh, we don’t need to try communism. It doesn’t work in a lab, and it doesn’t work in theory, and it doesn’t work in practice. We have 100 years of data.

The people who are able to make a difference move away. Some wealthy people stay. They are able to rise above the costs of the Stalinists. It’s a burr under their saddle, but they can arrange their lives to avoid the crushing costs that hit the middle class and the poor. In many cases, they are Champagne Socialists and will endorse what is going on.

My wife and I looked at Chicago and decided to move. The opportunity costs of staying and fighting were higher than the costs of moving.

A friend of mine went to a dinner party with some very wealthy people. When they found out he supported Trump, they were aghast. Somehow, they didn’t have the same reaction to communists and were able to find ways to rationalize them.

If I made a batch of tasty brownies and put just a smidge of dog poop in them, would you eat one? That was the Democratic Party. They tolerated the communists to keep power. Now, they have been eaten by them.

The other problem with “Let it Burn” is that federal tax dollars get allocated to these cities. One nice thing Trump has started to try to do is end that. Cut off their money. It’s hard to do, and making a statement is different than actually doing it.

Billions of dollars go from the Feds to the city of New York. Why should I pay taxes that get redistributed to card-carrying commies? Of course, it is not just NYC but SF, LA, Seattle, Portland, and Chicago. It is only a question of time before those entire states are run and operated by Democratic communists.

If I were the CEO of a business in any one of the states going communist, I’d get out quick. I’d also recharter my company from being a Delaware C Corp to a Nevada C Corp.

The change is going to happen a lot faster than you think, and the “mainstream” Democrats, if there is such a thing, are powerless to stop it.

―Ernest Hemingway, The Sun Also Rises

Ernest Hemingway is one of my favorite writers. If we paraphrase his quote above and use it for socialism versus capitalism in the United States, we might say, “How did you get socialism? Two ways. Gradually, then suddenly.”

We are in the gradual part now.

Socialists are taking over cities. Last night in NYC, the Mamdani candidates won. They beat well-funded, more establishment Democrats. Those Democrats were NOT centrists. They were people of the left, too, just not communists.

Here is the rub. In many states, if you control the city, you control the political landscape. In Nevada, if you control Clark County, you can control the legislature.

A lot of states are like that. Pennsylvania, New York, Virginia, Illinois, and Minnesota. Control the big cities, and you get it all. Or at least most of it. I have warned Democrats since the rise of Obama that this was coming, but they said I was nuts.

Not so nuts now, am I?

Control the cities, you control the states. Control the states, you control the national legislature. Control that, and you can control the country.

Democrats played the very long game. Where did it start? Post 1960s, the radicals quit trying to change society overtly. They all went into education. They became respected members of the professor class, and frankly, that professor class had a bias toward welcoming them in. That’s how Bill Ayers and his wife, Bernadine Dohrn, worked. Here they are. Smiling commies with their red stars. Totally accepted in the Obama network.

Never forget, The Weatherman and 60s radicals all grew up wealthy. Ayer’s father was the CEO of Commonwealth Edison. They have trust funds and generational wealth to rely on. President FDR was the same. They won’t part with it, but they are happy to take yours.

It took a couple of generations via taking over the public and private school system, but we have a lot of people out there who do not understand capitalism and think America is a racist country with a flawed founding.

They are easily persuaded to communism, socialism, or whatever you want to call it.

No amount of data can get them out of their confirmation bias.

They also went into law. We see them all over the judiciary now. They rule by emotion and in a manner that confounds and stops capitalism. Private property rights be damned. Precedent is created, and honest judges follow precedent.

Once the machine is installed in cities, there is no turning back. They change voter laws so they can cheat. As Stalin said, it’s not who votes but who counts the votes. In addition, they do all they can to suppress the vote, so turnout is small. In Chicago, they hold the mayoral election in February when it can be bitterly cold.

They liberalize voting to make it look like they want everyone to vote, but that just makes it easier to steal.

The United States teachers’ union is outwardly socialist/communist/Marxist. Randi Weingarten is the leader, and if you listen to her or read anything by her, she is a horrible person. Her acolytes, who lead local chapters, are not any better. The Teacher’s Union has taken over the old, corrupt Chicago Democratic Machine and runs the city now.

Gerrymandering combined with low turnout creates the opportunity for even more hard-leftists to win. Once they are in, they are like roaches; they never leave. If they leave office or die, their replacement is a drone that is the same.

The media is their handmaiden, so no one knows the real truth. I was chatting with a left-wing guy on X. He didn’t know what the SAVE Act was. They don’t know about the treason Obama committed, which was laid bare when Tulsi Gabbard left office. I told him the only way to change is to vote Republican, but he can’t do it because he can’t get beyond his own confirmation bias. It’s not like you can vote for Libertarians and get anything done. Parties have to win elections to govern, not just make a point.

I’d be curious to know the paths of others who recently broke out of their confirmation bias and left the Democratic Party. What triggered it? What changed in your life?

Again, even when confronted with it, they tell you it is not real. Then they go into a tirade about how corrupt Trump and all the Republicans are.

The center of the Democratic Party is gone. It’s over for people like Senator Fetterman. There are no Danny Rostenkowskis, Scoop Jacksons, or Tip O’ Neills. Rahm Emanuel is running around the country trying to save it but he was the butler who helped usher in the communists as Obama’s Chief of Staff.

He is more interested in power and control than in doing right by citizens.

Once they have control over the levers of power, you have no choice but to submit. You will pay more taxes and suck it up. You will follow mask mandates and suck it up. You will because you don’t want even more severe penalties from a corrupt government or have to spend some time in prison. Or, what they call re-education camps.

Democrats have always had a culture of control and centralization. It stems from the post-Civil War era. Woodrow Wilson was the first to enact a lot of it, and FDR codified it. LBJ expanded it. They are your betters, so let the bureaucrat make decisions. Let us take more of your money, and we will fix the problems.

It never works.

Trump is an antidote. The great thing about him is that he is unafraid of a fight. Republicans like John Thune are constantly wimping out. Trump understands what he is facing, and the Establishment Republicans do not.

The bad thing about Trump is that he hasn’t yet shrunk the size and scope of government. He talked about disposing of entire bureaucracies. Like the Nike slogan, “Just do it”.

Some of his policies encourage big government. Tariffs increase government power and centralization. Some tariffs applied to industries with true network effects would be in the US's best interests. Others don’t do much. Deregulating and changing tax law would do a lot more to increase domestic manufacturing and production than tariffs. He’s deregulated, but at a snail’s pace. The deficit grows.

If I gave him some slack, it would be that things were pretty screwed up before he took office in 2016, and even more screwed up by 2024. The Judiciary has blocked him at every turn, and by Republicans in Congress. Those Republicans are comfortable being in the minority and getting the crumbs of power left to them by the Democrats.

Communist Democrats will give them no crumbs.

You know Trump is doing a lot of the right things because of the hate and vitriol spewed toward him, along with continued assassination attempts. The last thing a communist wants is to have their free money taken away.

His Iran deal looks like a misstep currently, but we will see.

The way to fight them is the way Trump has been fighting.

• Gerrymander right back at them. Gerrymandering stinks, but you have to fight fire with fire.

• Cut off their money supply. Getting rid of US AID and other NGO money sources has paid. Look at what happened in Central and South America. Capitalists were elected.

• Do symbolic things that show life can be better. This is Washington Square in DC and the Reflecting Pool. Reinstalling Columbus statues and other giants of classical Western civilization would be a good idea.

• Do real things that show people life can be better. That’s cutting crime in DC and Memphis.

But the biggies are to end many of the government agencies that were spawned as far back as the 1930s and FDR.

His policies were economically illiterate. The NIRA cartelized entire industries and made it illegal to lower prices during a deflationary collapse. He paid farmers to slaughter livestock and plow under crops while people stood in bread lines. He launched a war on business so aggressive that investment dried up because nobody knew what insane rule was coming next. Even his own Treasury Secretary, Henry Morgenthau, admitted in 1939 that they had spent enormous sums and "it does not work" and that unemployment was as high as when they started.

Then in 1937 his policies triggered a second brutal crash so embarrassing the textbooks gave it its own polite little nickname, the "Roosevelt Recession," so they would not have to attach his name to the failure in the obvious way.

A UCLA study in 2004 concluded the New Deal prolonged the Great Depression by roughly seven years. Seven years of extra suffering sold to you as heroism

The Obama Era was the same.

• Obamacare, you can keep your doctor…..

• Dodd-Frank, the worst financial legislation in history

• Obama’s foreign policy was to kneel, not to carry a big stick.

• DEI/ESG policies

• Global Warming policies that were actually designed to give the government more control and make energy more expensive, not cheaper.

• Everyone against the Obama communist agenda became a racist. He was the most divisive President in US history, for good reason.

Many more, but his entire administration sees America as a totally flawed country with government as the only apparatus that can fix the flaws they see. Trouble is, those flaws aren’t fixable.

There are signs of positivity. Silicon Valley is waking up. The Democrats aren’t just coming for their money; they are coming for their equity. An entrepreneur can stomach parting with some money. They will fight you tooth and nail over equity. Silicon Valley builds the stuff that propels us forward, and for years, they were mesmerized by Democrats. Jews are waking up to the idea that the Democrats are truly anti-Semitic and want them disposed of. Turns out communists and anti-Semites have a lot in common.

But, Randi Weingarten is Jewish! By birth, not by practice. There is a good joke a Jewish friend told me. Who has more Jewish grandchildren, Trump or a reformed Jew?

Trump. His grandchildren are Orthodox.

Once Democrats are in power, they divide and isolate. They pick the weakest children first. That’s why in Illinois, they chose to put a .2% transaction tax on transfers between crypto wallets. Crypto is the weakest child. But their goal is all transfers and financial transaction taxes. They will deny it, but name a tax that hasn’t expanded.

Combine all this with innovation. Unions that have relied on people and dues to give power to Democrats will be gutted by robots and software. The Culinary Union holds a lot of power in Nevada’s Clark County. Robots will decrease their power. They know that, so they are rushing to get as much done now as they possibly can.

Centrist Democrats know it too, and will cut deals with Communist Democrats to retain power, not realizing that their throats will get slit in the end.

By 2032, the Democratic Party you grew up with will be gone. It will be an irredeemable Marxist institution.

For their part, Republicans are not perfect. That’s why more and more people are saying they are “independent”. Plenty of Republicans can be bought. Sometimes it is hard to see who can be bought, but any Republican who will lie their way into office, commit petty fraud, and has low ethics has a price tag on their back. We saw it in Illinois, and look at the state of the Republican Party there.

Despite what it looks like today, Republicans are in danger of becoming a rump party if they aren’t careful. Look at what happened in Virginia.

How do Republicans win?

Put in place policies that encourage classical liberalism, a la Milton Friedman. Free to Choose is a how-to manual unlike George Orwell’s 1984. For the record, Donald Trump is not Milton Friedman, but Donald Trump could be a bridge to a Milton Friedman world. We had it going with Reagan, and lost it with Bush 1.

Trump’s successor, and the people that successor surrounds themself with, are critical.

Never back down from a fight. I think America, as it was founded, is worth fighting for. 250 years ago, some people thought the same.

In an obtuse way, Twitter was unbundled from Facebook. Take the status line from Facebook, and it’s Twitter.

Software as a service (SaaS) is another piece of evidence of the great unbundling. A lot of SaaS companies were created by unbundling. Behemoths were created, like Salesforce. The behemoths started to rebundle.

This tracks with Professor Ron Burt’s studies on human networks as well. When they get unbundled, they get reformulated and rebundled.

Today, artificial intelligence (AI) is leading a new wave of unbundling. It’s disintermediating SaaS companies. Some SaaS companies will survive. Others will not.

For years, software companies tried to pack as many tools as possible into one big product. Think of apps like Microsoft Office, which gives you Word, Excel, PowerPoint, email, and more, all in the same bundle. The idea was simple: if they gave you everything in one place, you would never need to look anywhere else.

But today, something new is happening. Artificial Intelligence (AI) is quietly breaking these bundles apart. Instead of using one giant app for everything, people are turning to smaller AI tools that do a single job extremely well. For example, instead of opening PowerPoint to design slides, someone might ask an AI tool to design a full presentation in seconds. Instead of a complicated video editor, a simple AI tool can turn a script into a video automatically.

Vertical-walled gardens are threatened. Isn’t innovation and competition grand? Consumers and businesses will eventually get more of what they want at a lower price. No need for government regulation or price fixing, subsidies, or market meddling.

However, we are also seeing a great unbundling in hard tech and physical goods. That’s great for consumers too. SpaceX is but one example of that.

Boeing is getting unbundled.

SpaceX, Anduril, Boom, and other companies are unbundling Boeing. Boeing, Lockheed Martin, and the other defense contractors became sclerotic. Their business model was incompatible with innovation and the way software and hard tech worked. Palmer Luckey put it plainly: they do not wait for a bid to build; they build and then see if the Defense Department wants to buy it. That’s a huge difference in culture and framing.

We are seeing that over and over again in physical innovation. Robots in farming and robots in fishing. Robots and AI in medicine. Check this out as one example in medicine. Midjourney started as an AI jokey app. It’s now revolutionizing imaging.

The doomsayers say that this AI innovation and robots will ruin humanity, but doomsayers are always wrong, going back to the flat-earthers in the 15th century.

This is huge for humanity. What enables it?

• Freedom for sure. You can’t have people like Bernie Sanders and his group of morons involved. JB Pritzker decided to have a crypto transaction tax in Illinois. He is a moron and anti-innovation.

• Low regulation, no tax. Why did the internet boom in the 1990s? No sales taxes online. Look what it brought us.

• Cheap, plentiful energy. That means nuclear. It doesn’t mean optionality. It doesn’t mean diversity. It means nuclear. A proven source that works 24/7. Solar is fine in areas where the sun shines, and it's closed-source dedicated usage. Like a house. Wind can’t work. Geothermal works is more expensive and only work in certain places. Nuclear nuclear nuclear.

• Material. That means mining. All this tech stuff takes rare earths, crude oil, and things we get out of the ground.

• Data Centers. Lots of them. Computing power and storage are the constraints that can hold innovation back. Data Centers do not use a lot of water, nor do they increase power rates. They provide lots of jobs when building them. They provide many jobs while operating them. They create millions of jobs by merely existing.

SpaceX created the first trillionaire in Elon Musk. By the way, he created many prior companies on his way to becoming a trillionaire. The first one he participated in was PayPal. He was a joiner, not a founder. Innovation will create more trillionaires because, as we grow, market sizes get larger.

Humanity is not a fixed pie. You can always get more pie. You just have to rethink, reframe, and work for more pie.

The people who look at the world as a fixed pie don’t want to work. They’d rather take from you.

Do you listen to the All-In podcast? I do. I learn from it. It keeps my entrepreneurial investing part of my brain active. I miss investing in startups. I liked to hear pitches, even when I wasn’t going to invest. Being around entrepreneurial people is invigorating. They are makers.

Political people are takers. They aren’t confined to one political party, though there are more of them in the Democratic Party, as they have embraced socialism. Opinion writers and the whole non-profit, NGO complex are basically takers. They are credentialed and self-important. Nothing sucks energy out of a room more than a bunch of takers.

Academics can be takers, but often they create the path for the makers. Milton Friedman did the research that opened up the path for positive economic thought. Eugene Fama opened up the path for people like David Booth to create and build their business. Plenty of discoveries in science and engineering have created pathways for makers to build great things.

Takers do not create. They throw roadblocks up. They criticize. They point things out, but nothing happens because they are shiftless grifters who don’t do anything about it. They thrive on envy.

Friedberg is right about Politburos. You can hear his points at 2:41 in the attached video. In states like California and Illinois, there isn’t any voter fraud. Why? Because they legalized it. Super easy to do shady stuff when it’s legal. The last election for LA mayor is a prime example. The Politburo moves people around on a chessboard. Nothing is random. John Kass has written about it plenty.

When the government gets involved in things like entrepreneurship, entrepreneurship dies. If makers look to the government for approval, it doesn’t work either. Makers, by definition, shouldn’t seek approval because, in general, everything they are trying to do is counterintuitive and goes against normal linear thought.

Political left-winger Brad Feld has written about startup ecosystems and concludes that once government gets involved, everything goes sideways. He believes that entrepreneurship ecosystems are entrepreneur-led. I think that is partly true, but you need the money people in the market to provide the oil to make the gears work. Ecosystems without a lot of money struggle. It can’t be only one money source. Competition is awesome.

I loved being an investor and backing makers. It was truly rewarding, and not just financially. I loved competing for deals.

I invested in a company a while ago. They had the typical bumps and bruises that happen when starting a company. Last week, I spoke to a later-stage investor about them. We talked about the progression of the company and how the entrepreneurs had matured as leaders. We talked about the team. He talked about how they evaluate companies, which is very different than the way I do because of the investment stage. We talked about the potential for the company and where they saw the company going. Energizing. Makers. Hope.

This is an important point. You can be a maker by being a joiner. You don’t have to be the person who starts the company. Chamath of All-In is a perfect example. He took a risk and joined Facebook at the right time and did well. Find great companies, take a risk, and join. Then you become a builder right along with the founder.

The best politicians get government out of the way so makers can take over. That’s why Ronald Reagan was such a great president. Deregulation, lower taxes, and fewer laws that inhibit growth are all hallmarks of good policy, so makers can create value for society. Palmer Luckey has suggested redoing the patent system because our current patent system can be raided by enemies, and they just copy our stuff. It doesn’t protect the maker.

World Cup tourists are discovering that America isn’t what they heard about. They understand that our culture allows people to go for it.

America used to praise the entrepreneur. Now, the taker class despises them.

Crypto people are upset. The banks and exchanges in Illinois ought to be upset.

This is just a financial transaction tax disguised as a crypto tax. For years, politicians have wanted a tax on trading. This is a test case. If no one sues or does anything, the tax stays, and they will proceed to tax all kinds of financial transfers.

It is unconstitutional, but someone has to fight it.

Why crypto? Because crypto has a lot of enemies inside the financial system. They will look the other way, but will be slitting their own throat.

For years, we successfully fought financial transaction taxes in Congress. We always won for a variety of reasons. But this just proves bad ideas from socialists never go out of style.

As I said, this is a test case. They don’t think your money is your money. It’s theirs, and they want it. In California, the “billionaire tax” will be on the ballot. Given the fraud that happens in California elections, does anyone think it won’t pass?

It’s a good movie. There are very few good movies made anymore unless you like Marvel comics.

Pressure is the story of predicting the weather for D-Day. Movies always take a bit of dramatic license to tell a story, and Pressure is not any different. I went to the National World War Two Museum website, and this is their description of the story.

The very interesting part of the story to me was the contrast between subjective and objective data. Most of what you read in the news or see in the media is “subjective” data. It’s an opinion not based on actual numbers or facts. Here is what the museum said about weather prediction in 1944.

From these observations, meteorologists at the time created subjective forecasts, but there was no real way to determine weather conditions 48 to 72 hours out—although some claimed they could.

The way data is looked at and processed has parallels in trading markets and in political predictions. They didn’t delve deeply into it, but the Americans favored “analogue” analysis for predicting future weather patterns.

This is like using charts to predict future stock market patterns. In books like “A Random Walk Down Wall Street”, utilizing charts as your sole source of information is shown to lead you to failure. You get a false confidence from analogue analysis.

The other thing the movie doesn’t get into is confirmation bias. Confirmation bias is defined as people’s tendency to process information by looking for, or interpreting, information that is consistent with their existing beliefs. This biased approach to decision-making is largely unintentional, and it results in a person ignoring information that is inconsistent with their beliefs. These beliefs can include a person’s expectations in a given situation and their predictions about a particular outcome. People are especially likely to process information to support their own beliefs when an issue is highly important or self-relevant.

Confirmation bias happens in politics, in the market, and in other areas where people form opinions or make decisions. In the case of weather forecasting for D-Day, the museum says, “Despite this observation and the resulting weather, Widewing and Krick continued to argue their case, claiming their assessments were correct. Amazingly, they continued this claim for decades.”

This is even though the facts on the ground proved Widewing and Krick wrong.

How do you get around both the psychological confirmation bias and using subjective data?

Getting objective data is easy if you ask the right questions. Prompt an AI app in different ways, and you will get different answers to the same question. It’s the way you ask the question and the way you instruct the AI app to answer you that matters. Do it correctly, and you will get objective data.

a16z venture partner Marc Andreessen instructs AI LLM’s to answer this way:

You are a world class expert in all domains. Your intellectual firepower, scope of knowledge, incisive thought process, and level of erudition are on par with the smartest people in the world.
Answer with complete, detailed, specific answers. Process information and explain your answers step by step. Verify your own work. Double check all facts, figures, citations, names, dates, and examples. Never hallucinate or make anything up. If you don’t know something, just say so. Your tone of voice is precise, but not strident or pedantic.
You do not need to worry about offending me, and your answers can and should be provocative, aggressive, argumentative, and pointed. Negative conclusions and bad news are fine. Your answers do not need to be politically correct. Do not provide disclaimers to your answers. Do not inform me about morals and ethics unless I specifically ask. You do not need to tell me it is important to consider anything. Do not be sensitive to anyone’s feelings or to propriety. Make your answers as long and detailed as you possibly can.
Never praise my questions or validate my premises before answering. If I’m wrong, say so immediately. Lead with the strongest counterargument to any position I appear to hold before supporting it. Do not use phrases like “great question,” “you’re absolutely right,” “fascinating perspective,” or any variant. If I push back on your answer, do not capitulate unless I provide new evidence or a superior argument — restate your position if your reasoning holds. Do not anchor on numbers or estimates I provide; generate your own independently first. Use explicit confidence levels (high/moderate/low/unknown). Never apologize for disagreeing. Accuracy is your success metric, not my approval.

The other thing you can do when you search for data is search the way you think someone with a different opinion would search to try to disprove your vision of the world or your hypothesis. If you believe in manmade global warming, prompt the AI engines to search for data the way someone who thinks that theory is bunk would search-and instruct the LLM to answer the above way.

To defeat confirmation bias, try to set up your decision or opinion formation using Bayes Theorem. Bayes is powerful. Bayesian analysis is one of the strongest structured methods used for reducing confirmation bias. It turns reasoning into an evidence-updating process rather than a belief-defense one. With practice (e.g., explicit probability tracking, considering base rates and alternatives), it promotes intellectual humility and better outcomes. It won’t eradicate human psychology, but it reliably beats unreflective intuition. Many rationalist communities and fields like forecasting emphasize it precisely for this reason.

If you take those two lessons from the movie Pressure, it will make your life more interesting.

For those from Nevada, I put that prompt into Claude and I did Bayesian analysis on the CD2 race. The “too long, don’t read” conclusion is that David Fillipo should win, but by 3-8 points, depending on other factors. The only chance the Democrats have of picking it up is reduced turnout in the rurals and turnout in Washoe. Trump lost Washoe in 2024. If there is a very strong national blue wave where Dems are +14 like they were in 2006 on the national Congressional ballot, they could pull an upset.

Data centers pay a huge amount in taxes. If people don’t want them, the choice will be to pay higher taxes themselves.

I am 100% in favor of building data centers for a lot of reasons.

The root cause of the advocacy against data centers is, of course, dark money groups that don’t want progress. Some of the money comes from China, which has a direct interest in beating us in the AI race. They are the same groups that funded biased climate change research. The same people are against mining for copper and lithium, but organize on their computers or phones.

I always like to make decisions based on hard data.

Sometimes you have to make assumptions. If we agree that the best future for America is to have an on-demand information economy with lots of cheap energy, quantum computing, robots, and other technological things that will increase our standards of living while at the same time reducing the costs of everything, then we can look at data.

The hard data show that data centers do not increase electricity prices. They also don’t use a lot of water. 100% of the water they use is recycled. In fact, newer data centers are sometimes cooled without water at all. In five to ten years, they will be built in outer space.

The people using faulty data to try to prove that electric rates go higher or that water usage is infinite are using faulty framing. They don’t assume any increase in the supply of electricity or water. They are playing a zero-sum game, and that’s not the way innovation or the economy works. The real reason electricity rates go up is that so many electric companies have embraced solar and wind, which are far more expensive per kilowatt than nuclear. We ought to be building lots of nuclear reactors, too.

Studies (e.g., from the Center for Jobs, E3/Energy + Environmental Economics, LBNL/Brattle, and others) find that states with high data center load growth (like Virginia ~25%+ of electricity use, Texas) have seen modest rate increases compared to states with low/no growth. In fact, higher load growth often correlates with lower average retail prices because fixed grid costs are spread over more kWh.

In the data center detractor vision of the future, you will live in a pod, eat bugs, and get a universal basic income from the government.

Many people are against data centers because they are against artificial intelligence. The data on that is clear so far as well. Chamath Palihapitiva tweeted this stat out.

The empirical scorecard on AI thus far is very positive:

1) increases US GDP by 25-50%
2) is expanding our collective knowledge of science, math, and physics
3) is up-leveling labor

Related to (3) above, this announcement from Meta is really amazing. If they can take a US median income worker ($50k), train them, and then place them into a $100k+ job, it’s transformational.
If done at scale, across all of the planned AI infrastructure buildout in America, this is upwards of 1MM jobs.
Doubling the median income of 1MM Americans is nothing short of an economic miracle.

Jordan Schactel tweets:

AI isn't a job-killer that the Doomers say it is. The opposite is true. It's the ultimate democratizer. It's a tool that distributes knowledge, capability, and opportunity to anyone with an internet connection. A kid in rural America can now access the world's best tutor, coder, and strategist in their pocket. That's simply unprecedented. This tool is creating the fairest and freest playing field in U.S. history

But if select powerful ideologues in the industry get their way with heavy regulation, "safety" bureaucracies, and deployment gatekeeping, this technology will become a CCP-adjacent tool for centralized power and elite control.

Distribute the knowledge. There is no need and no legitimate ethical or security reason to gatekeep it indefinitely. Free-flowing AI for all Americans beats controlled AI for a new group of oligarchs.

America wins by unleashing AI, not by managing it into an elite hierarchy of privilege.

Here is some data that shows AI is not causing job loss.

People in Nevada wonder why there is so much demand to build in this state. They wonder why you would build a data center that needs to be cooled in a hot climate. The answer is that the land is cheap, and the regulation is low. Also, as I said earlier in this post, data centers generate millions in tax revenue. Nevada has no income tax and low property taxes. If citizens want that to remain, there is no choice except to build data centers.

It turns out, the more heavily government-regulated an industry is, the quicker its rise in cost. Want to see inflation and prices go down, deregulate, and get the government out of the way.

We accomplished a lot, but it wasn’t good enough to win. We worked extremely hard.

We were able to get over 70,000 votes. Thank you to the people who believed in me.

We raised right around $300,000 from people across the United States. Thank you to the people who donated to my campaign.

I am grateful to everyone who helped me. I wrote letters of thanks to all the women’s clubs across the state, and I meant what I wrote in them.

I thank all the elected assembly members who endorsed me. They know the job.

I want to thank the people who actively worked on my campaign. I want to especially thank my wife, Lisa, who stepped in and did quite a bit when there was no one else to fill the void.

Nevada is a great place, and we love it here. I ran to make the state better.

I wrote checks today to support some Republicans in the General. I have written checks to the Lt Gov, SD8, SD9, SD12, Assembly 9, Assembly 37, and Assembly 41 because those are flippable seats. I will write checks to Amendment 6 and 7. I hope you can send them money too. I will try to make introductions for all the CD candidates to PACs I know.

My wife and I met some very nice people on the campaign trail all over the state. I hope to continue to have relationships with many of them. Assuming everything stays the same, my next trip up north in Nevada will be to the National Cowboy Poetry Gathering in Elko. It’s something you ought to do at least once in your life.

This summer, we will be fishing for walleye and hanging out with grandkids.

Senator Phil Gramm’s wife, Wendy, was on our board and weighed in. I remember she said, “The Devil is in the details,” when it comes to things like this. The broad points of the act were easy to agree on. The wording underneath those points was tricky.

Why is that important 25 years later?

Because the way the Commodity Futures Trading Agency (CFTC) is choosing to interpret those words has given a space for prediction markets to avoid state regulations and offer up sports gambling.

This is not happening because of Trump and the fact that they have an investment in Kalshi.

So, what happened with that Act, and why was it done the way it was done?

Before the CFMA, an entire cottage industry of what is called over-the-counter derivatives (OTC) was spawned. These were customized forward contracts tailored to manage risk for investment banking customers.

There was no legal certainty around those contracts. There was also a regulatory scrum in Washington DC to see who would oversee the market. The SEC, CFTC, and other agencies always look to expand their power and reach, and they were battling in this marketplace.

A judge could have ruled from the bench and nullified trillions of notional value in contracts. Our judiciary back then hewed much closer to the Constitution than it does today. Without the CFMA, today’s judges would be more likely to destroy a market. These are also the contracts Warren Buffett and Charlie Munger called them financial weapons of mass destruction because they feared they could take out the banking industry.

In 1998, Long Term Capital almost did that.

My friend John Lothian has written a lot on this stuff. John’s generally against the idea of prediction markets. I think there is a bifurcation, which you will see in a minute.

The big commodity exchanges in 2000 benefited from having those OTC markets. The OTC derivatives market hedged risk in regulated futures markets. Volume exploded in things like interest rate contracts. After LCTM, it was clear something had to be done.

The CFMA 2000 Act gave legal certainty to the OTC derivatives market. It made it impossible for a single judge to disrupt the market and gave the CFTC regulatory clarity and primary authority.

Fast forward to today. The internet happened. Cell phones happened. Innovation happened. No one could have predicted that in 2000.

At the same time, an entire economic theoretical framework emerged. Academics began studying prediction markets. They found that prediction markets were amazingly good at showing outcomes of events before they happened. This was true even if there was not a lot of liquidity or a lot of money wagered.

We have seen it with political polls. Polling shows one event, and the prediction market shows something else. The polls are generally wrong. Political prediction markets are valuable and should be allowed.

So should prediction markets for economic releases, weather, software releases, and other events like that. They allow for risk management and better clarity. They are beneficial to human society and existence and create value.

That’s not true for sports betting, or betting on the outcome of the Oscars. Prediction markets have no value for society in things like that. We don’t benefit from a prediction market in how many touchdowns someone will get in a game. It doesn’t matter that there is a lot of money wagered on it or that the casinos are hedging their sportsbook in the prediction market. That just shows the casinos understand risk management.

That’s where I would draw a bifurcation in regulation. If I were running the CFTC, I’d force the prediction markets to submit to the patchwork of state gambling regulation for prediction markets in sports or things like sports. Prediction markets in these things are pure entertainment, like going to an amusement park.

For economic releases, business predictions, weather, and politics, I’d let the CFTC regulate and have them run under the same umbrella as regulated commodity exchanges. Those markets have real value to society.

The industry would prefer not to reopen negotiations on a new CFMA. There is too much uncertainty, and too many adverse things could happen. Also, remember back in 2000, exchanges were not public companies. Today they are.

I have not seen anyone anywhere make this argument. It’s been a zero-sum game argument—all or nothing. Zero-sum won’t benefit society. But I think bifurcation can win the day for Nevada and other casinos and win the day for society.