Acquired - From NFL to Startup COO to Congressman Regulating Crypto (with Rep. Anthony Gonzalez)

0:00I can make it so you can't see her if I just hold her. She's all wound up right now. We've got all the creatures here. I got the baby on the monitor. I got my fluffy dog. You get your fluffy dog. Keep her off camera to get never happened.

0:32Welcome to this special episode of Acquired, the podcast about great technology companies and the stories and playbooks behind them. I'm Ben Gilbert and I am the co-founder and managing director of Seattle-based Pioneer Square Labs and our venture fund, PSL Ventures. And I'm David Rosenthal and I am an angel investor based in San Francisco. And we are your hosts. Today we have a first ever for Acquired.

0:58Our guest is a United States congressman serving from my home state of Ohio representative Anthony Gonzalez. David Anthony has an incredible story. An incredible story. The original motivation was Anthony's on the House Financial Services Committee and is probably one of if not the foremost member of Congress working on understanding and regulating web three crypto everything that's happening.

1:26And beyond that to the broader economy, the Fed, GameStop, Robinhood, we get into all of it. Yes. The House Financial Services Committee had a broad mandate well before crypto came around. And Anthony is one of the handful of folks as we talk about that really actually use and understand this stuff in Congress. Yeah. And not just because he's actually played around with it himself, but...

1:47He ran a venture back to startup before serving in Congress. He went to Stanford GSB for grad school with David. That's where Anthony and I first intersected. And you know, that's the who we talk about at all through this episode. His story is just incredible. His family immigrated from Cuba after the revolution. His dad was a steel entrepreneur in Cleveland and Anthony ended up playing football at Ohio State. I remember in high school watching him on TV.

2:15You went to the NFL. He played for the cults. He caught touchdowns from Peyton Manning and he went to business school. And now is a US congressman. It's just incredible. Yep. All right. Excited to get into it. Listeners, if you want to discuss this episode after we wrap up here, join us in the acquired Slack at acquired.fm slash slack. All right. Listeners. Now is a great time to talk about a new partner of ours here on acquired LaGoura.

2:43the agentic operating system that is redefining how the world's best legal teams work. Yup, it's sort of obvious that AI is going to completely change the legal industry. I bet most of you listening have dropped a contract into some sort of AI chatbot out there. LaGora took that insight and asked the question, what if you really built something with that power from the ground up for the legal industry? So the founders did exactly what great founders do, operate with obsessive customer focus.

3:12They embedded inside a massive law firm for months. They sat with the lawyers just watching how the work really gets done. And that's how you get features that customers love, like tabular review, where you drop in a folder of hundreds of contracts and it pulls every key term into a grid a lawyer can actually work with.

3:31Lagora's bed here is interesting. Since it lets each lawyer handle more complexity, any given person can increase the quality of their work and do higher value work, and this means that the pie can grow even as each individual task takes less time.

3:44And they recently launched LaGora agent offering greater intelligence and performance. The agent lets lawyers set an objective. Then it can handle the planning and the execution and delivery of the final product. Legal teams get to maintain full control and transparency since they're still involved where judgment is required. And LaGora works where you already work. You can use it within Microsoft Word while redlining or drafting. The early LaGora numbers essentially speak for themselves when they have a head-to-head pilot with their top competitor they win 70% of the time LaGora now has over a hundred thousand lawyers on the platform from 1200 legal teams in 50 countries and crazily they went from one million to a hundred million in ARR in about 18 months truly insane numbers and that is the real test

4:37Plenty of things demo well, but the question is whether a busy associate actually reaches for it during crunch time, or whether a partner trusts it before going into a conversation with a major client. If your legal team wants to check it out, whether you're a law firm or you're in house at a company, you can learn more at logora.com slash acquired and just tell them that Ben and David sent you.

4:58Now onto our interview with Congressman Anthony Gonzalez, and remember, this show is not investment advice. David, myself, and any guests may have investments in the companies we discuss, and this show is for informational entertainment purposes. Anthony, welcome to acquired. This is pretty surreal, given that we were classmates just a few years ago, and now here we are again reunited on the podcast. So real for that reason, it's real because I've heard you make that intro before.

5:27but never for me because I listen to the show. So it is an honor to be here and thank you for having me. When you say here, where is here right now for you because it looks like a very official setting behind you. So it is. I'm currently in my congressional office in Washington. I'm not sure when the episode will air, but we just had a series of votes and we're done for the week. So got a couple hours and before I head out, figured we'd jump on and have a little chat. That's great. And where is the congressional office building wise?

5:56It's basically across the street from the capital building. My son, when he comes to work, he says, you know, that's the dough and more daddy works. So just across the street on, you know, one side of the street are the house office buildings, and then on the other side of the street are the senate office buildings. There's of course much nicer and much bigger, but ours aren't bad either. But you guys do the real work. We like to think so. They treat us like little children like, oh, that's cute, little house member. The senate's going to really solve this problem. I'm not sure that...

6:22The country would agree with, I don't think the country thinks either of us solve many problems, but that tends to be the dynamic around here. Well, we'll get into all that, but speaking of problems, things that you are highly involved in that are relevant to, I think all acquired listeners, you're on three committees in Congress, right? The House Financial Services Committee, which oversees all financial services in the country, and in particular, you're very involved with crypto, web3, All of that regulated the SPF testimony, all of that fun stuff. You're also on the Science Space and Technology Committee, which ever sees NASA among many other things. And the Climate Committee. So we're going to touch on all three of those here. Great. Yeah. All fun committees. One of the fun things about being a house member is it's sort of a choose your own adventure where you can kind of pick whatever you want to work on and what you think is interesting and relevant to your district. I found myself on three great committees that

7:19certainly will be relevant in the near and long term. So it's been an interesting few years to say the least. Yeah, well, because you teased it of things that are interesting to you and relevant to your district, let's take that threat and extrapolate on it. So how did those things become interesting to you? And let's start all the way with sort of your family story and dating back to Cuba. Yeah, so I'm the Son of Cuban immigrants, my father immigrated here from Cuba. My mother was born and raised in Cincinnati and her family. And our sort of path to Ohio is interesting in a sense. My grandparents, my Cuban grandparents, were honeymooning and trying to go from basically New York City to Miami through driving. The legend is that they ran out of money in Ohio. And so they had to stop for a little bit, figure out how to get home and finish out their trip. And so they made some friends.

8:13Made a little money and then came back to Cuba and never thought they'd come back. My grandfather always wanted to have some sort of an American experience because he always admired the US, particularly our democracy. You know, even pre-castro, it wasn't a beacon of democracy and freedom. It was known primarily for corruption. Both Ben and I just rewatched the Godfather movies and I forgot that Godfather Part 2 happened right before the revolution. Totally. And there's a book called Havana nocturne.

8:39which is really interesting and sort of graphic description of how the mob and Frank Sinatra and all those folks spent a lot of time down in Cuba. But anyway, once Castro took over, my family was driven into exile. My grandfather was part of a pro-democracy movement. There were sort of a handful of movements, disparate movements, but he was part of a pro-democracy movement. And once Castro took over, he, not directly, but through one of his lieutenants, offered my grandfather a position to run one of the courts.

9:10It's basically like a district court in Cuba. My grandfather turned him down because he kind of saw Castro for who he was, and that was the end. I mean, you don't turn Castro down back then. Right. Anybody who did was getting killed or put in prison. So they went into exile and basically kind of hit out in the jungles and around Havana until they got their visa processed. And then ultimately, once the visas came through, a flu here to the US did that legally, obviously.

9:36came to Miami for a couple days and then called the old school back that my grandfather worked at and this was in Cincinnati and he said hey can we have our jobs back this is sure come on up and so they got a small little house and a neighborhood called Sailor Park was working class primarily minority neighborhood at the time and that's where my father was raised this where he met my mother they went to brother sister schools Catholic schools in Cincinnati and got married father went to Michigan Oh, wow. Oh, wow. I didn't know that part of your history. Yeah, that was more contentious than I would have thought. When I was getting recruited, it was interesting because I ended up playing at Ohio State. He played at Michigan, so he went to Michigan, but he played for Bosham Beckler. Whoa, not too many father-son combos in that club. No, a small handful, but he was great once I told him where I wanted to go. Luckily, he knew Coach Trustle, but in any event, we've lived there and he started a steel company.

10:30Maybe the year before I was born, I think, that he runs to this day. And so that's kind of what I grew up in. I grew up in Northeast Ohio, which is, you know, the place I feel most comfortable in the world. That's kind of where my people are, if you will, did a lot of sports and hung out at the office with him, you know, like most founders. He was working 12, 14-hour days. So if you wanted to see Dad a lot, you had to go into the office. I'd see him in the mornings. I wake up early. He woke up early, but otherwise, he seemed in the office. You know, it's a hard working Sort of hard-scrabble kind of community that we take a lot of pride in and that I'm honored to represent to this day listeners as everyone knows I grew up in the Cleveland Akron area in Northeast Ohio to and my uncle David is very involved in the city with the Greater Cleveland Sports Commission and the Convention of Visitors Bureau in the way that they sort of described the area as sophisticated grit So now that you've said that I know exactly who you're talking about. It's so funny. I never put it together that Ben Gilbert and

11:25David Gilbert might be related. In the sort of circle of Cleveland area folks, you're not going to be more than a connection or two away. Yeah, no, for sure. Part of what I love about it is you feel like you kind of know everybody. And if you're from there, it can be great. I always just been really proud of being from Northeast Ohio and it's sort of who I am culturally and the things I'm interested in whatnot. And so that's how I've always been and part of what has been so fun about Congress as, you know, you get to represent a community that you love and that you're from and that from my perspective welcomed my family because we aren't from here, my father's not from this country, my mother's not from Cleveland, big move for them and ultimately we've made it home and it's been incredible for all of us. Well, Anthony, we were talking about you being the son of Cuban immigrants and the sort of unorthodox path to being a member of Congress. You had an even more unorthodox stop along the way playing D1,

12:18college football and then playing in the NFL, how did that transpire? I always say, when I look at my own back, I'm like, didn't know this makes any sense. Certainly not linear. So growing up, I love football. My father played football. He played at Michigan. I was actually a Michigan fan growing up until we went on a recruiting visit and Lloyd Carr was the head coach at the time and thought I was a kicker. I was not a kicker. Your dad must have been pissed about that. I was a wide receiver.

12:46He wasn't with me, my mom was, and now that I have kids, I can understand how heartbreaking that must have been. Because I grew up a huge Michigan fan, and my dream would have been to go there. I go with my mother, you know, we make the drive up from Cleveland, it's not far, two and a half hours. I'd been there for games before, right, and like, oh my gosh, this is it. I get to finally, you know, maybe be a part of this if they'll have me, and just completely ignored. And they paid attention to, and really focused on, for...

13:12people from Cleveland in particular who I knew who I just played against at my position. And I'm like, y'all didn't watch the game clearly. If you did, you maybe would at least say hello. So we were, I don't know, like an hour and a half in. And I turned to my mom. And I was like, I think I'm ready to go. And I was 16 at the time. And she's like, OK.

13:34Oh, that must have been heartbreaking. Yeah, again, like now that I'm a parent, I'm like, oh my gosh, like, how could I just, you know, burst into tears? I'd be mortified. Just for my kid, right? But the next week was Ohio State. Same thing. There were these things called junior days. This was before recruiting got crazy. And so, you know, I went to Ohio State and it could not have been more different. We walked in, Coach Trestle grabbed us the second we got in, pulled us into his office. We had a private meeting. He kind of went through. This is only a second year on staff.

14:02went through sort of his priorities for the program how he saw it how he could see me fitting into it all those sorts of things like exactly what you would do if you're trying to sell somebody and I walked out I said well that felt a little bit better you know as an impressionable 16 year old we'll consider it I know this is a tech and business podcast but you know you got to make it about the glory of Ohio State football for a minute here I think what you're explaining is a microcosm that really outlines why the next decade plus went the way that it did I think that's probably right So, it's stressful lost. I think once to Michigan in his second year, and then never again, and they haven't won much until last year. Yep. If we want to look at causes, I think Coach Trussell was definitely on the short list of reasons why the tide turned on that rivalry. So I get home from that junior day, and my dad, I wasn't sure how to tell him, because he went to Michigan, right? And so I just kind of played it cool. I was like, okay, yeah, you know, it was nice, it was fun. But they hadn't offered me a scholarship yet. And so...

15:00A couple of weeks later, there was this banquet in Maslan, Ohio. So, big football town. Right near the football hall of fame. Yeah, right down the street from football hall of fame. And we had played Maslan. They do a dinner every year where they have a keynote speaker and they invite the MVP from the opposing team for each game. So I was the inviteee from our team. And before I go, my dad says, well, this is easy, son. If he offers you a scholarship, you just say thanks, but no thanks. You know, we're going to Michigan and that's that.

15:29and I'm like, okay, but I knew kind of how I was feeling inside. So I get there, I go see Coach Trestle and he was the keynote and he comes up and he says, Anthony, we're gonna offer you a scholarship. And I said, I'd be honored to play for you, Coach. Whoops, I botched the line. Were you planning on saying that or was it spare the moment? No, I was actually planning to like do what my dad said and...

15:51You know, maybe see if Michigan came around, but I rushed back before the dinner. I was like, I really do need to think about it, but that is a generous offer. And I loved my time at Ohio State, so we'll see. And then eventually, obviously, I want it. My grandfather was an attorney, as I mentioned, and so was his wife, Maya Weila. And I was as close to them as anybody I've ever been close to in my life, especially my grandmother. She lived with us after he passed away. And her and I spoke daily until the day she died.

16:19And he always said if you want to be an attorney, you should major in philosophy in English. So I thought I wanted to be an attorney and I felt like English would be a little boring, but I really liked philosophy. And so I took a couple of classes and loved it. My plan was I'm going to major in that if I play in the NFL great, but then I'll go to law school. And I didn't change my mind until business school until I got to the NFL in my third year. I was hurt my entire third year.

16:46It's fast forward. I got drafted in the first round. Played two years was fine. I wasn't like an MVP or anything, but played well and was slated to take over for Marvin Harrison, who's a Hall of Fame wide receiver in playing for the Colts. Catching passes from Peyton Manning. Yeah. I was like, if Peyton Manning's your quarterback and you can stay on the field for 16 games, you're probably going to have a good year. Unfortunately, I got hurt in the first game and just never came back and really never came back period.

17:15Just kept getting hurt like I never got hurt my entire life and then that third year in the NFL I got hurt and I got hurt every time I stepped on the football field thereafter pretty much and so between my third and fourth years HBS did a program Like a little business program that they use the case method on and you know sort of like be a business school student for one week and after the first day I remember I called my mom and I was like I know exactly what I'm gonna do when I'm done with this game I'm gonna go to business school at that point I started studying for the GMAT So I hadn't taken a math class in like a decade. Took the test later that year, put it to bed until my career ended and when it was pretty obvious that was going to happen, I finally applied to Stanford. I did it actually from the locker room of my final preseason game, which is sort of weird, but I went out for the game and I felt like I just knew my body wasn't right. I don't think I'm going to play much longer.

18:09So you went back to the locker room and you started typing up an answer to what matters to you most and why? Exactly. Yeah. Yeah. I mean, I need an hour and a half here, folks. I'm not playing. I'm just going to bang out this essay. You were with the Patriots at that point, right? No, I was with the Colts. I had the application finished, but I wasn't sure I was going to submit it. But it was like right before the deadline for the first round. So anyway, so it's submitted and got in. And I still wasn't sure. So I signed with the Patriots. I went to New England.

18:36was hurt, again, I think I had three surgeries in like six weeks when I was there. And Bill Belichek actually was the one who, on ceremony, honestly fired me. He called me in and he said, he said, I like you, but you're hurt. And I can't have hurt people. And it's like, that makes sense. So he said, if you get healthy, have your agent call me. We would like to have you. And I was actually smiling when you're saying this.

19:03He said, you're smiling. That doesn't normally happen. I said, well, I think I'm going to retire and go to business school. He said, where are you going? I said, I'm going to go to Stanford. He goes, it's a good school. Good luck. That was, he was the first person I told. Wow. Wow. And then I didn't tell anybody for like three weeks. So I still wasn't sure. But eventually, I got around to it and it was good a decision as I possibly could have made. That's for sure. So at this point in your life, did you have public office in mind?

19:29Or were you thinking I'll also go to law school and be a lawyer? So my aspirations in college like if you were to ask Troy Smith who was our our Heisman trophy winning quarterback who had the locker next to me he was number 10 I was I was number 11 one of my best friends if you were to ask Troy what I'm gonna do he would say oh he's gonna be Mayor Cleveland because we used to talk about that I wanted to be Mayor Cleveland and that'd be the coolest job in the whole world would be Mayor of Cleveland and so I've always sort of had this thought in my head of public service admittedly you know as life moved on I thought I would do it after my NFL career or after a long business career so I went NFL went to GSB was was running a tech company before I got into Congress and my thought was you know play that out for a long time run that out have a family make some decent money take care of them and then once the kids are grown then go into public service that was sort of my plan what up ended that was

20:25Honestly, the 2016 election was probably the biggest thing that upended that, where I saw a situation where I just stopped recognizing politics in our country. It just didn't make any sense to me anymore. It seemed to me like we were headed down a pretty dangerous path politically, and so I really started thinking about, okay, what's the best way that I can be of use to the country in a moment like this? And ultimately came to the conclusion that I should just run for Congress, which is sort of a weird realization.

20:55But I thought if I did the right things that I could probably win, and I felt the urgency from the standpoint of the country. And so that's ultimately, you know, after a lot of back and forth with my wife, because this wasn't our plan when we got married at all, you know, was, hey, look, let's really talk about this and see if it's for us and if it's something that we should pursue. And again, I don't know that we were 100% like, yeah, this is definitely the right thing for us, but we did feel the urgency that the country was in a spot and my community was in a spot where going into service seemed like the right thing to do. And so we jumped in. So lots of people around that time were feeling like, gosh, the direction things are headed might be dangerous. Polarization, the sort of lack of respect for institutions that we hold sacred, the seeming shift away from democracy is the most important thing to my own power is the most important thing. Most people,

21:50Probably couldn't say you know what I think I should do I should run for office and then most people who do say that don't have a prayer so what were some of the things that set you apart where you started being like okay I met with this person and and that went well and I think I can start to coalition build in the Republican Party this way here locally how did that transpire also we should say probably most people who are thinking that we're not Republicans at that point in time right yeah so I came to like a sort of interesting conclusion on that but in terms of So, how you get started, right? Like, I had never done anything like this. I had been running a startup in San Francisco that are good friends at IGSP who David knows and would love to have on this show at some point if you can beg them on. The highly secretive investment group of Santa Barbara. We've been begging for years. Now, we're making a public appeal here. Come on guys. Yeah, I know. Come on, Reese and Tim and Alex get on here. So, I was working with them and running a startup that they were an investor in.

22:48You know, so I knew the startup game, and I'd kind of been in that world. And so I felt like, well, this is somewhat like a startup. I've never run for anything. And I don't know how politics works. But, you know, I'll try to figure it out. And so I honestly used a lot of the principles that I learned from them in terms of how to company build around how to build a campaign and how to build an apparatus around it. And it started with doing a bunch of what I would call customer interviews. So I probably had 15, 20 conversations.

23:16before I decided to run with people in and around politics in my district. Just to understand, you know, one, you know, what are the motivations, what do people care about, you know, all those things, I thought I knew, but you have to test those hypotheses, right? And then to figure out whether my message would work. And so I went through that process and ultimately thought I understood my district in a very powerful way and I thought I could craft a message that would work.

23:42But that's not enough either, right? Like you can have the best message in the world, but if you have no team and no ability to get it out, you're not going to go anywhere. What was the message that you landed on that you thought would work? Well, mine was primarily to focus on economic issues. So I think the takeaway that you saw nationally from the 2016 election was, oh my gosh, the country is embracing this terrible politics and this attitude and the nastiness and the vitriol and the anger and the division. And you know, that's what people want right now. And my view was, at least what happened in Northeast Ohio was fundamentally an economic story and I knew that story very very well because my father has been building a steel company in Northeast Ohio for my entire life and I know that when he started it there were I don't know something like five or six car manufacturing plants within 90 miles and now there's one and I know where they all went and I know what happened to those jobs and I know how the people feel about it I remember the day LTV steel shut down that factory absolutely

24:38a quick story on LTV, so LTV Steel had this massive factory just south of the city, massive. Right off the highway, it was a big, like, you drive by it, it has a presence. Yeah, you can't miss it. Just part of the city. And my dad always used to say when we were little, he would point at the smoke stacks and he'd say, as long as there's smoke coming out of there, everything's gonna be okay in Northeast Ohio. Just don't worry about it, because that means people are working. And I think, you know, at time, it was like 20,000 people working there. It's not precisely correct, but directly correct.

25:05That things changed and multiple times gone through multiple bankruptcies. I think that's fewer than 500 people work in there today. And so that kind of transformation is what I felt the real takeaway of 2016 was. And I wasn't seeing enough understanding of that or nuance on that. And so I ran on primarily an economic message and a unity message in 2018, which is when I ran around. Hey, look, we've got to work together from Northeast Ohio. We should know that the way you solve problems is together we're actually like a purple part of the state typically and so let's put all this chaos aside let's start working together and let's start building our economy in a way that works for all of us that was essentially my message obviously there was sort of nuance in there and specifics but that worked but the second part of it so that you get that message right and and then the advice I was getting from people who've been in politics forever was you have to do two things you have to build a great team and you have to raise money

26:01And if you can do those two things, you can probably have some success. And so I said, all right, well, I've run sales teams before, and I've, you know, I know how to manage revenue. That's not, it's not rocket science. And I think I can build teams. So my current chief of staff was campaign manager at the time. I went and found him. I basically sat, we sat at a bar together for about three and a half hours until I got him to say yes. I just got a warm down, but he still hasn't left. So I think he's somewhat happy.

26:29But my message in was, look, like, I view this as a partnership. Sure, my name will be the one on the door, but we're partners in this. And that means a lot of things to me. And so we've had a good run together and a lot of fun. But like I said, on the revenue side, I built a custom Salesforce dashboard, which I don't think is common for congressional members. And probably not the candidate themselves doing that. Right. Yeah, no. And so I like Salesforce, and I've used it in my previous company.

26:58I built a little dashboard and had the contacts loaded in and tracked it the same way I tracked sales. And ultimately hit the fundraising targets we built the team and then you just work like mad. I mean you're just everywhere. You don't stop until you win. Then that was that. What was the budget for that first campaign? I was told I needed two million for the primary and that's a lot. So I was told I needed two million and I was told I needed to make a big splash in the first month. And so I think we ended up raising roughly 600,000 in the first month, which was good. You can only raise it in 5,000, well, $2,700 chunks. Two million is a lot when you have to add a lot of little numbers together, but it's not very much when you could just find a billionaire and be like, here, just fund the whole thing. Yeah, but for a whole host of reasons, we've decided that that's probably not the best way to run our country. We've spent like seven episodes on campaign finance, but the goal there is let's not let all the rich folks band together.

27:55by elections essentially so you got to build support at a grassroots level and ultimately we're able to do it a ton of work but unbelievably rewarding and from a professional standpoint it's probably as much fun as I've ever had to be honest but I assume there's a power lot of campaign contributions there but you know even if let's assume all the top and you need a thousand people to give you that max campaign contribution right Yeah, but you also don't want your average number to be too high, right? Like you want broad support. So it is important to not only have the sort of high donors, but also grassroots support. So I forget what our average campaign contribution was, but I think the goal should be to get that number actually is pretty low because it means your support is beyond just sort of wealthy folks in your area. But there is something that happens in politics where people want to back the winner and they want momentum, right?

28:52Part of the goal with the advice on, you know, you need to raise a lot of money quickly is you're sending a signal to the market. Strength leads to strength. Right. It's like startups. Absolutely. So you have this sort of, I need to signal to people, hey, this isn't just some jock who thinks he can trade on his football name. Like there's some substance here. And so that the thought was, okay, well, let's raise as much as humanly possible quickly. And then once we did that, those first dollars are the easiest.

29:18In some ways because it's friends and family, I put some in myself, you know, it feels more controllable. After you get that first slug in, that's when the real work begins because now people are looking, okay, who is that and what is, what is he all about? And so then you're just continuously selling nonstop. We were leaving the house every morning at 7 a.m. I was finishing my follow-up emails around 11 p.m. And that was the schedule per like a year. But it was fun because you get to First off, I'm just a competition junkie, so I just love competing. It's just hardwired in there. I wish I could get it out sometimes, but that's just where it is. So there's that element to it. But the other part, and this is the more rewarding part, is you're connecting with the people that you're ultimately hoping to represent. And it's hard to explain this, but you learn so much from them, like an unbelievable amount.

30:14One of the things that always bothers me is when people say, well, voters are dumb. I'm like, I haven't met a dumb voter. My voters are really smart. They're smart on a handful of issues that really matter to them. And when you talk to them about those issues, they know more than anybody. They certainly know more than me. And they educate. And that's how you learn. Now, are they experts on every policy issue? No, of course not. But the ones they care the most about, and people are really smart on those issues. And they taught so much. And so that's where the The reward comes from us feeling like, oh my gosh, I better do a good job for these people because they care so deeply about these issues and I have to deliver for them. And so that was part of the reward and continuously be part of the reward, frankly, of doing this job. Yeah, so there's sort of this dual responsibility as an elected official, specifically to those people that you represent and you raise money from and you are inspired by and you understand their plight in a big way, but also, you know,

31:10You said on committees and what those committees need to do is think in the best interest of everyone not just the specific group that you represent and as we transition here and talking about some of the specific topics of your committees I want to open with that question of do those things ever come at odds or do you usually feel like? Representing your specific group and the brought American public is something that basically always works out. Yeah, so the way I think I was like how closely do your values align with your voters values and and for me the answer is most of the time and so it's not hard right there are occasional moments when those things are at odds and at that point you have a choice and your choice is do I rely on my own judgment which may cause me some problems back home or do you just sort of do the politically expedient thing and and there's different schools of thought on that honestly but you know the way that I handled it was

32:08To the extent that I thought I could do it, I always relied on my own instincts over political expedience. I will admit, nobody can do that 100% of the time, or at least I didn't feel like I could, because you only have so much political capital, and I think you need to be careful about how you spend it. And it doesn't mean you never spend it. Some people never spend it, by the way, and it's a really good way to keep getting elected. Everybody handles it a little bit differently.

32:34But the good news on that for me is like for the most part, you know, 99% of votes, then never really felt like I was making that choice. All right, listeners. Now is a great time to tell you about a long time friend of the show, Vanta, AI has scrambled the whole security picture. It used to be that you proved that you were secure once a year on audit or a static PDF that everyone would not and you're done. But in an AI first world, that doesn't hold up anymore.

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34:30You're making decisions on a lot of very important things right now But I do think it's worth giving listeners context of like What your term has been like and if you're willing take us through that second impeachment vote and how you thought about it and just so we don't bury the lead here Anthony voted in favor of impeachment of the president at the second vote so just quick rewind so the 2020 election happens, right?

34:56And from the time it ended until, say January 6th, I had a deeply uneasy feeling and felt like things were going to get pretty crazy. Because I was seeing the rhetoric that was coming out of the White House. I was seeing how it was being reported and I was hearing from my constituents how they were feeling. And to me it was pretty clear. And I personally think anybody who's in this business who knows how elections work should have known it was clear.

35:24And so to me, I was thinking, man, hopefully people are buying this because this is crazy. I remember talking to somebody very close to me and they said, gosh, this thing was stolen. I said, what country do you think you've lived in? This thing wasn't stolen. So tell me where you think it was. And they would give me this, some of these explanations that you'd be hearing on these Q and on boards and on Twitter and whatnot. And you could usually dispel them, but these were people close to me. But like your average person, they didn't have full access to me and I could barely get get our message out. So I remember grabbing my chief of staff. It's like, just find me a camera. Like, just get me in front of a camera. I need to start talking to people and telling them because otherwise we're going to have a problem. Like, there's going to be something terrible is going to happen if people think this thing was stolen. I mean, this is the United States. If half the country believes the election was stolen, you're working to have a real violent outcome here. I was hoping to be wrong, but that's what I thought was coming.

36:19Lo and behold you sort of fast forward as we get closer and closer to January 6th the pressure build and on the morning of January 6th they told us I said hey, you got to come in early You know just get here early. There's gonna be a big protest and we then it'll be easier for you if you're here early, so okay So early to me I wake up at 4 so early to me is like I'll go you know 4.35 o'clock and I'll get in and this was during the pandemic when nobody was ever on the streets normally from where I live to get to the capital it takes like 15 minutes. This time it's 45 minutes because they were buses and buses and buses from all over the country and the mall was already pretty well filled and packed with people and energy and activity and signs, you know, you can read the signs as you're going in. Signs I've never seen before that didn't make any sense to me and I thought, okay, this is actually going to be a lot worse than I even thought. And so I tried to send my staff home but they stay, they insisted.

37:19And we had already pre-released what I was going to do, which was to certify the election. And so, you know, fast forward a little bit. And we're in the house chamber. And I'm up in the balcony. I wanted to see a couple things. First, I wanted to make sure Pence did the right thing. I don't know what my plan was going to be if he didn't, but I just wanted to make sure. And then the second thing.

37:42I just wanted to see if they would actually go through with these objections. Because I thought it was crazy. That was the most anti-democratic thing I've ever seen in my life. Still feel that way. And so, you know, I'm sitting there, Pence does the right thing. Okay, good. And then Ted Cruz stands up and objects. And I was just disgusted. I just completely disgusted. And so I said, I gotta get out of here. So I started walking out of the chamber and I was gonna go back to my office. And then I could see the people start to breach. I looked out one of the windows.

38:11Oh my god, and you see the people start to go and I flipped on my Twitter and you know you could see oh my they've already gotten through the Senate and so You know at that point I thought okay. I got it's best thing for me to do is just get into my office so They get into the elevator, you know go through the tunnels boom and By the time I get back the folks were already in the house the the riders were already in the house and They were trying to evacuate people and basically the session had been canceled And so now you're sitting there going, OK, I don't know what's going to happen, but it's not good. I know that much. And the basic instructions we got were if you're not with the other members, they had hidden the other members in a sort of a bunker, if you will, if you're not with them, shut off all the lights and be dead silent, because we don't want, you know, we don't want you making any noise. OK, so I, you know, but I'm like sitting in my office and thinking, OK,

39:09You know, I should probably change out of these clothes so I don't look like a member of Congress in case they bust through the door. So I threw on jeans and running shoes and I'm thinking myself, well, you know, I can still run a little bit. So if they get in here, I guess I'll just jump over them and sprint. And that's, you know, maybe that's my plan. And so we did all that. And then, you know, periodically that you would hear screams and yells and stuff. And I called down at one point and I said, hey, there's somebody making a lot of noise in our hallway. You know, can you send somebody up? I don't know.

39:38that this patch is like, sorry, we are completely overwhelmed just like do the best you can. I'm like, okay, that doesn't sound so good. So then I started trying to get a hold of folks at the White House and just anybody I knew who might be there said, hey, he's got to call this off. Like, this is, this has gone way too far. And he wouldn't do it. And it took him hours. And I think we're almost three hours, maybe a little more than that. But when you're in a situation like that, three hours feels like 15 hours.

40:06I mean, you're just hoping to God that somebody does something responsible, you know, it just wasn't happening. And so, you know, my view remains that it's an unforgivable assault on the country. And it was led by the former president who was inspired by him. And ultimately, my view, which I think is coming out in this January 6th commission, is that he kind of liked it and kind of liked what was going on. And I spoke to a number of people who were around him that day and came to that conclusion.

40:35And so at that point, you know, you have to ask yourself, are you willing to make that vote, that impeachment vote? And to be clear, there was previously an impeachment vote that you would not have been in favor of, but this specific event is sort of what changed your mind to say, yes, I'm one of, I believe it was six Republicans to vote to impeach. I think we were 10. I mean, it may have been six senators, but in the house, there were 10 of us. The first one, let's go back to it.

41:02I certainly didn't condone the behavior, but it just didn't hit my bar for impeachable. That was the rest of the stuff, right? That was the, yeah, it's actually Ukraine, right? I tried to theoretically bribe Zelensky back to this current vote. As that was unfolding admittedly on January 6, I thought to myself, I think they're going to impeach him again. Democrats control the House, so they control what goes to the floors. I think that's where I think they're going to do it again. So I better start thinking about this.

41:29I kind of went back and forth, not because I didn't think it was wrong or impeachable. I certainly did. The thing I was kicking around in my head was what he did was clearly impeachable, but he has whatever six days left by the time the vocums are three days. Is that really the right thing to do? Should we censure him? Should we do something else? And ultimately, I came to the conclusion that not only was the right thing to do, but we actually had to do it for a whole host of reasons.

41:59But one of the main ones is because I think it's important that we send a message to every future president forever that if you think for one second, you can concoct this ridiculous plan and secure supporters on Congress and the Capitol, resulting in a bunch of deaths and total embarrassment of our country in a grave wound on the country, on the democracy itself, then you are going to get impeached and everybody needs to know that. And so that was ultimately the decision I came to but admittedly it was the hardest decision I've ever had to make professionally for sure. Well this is one of those where potentially your own interests are misaligned from what you believed was the right thing to do. I mean did you know that in casting this vote that would be the end of your ability to service subsequent term? No you know honestly I planned to fight it so I knew it was going to be hard but ultimately look at the end of the day I've made two oaths in my entire life.

42:58Okay, I've made one oath to my wife. And I've made an oath to the Constitution. Those are the only two oaths to my knowledge that I've ever taken. And I don't plan to break either one. It really came down to that for me. It's like I feel like I owe this to the country. I feel like I have to do this. And it's going to be brutal. And it's going to be terrible for me. And it was. But you got to do it. And then you got to fight for your political life. And ultimately that was the plan. And that's what what I intended to do.

43:28but admittedly after many months of sort of going through that process and really trying to figure out independent of the politics, trying to figure out what kind of life do my wife and I want. Like what do we want for our kids, what do we want for us, what do we want to be, what kind of jobs do we want. It was pretty obvious as our kids are getting older that politics probably isn't the best place. And so made a very difficult decision again which was to drop out of the campaign and I'll finish my term out here in January.

43:57We'll see what happens. You really have to live these two lives to relate with your constituents back home in Ohio, but like you're also in DC. Yeah, those places are not contiguously either geographically connected. No, and one of them's pretty expensive. So from a family perspective, it's just a really hard life. I think this is why originally I planned to get into politics much later when my kids were grown.

44:22The reality is to do this job correctly and to serve your constituents in the way that I think they deserve to be served. You probably have to be on the road north of 100 days a year for sure. But you're probably looking at 150 maybe close to 200 in terms of days that you should be out. And so we as a family talked about, okay, what do we want for our kids and what do we want for our marriage? Ultimately, we decided that the best thing to do is to just step away.

44:52I'll focus on my committee work, which I love. I'd love working on my committees, you know, making whatever difference I can in my last couple of months before, you know, set and sail on the next journey. Well, it's not like the work you're doing in your committees is some like afterthought. That's the craziest thing is like you had this very crucible moment in your term, and of course, that dominates a lot of the sort of conversations I'm sure that you have, but you still have the rest of your term here to serve, and you're doing things like Proposing regulation for the future of crypto and web 3 and potentially the next generation of technology so I'd love to talk a little bit about that if you're open to it and like what on earth a committee actually does Yeah, what I say is like committees are where the real work happens So, you know you you follow on Twitter you see the votes and all that all that's fine and good but like real work actually happens in committee That's where we have hearings and we have real dialogue and debate and you really talk policy and in terms of crypto

45:48So when I got here in 2018, what early 2019, crypto was a topic. It was definitely something we were talking about, but it really didn't go into overdrive really until the pandemic, when folks were at home and markets were straight vertical. You can all thank Jay Powell for that. Jay should have slowed down a little sooner. Do you see my favorite, I think this is going to be my favorite lasting moment of the pandemic was Somebody did a deep fake auto-tune video of Jay Powell, Janet Yellen, Ben Bernanke, and somebody else too. Rick rolling and singing, never gonna give you up and dancing around. Yeah, we have similar friends, so I get the same memes that come to me. As Elon Musk said, I got a good meme guy. It sounds like you both share the same meme tender. Yes, very similar meme vendors.

46:41You know, people really started paying attention to it, congressionally, in a sort of thoughtful way. I would say in 2020, as the markets were going a little haywire. Frankly, when I got into it, I was on a family vacation with my wife's family. They do an annual trip to Nantucket every year. And so we were there, and I was listening to Modern Finance, which is Kevin Rose's podcast. I know he's been a guest for this show. Yeah, of course. And he had something on Flamingo Dow, which I had never heard of a Dow period.

47:10certainly to know what flamingo dad was. And after that hour or however long it was, I thought, oh my gosh, I feel like, you know, it's about like getting red-pilled or whatever, or orange-pilled. That was my moment where I thought to myself, okay, I think I've just learned something or stumbled on to something that can be unbelievably impactful for society and helpful in solving a lot of problems that I currently see in with the internet and in our capital markets and with access to financial products and all these sorts of things.

47:39Really my aha moment and you were on the financial services committee at this point I was I went through the paces on crypto to make sure I wasn't ignorant, but I hadn't really gone deep on crypto and then I spent a Good chunk of the next few months going as deep as humanly possible and and just learning about The different L1s and what an L2 is and what's the difference between these tokens and and how are these applications working and you were actually like participating in DeFi and like yeah, so the way that I did it was, you know, I'm on the committee and I, there's no rule against this but I don't necessarily think I should be, you know, investing in crypto assets while I'm thinking about regulating them. Shocking, shocking. There should be or probably should be a rule against it, but there isn't. Well, there's just no regulation at this point, right? Like back then. Well, yeah, it's the whole host of things that don't make sense. That's probably one of them.

48:33I kept reading these white papers and coming to a conclusion, which is, man, I feel like I can only learn so much. I need to actually play with this stuff a little bit, so I can figure out how these things work. If I'm going to be knowledgeable on the space, I should at least have some sort of feel for it. It would almost be asking somebody to regulate cell phone companies, but you're not allowed to use a cell phone.

48:56So in my head, I thought, okay, well, I don't think I should be investing, but I do want to play around with it. So I took like a little margin, a couple hundred bucks or something, and started playing around in DeFi, and I quickly realized I couldn't do anything with my ETH because the gas fees would destroy it. Did that for like a couple weeks, and then my plan, which I ended up doing was, I'll just give it all the United Way when it's over. The United Way accepts crypto donations. And so I did that for a couple of weeks, I forget how long it was, not too long, but ultimately learned probably more

49:25playing around with it, then I ever could have just reading. And so, from that, not only did I feel like I understood it better, but I also felt like I could legislate in a more thoughtful way. And so, from there, we've kind of been going deep on it ever since, and it's been interesting, and we're getting to a point as a Congress, which is really nice, where I feel like we're getting close to finally legislating on it, specifically around stablecoins. We'll see if we get there, but I think that's sort of the first bite of the apple.

49:55coming off the terror Luna crash. Do you feel like there's critical mass now of enough people in Congress and maybe specifically on the Financial Services Committee who have done network who really understand it now? Or is it still in the people legislating on cell phone service without using a cell phone? So we're past that on financial services. Take a step back for a second if you were to just think Congress broadly. I would say 90% of members don't understand it at all. They've heard about it, but like, they don't know it, right? Maybe their kids use it, grandkids, whatever, but they don't know much about it beyond that. The next 5% are people in my committee who are getting up to speed, who understand the basics and the building blocks. We've had a couple hearings now that have been really productive, I think, and had some great witnesses. And, you know, they want to be thoughtful in the space, but maybe they feel a little hesitant because, you know, it's complicated if you've not

50:52really gone deep. It's hard to understand it. And then the final 5% are folks like me who have spent a ton of time on it and are now coming to some pretty clear views on what the right regulatory framework should be. And that may sound daunting like you got 90% you don't know anything about it. But the truth is that's how most issues are around here. So I say that's where the real work happens. The committees lead because these are difficult complex issues and you need real expertise. And then if it's the right Set of members is the right policy that can pull the other 90% with them. I think we're getting to that point where that 5% is comfortable on both sides of the aisle to really engage in a thoughtful way. This is reasonably bipartisan and it's the support or lack of support. It's not sort of split left right. It's kind of split on age or demographic lines. Yeah, so that's what I've noticed. I'll say this like going in right, like just walking into the debate for the first time,

51:50Republicans tended to be more supportive than Democrats. I'm not sure entirely why that is, but as a general rule, Republicans were more supportive than Democrats. Having said that, within those two bands, the bigger break was on demographics. So the more senior member, the more skeptical they're likely to be. And this makes sense, right? If you look at how crypto is used, and the more junior the member, and mostly by age, as opposed to tenure, the more likely they're going to engage in it and try to understand it. And that's largely played out.

52:19But as the weeks and months have gone on, even the more senior members have realized, hey, this is something we really need to tackle. I think the president's working group, they put out a paper which some of it I grew with, some of it I don't. The most meaningful aspect is that the White House signaled, hey, this is important and we need to work on it. And I think that's really jump started everybody because we've had a whole bunch of hearings as a result and now there's real legislation being debated. Yes, so let's zoom in on legislation being debated.

52:45We're going to go schoolhouse rock here a little bit, but how does something go from a vague concept of we probably need legislation in this space to becoming law and what is the committee's role in that versus a general member? So you'd be shocked at how many members seem to completely forget about schoolhouse rocks. I know how to fix this. Do you have a co-sponsor? Is it bipartisan? No, okay, sit down please. For our international listeners, you may not have I've been exposed to this. It was on PBS, right? Or I feel like it was all over the TV when we were growing up. Where was schoolhouse for Hux? I don't know. Everybody paused this, go to YouTube, search, I'm just a bill, and then come back. That's exactly right. To summarize the video, y'all are about to just watch. The way something like a crypto bill would work, okay, is Congress sort of gets it in their head that, hey, we need to legislate in this space. A whole bunch of catalysts for crypto in particular, but that's sort of a conclusion we've all come to.

53:43And at that point, the committees will hold hearings. And usually, they're on a number of different topics related to the main, if you will. So, we had one specifically on stablecoins. We had one specifically on CBDC. We had one on crypto markets just sort of broadly. And you go through that process, and it's a pretty in-depth process. And every time you, if you're smart, you know, you're preparing for these hearings, it's multiple hours, you and your staff are trading questions back and forth.

54:12And as you develop your understanding, you start to come to some conclusions around what you want to do. My view is the best legislation is durable and in order for something to be durable, it needs to be bipartisan and it should be by camera, by camera meeting House and Senate. So my perspective is always, you got to give yourself a chance by starting with some democratic counterpart. So if I'm legislating on a bill, what I'll do is I'll find, and I'll base this on committee comments. So I'm listening.

54:41not just to my own questions, but I'm listening to how other people are processing the information. And I'll say, okay, so these two people over here, I think I can work with on this. So then you just literally go to tap them and say, hey, you want to do something on this? I think it sounds like we're in a similar place. And from there, you know, your staffs get together and you all trade notes and legislation back and forth. And then ultimately, hopefully you've come to some good texts. You propose it. It will get a vote in committee if the committee chair wants it to.

55:09Once it goes through committee, it goes to the house floor, passes the house floor. Now it gets kicked over to the Senate. They can take it or not. Most of the time, Senate ignores us, but sometimes they listen. And then in the Senate, they have to beat the filibuster, so they need to get 60 votes over there. We're just simple majority in the house. And so a little harder to get things through that. But then from there, it goes to the White House and present signs in the law and away we go. As simple as that sounds, it's the most frustrating chaotic process you can imagine.

55:38things that should take like, I don't know, six months, take like six years? Well, you were in explaining to us last time we had it in preparing for this, that like, no bill ever is like pure of scope. It's the Christmas trees, right? And stuff gets hung on it and it all starts to see, you may be wanting to regulate stable coins. And like, oh, there's totally unrelated stuff that gets added on it. Yeah, totally. So that actually happened to crypto in particular on the infrastructure bill.

56:04So there was a big infrastructure bill that was passed not terribly long ago. One I worked on a lot is bipartisan by camera. It started in this group called the Problem Solvers Caucus, which is a group I'm a part of. It's great group. For most people who are frustrated by Congress, they'd be encouraged by this. It's 50 Republicans, 50 Democrats, everything we do is bipartisan. It's a great group. It's all the members who you've never heard of, but are actually very productive and stay off cable news, but work hard. So, Prime so much caucus.

56:32put the infrastructure bill forward at least the principles the senate worked out the details and then this is also frustrating you get the bill like four seconds before it's voted on it's not like you get the bill a week ahead of time oh i've been a part of companies closing financing yeah you get it four seconds before the deal is done yeah exactly so politics is the only place with this issue so the infrastructure bill gets through the senate and all of a sudden you know people are high five and it's like oh wait a minute there's a crypto provision in there in the infrastructure bill Why is there a crypto provision in the infrastructure bill? Well, because we have to pay for the infrastructure, of course. And so somebody slipped in a little tax without really telling anybody. And ultimately it came into the infrastructure bill and was signed into law. And that's sort of the Christmas tree version of how legislating works. And admittedly, the person who crafted that provision didn't intend it to be as wide sweeping as it was. There was a thought that

57:31Basically, we were going to label any developer working in crypto a broker, which would kill the industry. If everybody has to register as a broker. What is the tax? Well, it would have been, if you are a broker, then you have to do XYZ, which would involve you registering paying taxes, etc. That was part of it. The goal is to get at something real, which is if you don't have good tax compliance in crypto, that's another thing. I probably realized when I was playing around with it a little bit, it's like, if you're not careful, you can You can break tax law pretty easily in this space. Yeah, like the default is you do. Yeah, the default is, right? And so like one of the first things it does, like I need a software like this is all on chain. So surely there's a way for this to automate and track for me. And I won't name the product because I can't endorse a product. But I found a particular software that I liked that I used and helped me track all that stuff. But the motivation was a sincere one, which is hey, we want to make sure that people aren't evading taxes.

58:30Actually, that's what it was. It was going to require, it wasn't a tax on the broker. It was going to require anybody who was defined as a broker to provide tax information to the IRS. So it would have required developers to all of a sudden provide tax information. Which makes sense if you're not familiar with crypto because that is the way that our USD-based infrastructure works where if you have a brokerage account somewhere you can just count on the fact that it's calculating all your taxes for you it'll tell the IRS and it'll send you a copy so that you know what to pay and of course or at least you know what to include in your tax return and because that's not mandatory in crypto none of the brokerages do it so it's actually a little bit difficult in many ways well especially in DeFi to figure out what your taxes are but you face this other problem where it may not

59:19be what we think of as like a brokerage or an exchange that is generating these taxable events for you. And so you would need every application developer to be spitting these things out, too, which is, as you mentioned, pretty untenable. Right. And so the, the Senator who proposed that had to like go down to the well of the Senate and basically say, I did not intend for it to sweep in all these developers and wrote letters and those sorts of things. And that's, that's actually important to do because that way, if anything ever goes to court, they could refer to that as, hey, this was actually congressional intent. It wasn't to sweep up all the developers, but was to actually, you know, after legitimate brokers. And so, you know, that was an aha moment, I think, for all of us, but certainly for the crypto community, was that infrastructure bill. And so, you know, that's, unfortunately, how things do get legislated around here a lot. I am hopeful that with respect to crypto, though, that going forward will be more thoughtful and do things like what I think is appropriate, which is a take.

1:00:18sort of little bite-sized chunks as we understand them. Because the last thing you want to do is put something forward that you only sort of understand, and then ultimately you cause a heck of a lot more problems than you intend to. And so that's the direction we seem to be going in crypto, and that's actually really encouraging, and not normally how we operate around here. What do you think is like the writer, the directionally rate framework for regulation that should exist for crypto, given here we are in summer 2022, And then the second question is like, what do you predict the coming months of regulation is going to look like to the extent it's different? Yeah, so what do I think it should be? I actually think we should look to the Clinton administration for how they handled the early internet. And they orchestrated around the phrase, do no harm. So Bill Clinton, rightfully, I think, came to the conclusion that, hey, look, there's a lot of weird stuff happening with this new internet thing and like these chat rooms are weird.

1:01:16I mean, like, oh yeah, remember, those were nasty places. We were all teenagers and in them at the time, I think. Early teenagers, yeah. I think my first AOL chat room was in. I was definitely not a teenager and shouldn't have been in there. But having said that, you know, there's some pretty terrible things happening online. And you could have made an argument that the right thing to do is to shut it down and tamp it down and control it and regulate it to death, basically. Oh, and this was the era of remembering right where, like, A bunch of people in Congress wanted to, like, end video games. Yeah. This was not a crazy sentiment in the country at the time. No, this was kind of how people felt. And Bill Clinton actually provided the right leadership there where he said, you know, first, do no harm. Let's let this thing breathe. Let's see where it goes. And then once we understand it better, then we can propose a set of regulations that make sense for the space given what it's becoming. It won't always be nasty chat rooms.

1:02:14and he was right and so you know slowly but surely we we worked up on the regulatory apparatus do we get a perfect no of course not congress is infinitely valuable we never get everything perfect but I think that was ultimately the right playbook for that time and space I would argue the same mantra should exist today which is yes are there things that are bad that happen in crypto absolutely we talked on one tax evasion does that happen certainly it happens of course it happens As you said, it's probably the default. You have to decide that you're going to pay taxes. And so that's something we need to work on and there's other areas as well. But should the response be to destroy the entire industry before most people understand it and before it's even had a chance to really develop into anything? Certainly not. My view is the mantra should be do no harm and take bite-sized pieces as they become obvious. But don't...

1:03:09overreach and I suspect that's how Congress will behave. I do fear that the administration will take a more heavy handed path mainly because the SEC chair is pretty hostile at times in its public comments on crypto. That's I think where the given take will be but that's also why it's so important that Congress actually puts laws forward even if they don't pass but just by showing there's bipartisan support for a set of principles.

1:03:35That, in and of itself, will send a message to the regulators that, hey, we're actually pretty far away from where Congress is, and that's not a good place to be. Because the last thing you want to do is regulate, you propose a set of regulations, and then Congress just flips them on you. My hope is that the energy we're seeing, which is becoming more and more bipartisan by the day, will ultimately lead us more down that do no harm path, as opposed to the heavy-handed path.

1:04:02What do you think the bite-sized early regulation will be, sort of on the steps to getting a more complete regulatory framework? My view is stablecoins are probably the most straightforward to figure out. And part of it, you know, comes from the Terrelluna issue, right? And I think what that did was wanted awakened members of Congress to what can happen when things go wrong, right? But and this was a happy surprise. It also forced members to confront, okay, what is this algorithmic stablecoin thing and how is it different from a feedback stablecoin? And what if anything should we do about that distinction? And so I've been really encouraged by how well members have articulated that distinction and have grasped that distinction. And so what I think you'll probably see is some sort of law that enshrines a

1:04:57quote, payment stable coin that language has been used in a couple of different bills. A payment stable coin as essentially a feedback stable coin. And then my preference would be that we're silent on algorithmic stable coins and we'll figure out what exactly that is later. Is it a security? Is it something else? Is it a commodity? I don't think there's actually a clear answer to that because they're all different, right? And they all have different properties and they don't all work the same.

1:05:24I would say let's focus on fiat backstable coins because I think we all actually agree on that and intellectually that's not that difficult. Fiat backstable coins, you're really talking about what's the reserves, what are the reserve qualities, what are the auditing requirements, what sort of attestations do they need, and what sort of redemption and consumer protection things do you want to build into that? If you can answer those questions, you can probably define something that looks like a fiat backstable coin. Algos are much harder. Yeah, and in my mind, there's sort of two high level purposes that regulation in this space could serve. And I'm curious if you think that I'm sort of describing this right or thinking about it right. One is protection for the American consumer or the American investor. When something goes dramatically wrong, we look at it and we go, we don't want that to happen again. We pass a law that makes that thing illegal. Two is giving comfort to developers that they can innovate without doing something illegal.

1:06:21Is that sort of how Congress thinks about it, too, or are those actually the same thing? I think they're the same thing. I think they're heavily correlated, for sure. The overwhelming majority of the innovation happening, folks want to do it responsibly. Very few people are out there building these amazing products and services with the goal of stealing. There are some criminals out there and pump and dump schemes and nasty things, and we should go after them with the full force of law.

1:06:50And there are laws on the books that exist that give the authority to do it. But most innovators in this space want to build transformative, amazing products, and they want to do it at scale, but they're scared to do it in the US because our regulatory environment is so uncertain. So many examples, I mean, like, FTX being like the obvious one. FTX is the best example. Sandbank and Fried basically grew up on Stanford's campus. And he's building a tech company outside the US. It's like the craziest thing. Imagine that for a second. That never would have happened in Web 2 or Web 1 or whatever, right? If you're in Silicon Valley, that's where you want to build this tech company. And today he's going basically everywhere but here to build that company. We hope to get him back, which obviously like, you know, there's nuance, of course, but like pretty clear that's not in America's best interest. Like we want that company here. No, of course not. No, and that's my interest in it.

1:07:46I believe fundamentally in the innovation and I believe that it's powerful and it's going to create a ton of jobs and economic might and power and it's going to be important technologies for the world. For every technology like that, not just crypto, I want that here. I want that developed here. That's going to create jobs. It's going to provide opportunity. It's going to do all sorts of things that most Americans think are positive for our country and our democracy. That's my primary motivation. Part of how you protect consumers and provide that clarity on regulation, is by proposing things that hit both sides of it, and do things like defining what a stable coin is, what a payment stable coin is. Essentially, you provide that definition because, for my vantage point, in a world where these are proliferating around the entire country, I need to know that if my farmers get paid in stable coins, that they're solid. I can't have my farmer getting paid in Teraluna and all the sudden the thing goes to zero. If these are going to be hitting the payment rails,

1:08:46And people are going to be relying on them to pay their bills, feed their families, etc. We need to know that they're solid. And that's consumer protection, but it's also pro-innovation. I mean, it's happening. Like, angel lists, you can invest via stablecoins now. Like, we have LPs in kindergarten ventures that, you know, make their capital contributions in stablecoins. Like, we need that to be actual money, you know, to go into startups. Yeah. So, same thing I can free. He was in Washington not terribly long ago.

1:09:14And he said they've done acquisitions using stablecoins. They said when they buy companies, they use crypto. For the reasons you would think, because it's quicker and easier in the cost is lower. But when it's done right, I think we'll see more and more and more of that. But if we drop the ball on this or we're too heavy-handed or we go way further than we're capable from an understanding standpoint, we're more likely to get it wrong than right. And that's why, in my view, first thing, let's just do feedback stablecoins.

1:09:43because we can pretty much figure that out. Right. We have all the benefits of the instant settlement, no need for a trusted intermediary. There's going to be less fees, all the stuff. But like, we understand what the value is tied to. And we have a lot of other things that depend on that system of what that specific one USD denomination is tied to. So that there's a lot of comfort that can come from that while getting all the benefits of the innovation. Yeah, totally. 100%. And like the way I think about some of the other stuff, like again, like the Algos, I'm not Hopefully people aren't saying how he hates all of us. I don't. But to me, it's not clear what that's going to turn into and what the right response is. And so if I don't feel like I understand something from a policy standpoint, my reaction is I should be silent on it from a regulatory and policy standpoint. Until I understand it, I probably shouldn't be regulating it unless it's hurting people or destroying people, right? But that's why I say, I think we largely understand feedback stable coins. Let's start there.

1:10:41and then we can sort of take our bite size pieces as we develop. All right, listeners. Now is a great time to thank our longtime friend of the show, ServiceNow. If you are running a large enterprise, AI agents are likely spread across every team and deploying them is no longer the hard part.

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1:12:23So if you're trying to turn AI ambition into real business outcomes and make it work safely, securely at scale, go check out ServiceNow.com slash acquired and tell them that Ben and David sent you. All right. Let's stay in committee but move on from crypto. What percentage of your time on the House Financial Services Committee is spent on crypto? Let's say it over the whole course of your term. Over the whole course of my term. I would say probably a third. I've done a ton of China work.

1:12:51And that was like the bulk of my first year in Congress was doing things to fix our international financial institutions like the World Bank and the IMF, which had been largely overrun by China. And so I did a ton of stuff for reforms there, and that took a lot of time and energy. But the areas I focused the most on China, cap markets, so I did like a lot of different things around the game stop, you know, meme stock craze, which was interesting and fun, especially following it on Wall Street bets.

1:13:17and then crypto. Those are probably the three areas that I spend my most time. Has there been legislation that came out of the meme stock, Mania? No. You know, I was actually disappointed in that because we did a ton of hearings on it and the Democrats proposed some things. I don't say this as a partisan comment, by the way, it's just the reality. Republicans do the same junk. So we could have done some things maybe in a bipartisan way that I think would have been smart. The main thing we could have done is passed a bill to shorten the settlement time from two days to one day.

1:13:47that would reduce the risk in the system overall and probably would have prevented what Robinhood ultimately had to do, which was halt trading. But rather than do that, what they ended up doing was they took a whole bunch of things that they had wanted to do for the last decade and they put them into a bill and it passed the House, it'll never go anywhere in the Senate and so nothing changed. Again, that sounds like a hit on the Democrats. I'm not trying to hit Democrats. I'm sure if and when we retake the House majority will do the same thing. It's just kind of the frustration of Washington. It became a...

1:14:16Political casualty. It did. That happens, unfortunately, with a lot of issues. The reason that one was so frustrating is because we actually did real work on it. I think we had four hearings on it. So we spent a lot of time trying to understand it. And there was national media attention. I mean, I think I watched those hearings like live. Yeah, that was probably the most fun hearing. They're interesting hearings. So I had two computers up. We did it remote. I had two computers up. I had my personal computer up, which had the Wall Street Bets forum. And then I had the hearing.

1:14:45and every single member who spoke, they just absolutely eviscerated. I love it. You're just like what reading a real time. And they were getting me to like the guy from Hitman, the show, or the video game in the movie. They're like, who let this guy in? He looked like whatever his name is. They were comparing you to the guy from Hitman. That's so great. Yeah, they're like, who let Hitman in?

1:15:09This guy's an idiot, and then I started asking questions like, wait a minute, he's got it. Okay, there we go. This is your career after Congress. You can go play Hitman and, you know, the next video game. Yeah. Play Hitman and be a meme stalker. Yeah. You've got a built-in audience. All right, let's move out of financial services. I, um...

1:15:29I don't want to make you bash on J-PAL even more than he's already, you know, poor guy. He's already in the depths right now. He's a very nice man, but I've got some inflation issues. Yes, seriously. A fun little sidebar before we move on to science, space, and technology and American dynamism, but it's sort of related. You, given your background, have been highly involved with.

1:15:53The revolution really that's happening in the NCAA right now, in college athletics and the name image and likeness bill for college athletes can now take sponsorships, the repercussions that have been wild. It tells us a little bit about what's going on there. So it's pretty messy right now. You know, my view on name image and likeness, and this goes back to my time at Ohio State.

1:16:17was it never made sense to me why college athletes were the only people in America who couldn't do anything with their name image and likeness. Literally everyone else in the country can do it that I'm aware of. Maybe some military officers can't, I have no idea, but I think even they can. But college athletes, as far as I knew were the only ones, didn't make sense to me, then still doesn't make sense to me. And did you and your teammates like, did you resent this back in the day? A little bit, not in like a, you know, a negative way necessarily. I mean, look, like I always say, college athletics was

1:16:45one of the greatest experiences of my life. I got way more out of Ohio State than they ever got out of me. I did the best I could while I was there, and I hope I contributed admirably, but that experience was invaluable, and I wouldn't trade it for anything in the world. Having said that, there is something that happens to when you see a bunch of people wearing your jersey in the stands, and you see your autographs on eBay selling for whatever amount of money, and you're thinking to yourself, well, two things.

1:17:15I'm not getting any of that, but that's my jersey. And that's a picture of me with my signature. And so that does affect people. And again, not in a way that's cheap in the experience, not to say, hey, this is BS, I didn't get anything out of this. We all had an amazing experience. But that doesn't mean that everything was perfect. And so this was always something that I thought makes sense for people to be able to do.

1:17:41And not just for the football players, by the way. So my wife was a swimmer at Stanford. She's a college swimmer. Stanford is one of the most expensive places in the country to go to school and to live. She's on the swimming team. She's not allowed to teach swimming lessons to help pay bills. It's like literally the number one person I'd want to take swimming lessons from.

1:18:02Right, exactly. There are a lot of families in Athens that would pay a lot of money for a Stanford swimmer to teach their kids out of swim. Exactly. And, you know, they probably did despite the rules. But the rules for forever said you couldn't do anything with this. Nothing with name, image, and likeness. So whether you're a star football player, Ohio State, or a star swimmer at Stanford, or, you know, a backup long snapper at, you know, pick your college anywhere, you just can't do anything with this. It didn't make sense to me because I thought you could monetize it.

1:18:31And so a couple of years ago, the state of California passed a bill that would legalize it in the state of California. And that set off a whole chain reaction where states all over the country started passing laws, but they were all different. And to me, that was chaos. You know, you want a whole host of things, but at minimum, you want an even playing field for everybody across the country. Right. Because then you get into a situation where like, let's just stick in football for a moment, like quarterback goes to USC, well, now that that person can make a lot of money by doing that. Quarterback goes to Ohio State. They can't make any money by doing that. Like that. That's a market distortion. Exactly. I think it's an awkward way to make a college decision is like, which state has passed the law that I like the most with respect to marketing rights? And so what we propose was, hey, let's do a national standard. Let's have one standard and legalize it, provide the economic right for the athlete, no matter who you are.

1:19:27but build in some guardrails around inducements and recruiting and those sorts of things. And so that was our intent. That's what we've proposed now for two congresses. Have it bipartisan. And just so people understand the history of this, it's not like there was something federally making it illegal. It was that the NCAA said that you can't do this and be a part of one of our programs which are all the biggest programs.

1:19:53with Congress passing regulations, it's basically superseding and saying, look, like you can't prohibit these people from doing this thing. Exactly. And so we've been pushing that legislation for a few years now. Ultimately, what happened is the NCAA lost a court case at the Supreme Court last year, it was about a year ago today. And since then, they just said, we'll make name image in likeness legal, but we won't enforce it. And so we'll stay completely out of it, essentially. And so that's set off what to me looks like the Wild West. So now what you're seeing are these things called collectives. And what a collective is, is it's a group of boosters that don't have an official affiliation with the university. And they are raising quote marketing dollars to go buy players on behalf of the team. Yeah, this is insane. This is crazy. Yeah, it's nuts. And you're seeing it in recruiting. You're seeing in a quarterbacks sign these quote NIL deals for $8 million.

1:20:50Problem with that, I've not seen any of these deals and nobody has, but here's what you should look for if you were to look at one of those deals. Number one, what commission is the person who brokered the deal taking? My guess is they're taking a big commission, so if you sign an NFL contract, the most your agent can make us 3%. That's via collective bargaining and the rules of the union. Marketing deals have unlimited cuts, but normally it's around 20%.

1:21:18My guess is these NIL deals are coming with pretty big haircuts that look more like 20% than 3%, but there's no way to know because there's no transparency and everything's just sort of happening in this chaotic situation. On top of that, it's goofy for the team, right? Like if you're the coach, now you're hoping that the collective that you have no association with buys the right players.

1:21:42It really handicaps the coach. The coach can't go and convince a player and say, I know for sure I have this thing for you. They're like at the mercy of a collective and gotta make a call and say, do you think you could go up to this number for this player? Exactly. To me, the model is in a place where if Congress doesn't step in and find some sort of way to stabilize this, the whole thing will probably just go professional, which maybe like a lot of people think it should, and that's maybe an argument for another day.

1:22:12But in that world, here's the trade-off that you make if it goes full professional. In that world, the way most schools would react, I suspect, is they would cut every single sport that doesn't make money except for the ones they would have to keep for Title IX purposes. And so these athletic departments would shrink dramatically. Right. You'd probably have like six to 10 programs per school at most, right? Yeah. I mean, you'd probably, you know, you'd have a football team and a basketball team.

1:22:41and you have a women's basketball team and then you probably have field hockey. I think there's a lot of people on that team. I think synchronized swimming has big numbers. You'd be making choices that I would argue aren't the best interest of your entire student athlete body. And so a lot of opportunity would go away. And for folks who don't know, I'm pretty sure when I was at Ohio State, I remember the stat that us in the University of Oregon by virtue of Nike using it as their testing ground and the incredible rabid fanhood for the university, I think the football program paid for every other sport thus making the athletic department itself profitable and could contribute back to other things in the university, but I think us in the University of Oregon were the only countries in the nation at that time that actually could do that. Yeah. I think there's more that are profitable now, but the general structure is football and men's basketball make the money and they pay for everything else is generally how it works. Maybe we should have that discussion, but

1:23:38There is a trade-off, like there is in everything, right? And the trade-off is the opportunity for the men's track and the women's track and the softball team and the field hockey team and my wife's swimming team and all these things, right? Like, all of a sudden, those are on the chopping block. And when you talk about how do we expand opportunity in our society and how do we make sure that institutions are more receptive to people from all different backgrounds, in particular, really difficult backgrounds, in particular minority backgrounds?

1:24:06One of the best ways is through sports. And so if you're going to kill the college model, you're going to kill that opportunity right alongside of it. That is the trade-off. And again, people can come down wherever they want on that issue. But I think we need to be eyes wide open as we think through this. And for me, the conclusion has always been, look, I don't know what the answer to that question is. I do know that NIL is pretty straightforward. And I know that people should be able to market themselves. And if a college swimmer anywhere in the country wants to teach swim lessons to help pay for school because by the way they're not on scholarship so they're taking on student debt just like everyone else if that's true then we should let them market themselves and I don't think that's controversial. It's crazy the amount of dollars that are involved. I mean the most crazy thing to me from all of it is that like it's almost like college programs are like half pregnant right now and that like it's got all of the money and structure of

1:25:04Like professionally owned you know for profit sports organization, right, but you know like these collectives of boosters like they don't own equity in Ohio State You know like they're just like it's wild that they're putting up this money for I don't know Yeah, I also don't think it's sustainable, right? Like what do you get it? You don't there's no economic return to it for them exactly It's a psychological return and the notion that you get to be more connected to your team and you're gonna win more games and that's wonderful but people paying that money don't make anything off of that. As far as I can tell, maybe they do. I don't think they do. Maybe they're cutting on the deals that there's such a large commission or something. No, I think the collectives are set up all as nonprofits. I think the people who are making money off the deals are the agents would be my guess. And that's where I think having some visibility on what those commissions look like would be helpful to the players, frankly, because you would know, hey, what the heck? You took 30% of me, but only 5% of him.

1:26:03You know, what's going on here? So yeah, it's a broken market. Well, speaking of opportunity in America, let's talk about science, space, and technology and kind of, you know, American dynamism and Catherine Boyle's terms, you know, you mentioned China, competitiveness that you were involved in actually in the financial services committee. But yeah, I'd love to hear from you, you know, maybe the right way to start is, you know, you've said this before, you know, plenty elsewhere.

1:26:30You know, kind of what you see is the great political battle of our time and how it's not Republican versus Democrat. I don't think it is though the activists inside of both parties think that's what it is. So to me, I think we're at a crossroads in our country, but also globally, and I think the breakdown is do you believe in American democracy or not? And that's not a question of do you believe that the democracy is working perfectly? Clearly the answer to that is no. There are almost no people I know who think our government's working exactly the way that it should.

1:26:59And so we should fight for meaningful reforms to make sure it's more reflective of the people we serve. Absolutely. When I say there are people who have lost faith in America and why I think that real divide is who believes in American democracy and not, is I think on both sides what I've seen increasingly is people inside the parties when things don't go their way, when they don't get the outcome they like, their immediate reaction is to destroy and tear down something.

1:27:29Could be a building could be law could be the court could be anything, right? It's sort of the take your ball and go home. This thing's totally broken. We need to burn it down and start over with something else. I see that on the left and I see it on the right. I think that's poison. It's poison for a whole host of reasons. One of which is I think we need to take a step back and remember how incredible the American idea in American democracy has been for the entire world prior to our founding. Governments were not of buying for the people.

1:27:59Governments were of by and for the government like a monarch Yeah outside of a handful of like Greek city states back in the day Democracy was a new idea and was an experiment and for the first time ever we placed the sovereignty of the individual at the center of society and governments job If you go back to the founding was basically to protect the rights of the individual the individual was sovereign the government was beholden to the individual That's a beautiful beautiful and powerful idea And oh, by the way, we don't just believe that for people inside our own country. The belief is that all people have dignity, all people have these rights. And as a result, we need to lead with those values globally. And if you believe that, then of course you have self-government. Of course, you have a democracy. You wouldn't have an arbitrary monarch ruling over you because the people are sovereign. And from that, look, we've created more wealth, more prosperity, lifted more people out of poverty, freed more people, and

1:28:55oversaw the longest sustainable peace in world history. It's not to say we're perfect. Again, of course we're not. And of course the founding wasn't perfect, right? We have the three-fist compromise. I think it's the original center of the country. Whole host of things that we've gotten wrong. But compare that to the alternative which is sort of authoritarianism and Chinese communism and the sort of divides there. And I think it's a pretty clear answer as to what the right path forward is. And so when I see people tear down our democracy, whether it's, again, right or left, I think that's a dead giveaway to China. It emboldens the rushes in the China's of the world and you hear it in the rhetoric. You see it from their propaganda arms and all it does is cheap in democracy and our leadership in the world globally. And so to me, that's the real divide. You know, look like faith in democracy isn't given, it's earned. And so people in positions like mine need to do a much better job of fighting for things that are relevant for our people and

1:29:54ignoring the most extreme voices and take the necessary political risk to bring us back. But it's also not just on us, right? So like the beauty, but also the burden of democracy is it's a participation sport. So you actually have to show up as an American. You have to vote and not just once every four years. Right. And not only do I have the right to vote, but like I kind of should know what I'm voting on. So like I kind of need to do some work to make informed choices. Yeah. The one question people ask me a lot is Hey, how do we fix this? The first question I ask is, how many of you have voted in primaries? And usually one hand goes up. The numbers are around 20%, around 20% of voters vote in primaries. Well, the primaries where the battle is for most races. Most congressional districts, certainly in this country, are heavily gerrymandered. And a lot of these Senate races are really come down to who's going to win that primary.

1:30:49I mean, you were saying in your own journey, it was all focused on the primary riddle, the fundraising, that was the battle. Yeah, and you run hard and you fight hard for every vote and you represent every constituent, not just Republican primary voters, but ultimately, you have to appeal to the people who vote if you want to get elected. If we could move our primary electorate participation from like 20 to 50, I actually think our politics would moderate and they would improve dramatically.

1:31:16more so than most people realize. And why is it that they're won or lost in the primary versus the general? Well, in congressional districts, because they're so gerrymandered, so they're all ranked. My district's like an R plus nine, which means generic Republican versus generic Democrat, the Republican has a nine point lead. You know, every district has it. Mine's actually a nine point lead is a lot. Mine's one of the least gerrymandered in the country. Right. You actually see a lot in like the teens and 20s and 40s, where it's, you know, an R plus 57. It's like So, like, nobody can win. So, that's the argument of, like, whoever then wins the Republican nomination and the primary is paved. The path is paved from there. Right. If you think about it in general elections, the media is making such a big deal about x, y, z, how seed, or senate seed. And it's like, well, you're talking about, like, three or four seeds in the entire country. What does that mean for the rest of the seeds? Like, those are givens. Right. And, you know, what else just happened? We all just got our maps redrawn.

1:32:11And what happened is fewer districts are now toss-ups, so there's basically fewer at play, and the existing districts are now more extreme. And so it's like the worst of all worlds. So we have fewer competitive seats, and the ones that we have are going to have more extreme candidates. Unless, and here's the hack, unless people actually show up and vote. This one little trick. Yeah, this one thing that you need to do, like...

1:32:35get engaged to actually follow the primary. And look, it's like, do I like this candidate or not? They mail you a booklet. It's right there. Everything you need to know is right there. Yeah. And everybody's on Twitter, get on there and look at the things. It's really easy, I think, to figure out. I resonate more with this person or that person. And nobody's going to be 100% the way you want, of course. But I think you'll be able to quickly figure out who's going to be a productive representative and who's Maybe has other motives. Right. And so that that would be my biggest solution for individuals who are frustrated. I just got to vote more. All right, listeners. Now is a great time to talk about one of our favorite companies, Statsig. Yes, there is a reason why the best product teams rely on Statsig, whether they are iterating on their core product features or shipping AI-powered experiences at scale. Yep. In the

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1:34:15So maybe let's now bring it to American industrial policy. I mean, over the time you've been in Congress, the view has shifted so much of globalism is an unfettered good to holy crap. We may have some issues with our supply chain and like American industrialism and offshoring. You've lived all this. What's your journey been? Yeah, so, you know, again, I come from a maybe a slightly different perspective because of My father's background, my family's background, building a steel company in Northeast Ohio and seeing what has happened to the industrial base in the Midwest and what that's meant for our communities. You've seen poverty creep into places, you've seen what were once very vibrant neighborhoods start to decay and a lot of hopelessness and opioids and all kinds of terrible things come in their place.

1:35:05And so when you see that, I think it forces you to take a step back and say, OK, what should we really be doing here? And to me, I think there's sort of three buckets that I think are most important. One is to build a sustainable economy, one a dynamic economy, and then also a resilient economy. And I would say sustainability gets probably the most publicity right now. And that's obviously important. But the dynamism is absolutely critical. And by that, I mean, basically, I think the US should lead in every critical technology.

1:35:35from now until eternity, so I want the best AI systems and machine learning systems. Dynamic literally meaning changing, so whatever the next big wave is that we are leading that big wave. Yeah, because that's where the economic value is going to be created and that's also where the jobs are going to be created for the most part, right? Like FTX being based in the Bahamas is not good. Yeah, drives me crazy. And they're not the only one, right? And so whatever we need to do to attract builders and founders and engineers and talent to be in this country, to be educated, and to build the most critical technologies of the future, and the supply chains that underpin them, I think is massively important. And then on the resiliency side, I think this is where the goal was efficiency forever. And I think COVID more than anything probably highlighted to the world what maybe Northeast Ohio realized a long time ago, which is if you just optimize for efficiency,

1:36:30You're going to hit a trade off at some point for us. It was jobs during the pandemic. It was supplies and PPE. Yes. The more you squeeze margin and the more you make it so that you can get every last drop out of the towel, the less resilient you are to any sort of shock in the system. Absolutely. And we're dealing with it again on the inflation side, which I think is still largely a holdover from COVID disruptions. But what should we do going forward? Do I think we should reshore everything? No, I don't. But in this world where I believe it's us versus China and Russia and US values norms and ideas versus the Chinese Communist Party values and ideas. I want as many critical technologies and supply chains domestic or with our friends as possible. So I'm happy to offshore, I don't know, t-shirt manufacturing. If we run out of t-shirts that would be unfortunate but if a war broke out we would probably survive.

1:37:27And you're identifying that it's not mission critical, whereas semiconductors, for example, mission critical. TSMC is pretty freaking important. Yeah, absolutely. And by the way, if China moves on Taiwan, that's a big problem for us, especially if we have a national security issue. Those are the sorts of things, but on top of that, I think we have to get some of these raw materials going here as well. And that can be uncomfortable because there's environmental impacts. But what I would say to my folks who are more concerned about that is By and large isn't 100% true, but by and large, the United States has higher standards around our manufacturing and the cleanliness and sustainability of our manufacturing than other parts of the world. It's like a ton of steel made in the United States is going to be made with less energy intensity than most parts of the world, not all, but most, and certainly China. There's enough silver bullet, but I think you solve a variety of your goals if you want a dynamic resilient and sustainable economy.

1:38:25by bringing a lot of this production in particular, the most critical pieces back home or with our most trusted allies. It's such a prisoner's dilemma on the sustainability versus dynamism front because, okay, let's just simplify the problem and say the US spends more money to make steel, the very same steel, but does weigh less pollution.

1:38:51China does way more pollution to make cheaper steel of the same quality. And I know those things aren't necessarily true, but let's just assume that it's a clean boxed problem. Right. Well, we all live in the same atmosphere. And so if you take it as a given that they're going to keep doing that as long as we're willing to keep buying it, then like are we actually helping the sustainability goals by saying, hey, let's not produce here because that would be a way to contribute to solving the problem by being the leader in the first mover.

1:39:20Yeah, so that's why I think from a policy standpoint, it's so important that we at the government level invest in the R&D necessary to literally invent the answer to that question. It's like at my belief is the answer to the prisoner's dilemma is we have to invent the answer. Like it doesn't exist today. There's no obvious answer to that. You are literally in a prisoner's dilemma unless we find a way to develop cheap but also sustainable steel.

1:39:49we're going to forever be in that particular box and so some legislation that I hope will pass very very soon that I'm working on would basically fund demonstration projects for clean steel to do literally exactly this problem and I think you know steel is one thing but we you know that's on the manufacturing side but you could also look at agriculture transportation energy generation that most of those sectors have similar trade-offs to what you just described And my view is the only way we can really do it on a global scale is if we make the green alternatives so cheap and reliable that everyone everywhere would say, hey, this is the best thing to do for all sorts of reasons. Now, that's way into the future. Would I just describe? That's probably a 20 to 50-year journey. But I don't know how to solve the sustainability goals otherwise because they're just sad. I think something like 50% of the people born in the world in the next 50 years will be born in Africa.

1:40:45Wow. Well, how do those economies power themselves? They power themselves largely on fossil fuels. Right. And they're developing economies. So what are you going to tell them, hey, Sara, you have to take this really expensive steel and your people have to stay impoverished? Absolutely not. And it's deeply oppressive to say like we spent the last 100 years expounding unbelievable amounts of energy to build this incredible nation that we live in.

1:41:06But sorry, the atmosphere is super polluted now, so none of you are allowed to do that and we're going to use military muscle to make sure that's true. That's a press if you need to innovate your way through this problem. That's my personal view. Yeah, you could set it better than me. My view is that the answer to this is it's a market design question, but it's also an innovation question. And I think our responsibility, again, at the governmental level is to make sure we're funding that R&D so that we get there.

1:41:33No private enterprise can underwrite a 50 year R&D project. The payoff's not there. Well, this is our argument on the TSMC episode is that only government scale investment actually could have a prayer of succeeding and creating the next TSMC elsewhere. And TSMC was a government-seated, you know, company. Yeah. I mean, in Congress, we're about to pass this chips act, which is a bit controversial, but its goal is to...

1:42:00reshore semiconductor manufacturing here in the US by providing subsidies and grants and all kinds of incentives to get folks to build fabs here. Happens to be that Intel has announced a massive investment in Ohio, so I'm pretty excited about that. I want to see that get done. Totally agree. That's what we've always done is an innovative our way out of problems. Exactly.

1:42:21I don't know if it's the American way, I think it is, but it's the acquired way at least. Let's put it that way. It's definitely the human way. Human beings are unbelievably good at growing and surviving, and so I think humanity will continue to bump up against the edges of its environment until it innovates away to continue to spread and prosper. Yeah, and I'm totally bullish on our ability as it species to do that, and I'm particularly bullish America is going to lead the way because I think we have the best system for it. The free enterprise system is unbelievable. If you want evidence, think about how awful our politics are, but how strong our economy is on a relative basis. We should be in a much better position than we are politically, but that's the power of free enterprises. You set the incentives up and you turn people loose and that creates some unbelievable things. So my question is, when do entrepreneurs and investors do? If you agree that

1:43:17re-shoring the dynamism part of the American economy needs to be reinvigorated. Let's take Ohio. Are new steel startups going to get started? What's the right way to approach this? Or is it legacy companies? Is it a combination of both? I think it's all the above. Governors all over this country want their states to be more dynamic and want their economies to be stronger. They want to attract more people generally. In Ohio, I always think the way to approach it is to leverage the existing assets that you have.

1:43:47Most people don't know this, but Columbus, Ohio in particular is starting to develop a pretty nice tech scene. So there's a company called Drive Capital, which was started by Mark Kovami, who some of y'all might know. And his fund is doing incredibly well, and they've had a handful of IPOs in the last few years and some solid acquisitions. And as a result, you're seeing this burgeoning tech scene more on the software side in Columbus, Ohio. And a lot of it's in the insurance space. We happen to have an incredible insurance industry in Ohio as well.

1:44:15turns out nationwide people know a lot about how to create new insurance products. Exactly. So you have this sort of nice little flywheel building around software and insurance and technology. And then the capital and expertise is there with Drive Capital. Layer the Intel investment on top of that, right? And so we'll have some giant fabs and investment happening right outside of Columbus. It's a trite term, but you can see sort of a Silicon Heartland sort of dynamic taking place. What we'll need to do is find a way to become great at advanced manufacturing and chip manufacturing and all those sorts of things. And we're going to actually have to build the facilities and the support services around them. That's going to happen in Ohio. And that's really exciting. That's just the Columbus area. Northeast Ohio, as you know, Cleveland Clinic and University Hospital are two of the most innovative medical facilities in the world. And so, I think we need to do a much better job as a region.

1:45:10connecting the innovations that are happening inside the walls of those two great institutions out to the broader ecosystem. But, you know, I think if you sort of look at the pockets throughout states and see, okay, what assets do I already have and how can I leverage them and what's, you know, fast growing, high growing, I think you can start to piece together a strategy, take a step up at sort of a national level. And I think you need to have the incentives put in place such that as we transition away from fossil fuels and towards more clean energy that we're doing as much of that development and manufacturing here as possible, that we're mining the minerals here, and that we're building sustainable supply chains around that. That could be anywhere. That's sort of how I think about the economic challenges that we have. It's interesting. I mean, this dynamic has always been true, but now that Silicon Valley mindset is really a diaspora at this point across the country and the world, obviously,

1:46:09You know, one of the things I always thought, and then, you know, when you and I Anthony were there, lived firsthand, was that like, Stanford really got this from a policy perspective right in a way that like, no other university ever has, which is just like, to my mind, I always build it down as the simple idea that like, if you push the innovation out of the university, let people make money on it, you will do better as a university than if you try and hold it within, right?

1:46:38And that, to me, is a big part of the story of Silicon Valley. I mean, famously Stanford only took 1% of Google when it was a Stanford graduate research project. When most universities want 25, 50 plus percent of anything that they call it tech transfer, that it's not even like, oh, it was your idea in the first place, and we'd like to piece of it so it was developed here. It's like, oh, we're transferring it out into a company. It's right there in the language.

1:47:03Right. Jensen Huang was a grad student at Stanford as we talked about while he was starting Nvidia and there's a Jensen Huang building at Stanford and it's not because Stanford took equity in Nvidia in the early days. Yeah. Yeah. And the inertia behind some of these really good important early decisions is incredible. Once you get it right, these flywheels develop and they're just so powerful. They're powerful for your community, they're powerful for the country. We use much of it as we can get.

1:47:33Well, Anthony, on a closing note, let's bring it back to you personally a little bit. You're not running in the next election. So what do you think the future holds for you as you focus on the next chapter of your life? There's a good question. Admittedly, my primary focus is finishing strong. I have a handful of pieces of legislation that I'm still pushing, that I'm hopeful we can get across the finish line. That's the primary focus. But I am starting to kind of go through my notes again and reread my like business school notebooks and go through experiences. I keep notebooks at all times, so it's kind of fun to go through and relive some of those experiences, building businesses, but also in business school. And, you know, I think I'm still trying to work through, do I want to be an investor or do I want to be an operator? I've done operating, and I enjoy it. I enjoy the heck out of building our campaign team, which is sort of like a startup in a way, and I enjoy the investment side.

1:48:29And for me, what I'm trying to figure out is who in my life do I admire and what kind of businesses do I want to build. I think of the IGSB model and I just think it's fundamentally an incredible model. The success is outrageous. For those of you who listen to the Altos acquired episode, it's probably most similar to that. Did truly incredible story. It came out of...

1:48:50It's called the investment group of Santa Barbara, but it also came out of Stanford DSP and really just two folks in a very small handful of people over 50 years have compounded at numbers that are unbelievable. Yeah, and it's crazy. And basically by doing the Buffett model but with high-growth companies, be super concentrated. Don't get outside your circle of competence and focus on the underlying economics of the business. And what they would say is we also only work with people we like and admire.

1:49:20That is probably my top priority as I move forward. Is I want to be in a position where I love the people I work with, I admire the people I work with and for, and I'm working on exciting new challenges. That's sort of where I think I'll be the most effective. And again, whether it's operating or investing, I guess time will tell. But I guess we're also all just a little bit of both at the end of the day, right? Yeah. Capital allocation is the number one most important skill of a CEO for many people would argue so.

1:49:48Yeah, yeah. That's certainly the, uh, the Will Thorn Deic perspective, right? Absolutely. Oh, we should plug Will's new thing here. Oh, yeah. If you like the outsiders and you liked our book club with Will back in the day, uh, he's got a new podcast called 50X. That's the first episode I think is with the CEO of TransTime, which is a great episode. David and I got a little early sneak peek. Yeah. That's part of our friends over at the Colossus Empire. That's good for me. I got to pick that up. Oh, yeah. It's, it's really good. It's unbelievable how they've grown.

1:50:18a truly excellent manufacturing company both organically and by acquisition over the years. It's an impressive story. Translime is Nikali's company. Yep. I know Nick Well. Oh nice. Yeah, it's Will interviewing Nick. We have a very vocal.

1:50:33It's a small minority, but a very vocal small minority of acquired listeners who are just like campaigning for a trans-dynamic said Nick would be great on the podcast I don't have you ever heard Nick speak but Nick is incredible. He's super fun entertaining and like gregarious. He's a Cleveland guy. Yeah, he's awesome. Yeah, he'd be a good guest. It'd be better than me. You should just should get home. This has been pretty good. Well, we'll add it to the list and and listeners go check out 50X. All right, so We won't make you answer what you're gonna do next though, but I am curious Where would you steer founders? I think there are a lot of people out there right now who always who are listening who want to found companies But I think especially you know if these ideas that we've been talking about with with Catherine with you of American dynamism You know resonate where do you think founders should go poke around and dig to start companies?

1:51:25It's a great question. I mean, admittedly, I'm kind of thinking of the same thing. Don't give away your best ideas. Maybe your second best. Yeah. Well, I mean, this isn't going to be that profound. But to me, like, I look for industries that have enormous tailwinds. And like, where is the growth going to be? And then where can I fit inside of that, if at all? So like, there's probably going to be enormous growth in vaccine development and pharmaceuticals. I know nothing about it. I hope everybody does it.

1:51:51phenomenally well in that space, it's just not going to be for me. Okay, so outside my circle of competence, I love everyone in it, not for me. But, you know, are there ways to marry my experiences on decentralized systems and, I don't know, sports or entertainment probably? Is that what I'm going to do? I have no idea. But I do think there's some interesting tailwinds on the decentralization side. There's certainly interesting tailwinds on the climate movement.

1:52:17Right, and how do we decarbonize the economy and do it in a way that's responsible, not just for our people, but for the entire world. It's probably the biggest theme, frankly, that, you know, I think it's probably a 50 year theme, but definitely for the rest of my career, I think we'll be working on that. And so, where are your skills going to be the most valuable and where do you have the ability to do the best job, which is sort of an obvious point, but I think it's important one. I think a lot of times people think, oh, there's a lot of money to be made over there. I'll go over there. If you're not a good fit for that, you're just gonna be

1:52:47you know, fighting a pill. That's what I would tell founders. You know, focus on the things that you can be the best in the world at, that have a bunch of tailwinds behind them, and surround yourself with people you love and admire. The times that I've gotten it wrong in my life is when I've put myself in positions where I'm not with people I love and admire. When you're in that position, things can break down and they break down quickly. Amen. I 100% agree with that. That is true. Good wisdom from the ideas, be folks, and many others. For sure.

1:53:16The most fun times I have in my career and the most meaningful are always with people I love. And it's not even like-minded people. It's like people from all different backgrounds and creeds and colors and you come together in these interesting environments and you build something amazing. And it's so fun and interesting and you've learned so much. That to me is where the development is. It's in those uncomfortable moments. Anybody can go be comfortable. It's sort of where can you push your own limits and do it with people you love.

1:53:44that I think that the growth comes. And that's what I enjoy the most. Well, Anthony, it's a bummer that we're all going to lose you as someone representing us, but I got to say it's going to be nice to have you back building stuff again. Yeah. I'm excited to finish it out, but I'm excited to get back out there. It's a great big world out there. I just got to find my place in it. Well, Anthony, thank you so much. Oh, thank you. This has been fun and an honor and I appreciate you having me on with that listeners.

1:54:09After you finish this episode, come discuss it with the other 12,000 smart members of the acquired community at acquired.fm slash slack. Many of you know this, but we have something called an LP show. If you want more, you can go to any podcast player and search acquired LP show. Our next episode is an interview in partnership with the Solana Foundation. We had a long time listener, seriously long time listener, like 2016 Austin Federa joined us for a primer on The state of the crypto and web3 ecosystem today is actually going to be a great companion episode to this episode. Totally. I mean, it's frankly very helpful just to understand what is the terminology that everyone's using. What does it mean today?

1:54:51how are all of us sort of sharpening our pencils on better understanding what this landscape looks like, what's useful, what did we think was going to be useful, but didn't really play out. So that will be live soon in the public LP feed that you can find at any podcast player. And if you want that episode early, it is already live for paid acquired LPs at acquire.fm slash LP or by clicking the link in the show notes.

1:55:17Lastly, if you are looking for that next great move in your career, check out acquired.fm slash jobs. Those are all curated by us here at Team Acquired. And we hope to hook you up with an opportunity that, frankly, we think is really interesting. So with that listeners, we will see you next time. We'll see you next time.