Based Camp - Geopolitics Post AI & Birth Rate Collapse

00:00:00.000 hello i am excited to be here with you today today we are going to be discussing the future

00:00:05.780 of global geopolitics and economics in the face of the two biggest changes the world is facing

00:00:12.820 right now which is the development of ai and fertility collapse so this can be thought of

00:00:18.780 as sort of a fertility collapse update video and our well and ai someone was like you've been doing

00:00:24.200 so much ai recently and i'm like ai is literally going to change everything about the human

00:00:29.240 condition over our lifetimes anybody who's not thinking about ai as much as they're thinking

00:00:34.340 about rome or anybody that's that's a very good point actually yeah rome happened you you can't

00:00:42.120 change it oh dear no but i mean when as you're you know predicting out your career or what education

00:00:50.540 means for you and your kids or really anything what's happening in the space of ai is incredibly

00:00:57.700 important now simone i sent you yesterday some maps and we'll just go over these in turn with

00:01:04.200 our fans because i think that they're very important for getting a grip on how bad things are now and this

00:01:12.400 this first graph is terribly designed the darker blue areas where it gets to like purple and darker blue

00:01:20.720 those are areas of lower fertility the lighter blue areas are areas of higher fertility so the more

00:01:28.120 tan brown orange-ish the higher the fertility the more darker purple the lower the fertility 0.94

00:01:35.260 and you see i mean it's kind of obvious because all you have to do in a graph like this to calibrate

00:01:39.880 is look at south korea and then you kind of know what's going on yeah and then the lighter

00:01:44.100 man i didn't know nepal was doing so horribly we'll get to these in a second so the lighter red

00:01:49.980 is higher for lower fertility but it's higher fertility for the darker red so they're sort 1.00

00:01:55.780 of treating white the 2.1 you know replacement tfr as the midpoint and then you move either to red or

00:02:01.900 blue depending on where you are and what colorblind it's it's it's purple what you should immediately

00:02:07.900 see here is or purple okay is that the americas are now just completely effed out right like i think a

00:02:16.820 lot of people thought that south america would take longer to get to the place it is right now

00:02:21.260 but we're now at a place where we are depending on how you calculate it the if you do it like per

00:02:29.220 person so if you correct by the population of a country yeah latin america may be below the united

00:02:35.560 states in terms of tfr now yeah she's she's gone guys and if it isn't right now it's going to be soon

00:02:41.780 and this is really big because when we're talking about the future of geopolitics this is true both

00:02:47.140 within the united states and around the world and we'll get to this as we explore these different

00:02:50.540 regional maps because i think that's a better way to do this who's going to own the future

00:02:54.560 our countries and populations that while being economically and technologically productive

00:03:02.040 can still be high fertility all right a country like somalia which you can see right here i'm pretty

00:03:10.020 sure that's somalia which is super high fertility doesn't effing matter it doesn't matter if somalia 1.00

00:03:15.960 has 20 times its current population that's just going to be 20 times where people in desperate

00:03:21.380 suffering it might matter to you know surrounding companies in terms of like refugee crises and stuff

00:03:25.660 like that but it doesn't matter on like the global stage right like they're not going to suddenly become

00:03:30.380 a powerhouse and we imagine if they could choose they would probably rather first improve quality of

00:03:37.220 life before they improve which is going to lower the birth rate but yeah the place where this can

00:03:42.880 really be seen is in east asia and so here we're going to be talking about the map i have on screen

00:03:49.040 here is east asia more broadly but i'm going to talk about it along with oceania because they're

00:03:53.540 basically a connected economy when people think about fertility rate collapse even though it's a bigger

00:03:58.760 problem in east asia they often think about it in the context of themselves and their neighbors and

00:04:03.860 their trading networks but the biggest disruption that it's going to cause is is in this part of

00:04:08.980 the world and so you've got china with a fertility rate of like 1.2 japan with a fertility rate of 1.3

00:04:16.280 south korea 0.9 and taiwan i've seen all sorts of weird fertility rates for taiwan recently from

00:04:23.460 this one has it at 1.1 but i've seen it down to below south korea at 0.76 yeah what's going on

00:04:29.400 get it straight guys falling very quickly is the general gist of it but the the wider point here

00:04:36.740 is who is declining within this region it is everyone who is economically relevant is declining

00:04:43.500 within this region and well i should say not everyone so then the question is okay you're

00:04:49.660 saying there's somebody near this part of the world that isn't in a complete free fall right now

00:04:54.440 who are you talking about well the two countries that are economically relevant in this region and

00:04:59.760 are not in complete free fall are australia with a tfr of like 1.56 in new zealand with fertility rates

00:05:07.480 i've seen of between like 1.6 and 1.85 which is actually very robust i mean for for these days

00:05:14.960 for these days right yeah i mean you still need 2.1 people just to remind you if you if you're new to

00:05:21.440 this podcast and subject if you want your country to maintain a stable population you need to have

00:05:26.420 a total fertility rate of 2.1 or more right and a lot of people can say well you know what about for

00:05:33.200 example india right with its with its tfr of 2 on average or it's slightly below replacement rate

00:05:39.320 and this is again where you you sometimes even need to look sub-regionally to predict the future of

00:05:45.300 a region you know you can't think about these countries as just countries like india as just india

00:05:50.420 you need to see who in india is having lots of children in india it's it's muslim extremists 1.00

00:05:58.540 and if india does become a a country because it's a democracy where muslim extremists end up running 0.78

00:06:07.580 the country it's going to almost immediately fracture and completely change its relationship

00:06:13.260 with pakistan because that would change things pretty extremely india's in a very dangerous 1.00

00:06:19.240 demographic position right now and it's something that's like very well known on the ground in india

00:06:24.780 it's it's it's sort of a ticking clock in terms of its regional power uh because its its regional power

00:06:30.240 relies on the existing sort of demographic breakup staying largely the same and and note here people

00:06:38.640 can be like oh well wouldn't this be the same thing as like minorities becoming the majority in the

00:06:43.660 united states like suppose like hispanics became the majority in the united states and then they 0.71

00:06:47.780 started electing you know a bunch of hispanic presidents or something like that no not not even

00:06:52.540 a little bit like the the the conflict between the hindis and the muslims in india is very very much

00:07:01.140 hotter than the conflict in america between you know wasps and hispanics there is not a deep

00:07:08.400 like there is you know a little bit of tension occasionally but it's not that deep or bad of

00:07:15.480 tension and what's also interesting about the united states is it's often the regions with the um most

00:07:23.240 history with hispanic populations i.e.g. we're getting a lot of hispanic populations moving where you have

00:07:29.320 the most positive sort of perceptions of them um and integration of them with locals one of the problems

00:07:35.520 that texas republicans always have is they have a history of being more open to immigration than other

00:07:41.480 republicans which has really hurt them it hurt i forgot one of the guys who's running in the election

00:07:46.140 cycle i can't remember his name but he was a primary in donald trump a few election cycles ago

00:07:51.520 and it was a big problem for him i'm thinking of rick perry here but it is it was a george bush was that

00:07:57.360 way too so you you have this problem consistently but it's i think as a problem what it shows is that when

00:08:04.080 these populations live next to each other for a long time they often begin to become quite you know

00:08:09.280 fine with each other that is that is not what we're going to see in india and this also when people

00:08:14.640 frame everything like this in terms of like racism or whatever they're like you are racist to care about

00:08:20.900 this stuff right i'm like you do see that an entire half of the world is going to have the scales

00:08:27.660 dominated in favor of white people people in new zealand and australia and you're just ignoring

00:08:34.960 that because it doesn't fit your narrative now here i need to talk about ai and we're going to get

00:08:40.400 into a number of ai studies after we go around the globe but just to first your people can be like oh

00:08:46.700 well there's still some you know economically what about cambodia they're they're sort of have a stable

00:08:53.040 population at like 2.2 or vietnam which has a stable population at like 1.9 and don't get us wrong good

00:08:59.660 for them yeah the philippines at 2.7 and it's like well the problem is is this kind of developing economy

00:09:05.760 what type of job are they taking right like what type of job did you have in india most frequently

00:09:11.120 when it was in this period of development it was outsourcing the type of jobs that you go to upwork for

00:09:17.240 the problem is is outsourcing and call centers are the very first things that ai is being applied to

00:09:23.460 at scale you you probably already interacted with ai call bots right that's not awesome for these

00:09:31.900 regions that are hoping to spam it with just lots of people well and combine that with increasing

00:09:38.400 protectionism which people like peter zeihan expect is only going to increase that we're going to see

00:09:44.040 less global trade and exchange so there will be less interest in people even outsourcing

00:09:51.220 non-service professions things like clothing production factory production in general etc so

00:09:58.220 in general the headwinds are not they're not favorable people are wondering why that would

00:10:03.660 happen it's because the u.s has less motivation to do international deals it has a strong motivation to

00:10:11.560 be protectionist now both of the united states political parties have a protectionist bent like

00:10:15.760 joe biden and camel harris had a bunch of protectionist policies donald trump had a bunch

00:10:19.560 of protectionist policies and the even more protectionist of the two protectionist parties

00:10:23.880 one and he's shown perfectly willing to implement these protectionist policies like you look at the chip

00:10:28.920 restrictions and everything like that on china that was all under the biden administration that that

00:10:32.740 stuff was started so the the united states and i think ai might even increase the relevancy of being

00:10:39.840 protectionist going forwards because when you can totally automate a factory like why do we send

00:10:45.520 stuff to china to have it made inexpensively it's because inexpensive chinese labor the more automation

00:10:52.660 that's possible the more that can be done in the united states right uh the less of a motivation you have

00:10:58.420 to ship out and in addition if we are going to ship out now it's cheaper like if you're setting up a new

00:11:03.000 factory from scratch to just do it in mexico which is closer to us and kept artificially

00:11:07.960 inexpensive because of the gangs in a really weird economic way um it's a very weird situation like

00:11:13.980 mexico it's like geopolitically like way worse than it should be given its demographics education level

00:11:21.180 uh location next to the united states etc etc by the way did you know mexico has fallen below the u.s

00:11:27.520 in some measures in terms of tfr yeah above the u.s in terms of obesity rates now yeah yeah so mexico's

00:11:35.240 got some poor mexico yeah there's they've got a lot going on right now so next let's go to the

00:11:41.160 middle east right because i think a lot of people they look at the middle east and they're like oh

00:11:44.040 the middle east has great tfrs and i think you can immediately see the economically relevant countries

00:11:50.260 don't like look look at look at turkey here 1.4 right iran 1.6 right like those aren't great no the

00:11:59.480 only place where you see the good ones is like you know like tunisia in egypt right no but that's the

00:12:05.660 poverty then we talked about this when we did our middle east birth rates episode and and looked it

00:12:12.680 would dispel basically the rumors of oh well it's muslims and people on the middle east no their

00:12:18.760 fertility rates are not that good and when they are good it's because they haven't developed yet that's

00:12:22.800 it you know it's this classic pattern are they poor okay well that's why their fertility is high okay

00:12:27.880 get over it stop and a and ai this is the thing you could be like well i mean at least like the

00:12:34.540 rulers in the geographically regions and one of the things that we've got to keep in mind by the future

00:12:38.180 is the poxa romana the urban monoculture this is sort of the piece that's being held up by europe

00:12:42.440 right now is going to collapse europe a lot of these countries are like 20 years away from their

00:12:48.200 social security systems collapsing and when europe starts to break apart as a geopolitical force 0.94

00:12:54.420 them telling other people to not kill each other or enslave each other over stupid things 0.75

00:12:59.260 is not going to be as effective and in the middle east there's a lot of groups that want to kill or 0.97

00:13:04.640 enslave their neighbors over silly things and well not necessarily over silly things or even just like

00:13:10.000 economic right you know we see this all over the place where you basically have slavery all across

00:13:15.160 the region already if you don't literally have slavery in the region now people can say well what if

00:13:20.240 you know the super wealthy groups that aren't doing good in fertility they just sort of enslave

00:13:26.020 the populations near them that do have this high fertility rate and they can use that to sort of

00:13:30.340 economically cheese their system in a way that they they kind of are already the problem with this

00:13:36.400 is that it's twofold for this region one as soon as we have good ai bots that you can build

00:13:45.140 right they're they're just more efficient than slaves this this is you know if you think about i

00:13:52.020 have a ai scenario i created for rfab.ai when it's implemented we haven't implemented the scenario yet

00:13:57.240 where you you are you know a commander for the terran federation which is a far future earth fascist

00:14:05.260 empire and you've just conquered a planet and you need to justify why the planet's populace shouldn't just

00:14:11.340 be liquidated because you know you could just have ai workers replace them with less resistance and

00:14:17.340 and well less expensively and you can be like well what about the energy cost and it's like oh remember

00:14:22.580 you are in the middle east which means even if you didn't have inexpensive gas for energy you would have

00:14:30.280 endless solar power in some of these well and we're going to end up with much more scalable nuclear

00:14:36.700 energy too which i think is big yeah which means that we may have an opportunity for the most

00:14:42.940 economically productive of these regions to consolidate their power and have even more power

00:14:47.300 but for everyone else they're basically effed and national borders probably won't matter as much

00:14:53.660 once the urban monoculture falls like the idea of national borders is something that's become normalized

00:14:59.560 in a large part because of the pox de romana implied by europe when countries decide they

00:15:06.800 want to expand their borders going forwards historically that was something people did all

00:15:09.820 the time like now it's something you just don't do that much so going on to europe we've been talking

00:15:15.180 about what a terrible terrible situation europe is in and here if you look at a map you know across

00:15:20.820 europe you're looking at things like in the in the more catholic countries uh you know like

00:15:25.400 italy and spain 1.2 which as i pointed out it's like 1.85 actually for every 100 italians there's

00:15:31.560 going to be 20 great-grandchildren at this point and this is assuming it doesn't get worse right

00:15:35.380 and even if and then you you see you know you've got ones here's 1.2s all over the place but if you're

00:15:42.260 if you're looking at the the better ones and this is another thing where people are like oh you're

00:15:46.020 trying to you're worried about fertility rates because it's your people who are going to suffer

00:15:50.540 and i'm like it's not my people like wherever i look we're pretty fine dominating so i am you know

00:15:58.100 we are our english scottish scandinavian background right you know so if you look at this map and you

00:16:03.580 ask the question what are the places that are better off in fertility rate and still economically

00:16:11.380 productive okay yeah france 1.6 with us audience ireland 1.6 england 1.5 scandinavia and norway at

00:16:22.560 1.4 1.4 germany 1.5 denmark 1.5 it's it's switzerland 1.5 it's the places that look like me

00:16:33.060 there are some other places that have slightly higher fertility rates here like the 1.6 in turkey

00:16:38.260 right and and some of these these countries in the balkans that have decent fertility rates but

00:16:42.780 they're not economically particularly relevant which is the the problem here right like we need

00:16:48.280 to be realistic they're not gonna you know turkey isn't going to become an economic powerhouse overnight

00:16:52.900 just because this population is declining slightly slower than these other places it's also going to

00:16:57.460 have to deal with the social security issues as things start collapsing okay yeah yeah yeah even

00:17:02.320 those who are doing okay are still going to face dependency ratio cascades as time goes on

00:17:07.300 a dependency ratio cascade is a phenomenon where in a in the united states you have 1.8 people paying

00:17:14.600 into the tax system for every one person who's living off the tax system this number gets worse

00:17:19.800 as more and more people get old because you have more and more people in social security and eventually

00:17:24.300 you reach a point where the majority of the population is relying on the government and then

00:17:29.020 democracies stop working because people never vote themselves less money you know if they're if

00:17:32.820 they're living off the government and so then all the productive taxpayers leave and your country

00:17:37.280 ends up in a terrible situation but if we want to talk about terrible situations look at latin america

00:17:42.800 right like not only are they not great off economically but like look at a country like argentina that's

00:17:50.560 1.16 how do you how do you fix that when well i mean they're trying to import some mennonites so

00:17:57.720 that's a start look at chile 1.03 yeah not good brazil 1.47 mexico 1.45

00:18:07.920 peru 1.7 colombia 1.06

00:18:13.720 venezuela oh we got we got a strong one here you can be like well some of these countries

00:18:18.460 no yeah all you have to do is just create rampant poverty and have blackouts and brownouts and little 0.80

00:18:24.940 electricity and food shortages and you know yeah who's okay here venezuela and haiti you think

00:18:30.700 because they're okay with demographics right now they're going to be economic power players in the

00:18:34.400 future everyone within education in venezuela is leaving right everyone who's economically

00:18:40.580 productive is leaving what they've left already they've left already we've seen this i mean the

00:18:45.100 travel business that we that we managed at the time that we acquired it basically its specialty was

00:18:51.440 working with venezuelan travel agencies that were either specialized in getting venezuelans

00:18:57.240 out of venezuela or literally flying suitcases full of u.s dollars into the country because

00:19:04.640 you know their currency wasn't exactly working anymore by the way simone you know i i often tout the

00:19:11.520 i've been to 50 countries statistic yeah a huge part of that is because you know it's on this map in

00:19:17.240 the island chain that there's a bunch of different numbers listed because there's so many different

00:19:20.240 countries in that chain yeah i took a boat trip through that island scuba trip so that's just

00:19:25.300 one of those like ding ding ding ding ding ding ding ding ding ding ding yeah so that's that's how

00:19:30.300 that explains a lot okay like 10 of those seems like excessive you know it does seem excessive but

00:19:36.620 yeah but i think you can see by looking at this like you you look throughout central america right you

00:19:40.960 usually see you know 1.1s 1.7s in some cases 1.3 you know this is not good

00:19:48.020 this is not a place it's better off when people are like you're concerned about white people

00:19:52.880 also i'd note in the united states remember i said what matters is the groups that are breeding

00:19:57.980 when they have money right because what's going to happen to a group over time if they're having

00:20:02.260 tons of kids and it's only the ones who don't have money who are having tons of kids is one that

00:20:06.960 population is going to be subjective to dysgenic selection which has negative effects but then two

00:20:13.220 even culturally speaking if it's making an anti-education choice if it's making a choice

00:20:20.160 to not be economically productive that leads to that group surviving and proliferating the cultural

00:20:26.260 elements in those groups that enhance that choice are going to proliferate in the future

00:20:29.960 in the u.s this becomes really important because if you're like who's going to dominate the future of

00:20:33.860 the united states if you are above 50 income in the united states above 50 income who has the highest

00:20:41.860 fertility what what demographic can anybody guess it's white people yeah not what people think

00:20:47.640 i'm actually i'll send you on whatsapp the institute for family studies graph that shows this because

00:20:53.680 it's so actually it when you look at it it actually looks as though when we're when we get beyond just

00:21:00.080 abject poverty there is actually a slight positive correlation between income and well fertility but

00:21:10.000 only for white people only for all other groups it goes down which really does 0.93

00:21:14.840 it kind of makes what they're arguing for look really bad because they keep arguing like give

00:21:20.780 people more money and they'll have more kids and it's like well that's not really true except for

00:21:24.360 just white people can you guys white people do have more kids you're showing your hand guys this is

00:21:29.720 not a good look for you the thing here is people are like oh what about scary black tfr which isn't even

00:21:36.500 that high by the way and i always point out here but it is very important to note black people in

00:21:41.360 the united states that aren't in like the bottom i'd say 15 of income for for black individuals have

00:21:47.040 the lowest fertility rate of any ethnic group in the united states yeah anybody they are at risk they 0.76

00:21:51.860 are at risk they need help yeah and anybody who is wealthy black friends knows this like black people 1.00

00:21:56.520 when they get money they have like no kids and there's a number of reasons for this we won't get into 0.88

00:22:01.720 it in this episode might be worse doing a whole episode of why black people don't have kids that

00:22:06.280 actually would would be an interesting episode yeah because i think it's similar to people being like

00:22:11.160 oh we'll just use latin america indefinitely to get population numbers up for the united states which

00:22:17.400 is as we've shown super not going to happen the other thing that people constantly say is like

00:22:22.620 well black people and africans are just going to keep having lots of babies so you know just don't 1.00

00:22:28.000 worry about it they'll take care of it and it's like well actually assuming you're not in poverty

00:22:32.160 no extra no let's work on that and so here i want to go over some studies because i have made the

00:22:40.500 assertion many times and i i do deeply believe this that as ai becomes more advanced there will be

00:22:46.460 sections of the population they just can't do anything as good as ai can do it and the question is

00:22:51.640 is what is their role was in the economy and was the geopolitical order was in which we live when

00:22:57.860 that happens and the question here is yeah but is that true because if you anecdotally think about

00:23:04.340 it you will have heard of some studies that show that ai actually increases the productivity of

00:23:09.180 less productive workers more and it increases the productivity of more productive workers less

00:23:14.980 so let's go over some of these studies in a field experiment was nearly 5200 customer support

00:23:20.580 agents a fortune 500 software firm access to a generative ai conversational assistant increased

00:23:27.140 average productivity issues resolved per hour by 14 the gains were largest up 35 for the least

00:23:33.720 skilled and least experienced agents those with under three months tenure while highly skilled agents

00:23:39.560 saw minimum or no improvement the ai dissemination tacit knowledge from top performers allowing sorry

00:23:46.500 the ai disseminated tacit knowledge from top performers allowing novices to quote unquote move up the

00:23:51.700 experience curve faster with with treated agents at two months tenure matching untreated agents at six

00:23:58.360 months tenure this also improves customer satisfaction and reduced employee turnover among the newer workers

00:24:03.660 suggesting potential to narrow base skill inequality so think about that a two months employee is now equal 0.90

00:24:09.760 to a six months employee that's almost like a prosthetic for dumb people yes and it wasn't helping the smart

00:24:19.060 people at all what i think is really happening here and we're going to see this over and over again 0.96

00:24:23.840 is midwits because if you're working at a call center even if you are a higher end producer you're probably on the

00:24:29.740 midwit side of the spectrum i mean you'd be running the company if you were on the higher end of the spectrum

00:24:34.320 midwits are over as brian chow once said uh mid is over mid artist mid musicians mid employees mid

00:24:43.000 yeah just the center if you're in the center of the bell curve watch out

00:24:47.940 yikes let's go next an online experiment was 453 college educated professionals on writing task

00:24:55.360 e.g press releases reports showed that chat gpt reduced tax time by 40 percent and improved quality

00:25:02.820 output by 18 percent on average weaker skilled participants benefited the most leading to a

00:25:08.180 convergence in performance and reduced inequality between the high and low ability workers participants

00:25:13.340 exposed to chat gpt were twice as likely to adopt their re to adopt it in their real jobs later

00:25:18.700 indicating lasting effect a study involving over 700 boston consulting group consultants on tasks like

00:25:24.360 idea generation and analysis found that gpt4 improved performance by 40 percent when used within

00:25:30.080 its capabilities lower skilled consultants saw a 43 percent boost relative to their baseline compared to 17

00:25:35.980 for higher skilled ones suggesting ai acts as an equalizer imf analytics cites research showing ai

00:25:43.840 helps less experienced workers enhance productivity more quickly with younger workers adopting it faster

00:25:49.120 in advanced economies ai could complement about half of exposed jobs boost output but this is more

00:25:56.440 pronounced for entry to high level roles now let's go to the other end the same mit sloan bcg study

00:26:03.640 found that tasks outside of gpt capabilities complex problem solving requiring human judgment ai used

00:26:10.480 decreased performance by 13 to 24 percent as users over relied on flawed outputs higher skilled models were

00:26:17.500 better at applying a cognitive effort to integrate the point here being is for the type of thing that

00:26:24.940 humans are better than ai ai makes mid worse and dramatically worse when contrasted with experts 0.92

00:26:34.180 mm-hmm so again we're seeing the but what does this mean economically it means a slight boosting and i suspect

00:26:42.100 temporary boosting of the very bottom of the economy and then it's going to be basically washed out when ai can do

00:26:48.320 everything they can do and the reason why ai can't do everything they can do is mostly just problems with

00:26:55.720 the models and the way they're set up right now because you don't have persistent memory learning

00:26:59.220 an easy way to create them to be more agentic which is a project we're going to work on with our

00:27:04.180 ai company broader analysis suggests ai could widen gaps by displacing low-skilled jobs while

00:27:10.320 complementing high income roles for instance ai may increase demand for skilled labor and knowledge

00:27:15.820 intensive fields leading to a pyramid type skilled structures autonomous ai agents eg systems that

00:27:21.320 handle routine work independently tend to benefit knowledgeable individuals more as they can orchestrate

00:27:26.640 and verify ai outputs more effectively and then anyway i'll just leave that out but yeah the the point

00:27:32.820 here being i think what we're going to see is at first a huge jump to sort of mid-intellect individuals

00:27:42.760 and then as ai sorry the very low skilled individuals like like not at the very bottom like

00:27:48.660 basically tards but but the type of people he would used to outsource to and then after that we're going 0.99

00:27:56.520 to see them become economically irrelevant as ai can do literally everything they can do especially as

00:28:01.940 ai can do physical tasks more and then the world is essentially going to be dominated by 0.95

00:28:08.660 a very narrow class of people who is having kids at a very low rate in most economies right now

00:28:15.320 yeah like maybe what i hear more people saying is that just the stock market in general

00:28:26.140 is going to see a big boom white collar jobs are going to be wiped out so generally like high achieving

00:28:33.220 mba holding you know more highly educated people are going to find themselves high and dry those with

00:28:40.040 money to invest though will be able to make a lot of money during this period those who are in the

00:28:45.620 trades are going to maintain stable jobs for the foreseeable future because it's going to take a long

00:28:51.660 time for us to catch up with robotics and so the the really big disruption is going to be

00:28:59.940 just a hollowing out of what many people think of as the middle class or the middle class is just going

00:29:05.620 to change from what historically has been seen as more of a college education holding

00:29:11.380 i don't know like a higher social class kind of group to a high earning but trade degree holding

00:29:21.140 and maybe not seen as like coastal elite culture style person which i think is kind of great and

00:29:31.120 more close to the american ideal yeah that's what i think i think people are just underestimating a few

00:29:41.220 things in a lot of their calculations here it's even within the high fertility countries how few of

00:29:46.560 those high fertility people are big economic contributors and big you know like like the type 0.99

00:29:52.660 of person who's going to be inventing the next ai system i mean take a country like israel which i do

00:29:58.160 laud like secular jewish populations conservative religious jewish populations have decent fertility rates

00:30:03.800 but they're still absolutely stomped by ultra-orthodox jews many of whom are not the type of groups that are 0.72

00:30:10.340 going to develop cutting-edge ai systems and that you know as our governments take more and more of a

00:30:18.240 burden to care for these populations that's going to hit us more and more going forwards yeah and

00:30:27.320 that's going to change like daily life a lot i mean i think a lot of kids aren't even really planning

00:30:32.340 to enter the economy right now which is such a uh an interesting phenomenon i 100 agree and can you

00:30:39.700 blame them i mean i think a lot of people in gen z or and or gen alpha have already more or less decided

00:30:47.280 like i guess that's not going to happen to me anymore so we're there this is a reality we occupy now

00:30:55.260 the question is what's going to happen after the shakeout right now the earthquake is happening

00:31:02.460 what happens after the aftershocks have mostly passed and we're in some form of new normal

00:31:09.720 that i don't know but like i said you know trades good building a public reputation and specialization

00:31:21.100 that is likely going to maintain relevancy in a post-ai age good if you want to have a job

00:31:28.360 man mechanical engineering that seems like a pretty good place to be because that's one place where i

00:31:34.960 just i know there's going to have to be so much work done in order for us to get to that full full

00:31:40.300 on a ai age we're we're just super behind in robotics and you can see but i'd be like i think

00:31:46.700 that the bigger thing that you're missing with all of this is when i'm going over all this and i'm going

00:31:51.300 over the geopolitics of all this okay is going forwards how much which country you happen to be in is going

00:31:57.740 to matter i've lived in an age with very little war like the fact that there is a war in europe at

00:32:03.940 all right now people are acting like is absolutely insane when you know historically wars were very

00:32:09.320 common between regions if you look at the rate of war in the world right now like it's like a super

00:32:13.940 low rate historically speaking i don't think that is so it's not just that we might have now are we

00:32:20.480 going to have more quote-unquote traditional wars maybe not maybe not even traditional terrorism

00:32:25.460 because keep in mind older people don't do this stuff as much they're just not as radical as other

00:32:29.480 groups but we've got to ask what does happen once countries begin to become economically unfeasible

00:32:35.220 like what is actually going to happen across latin america and europe when they hit a

00:32:39.760 dependency ratio cascade like i i think we don't know or actually i i can sort of i'll try to map this

00:32:48.460 out i think that japan and korea are going to figure this out in some way it's going to be hard and it's not

00:32:54.360 going to look nice but they'll figure out some solution not for saving their populations i think

00:33:00.760 that their fertility rates are going to stay pretty bad writing them off yeah i'm just saying the

00:33:06.480 preventing a complete government collapse due to their social security system not working

00:33:10.860 but i think that then some other countries are going to be like oh well we in europe will be able

00:33:16.580 to do what they did and i'm like no like south koreans are much more disciplined than you i've worked

00:33:20.280 with both of these populations before i lived in south korea i lived in europe something that you

00:33:24.500 implement in south korea isn't necessarily going to work in the uk and so i think that that's where

00:33:29.360 we're going to see some really brutal collapses europe and latin america and i actually might even

00:33:38.080 recommend people to seriously think about immigrating out of countries that are in really really bad 0.99

00:33:44.740 dependency ratio situation right now so you know maybe we should do a whole episode on this but i

00:33:49.900 feel like many latin american countries not due to some wise form of preparation but perhaps due to a

00:33:59.200 lack of trust and conscientiousness when it comes to filing taxes or things like that or like an

00:34:05.500 expectation of corruption meaning that you've had to make a more trustless society have set up social

00:34:11.060 services in a way that could possibly be accommodated by demographic collapse and reduces the incidence

00:34:19.380 of dependency ratio cascades for example in the united states right now people paying into social

00:34:25.060 security actively like us as active taxpayers our money is being used by people who are draining the

00:34:32.740 system like we don't you know you can log in and see your account but that's your money ain't

00:34:41.020 sitting there safe whereas in peru where we worked for a while we learned through having to manage all

00:34:48.660 of the account deposits and reporting that citizens have their dedicated bank account in banco nacional de

00:34:59.140 peru that is its own bank with its own branches where employers have to deposit money into your retirement

00:35:07.500 account into an unemployment account and they're real accounts that you can see and that's your money

00:35:15.060 sitting there so in that sense like whereas we're in the united states going to see social security

00:35:21.780 collapse between 2032 and 2036 probably what's going to happen is they're just going to start

00:35:27.780 devaluing the u.s dollar to a certain extent and and you know are the the purchasing power of a dollar is

00:35:34.380 going to go down is they just kind of make up for it by being like oh don't worry we're just printing

00:35:38.280 more money it's fine whereas in peru at least when it comes to retirement accounts they don't need to

00:35:43.520 like find the money to pay people out if i understand how things are being run correctly so i wonder if

00:35:52.160 maybe based on the way that some society's social safety nets have been set up it's going to be okay

00:35:58.560 for example like similar thing happens in peru with unemployment the way that unemployment works is that

00:36:03.700 you as an employer have to deposit money into your employees individual unemployment accounts

00:36:11.620 and we have had employees ask us to fire them so that they can liquidate those accounts and use the

00:36:19.780 money for like other stuff and then like rehire them when we're like we're not we're not doing that

00:36:24.240 we're not going to do that but like that the money is real whereas what we do in the united states is pay

00:36:30.480 into this like vague state unemployment system and it's not really clear what happens when you lose

00:36:36.780 your job you have to apply for it there's all these other hoops you have to jump through maybe

00:36:40.780 you'll get it maybe you won't it kind of depends on like how you were fired and how long whereas like

00:36:44.940 no it's super clear in peru money gets deposited into that periodically you can log in and see exactly

00:36:51.680 how much money is in that account so like the longer you've worked somewhere the bigger your

00:36:56.080 unemployment account gets and when you are when you lose your job or are fired that money is now

00:37:03.600 yours and you know exactly how much there is and there's no application process there's no

00:37:08.160 you know would you qualify i don't know because it's your freaking money so i do wonder if there are

00:37:13.920 some countries that are counterintuitively perhaps or due to the the nature of their infrastructure 0.87

00:37:21.040 not as screwed because they didn't use as much of the ponzi scheme not model as other countries what

00:37:28.420 do you think i mean peru just has a fantastically like designed a lot of parts of its it's it's like

00:37:35.280 for example when i pay my local taxes there's a little envelope for putting your credit card

00:37:40.580 information in and they're just like we'll just charge you your taxes and they give you a brochure of

00:37:44.880 everything yeah you can go on autopay it's just like a netflix subscription but they also give

00:37:50.400 you a beautiful booklet that shows you all the nice things that have been used to to improve your

00:37:55.680 local municipality when you pay those taxes which is just so nice i'm like yeah take my absolutely

00:38:01.200 you're doing something that's great i don't know set up yes but so yeah there's there's systems that

00:38:10.320 are better and you might be right about this but peru more broadly if we're just going to talk

00:38:13.440 about peru is completely because basically all of peru is lima lima is like a third of the

00:38:19.520 population of peru it's a huge chunk of their economy and lima is i think the largest city in

00:38:25.260 the world in the middle of the desert or one of the largest but it's in a giant desert yeah you

00:38:29.660 really feel like as soon as you step out you're like am i on mars it looks like mars it's this red

00:38:35.340 yeah outside of of the city itself in this meeting it feels like you're in like a a jungle oasis of

00:38:42.040 of you know yeah really nice stuff all the cliff edge the ocean but the problem is the problem is

00:38:48.440 is that the water that the city relies on is going to dry up in something like 20 years not not that

00:38:55.440 long it's coming unless they get really good i feel like ai could really help with desalinization

00:38:59.560 technology and then they're fine yeah elon has mentioned that they might be able to do something

00:39:03.300 with desalinization we'll see but yeah i wonder we have to hope we really need nuclear to work we

00:39:10.740 really need desalinization to work a lot of the developing world is propped up by demand from

00:39:17.320 china right like a lot of these countries like like peru a lot of latin american countries a lot

00:39:22.760 of african countries make a lot of their money selling commodities a lot of these commodities are

00:39:26.480 basically building materials which are used to build this giant real estate bubble that happened

00:39:30.420 in china um with china being at a tfr of 1.2 you know you need to look like you want to know the

00:39:36.240 future of your country don't just look at your fertility rate look at a breakup of who's buying your

00:39:40.440 stuff and then look at their fertility rates um because if their fertility rates are bad that's 0.97

00:39:45.760 going to hit you really bad as well that's the future of your economy yeah yeah yeah what else is

00:39:54.780 there to say i mean that's well it's just it's just such a thing when you're thinking about the

00:39:59.120 future of geopolitical control and ai and all that to not get high high fertility rates caused by

00:40:05.540 poverty confused with actual high fertility rates as a lot of people do that's fair yeah that's 1.00

00:40:11.680 underrated your relevancy anyway i love you simone this is a very interesting conversation and a good

00:40:18.700 sort of catch up for people who haven't heard this stuff in a while and very excited to be giving this

00:40:24.320 speech to some very important people in the near future me too yeah looking forward to our drive

00:40:30.420 time together all right bye i think i figured out why i've been so irritable today and it's i was

00:40:40.460 deprived of my morning walk with you i'm an addict that's what happens even well tomorrow we're going

00:40:48.500 to be in the car dc and back yeah so that's going to be a good day although we may have calls on the

00:40:56.780 car ride but oh really that's okay maybe so many hours we'll have yeah well i mean we're gonna need

00:41:02.900 to memorize that speech and blah blah blah blah blah yes i appreciate your work on putting together

00:41:10.120 the slide deck make sure you get that for me so i can review it tomorrow morning as i get an episode

00:41:13.560 ready to go yeah after dinner i'm gonna finish it up all right that works for me the comments on the

00:41:21.420 episode today i was so surprised that it did bad the one on ai and like the silicon valley people

00:41:27.140 becoming religious because of ai and i had another one prepped on the same topic because i found a

00:41:32.420 really interesting article on this trend and it did really bad and so i i don't get it i thought i

00:41:37.240 thought our audience would love that i mean you could make it something that we put on

00:41:41.620 patreon for one of our patreon only weekend episodes that's a really good idea yeah that's

00:41:48.640 the type of thing that they would like all right let's do that simone won't let me we created a book

00:41:52.720 out of her personal diaries from the first year we met called into the heart of dorkness which is

00:41:58.080 the best title book we published but she wouldn't let me i was like oh i'll release it on patreon and

00:42:04.420 she's like you absolutely will not our platform is too big now what it was going to be our debut book

00:42:10.640 and now i can't even publish it on patreon yeah i mean someone might convince me someday but

00:42:16.160 hey i really trust our friends who are like whatever you do don't publish no what she said

00:42:26.440 was is it just wasn't entertaining to read as we thought it was but i think that that was the case

00:42:31.960 because she had no not the personal investment in us that somebody who subscribed to our patreon would

00:42:36.940 they would be very interested to what are simone's inner thoughts when she's first meeting malcolm

00:42:42.020 in the first year they're dating when they she's promising to break up you know i'll only date you

00:42:46.460 if you break up with me etc like what what was she thinking during their breakup like this is all i think

00:42:52.280 from a you know what our our podcast fans can can weigh in on this and and you can tell simone

00:42:57.080 whether or not she needs to publish us to patreon maybe maybe to a special tier

00:43:02.620 and then the comments on the ai religion video were just like not not that interesting it was just

00:43:11.300 like oh those dumb atheists taking too long to figure it out some people were sharing specific 0.92

00:43:16.240 thoughts on specific elements of religion some people were trying to argue that ai is a false god 0.99

00:43:26.400 but you were never saying that ai was a god so i think they weren't really paying attention

00:43:30.380 it was a mix and there there were some people who just a lot of people just really enjoyed the 0.76

00:43:36.040 subject they're like you so i think this is where people are being stupid ai is not a god nor would 0.85

00:43:42.680 we argue that it's ever going to be a god but it is an intelligence and it is the like us a token 0.96

00:43:49.180 predictor and it is the first orthogonal intelligence we have ever encountered which means that it is very

00:43:56.220 useful in attempting to model because god god a supernatural entity from the perspective of most

00:44:04.840 people certainly an entity that is that is different from us in some incredibly meaningful way

00:44:11.040 like as as different as we are from ai by looking at how ai is different from us we can begin to

00:44:16.400 understand the different ways that thought machines can be different from each other and this is useful

00:44:22.740 when attempting to to model out supernatural entities and stuff like that uh so i just i don't think

00:44:28.760 it's something to just throw away and be like hey this is a pointless thing to to not engage with

00:44:32.960 anyway i love you simone and i will get started i love you too

00:44:38.120 they are they are yes i buy my new house oh hi this is my new house hey that's my dad wait i knew hey

00:44:54.140 that's our dad because we because see that's our house and you can't hey you break our house

00:45:03.920 what is my name anymore that's a house hey stop that is a house that doesn't like the house looks like

00:45:14.420 that's yeah that's yeah that's what our house looks like and that's

00:45:21.420 look at our house wait a minute that's all right that's in here wait a minute wait a minute wait a minute

00:45:28.420 wait a minute wait a minute wait we can connect that cross tonight through the second room

00:45:35.420 room there was me but that's our daddy in here so that's our house it's not your house our house

00:45:46.420 okay so now i'm neighbors with you i'm neighbors okay yeah neighbors my house is going to your house actually

00:45:56.420 now okay but don't call this your house

00:46:02.420 okay

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Based Camp - August 19, 2025

Geopolitics Post AI & Birth Rate Collapse

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