Hi, everyone. Hi, Devcom. My name is Alex Hoekstra. I am a molecular biologist and I'm one of the co-founders and scientists at the Rapid Deployment Vaccine Collaborative or RANVAC. I'm excited and I'm grateful to talk to Biohacking Village about open source technology in vaccine development, building the kind of tools that fill gaps in global vaccine infrastructure. My goal in this session is to present the case for open source vaccine development and the tools that enable that kind of development, which RANVAC we've been trying to think of as developer kits or vaccine developer kits, because it's very clear that vaccines are a uniquely important tool in biosecurity and there's so much more room for improvement in various facets of vaccinology, especially with regards to accident. We think that many aspects of vaccinology should and with the right kind of tools can be made more accessible for more people in more places around the world and that the vaccinology itself could grow and be improved by that kind of inclusive participation. So during the COVID-19 pandemic, obviously all kinds of gaps were built in public health infrastructure and biosecurity and there's more reason than ever to think seriously and creatively about how to fill these various gaps going forward. I guess both for the ongoing reality for billions of us still struggling through COVID and this pandemic, but also for inevitable future emerging diseases, which we might be able to minimize and even prevent the right tools. So I want to introduce some work by discussing some concepts regarding vaccines that I think may will be familiar to a lot of people here who are already familiar with space, but I also want to get into some hopefully exciting and new ideas for a lot of people across the biosciences. Since vaccinology has been heavily shaped by IP laws for the last seven or so decades, there's a lot of room for creative improvement, especially when you begin thinking kind of outside that box. I think it's important to bring up a few foundational topics like vaccine economics and the unique role of the vaccine to play in epidemiology and as well as the immunology as it relates to vaccine platforms or the technology themselves. Then we'll take a quick look at those issues before we get into what RADVAC is doing in particular because I think they're helpful in identifying the gaps and why they exist presently. Ultimately I do want to get into what we've been doing at RADVAC in terms of open source efforts, what open source efforts can do to kind of bridge those economic technical and logistical gaps. We at RADVAC have been working on building a particular platform for intranasal peptide-based vaccine candidates against SARS-CoV-2 virus, but we also think that these these principles of development may be more valuable in their generalizable form than any single development project on its own. So I want to get into why vaccines are uniquely important, uniquely leverageable tool in public health and defense against infectious disease. Vaccines serve to combat disease in a number of ways, primarily by inhibiting infection, inhibiting disease, inhibiting transmission, and inhibiting replication, which subsequently inhibits mutations and the evolution of new pathogens. And although there are a variety of important and even very useful tools to achieve some of these functions, in fact, things are arguably the most the Swiss cheese model. It's something that I'm borrowing from Ian McKay who adopted a similar illustration for COVID. Out of the mind is only showing a handful of risk prevention interventions and isn't really to scale in terms of each intervention's efficacy, it's stopping pathogens from infecting a person. I think the illustration is still a useful one insofar as it makes the case for applying multiple layers, additive layers to mitigate risk. Vaccines, though, are unique among these interventions because they both augment a person's ability to fight off infection if the prior layers of protection fail. But also, if applied at scale across the population, vaccines can limit the collective exposure to these pathogens by reducing the number of available hosts and transmitters. And in the next slide, we're going to get into just a little bit of math. I promise it won't be too much and that'll be the end of the math. But essentially, the network effects may be one of the most important features to vaccines, which are good on a personal level, good for individual health, but so much better on population scale. But a lot of things have to go right in order to achieve those population scale network effects. And as of now, as of July 2021, almost a full 16 months after the first COVID vaccines were actually developed. And now seven months after those vaccines were authorized and made available in the US and other high income countries, we're still not yet achieving the full benefit or benefits of those network effects on disease prevention that these vaccines could and hopefully will soon provide once they're made more accessible and more widely deployed. There's a good amount of math involved with considering how to prevent or endopend them, accounting for things like population characteristics, age, health status, mobility, environmental conditions, and a lot more. But one of the most important concepts is understanding the effective reproductive number for a given disease. Effective reproductive number is sometimes written as R or R sub e. And it's a bit different from basic reproductive number, which is more commonly talked about, it's R not or R sub zero. Because effective reproductive number R sub e basically takes into consideration the percentage of a population that's susceptible to infection, essentially the percentage that is not immune, sometimes written as S. So R not on the other hand, is meant to be a metric of a disease's contagiousness or a transmissibility. You can calculate effective reproductive number by multiplying the basic reproductive number by S. So killing a pandemic requires bringing that effective reproductive number to under one. Since the spread of infectious disease is essentially an exponential function in which every infected person can infect a certain number of other non-immune people, a reproductive number, a reproduction number greater than one will increase the transmission at an exponential rate. Whereas the reproduction number below one decreases transmission, approaching zero new infections over time. So here we can see a few illustrated graphs on what happens to an exponential function when that constant is above one and when it is below one. So the state is related to herd immunity threshold hit, which is also a function of a disease's reproductive number. Essentially the higher the reproductive number for that disease, the higher the threshold for population scale immunity. The population is immune to a disease in excess of that disease's immunity threshold. The number of cases reduces at a faster rate, outbreaks are less likely to happen and outbreaks that do occur are smaller than they would have been otherwise. It's probably important to note that the herd immunity threshold doesn't represent the point at which a disease stops spreading altogether, but rather the point at which each infected person infects fewer than one additional persons on average, essentially modulating the effective reproductive number and diminishing the incidence of disease. So these are useful formulas when thinking about vaccine readiness and roll out in situations of emerging disease where populations begin with virtually no pre-existing immunity. So the effective reproduction rate is actually very high and can be brought down by vaccines that are both effective and very importantly available. So what happens when there's no pre-existing immunity? So S is very high and we're met with a disease that has a high basic reproductive number. Well we are living it with SARS-CoV-2. Since SARS-CoV-2 is a new virus and since it replicates with high efficiency, COVID-19's debut has been devastating. A COVID toll on human health won't be fully calculable for years now, but we're still very much in this pandemic globally where immunization rates are low and the effective reproductive rate is greater than one in many places. Again, no matter how effective a vaccine is on an individual level, the key to ending pandemics is decreasing R, that effective reproductive rate, which means decreasing the number of susceptible non-immune folks S. So bear in mind that the production, authorization, and roll out of safe and effective vaccines for an emerging disease in under a year is historically unprecedented and a very, very good thing, but it's also clear that the cost of not being prepared, both in terms of prevention and in response, those costs are vast and indeed far, far greater than the cost of building the kind of biosecurity infrastructure, including vaccines that were, you know, we already largely know how to make them. So I'd like to explore why this infrastructure was lacking and then maybe get into some solution-oriented ideas. I think it's important also to talk about the ecosystem of vaccine development that existed leading into 2020 and why COVID caught us all off guard, despite years and years of scientists and people who listened to scientists agreeing that such an outbreak was really only a matter of time. So Professor Andrew Lowe, MIT Professor of Economics there has done some really interesting analyses on the economic landscape of vaccine development over the last few decades, which taken together revealed some interesting insights about why despite their importance and despite the high rate of technical success in development, vaccines are less than 10 percent of industrial biotech investment. It turns out the vaccines have a uniquely high probability of success and end development, close to 40 percent compared to 11 percent across all therapeutic groups, but industrial sponsors have been pulling out of the vaccine development business for at least the past two decades. So Professor Lowe and others began to understand that vaccines are a high cost and low financial reward, low margin investment, and generally a turnoff for industrial or industry sponsors, biotech pharmaceutical companies, as well as their investors. Dr. Lowe and his colleagues point out that these analyses of vaccine landscape reveal some big gaps in investment, waning vaccine or in the participation and ultimately inhibited vaccine access that predate 2020 by a number of decades. And they suggest that public sector support may be useful in filling in these gaps left by kind of a lack of capital market incentives. And this itself is a really interesting line of thinking because with what we know about how vaccines leverage network effects at a population scale, lowering S, lowering R by increasing immunity throughout that population, we could ask, could vaccine development and vaccine innovation be driven by sort of rethinking of vaccines, not as a market dependent good, but instead as a sort of international public, since they clearly have international public benefits, and since the market incentive structure has failed to make those investments profitable for profit driven developers so far. Anyway, the need for public sector support should probably include scientists, many of whom also happen to be members of the public, many of whom may actually be listening right now. So, vaccinology is really a constellation of a dozen or so disciplines that field the science of public health, epidemiology, immunology, psychology, chemistry, economics, policy, clinical trials, ethics, informatics. We've actually had a couple of physicists reach out and offered to assist us in characterizing our vaccine candidates. So, it's clear that there's a need for skilled people of all kinds to take an active part in building global scientific and logistical highway system that can deliver vaccines to populations more quickly with high levels of efficacy, safety, trust, and access. But we at RandVac took a systems view of the gaps in vaccine infrastructure, and across four different elements of the vaccine response, including R&D, testing, approval, and deployment of vaccines. It seems to us that each of these steps could be potentially augmented, improved, sped up, and made more accessible globally by increasing the kind of access and powers participation in each of those central processes. We believe that the ability to take part is a fundamental prerequisite for things like vaccine equity, inclusivity, transparency, ultimately entrust safety efficacy as well. And ultimately, in developing great ideas about how vaccines work both on a technical level, but also on a systemic, worldwide people and global health level. RandVac actually began when Dr. Press and ESA sent out an email asking me and some of our other colleagues if any of us had heard of projects to accelerate vaccine development through public participation, essentially citizen science. He figured that since vaccines are fairly old and fairly well understood technology, or at least that many vaccines were built on very well established technological platforms, it might not be out of reach for vaccines to be developed quickly, even on a low budget, maybe even with massively parallel distributed, kind of a global scheme. Several of us got really interested in that idea and we formed the core of the RandVac team, so I'd love to tell you what we've been working on. So we began with a couple principles in mind. Because of decades of extensive research on both pathogens and on the development of vaccines, modern vaccines are actually very quick and easy for experts to develop. And they have, again, by far the highest probability of success of any therapeutic class. So access to vaccines and the process of developing vaccine, research and development vaccine is presently, it's expensive, it's fairly well guarded by intellectual property, again, relating to the expense and investors having to recoup their investment. But we think that that participation should be enhanced and can be enhanced through open source information, research and resource sharing. And one of the most powerful principles, motivating principles for us was that, in this crisis, we should help. We should do something rather than waiting for the status quo, rather than waiting for the sort of authoritative pre-existing infrastructure to do its thing. And so we did. We are trying and we will continue to try. And our method of trying has a kind of unique structure to it, which is sort of intrinsically open source, open source is kind of a central component of our development platform. When we say free and open source, we mean it both in free like speech and free like beer, that is the Libre and the Gratis definition. But essentially, it's meant to inspire this sort of positive feedback loop of researching, prototyping, refining, sharing, and then getting feedback from other collaborators throughout this shared challenge. We took into consideration some sort of basic design principles when considering how to develop vaccine candidates that fit the needs of this pandemic and potentially a future pandemic. So we opted for safe, inexpensive, accessible, and primarily off-the-shelf materials, very few custom components, and very few that required sort of, I guess, high grade or inaccessible laboratory infrastructure. We also wanted these prototype vaccines or vaccine candidates to be rapidly reproducible, that is rapidly producible, but also with high enough fidelity and enough simplicity that they could be reproduced in other labs so that you could have parallel implementations and maybe parallel experiments happening in multiple places at once. Obviously, for that to work, it has to be safe, both in terms of development, which means no infectious components, and also on the sort of administration side, which also if you are working with safe materials, it certainly helps with safe administration, although those two are totally equivalent. We also wanted well-characterized antigenic targets, which could ideally be adapted over time as more research began to focus on the selection of certain epitopes that elicited the strongest or the best or the most immunologically useful responses from post-immune system. All encompassing within this is the idea that this work should be shared, and that it shouldn't be contained to a single laboratory or a single team or a single brain. It isn't necessarily against the traditional model, but it is potentially enhancing of the traditional model. We've seen this with other open-source developments in other areas, that the Android operating system leverages open-source technology, but Google still makes a good amount of money either on Android or Android components. This is not an anti-profit model. It's not an anti-revenue. It's not an anti-business model. It is a pro-sharing and sort of pro-accessibility model. In order to catalyze that participation, in mid-2020, we published our first white paper describing the initial proposed vaccine candidates against SARS-CoV-2. We had four authors, the original white paper with 43 pages. We had 19 epitopes from SARS-CoV-2 that were identified in the research or predicted in other research to be of high value in terms of eliciting immunogenic response from the host. We also gave kind of a primer background research and provided this sort of library of pre-existing research on mucosal and cellular and tumoral immunity. Again, epitope selection and immunogenicity and resilience against future variants by selecting for conserved epitope. We also went into not a great length, but considerations for safety and efficacy testing for short and long term, for shelf life and stability, for booster doses, and for ethics. We think that's important during a global crisis like this. As of 2021, as of July of this year, we've released over a dozen updates to our white paper. We have more than 20 authors, 90 pages, more than 200 references. We've updated and in many ways narrowed our list of well-characterized epitopes that we think are highly useful in eliciting an immunogenic response against SARS-CoV-2 and protective against COVID-19. Along that line, we've produced 10 generations of vaccine candidates so far. We've expanded our discussions on safety and efficacy and epitope selection and booster regimens and heterologous booster regimens, optimizing production, optimizing stability, optimizing valence or multi-valence. We talk about the breadth of immunity that's provided by a vaccine and whether it is resilient against these future variants and mutations that might otherwise minimize vaccine efficacy. It has become a collaborative living document and catalyst for collaborative living research. I mentioned earlier some of the parallels in other open source development and open source initiatives. Linux, for instance, is a great example of how we hope we might be able to contribute with developer kits. Linux clearly is such an infrastructural tool in software development and hardware development and really promoting accessibility for most of the world at this point. It's clear that there are reasons that Linux is superior to alternatives that have to do with its open source mess, its collaborative development ecosystem, and the ability for multiple people in multiple places to take part without restrictions. We conceptualize viruses as non-digital pathogen, kind of funny because the name went the opposite way. Computer viruses are the digital appropriation of the actual biological virus. We're kind of going in the opposite direction now. In software developer tool kits, there's a number of key features that are really useful, maybe required in order for people to actually use them and pick them up and develop cool things with them. Chief among them are a compiler, a debugger, and a software framework and some of the components that are critical are libraries, documentation, code samples, processes, and guides. We think that the vaccine developer tool kit should mirror and encompass all of those components that are essential to collaborative and open source and even just good vaccine development. Again, in open source, you don't have to necessarily share and share like. You can take it and if you adapt it well enough, you can actually even patent it. You can protect it with IP. Even when it is open source, there's no real reason you can't start a company. You can run with these products in a profit or even in a revenue-driven way. But to put it into context of vaccine development, we think that providing a framework of reproducible, simple, accessible, adaptable vaccine technology is really useful. In terms of processes, we want detailed production protocols. In terms of libraries, we want vast documentation of past studies that are related to vaccine immunogenicity, vaccine safety, various aspects of vaccine technology. Code samples for us come down to the design specifications for specific vaccine candidates. In terms of debugging vaccine candidates, you got to talk about protocols and considerations for preclinical and clinical testing. Ultimately, it has to play well with other and this is achievable through open source licensing like Creative Commons and through an active, engaged developer ecosystem. Ideally, one that is committed to this concept of working together or at least learning from one another as they each do maybe their own thing. Along that line, we think that our white paper is a foundational open source VDK, a vaccine developer kit. It may be that there's huge room for improvement in the construction and the composition of VDKs. There are certainly components of the white paper that don't exist yet. We've done a lot to characterize our method of epitope selection and various other things that I've already talked about, but it still lives in a PDF. I don't think PDF is necessarily anyone's preferred format of engaging with a project or engaging with... It's not necessarily a collaborative ecosystem in and of itself. We've started a researcher's map in hopes of connecting people who are interested in doing vaccine development together or learning from one another or sharing ideas, sharing resources, that kind of thing. But really it's in its foundational stages. What I hope to achieve here is both to pitch the idea that open source vaccine development is useful and achievable, but also that it's worth your time, that it's worth the engagement and the efforts of people of all kinds of skill sets. I think that we're at the beginning. I think that we're facing a variety of possible futures, but one of which is of open source infrastructure for vaccine development and essentially that infrastructure extending the ability to participate in vaccine research to historically excluded people. The cost of exclusion, the cost of exclusivity in vaccine development are things that we're feeling very acutely during the COVID-19 pandemic, but also that unless we resolve them are not going to be fixable with the old way of doing things. It's interesting then to think about what would biosecurity look like if it were decentralized from these centralized nodes of pharmaceutical companies with very, very high budgets or potentially very high budgets doing the majority of these developments. What if we were able to decentralize a little bit by bringing down certain infrastructural costs or infrastructural barriers? The BDK I think are a way to make vaccinology easy, affordable, accessible and for people who want to start vaccine companies, which may be the only way to get to a billion doses. I think again by reducing those costs we can get more people involved. We can see more vaccine innovation. We can see better vaccines that get developed and approved faster and more effectively. With that I thank you. I hope that you got something out of the presentation. I hope that you'll get curious about what an open source vaccine development future might look like. Reach out to us at radvac.org or elsewhere and thank you for your time.


our praise and thanks are due to Allah subhanahu wa'ta'ala. He seek his forgiveness, his guidance, and his assistance, and we take refuge with him from the evil within our souls and from the consequence of our misdeeds. However, Allah subhanahu wa'ta'ala gives guidance to the likeness of the man, whoever he misleads, and I can guide.  He has no partners, and I bear witness that Muhammad, the son of Abdullah, sallallahu alaihi wa'ala aari wa sallam, is his servant and messenger. We ask Allah subhanahu wa'ta'ala to grant him peace and to extend him our salutations on this blessed day, just as we ask him to show peace and mercy to his family members, his companions, and everyone who follows and witnesses and shows good will into the meeting and the reckoning of Allah subhanahu wa'ta'ala. I detect within you all the goodness that I recognize, and Allah knows that my eyes do not betray me.  You are the prophets and whoever is denied your intercession on the day of reckoning, then fate has dealt a great blow to that person. So may Allah in the same way that he grants stability to Musa, similar to the help that he gave to those who came before you. These are the words of the companion, Abdullah ibn Abdullah ibn Muawwaha, a part of a poem that he composed in praise of the Masjid alayhi s-salatu s-salam. Abdullah ibn Muawwaha, one of the great sahabah from the Ansar, and we are all familiar with Hassan ibn Thabit as one of the poets who used to defend the Masjid alayhi s-salatu s-salam. Abdullah ibn Muawwaha was another of those who would defend the Masjid alayhi s-salatu s-salam in poetry, the goodness that I recognize in you, and Allah knows that my eyes do not betray me. They don't betray me. Speaking of the importance of the Masjid alayhi s-salatu s-salam and the importance of receiving his intercession on the day of judgment, Hassan ibn Thabit, similarly he said about the prophet alayhi s-salatu s-salam, My eye has never seen anything more beautiful than you, nor has any woman given birth to someone with more consummate in virtue than you are. That you were created free of any flaw, every flaw. It is as if you were created in the way that you wanted to be. The words of Hassan ibn Thabit about our Masjid alayhi s-salatu s-salam, that every time that I choose to speak about the prophet alayhi s-salatu s-salam is very difficult to decide on what aspect of the life of the Masjid alayhi s-salatu s-salam that I would like to emphasize, because there are so many things about him, should we speak about his devotion or speak about his commitment and conviction, should we speak about his justice or his mercy, speak about his role as a political leader, his role as a father, as a nephew, as a son, and so many other aspects to his life that we can speak about, his public life, his private life. Perhaps there is no person who has ever existed that we have more information about the details, the fine details about his life than Muhammad sallallahu alayhi wa sallam. And of course having those details creates a type of vulnerability with respect to the Masjid alayhi s-salatu s-salam which gives the enemies of the Masjid alayhi s-salatu s-salam areas to launch an attack against him. But it is very difficult to choose what to talk about about the Masjid alayhi s-salatu s-salam, should we talk about his role as the prophet and also should we talk about his human characteristics or his humanity in the way that he is so much like all the rest of us, difficult to choose what to speak about. But we also should understand the significance of Muhammad alayhi s-salatu s-salam and the significance of the Mba in general, all the prophets. I think that this often is missed when we reflect upon his life and reflect upon the lives of the prophets and the messengers and even our reality, the realities where we live and that we live on a planet in the middle of the universe floating around, we would say, in space. What is the significance? There are many important significances, of course, to the messengers and the prophets. But we have to remind ourselves in fact that we are a creation of Allah SWT that the life that we have has been given to us, the health that we have has been given to us, the perfect conditions that exist on this planet for us to continue to survive have been given to us. The blood that runs through our veins, without our choice, our hearts beat without our choice, our lungs and everything else about us, our eyes, our ears given to us by Allah SWT. And they will come when those airbags will no longer work and that motor inside of our chest will stop beating and then we'll have to return to Allah SWT.  That Allah created angels and given them rationality and then we removed something, appetite created the lower animals and given them where appetite which overwhelmed their being and reduced the amounts of rationality that they had. But they gave the human being the combination of both and expect it from us to master the lower appetite with the higher appetite. But Allah is a place within us something called another remorse. And that itself is differentiated as soon as he sent from Shefan that he had no remorse, that he disobeyed God and he was defiant. But Adam, Allah SWT, that he placed it within him that he would turn back to Allah SWT. Realizing his mistake and seeking forgiveness for his mistake. But the messengers they've been given to us as examples to show us what human potential is. Say to them, if there happen to be angels walking secure in the earth, then we would send down an angel to them. In other words, Allah SWT, he gave us human messengers to teach us that this is what you can do as well, that you have this potential. If Allah had sent down angels who don't have the passion to a type of unsettled emotional states and make it difficult for them to comply like us, then we could always say, Ya Allah can't do that because they can do it because they're angels they don't have.  But revelation given to me is one of the aspects of the prophet's life that remind us of how much he is like all of us. And if anything, I do think it's a mistake off of that Muslims, when they speak about the prophet Muhammad SAW and his psycho emotional state that when you hear many Muslims talk, you get the impression that the prophet was a stoic. In other words, that he just, you know, you hear the prophet, he never lost faith in Allah, that he never had weak faith. He never doubted, he never struggled, he never suffered fear and sadness. But all you have to do is read the Qur'an and learn about the state of the messenger of Allah SAW. And of course, it's never meant to diminish his stature with us, but to put things in proper context. Rasulullah SAW, you read the Qur'an, you see fear, you see sadness, you see distress, you see, that distress and harm came to them and they were shaken. Rasulullah SAW, to the point that the messenger and those who believe, you know, the messenger also, right, said, what? When shall the help of God come? We see Muhammad SAW in distress. That he was, of course, he would beat himself up. Why don't they believe? Why don't they follow the messages? This salvation is easy for them. Why not just believe that he was, he was concerned for the humanity of others. Most importantly, he concerned for that akhira, concerned that they get salvation in the hereafter. And of course, we can speak about his mercy, alayhi s-salatu wa s-salam. He was a mercy to all the worlds. He was a mercy to himself. He was a mercy to his families, to his tribe, to his enemies. He was a mercy to all of them. He was a mercy to the believers. He was a mercy to the believers, Ibn Amr, the trickster among the sahaba, had a problem. He had a drinking problem, and he was being punished on one occasion, and a certain person started to speak bad of him. And the messenger, alayhi s-salatu wa s-salam, said, don't curse your brother because what? He loves Allah. He loves Allah in his messenger. He loves Allah in his messenger. Even though he's a sinner, he loves Allah in his messenger. You see it so many different occasions. There's not enough time to go into all of these examples. But I will mention one more example. There's a woman who came to the prophet, alayhi s-salatu wa s-salam, she confessed that she committed adultery.  Maybe it was really nothing other than something very small. So go, Miktoba. The prophet, so I said, sent her away. They said, well, maybe you're trying to deal with me in the same way you dealt with Mahis ibn Mahdik, who was another man who, a man prior to her, had come to and confessed of adultery. And the prophet, alayhi s-salatu wa s-salam, gave him his purification. But this woman comes and then the prophet is trying to turn her away. He's not obsessed with trying to punish her. He knows what the hud is. You know, go and make toba. And so he goes, the others, I'm pregnant. And then the prophet, alayhi s-salatu wa s-salam, turns and says to her, go have your baby. She leaves. And after she gives birth, she returns to the Mahis ibn Mahdik, alayhi s-salatu wa s-salam. Then she has the baby with her. And she says, alayhi s-salatu wa s-salam, I've given birth. Give me my purification, tahirni.  Two more years. She could have fled at any time. She could have left Medina. She leaves and then comes back after two years. And then she has the baby and the baby is holding a piece of bread in his hand to indicate that this baby is no longer drinking my milk, he's eating real food now. And then the prophet said, now at this moment, once he realizes her sincerity that he then orders her to receive her purification. And then after she dies, the prophet, he prays over her. Which is really interesting because we learn from the sunnah of the prophet, the iman, the lead of the community should never pray over a sinner because it belittles the sin. This is like when one occasion a man, he was about to lead the prayer and then he asks, is there anyone to whom this man owes a debt? And then somebody speaks up saying, yes, you wrote, Rasulullah, he owes me this much money. And then the prophet turns to the companions and says, pray over your brother. He leaves them. Not the prophet's prayer, someone else's prayer, which we know not really guaranteed to be accepted. The prophet's prayer would be accepted. And of course, the prophet leaves to go gather up money for the debt the man is debt. But this case, the prophet, he prays over this woman. And he says that if her toba had to be distributed and divided among the people of Medina, then it would be enough for the people of Medina. Meaning, Allah subhanahu wa ta'ala will forgive every single one of them. Meaning, Yom al-Qiyamah, when they meet Allah, no hesab. Don't worry about it. In other words, this is a sincere toba. So the messenger, he was a mercy to everyone. And most importantly, a mercy to his community. We ask Allah subhanahu wa ta'ala that we experience a similar mercy as the mercy shown by a messenger Jal'a alayhi s-Salam. And of course, shown by Allah subhanahu wa ta'ala through his messenger. I will say this, and I thank Allah. And in closing, what needs to be understood is that the messenger Jal'a alayhi s-Salam, he is our standard. He is our exemplar. He is the one we are expected to become like as much as possible. And our salvation depends upon that. How much we become like the messenger alayhi s-Salam. All of us fall short. No one, none of us are perfect. And the messenger, although he was a mercy, he also must not obscure a reality, another reality, which is that although he was a mercy, and he was kind all the time, doesn't mean that he was that way with every single person. Nor was he expected to be that way with every single person, because Allah tells him in the Qur'an, O Prophet, struggle, do jihad against the kufar, and the hypocrites, and show them sternness, show them a type of abrasiveness, a sternness towards those people, the enemies of God. But his norm, as we know it, was he's a rahma l-alameen. Rahma l-alameen, he forgave even in spite of all things. When people fought against him, he still forgave them, right? Once they, of course, made their proper reforms. And he was merciful to this woman, he was merciful to others who committed sin, who were sinners among the sahaba, who committed these sins among the sahaba. But that in itself does not mean that the Prophet affirmed sin. The Prophet did not affirm sin. The Prophet, shall I say, suddenly did not affirm fornication, or adultery, or sodomy, right? That the Prophet, shall I say, does not affirm theft, or the murder of children, that the Prophet, shall I say, leaves the door open for people who are willing to repent and reform themselves, right? And this, these are some of the few lessons that we can mention today. And of course, there are many, many more. And we ask Allah, subhanahu wa ta'ala, that he grant us the life so that we can complete his mission of the Messenger of Allah, because we are part of that mission of calling to Allah, subhanahu wa ta'ala, in being a light for others. We ask Allah, subhanahu wa ta'ala, that he bless our Messenger, that he love our Messenger, and he place the love of our Messenger in our hearts. We ask you, Allah, that you guide us through actions, which will bring us closer to you, and increase your love for us. Oh Allah, please love us because we love our Messenger. Allah, Allah, please love us because we love your Messenger. Increase our love for the Messenger of Allah. And Allah, please guide us during dark times and protect us from the evil of the machinations of Shaytan and his minions. Allahumma gfirul al-muslimin wa muslimat wal mu'minina wa mu'minata al-hayyā'i minhum al-amwāt. Wa gfirulana allāhumma ma'a'uhum bi-fātiki abu-iḥsāniki ya'a ar-hamal rāhimīn. Allahumma rabbana āti an-fqusinā taqwāḥa wa zakiḥā an-taqayru man zakāḥa an-tawāliyuhā ba-mūlāḥa. Allahumma salli alā muḥammadin wa alā āri muḥammad wa ar-ham muḥammadin wa ala muḥammad. Wabārak alā muḥammadin wa alā āri muḥammad. Ka ma salli tibū rāhintu wabārak alā ibraḥim wa alā āri ibraḥim fi al-ārimīn. Inna qahmeidu majīd. Rabbana āti nā fi dunya hasnā wa fi al-ākirati hasnā. Waqinā ātāb al-nāb. Waqinā ātāb al-nāb. Waqinā ātāb al-nāb. Wa salli alā hummu musallim wa bārak alāsīlinā muḥammadin wa alā āri wa as-hāb al-akhiār. Wa sallim tisliman kathīrā. Wa sallim tisliman kathīrā. Wa sallim tisliman kathīrā.


When you will give your next surprise, there will be high seasons in America on the political scene. Now there is this famous quote from the movie E.C. Ryder, who then said, you know this used to be a hell of a good country. I can't understand what's going on with that. And the part of the name called the G.O.P. is now in part of Mr Trump, Mr Cruz, Mr Rubio, Mr whatever. What went wrong with the United States of America? I think the United States doesn't have a particular corner on bad politicians. I think bad politicians are available in most locations of the moment. So I'm not going to feel it just person. It's not just our problem. But it used to be the city on the hill, according to the American self-image. Yeah, but I think a lot of, you know, in the golden era, you know, what is the golden era of American politics, the Vietnam War?  I mean, there are horrifying things that then, of course, become the karma that comes from the roots. You know, I mean, the bad karma was built in when certain incorrect actions were taken. And yes, of course, you pay the price for that. None of this comes for free. So for me, it's not a suddenly that we're in some bad time. It's like a fight. This has been prepared. And this is the result of a series of disasters and short-term consequences. Actions which have really bad long-term consequences. The other thing very simply is when the Republicans came to power 30 years ago in the regular revolution, we didn't stop them. And they immediately attacked education. And the mission has been to make education inaccessible to the largest part of the population, to make basic elementary education inadequate, to make the school system relate to the prison system, and to lower both the standards and the idealism of the entire education. So that, like any fascist country we now are teaching standardized tests, rather than, well, you know, a paragraph of Tolstoy is meant for your creative input, not for you to answer free multiple choice questions directly.  He's inviting you to imagine another world. And all of that activity, which is not about giving back the correct answer that someone else has already thought of, but actually giving an answer that nobody has ever given ever before, which is of course the entire point. We have shut down creativity in education in my country. And the result is you have an under-informed public, which is easily frightened and easily manipulated.   What is the work? You know, it's not a question of blaming anybody. It's not a question, you know, everybody's at fault because we all let it happen. And so, okay, now we all have to put our shoulders to the wheel and figure out how we move forward with it. And again, we need positive energy for that, not negative energy. It's too late to fall into the trap of the Republicans and demonize everyone, complain and point fingers. And it's actually completely inappropriate. We all share the same responsibility for the situation we're in. So we all have to move out of it positively and stop fighting each other and calling each other horrible names and do something that makes a real difference and that moves everyone to the next place with the core of what is responsible. The core of civil society, which is respect for each other, ability to treat each other with decency, ability to find something admirable in your worst enemy, what nobility really means, which is to stop complaining in difficult times, more stature and have more honor and represent your own highest ideal of what human dignity would be. So please, this is the time. Don't wait.


of the next years or decades and beyond, because I don't get to think very much about that. And I'm certain to introduce the panel, we have Bill Janeway, who's the Senior Advisor and Managing Director at Warburg Pincus. He's one of, on the Board of Governors of INET and the Social Science Research Council. Tim O'Reilly, the founder and CEO of O'Reilly Media. And Rob Johnson, the President of INET. So without further ado, Rob. Good morning. Today we have an interesting discussion. There was a lot of energy throughout the sessions about the ominous prospect of technological change. And so we've assembled two people who've both written books as well as explored that realm about as deeply as anyone I know. Tim lives in Northern California. Runzel O'Reilly Media has been immersed in that world for many, many years and has been a source of great insights. I know Bill, for as long as I've known you, you've been talking about food camps and the two of you are really very good friends in reading the prefaces of each of your books and so forth. I know how much you've reinforced each other. So I'm gonna try to step aside a little bit. We'll start with a discussion of Tim's book and then Bill will talk about your book, which is now on the cusp of being released as a second edition with some substantial changes in light of what you've learned since the first one and then we'll open things to the audience. Tim? Yeah, so on my way here, I spoke to a device in my kitchen. Costs roughly $100. And I asked it whether my flight was gonna be on time and then I asked it to call me a car. And a few minutes later a car showed up. Well, anybody hearing that or seeing that a decade ago would have said WTF. But a lot of people are hearing about technology and they're hearing that Oxford has done a study saying that 47% of human jobs could be automated in the next 20 years. They're hearing that we need universal basic income because they'll give me nothing left for people to do. And they're saying WTF in a very, very different tone of voice. And so that really encapsulates the reason why I wrote this book. Technology has enormous promise to make a better world. It also fills people with fear. And it seemed to me as someone who's been in Silicon Valley for approaching 40 years with a unique perspective on the rise and fall, on various technology platforms to sort of capture some of what I've learned about those platforms, how they work, what the dynamics are. And the reason I'm here is because in some ways technology platforms are micro economies and understanding how they work and how that is changing led me inevitably to economics. I'm not somebody who ever studied economics at all, even in college. I never took the acting class at Harvard from a lot of my classmates. See, that was a Classics major. So all this comes to me simply from observing technology. My company publishes books about technology. In fact, back in 2000 the cover of Publishers Weekly in the United States said the internet was built on O'Reilly books. And many internet billionaires started their company with what they learned from a book that I published. Just how-to programming books. And I started doing conferences. Now the heart of my business is a large online learning platform aimed mostly at technology but also business called Safari. We've managed to survive ourselves a great deal of technology change by growing and adapting. But the most important thing that I learned early on in my career was that people care about ideas. And so the thing that probably most distinguished me in my company is that we used storytelling very much in the way that George Aikuloff was describing. We used storytelling to shape the narrative about technology. So in 1993 my company, it's a very small company at the time, was the first company to create a commercial website. And I did it by telling a story about why advertising on the worldwide web where people come to you was very different than sending, you know, say email marketing out. Of course we later fell into the trap of using a broadcast marketing as well. In 1998 I organized the meeting where the term open source software was adopted and promulgated largely by telling a story, sort of reframing the story that a lot of people had at the time that free software was in opposition to proprietary software at Microsoft. And instead saying, no, no, no, actually there's this whole world of software that you're all using called the internet, which also is based on free software. And changed the way people thought about what free software was about. And then a few years later after the dot-com bust I promulgated this term web 2.0 to explain how we were moving from the world that was dominated by Microsoft, dominated by the PC to one that was effectively what we now call cloud computing, where the applications were basically on the internet, where they were of a very different character, and where big data and collective intelligence would be the core of company's competitive advantage. So out of all that I got a reputation as a futurist, but I don't think of myself as a futurist. I think of myself as somebody who describes the present in a way that we can see it more deeply. So the first part of the book, the book is divided into four parts. The first part describes the techniques that I use to see the world more clearly than other people around me and to be able to effectively see the future in the present. And this kind of reframing is something that I think we need in policy right now as well and in economics. How do we get new paradigms? It was actually, not by coincidence really, because Bill and I have been friends for a long time. It was in 2003 that I gave a talk called The Open Source Paradigm Shift, where I first sort of articulated this as a dinner talk at the World Bankist Technology Conference. And I remember asking everyone in the audience, how many of you use Linux? Let me ask those of you here, how many of you use Linux? Okay.  How many of you use Google? How many of you use Google? All right. Okay, you use Linux, right? People just couldn't even see it. And we still see that. So 2005, we knew what a connected taxi cab looked like. Right? You put a screen in the back and you ran ads.  We can actually connect passengers and drivers in real time.  And that's when we got to Uber. And so that's that kind of mental reframing. And technology always gives us these moments where we have to reinvent the world based on what is possible today, rather than on what was possible yesterday. And business models change as well. And you see very often companies, individuals, policymakers, not understanding the ways that the world has changed, and continuing to operate with the rules of yesterday. And so that's the first lesson that we get from technology. We have to make it new. The second lesson really has to do with the way that the technology landscape tends to be dominated and has been really for the last 30 years by winner takes all platforms, or winner takes most, at least. And so then the question is, well, what makes these platforms rise and fall? And this is probably the first place that I really start to intersect with the world of INET because what I discovered was what makes them rise is generosity and what makes them fall is greed. And so effectively, the first wave that I was associated with the personal computer happened when IBM, not really through intentional generosity, but through an unintentional act, basically released the specifications for the personal computer to the world so that anybody could make them. So Michael Dell started his eponymous company when he was a student at the University of Texas. He started it from his dorm room because anybody could, because IBM had published the specifications. Now, it was a short-sighted move from a point of view of a company that was dominating the industry, but it was good for everybody else. The next great wave was when Tim Berners-Lee put the web into the public domain. Again, huge explosion of creativity in a market that had come to be dominated by Microsoft and Intel, and they had effectively squeezed most of the life out of it. Microsoft was literally at that point holding meetings in what we now call Silicon Valley, telling venture capitalists what they could and could not invest in, because, hey, it's not worth investing here because we're gonna do that and we'll just put you out of business. So effectively, we went from a really open market with a lot of creativity to one without a lot, and all the developers went somewhere else to where it was freedom. So watching that pattern, you know, that started getting me thinking about economics again, and in particular, I was spending a lot of time looking at the crop of platforms where technology's meeting the real world, particularly Uber and Lyft, and I was meeting with the chief economist at Uber, and he said, this is my Bible, and he handed me Alvin Roth's book, Who Gets What and Why, which is about, you know, Roth got his Nobel Prize for improving matching and kidney transplant marketplaces, but it really is about this idea of distributional economics, and there's a better way to do it, that the obvious ways are not always the best. And it got me thinking a lot about the challenges of these platforms and how they are actually matching platforms, and that there are conclusions from that. And one of the conclusions that I came to, and actually Bill was sort of kept prodding me on this, is, you know, because Uber was not actually doing a good job by their drivers, that eventually this would lead to their downfall and that Lyft would gain share, and so on, so it's the generosity story again. But more than that, these platforms teach us a lot about the future, you know, for example, when you hear analysts or breathless business articles that say that Uber can bring in self-driving cars and, you know, they won't have to pay their drivers anymore, you really haven't understood their business model. Because what makes Uber and Lyft work is the fact that they have a swarming marketplace in which more people show up when there's more demand and fewer people show up when there's less demand. If they owned all the self-driving cars, they would have to have enough cars to meet peak demand. Right, so all of a sudden they have unused cars and a statement like the one in Fortune Magazine that they'll get rid of all the costs, plus they will, the driver costs, plus they will have the cars used all the time indicates that somebody has not been thinking very deeply. But more to the point, they'll also take on the risk, they'll take on the operational costs, they'll take on the capital costs. So that leads me down the path that says actually if there is a future for self-driving cars with Uber and Lyft, it will look a lot more like Airbnb, you know, that is somebody else will provide the cars and they will provide a logistics layer. So the point is understanding the economics of platforms also leads you to make predictions about what will happen in the business world. The third part of the book is really about the fact that these platforms are increasingly ruled by algorithms. And if you think about a company like Google or Amazon with a 20th century mindset, you might think that the programmers who are cranking out code or data models or even creating AI are a little bit like the workers in a 19th or 20th century factory, except they're producing software rather than hardware. But if you really understand these companies, you realize that the workers at these companies are programs and models, right? And those programmers are their managers. So we actually have a new world in which people are managing algorithms that do the bulk of the work. And now as we look at companies like Uber and Lyft, we're starting to see, oh, those algorithms are sometimes themselves middle managers managing humans. And so we have a very, very different landscape of labor and capital. Because of course, a huge number of the workers are actually capital costs rather than labor costs. And so again, it's just an inversion of the way we normally think about the world. And I don't really know all of the implications of that for your world, but it's so important that you start thinking about it because understanding the economics of how these companies are gonna be different really matters. And so there's also a thread that led me in the direction that we've heard from a number of people here about the financialization of the economy because I started thinking about the way that algorithmic systems always have an objective function. So Uber and Lyft are managing in such a way that they can pick up passengers within three to five minutes wherever they are. And a lot of what they have to do, of course, is to marshal the drivers as well as marshal the passengers. And the reason why these companies are losing a lot of money right now is because it's very hard to create a new marketplace. I think over time, as this becomes the new normal and they get to a stable equilibrium, it will actually change in established markets. So a lot of people who are eager to say they're unsustainable, I'm not sure are right. But more of the point is you understand that that algorithm has a goal and everything they do is in support of that goal. Now, they may have secondary goals like they wanna make money, but the primary goal of the algorithms is to make the match. And that leads to a couple of really interesting understandings because first of all, you understand why taxi drivers, taxi companies that say, oh, well, we don't like Uber and Lyft this, they have all these unlicensed drivers who are missing the point because they can't match drivers and passengers without that model. But continue down that path. Google, I spent a lot of time in one of the chapters explaining how Google search quality works just as a way of explaining how programmers manage these algorithms, how they make them better, how they use data to give them feedback about how they work. And then I talk about Facebook and fake news and you can understand that Facebook actually has a different set of algorithmic goals than Google.   One of their signals in fact is what they call the long click versus the short click.  A short click is they clicked, they went away, they came right back to the same search, clicked again, and so Google's always trying to get to the long click. Facebook on the other hand wants you to stay. They're trying to show you content that gives you more and more of what you ask for so that you'll spend time. So even though they're both advertising supported businesses, very, very different model. They don't always remember this. Google has tried to become more like Facebook in some ways and to their detriment, but think about that. Now, you saw how Facebook's algorithms had unintended consequences. They thought that they would create more community. People would find more of what they wanted from their friends. They didn't mean to increase hyper-partisanship. They didn't mean to create fertile ground for the US election to be hacked, but they did. So then I asked myself, well, what's the master objective function of our financial markets? Well, shareholder value. We literally tell all of our companies optimized for share price above all else. Treat humans as a cost to be eliminated. So in some sense, when everybody's worried about the rogue AI of the future, they imagine this machine that's been given an objective function that it pursues to the exclusion of all else. Nick Bostrom in Superintelligence has the idea of a paperclip making machine that becomes intelligent and all it wants to do is make paperclips. Elon Musk has described the strawberry-picking robot that wants to see strawberry fields forever. They go, we actually have built one of these machines. It's called the financial market. It says, I want to see shareholder price go up and up and up. Doesn't matter what happens to people. And this is the ultimate point of that section of the book, which is these things are under our control. And I actually borrow the title of one of Joe's, Joseph Stieglitz's books, we can rewrite the rules. And we have to rewrite the rules. And really, that's the fourth part of the book, a set of musings about how and why we should be rewriting the rules that we use to govern our technology, that we use to govern our markets, and how we need to actually think about the ways that the future is not inevitable that it's up to us. There's another board I sit on, which is Tim O'Reilly's board. And we met a long time ago when Tim had invented that. You gotta hold it closer. So I'm listening to, can you turn me on and strawberry fields forever? I know. I'm just wondering what I'm doing. Is this going to 67? No, we're just playing the year off. There you go. Now remember, old men should be explorers than we are. So in any case, when I sat down to write my book, it was to reflect on what was then, had come to an end, a 35-year sabbatical from academic economics, from Cambridge specifically, by way of getting to know Tim about halfway through that process. And realizing how I had understood the sources of the digital revolution that I had participated in and that was in the process of transforming the world. And I came up with this idea that first, innovation at the frontier takes place by trial and error and error. That the narrow-minded, simplistic, neoclassical presumption that investment will map to economic value as if we knew in advance what the economic value was going to be was profoundly mistaken. And you could actually track that all the way back to the first industrial revolution, the second industrial revolution, and very definitely in the third. What that said was, what that told me was, these kinds of technological revolutions depend on sources of funding that have another purpose other than generating economic value. One hand, a mission-driven state. The state that in the 19th century was largely focused on national development, whether it was the United States, France, or Germany. And on the other hand, financial speculation. Financial capitalists, who, as Tim says, are interested in making money. They care about making money, but they don't care whether they're trading tulip bulbs or the shares of the South Sea Company or Dotcoms or the businesses like Microsoft and then Google that wound up generating enormous economic value. So I thought of this kind of this three-player game informed by arguably the greatest historian of the 20th century, Fernand Brodell. And if you ever find yourself working in a job in which you have no intrinsic interest but you're contractually required to do so, as I was between 1985 and 1988, I urge you to read Brodell's Capitalism and Civilization, three volumes that explain before the First Industrial Revolution the role of capitalism in seeking super profits through incredible arbitrage opportunities, the result of which cannot be known in advance. He was talking about long-distance trade. He's talking about the world of the merchant of Venice, but it applied directly to thinking about how investments in fundamental transformational technology whose consequences could not be known in advance would play out. So the first edition of my book is a celebration of an extraordinarily constructive and positive configuration in post-war America of a mission-driven state driven by the Cold War to invest upstream in science and support the emergence of technologies from the science across all of the components of the digital revolution from silicon to software and to be the first early collaborative, supportive customer for the stuff that was coming out of that investment that was not yet ready for prime time. When the yield on a microprocessor was one out of 100 or one out of 500, but the Air Force bought them and put them into the guidance system of the Minuteman missile, pulled Texas instruments and then Intel down the learning curve to where a PC could happen. And then on the other hand, what the Defense Department did, not because it intended to, was build a platform for entrepreneurs and their venture capital backers to dance on. And in dancing on it, they attracted, we attracted the financial speculators, the bubbles, the productive bubble that accelerated the digital revolution by a generation, okay? And thereby transformed the market economy, the conventional economy of work and saving and investment and consumption through digitalization, even as the railways had done it at the end of the, in the middle of the 19th century and as electrification had done it in the early 20th century. That was about the first half of the book. I mean, the first edition of the book.  So the second, what I've been reflecting on, what I've written about and how I've rewritten the book is to recognize that the three player game never stops. It has an internal dynamic. While this was going on, even while the digital revolution was escaping from the need of state sponsorship and taking on a life of its own, as Tim has described, in the 80s and into the 90s with open source and the internet, the state was being delegitimized as an economic actor. I promise you that the founders of Intel when somebody from the government showed up and said, I'm here to help, did not think that was the most frightening words you could ever hear as Ronald Reagan suggested. On the contrary, they were there to help and they enabled Intel to exist. The delegitimization of the state, the triumph of the Mount Pellerin Society has crippled the entity on which we must rely to counterbalance and cushion and adjust in response to the consequences of the digital revolution, which by the way, include the second globalization. There's really one phenomenon that we've been living with over the last 20, 30 years. Automation, the digital communications, digital logistics, the digitalization of the physical economy is what enabled globalization, outsourcing fragmented supply chains, unthinkable without the digital revolution. But now, as we see the consequences, the blowback as we've been discussing for two days here, as we see the consequences, you turn around and the state is not there. Government is not available. Certainly in the United States, less available in the UK, maybe in Germany, to provide some of that necessary cushioning. And on the other hand, the state is also not there in the United States and it's abdicated from the next revolution, from the green tech, clean tech revolution. Now it is done so explicitly, even before, if you just look at the funding of ARPA-E, Advanced Research Project Agency Energy, it never reached $300 million. DARPA is still funded at $3 billion a year, even while only on the margin is it funding commercially relevant, usually around natural language understanding, which has, let's say, dual use between the military and the commercial sectors. So that's one aspect. The second, the market economy that's been transformed in the United States is now characterized by an extraordinarily frustrating kind of schizophrenia. On the one hand, we have the Bay Area, we have the new digital economy, but then we have the rest of the economy in which, for the last five years, we've had fewer companies started than have closed down. Since we've had data, we've never seen this before. We've seen the markup, this new paper, fascinating paper, uses a very imaginative approach methodology, which indicates that whereas 30 years ago, the average markup of price over cost by American business was on the order of 15 to 20%. It's now on the order of 65 to 70%. This is the mark of a stagnant economy lacking, we're rent-seeking, and now, of course, we have the third aspect, which is those in the legacy economy seeking to defend their rents through political action as well as through market force. So in the second edition, I start talking about how does a leader become a follower? And that's what's happening in the US, particularly with respect to the next green tech, clean tech revolution. And on the other hand, is it the case that China, which has certainly beaten all records for being an effective follower, will be able to make the necessary transitions to become a new leader, even while, of course, it's getting an enormous boost from the current American administration, whose lasting legacy I think will be its role at accelerating China's rise towards world leadership. But it is important to remember that the institutions that get you to the frontier, the national champions, the success in appropriating other people's intellectual property, whether it's the British taking textile technology from India or the US taking textile technology from Britain entirely against the law, or whether it's China following Korea and Japan appropriating the intellectual property that already existed. When you get to the frontier, those national champions are barriers. If we'd left the digital revolution to AT&T and IBM, Tim would not have written this book, and arguably a Riley media wouldn't exist. The Chinese are going to have that challenge. So this is a pretty dark picture. In fact, I am calling the conclusion of the book, the dark side of the three-player game. So the guy who hired me at Warburg Pincus when I was in the process of my 35-year sabbatical used to say you can't survive as a venture capitalist if you're a pessimist. And there is a bright side, and the bright side is right here. 2008, the global financial crisis and the Great Recession saw the world crash in on neoclassical economics. The economics that in 1971 I decided I could not teach. I could not pervert and pollute the brains of young students by teaching them about perfect competitive markets and perfect information and all that jazz. 2008 and the global Great Recession have been the gift that keeps on giving to the disciplines of economics and finance. First, they've smashed them together. The divorce between economics and finance with the finance guy saying well, we know that the markets are competitive and that therefore resources are being allocated efficiently and the economist saying yeah, we know that in the markets price equals the net present value of expected future cash flows so it's priced efficiently. We can each take each other for granted and pretend that there's no need to understand the dynamic relationship between the two. That blew up big time in just about nine years ago. And from that has come an enormous energy some of which has been amplified, some of which has been sponsored, some of which has been catalyzed by INAT and that's why I'm a co-founder of INAT because this became an essential, this was an opportunity that could not be missed and it's begun in its own turn in my view to take on a life of its own. You know INAT is not funding David Outor or Raj Chetty now. We did provide initial funding for the World Income Database and we have provided critical funding early on but it's taken on a life of its own. It's not going to change policy today or even tomorrow but it has the potential to transform the context in which policy is debated over the next generation and that's what gives me some hope beyond this state that we find ourselves in today frustrating and frustrated as it is. I'd love to pick up real quickly on just this last thought of bills of reasons for hope and one that strikes me as very, very aligned with this is the breaking of the old paradigm is messy but it is what makes possible the new one and one of the reasons why we see a new economics becoming established is because people are understanding the old system is breaking down. Now we do have a set of very dark possibilities ahead of us in the political realm. Things get a lot worse before they get better but a lot of the norm that's being broken that we see certainly in American politics and I think to some extent over here as well are I think an opportunity for us to look more deeply and say can we break some of the old alliances of ideas that don't actually belong together ideas that are a little bit like that screen in the back of the taxicab being accepted as the way that you have a connected taxicab. Can we in fact say oh wait the alignments that we have in politics are blocking us from seeing the possibilities of the future and might there be a completely different economic paradigm that we could begin to work towards. So I'm very hopeful on that front. The other thing that I think is a really opportune moment is that there is a lot of scrutiny on the great tech platforms and if we can actually think correctly about say the distributional consequences of the dominance of these global platforms because they really are global then it might actually be a laboratory for us to think about a distributional economics and how we measure the value of creation and the value flows within economic systems in ways that we can then generalize to the broader economy. I think we can even make that quite concrete. So there's this kind of it's almost a dialectic the same types of technologies that enable Uber and Airbnb these matching engines with incredible efficiency unimaginable efficiency are also usable to manage workers in the gig economy the zero hour contract but they're also available for those people whether it's Uber drivers or whether it's minimum wage workers at Walmart to organize. I'm old enough to remember when trade unions in the United States private sector were legitimate. And part of the counter rebellion that delegitimize the state delegitimize the trade union but now you can imagine and this may be a little romantic perhaps guilds of Uber drivers in a particular city say you know what? Your algorithm has to be tweaked or you're not gonna have us available when you need us. And that's where the reduction in friction which is what a lot of this technology is about is eliminating frictions could be put to a productive and distributionally more fair consequence. So the technology is not entirely neutral but it's accessible and that means that the future remains open it is not deterministic and that's why I entirely agree with Tim it is up to us and not just in our political lives. The other thing I just say about the US which is you know we saw from this election many people don't appreciate what an unbelievable clues the American constitution represents. I got a reading list for anybody who's interested I won't go through it right now but you can catch me afterwards if you wanna crash course in understanding the bizarre construction and evolution of the American polity. But one aspect of it is that you have these individual states each of which has their own constitution each of which actually has much more power over our lives than the federal government. They're the ones who tell us when we can drink, who we can marry, when we can drive. These states can be and the last time around at the time the start of the progressive era the great Louis Brandeis said they can be our laboratories of democracy. And one of the things we are seeing not just in California in response to a federal government that at best is incoherently incompetent that may be our defense against the Trump administration is at the state level experiments taking place. California of course is leading with respect to climate change just as it did with respect to pollution but that's another place where this kind of well, Tim's wife Jen Palka runs built an extraordinary organization called Code for America which is empowering state government somewhat in the model of the British government digital service to use these technologies to reduce the friction between citizens and their governments. And that's another dimension where things are open opportunity exists. Who have questions? Any questions from the audience? Mr. Elmer, we're here. Yeah, Muhammad is in University of Odin in Italy. Just curiosity when you say it when you say that it depends on us what do you intend by us? Is it U.S. or it is U.S. I mean United States and so on. And also another question. We passed from the globalization and this led us to globalization if I can say. Googleization, so Googling everything that you want to go and Google it and then you will find it. So people abandoned to put science in their mind and they rely too much on the availability of information in the platform. And so how do you see this is going to influence the future of the people? Are we going to be imprisoned in hashtags and influenced by that? Thank you. Yeah. There's two separate questions there but let me address the first one. Who do I mean by us? And I think the first thing that I really think very strongly what we believe collectively shapes what is possible. There was a time around the world when everybody believed in the divine right of kings. And certainly as an American we take great pride in the fact that the founders of our country said we don't believe that anymore. We believe something different. And I always loved the story that after the British gave up on trying to put down the American Revolution George III expected that George Washington would be crowned king of America. And when he heard that he had gone back to his farm and turned over power to this the first version of this American assembly he said if he has done that he is the greatest man the world has ever seen. This was unthinkable at the time. And so we're sitting here now living in a world where we accept the divine right of capital. Where we believe that the world works the way it works because that's the best of all possible worlds. In fact that of course businesses want to have the lowest cost as possible. Of course they wanna eliminate human labor. Of course they want because that's just the way it is. And so the first way that it's up to us is to stop believing that and to start searching out the possibilities of a different world, of a different kind of economics. And it's actually, the study of history is really important because there's that very large movement literally towards radical rethinking of the economy in a world of abundance where robots and AI could do so much more of the work we do today and we would say well how would we construct that world? How could that be a positive world? And there are science fiction writers who are thinking about this. I highly recommend a pair of books by Corey Doctorow who works for the Electronic Frontier Foundation. His first book was called Down and Out in the Magic Kingdom and it's basically about a far future of nanotechnology where everything can be made by machines and humans basically compete in a creative economy to entertain each other. But 20 years later he wrote a prequel to that book and it's called Walk Away. And it's basically about the way that people just decided to stop participating in the old economy. And the thing that's interesting is once I read Walk Away, I started meeting walkaways everywhere. You know there was a woman I met in Tulsa, Oklahoma and she was at a meeting of the Code for America local brigade which are these tech volunteers who help their cities and states work on improving their programs. And she's dressed kind of like a train conductor and I go this is a little odd. And it turns out well she says well he used to be a real estate agent and then I started volunteering at a food bank and it was so much more fulfilling. So what she does now is she has built a mobile grocery store that she takes around the food deserts to women's shelters or old folks homes to give them good food. She runs an organic farm and this is literally she has this horse drawn mobile store that she takes all around the Tulsa metropolitan area. She's a walk away. She said I don't like the existing paradigm. I am just gonna basically build this pro-social thing. It's a non-profit, it's not really a business but she's spending her life just like she could be taking that to Burning Man and instead she's taking it to women's shelters in Tulsa. And that's really, that's probably one of the most hopeful stories that I've encountered recently. And each of us has that choice within ourselves to just stop playing the game the way it's played and when enough people do that it will add up to something. The question of whether these systems like Google and Facebook shape what we think shape our minds. I just wanna give you a practical experiment that will remind you of really that Facebook and it's like our mirrors not actually masters. How many of you here use Facebook? Okay, not too many of you. So this won't be as meaningful to you. But all the people who have kind of say oh well I'm getting all this news that gets me riled up to hyper-partisanship is completely under your control. If you basically, you click on a news story or you respond to it or you share it, Facebook shows you more of that. So if you have that experience, go and seek out pictures of your friends, kids. Share those, click on those, like those. Look at your friends vacations. And before long, that's all the Facebook will show you. That we train it every day. And I think this is one of the really wonderful things that we're starting to see with these algorithmic systems is that they can help us see ourselves. When we have reports of algorithmic bias, when we say oh my gosh, they're doing these predictive policing algorithms and they're biased against people of color because wait, we loaded in 30, 40 years of actual policing data. That's not a biased algorithm, that's a biased data set which lets us understand the way that we have been acting. And so we can change. And so we have an opportunity with today's technology to see ourselves more deeply and to respond and to be better. And so I think that's another reason why the future is up to us because we have an opportunity to see ourselves and to change. Yeah. I've read actually both these books very carefully. I didn't read Tim's book while I was sitting here. He sent me advanced copy. And they're great books.  It's very important. So I'd like to actually just ask a couple of things about and to say remarks about how these books differ and maybe get a bit of discussion of that. So Bill Janeway focuses particularly on the role of the state. And as a taxpayer in the United States, I want to return on that. And I'm not getting the return. Our people in general are not getting that return because of some of the things that Tim says that I don't think are as highlighted as much in Bill's book unless it's in the revision. And that is financialization, particularly financialization of the business enterprise, not just growth of finance in the economy. And in some ways Tim's book is really talking about a thing when I read Bill's book and I read it right after it came out that I found a little murky of what was meant by the market economy. I understood the other parts of the three player game, the role of the state and the speculative financial markets. And that's where I think we really need to come to some conclusions about what it is, because that's what economics is about or it's supposed to be about. Actually, I think last night, Joe Stiglitz's remarks, which I saw him going much further away from neoclassical economics than I had before to actually recognize that the family is an organization. The business enterprise is an organization. They're not black boxes and that's the important thing. As long as economists, as Joe Stiglitz said last night, the business enterprise of black box will how you can understand the economy. Okay, so the question, the way I'll pose the question is that it seems to me that the dot com boom, which led to some very important companies coming into existence is a question of whether it would have come into existence anyway. So that's one question. But it did inspire a lot of people to start companies. First of all, did they really start these companies because they wanted to make money? Actually, when I read Tim's book, it's much more that they wanted to start companies. And then some people said, hey, we can make a lot of money out of this. And that then turns the passion into a greed or however you put it. So that's the one thing. And so the other thing is that I think when that occurs, there tends to be a lot of collateral damage. That is that the companies are so committed to the stock market as a way of tracking labor and capital. I mean, that's what the new economy did with stock options or broad base of employees and capital from venture capital, that they never forget that. And so when they grow big, they start doing the things like that. I'd write about massive buybacks. Cisco has spent over 100% of its net income since 2002 on buying back its own stock. And I think stock being an innovative company because of that. So the state remains important. These business enterprises remain important. But how do they work together so that we, the people who work for them, the taxpayers don't lose out? So the second, the first edition of the book, as I say, was something of a celebration. While it did take account of how out in Silicon Valley in the 70s, we kind of invented what we call Silicon Valley socialism. So in order to attract people to the frontier to take the wild ass risk of joining a startup when they could have just kept working for digital equipment or Hewlett-Packard, we had to give them tickets to the lottery. If they won, like just like the national lottery in Britain, the vast majority of tickets expire unexercised and are worthless. Most startups fail, whether they're restaurants or software companies or anything in between. That invention got hijacked. It got hijacked by big companies that were already established where the risks were just orders of magnitude less. And then it got hijacked by the banks where the right-hand side of the balance sheet was guaranteed by the taxpayer. So that aspect of financialization is very much discussed in doing capitalism the first edition, which, by the way, is still available as I mentioned the other night at an Amazon outlet near you. The second aspect of this is you do have turnover. Companies do run out of steam. And at that point, one of the challenges is do they manage to perpetuate themselves as zombies? There's a lot of concern about the Japanese economy and the persistence of zombie companies. I think that's happening in the US. The third aspect, and this is, I think Bill has a very good point here, is that where and when the state, the government funded by taxpayers, makes investments that actually pay off, getting a return not just from a tax system which is incapable of capturing the taxes from those who have become extremely good at managing to earn their rents in Ireland, not in Britain, not in the US, there the notion of some kind of golden share, some kind of payback on that is an idea that we're not going to remotely address in this administration or maybe even the next administration, but it ought to be on the agenda. Definitely on the agenda. And I just said one last thing. And this has to do with the next revolution that the US is the outstanding laggard in. And I heard last night, yes, we talked a little bit about Canada and Australia as well. Huge per capita carbon admitters that are basically missing an action in the response to climate change. They're the driving force and this is very central into the second edition of Doing Capitalism and the negative, frustrated feeling that I am trying to communicate in a rigorous way. That really still needs investments that are not yet commercially or financially attractive. It needs the kind of cross the board, massive funding for purposes that transcend any cost benefit analysis, any narrow financial calculation of net present value. And it's happening in China. It's not happening in the US. Yeah, I think that's a really good point. I do wanna though address something else that Bill brought up, which is really the challenge of main street competing with Wall Street, so to speak. Although Wall Street is now largely residential. Most of it's moved elsewhere. The thing that, I have a private company and I have to compete with these companies that have what you could call super money. I think it was Bill who pointed me to the book of that name. But Google basically pays its employees with a currency that basically just conjures out of thin air. It basically draws it in from its shareholder simply by issuing new stock, $4 billion a year, which it can pay to its employees. I have to pay my employees out of my actual profits. A dollar of profit for me is worth a dollar. A dollar of profit for Google is worth roughly 30. A dollar of profit for Amazon is worth well over $100. And this is part of why these companies become what David Autor called superstar firms. Yes, they can pay people more because they are participating in this financialized market. And the question is, is that entirely a good thing? When Google is actually making, or Apple, whatever is actually making a huge sums of money in the real market of goods and services, they're doing quite well. They don't actually need this additional boost that we have in the rules of the system that favor capital formation, that favor with better tax rates, with various kinds of incentives. And so the real question is, if we really want to have a more equitable economy, we actually have to think differently rather than simply saying, oh, there's these superstar firms and they pay people better. Go, well, what are the drivers? What are the inputs to that? Because some of the inputs are the same inputs as the real economy, and others are not. And it's really interesting. I have not actually done the math in detail, but I did a back of the napkin. And I said, look, actually, if Google were a private company, Larry Page and Sergey Brin would be roughly as wealthy as they are with Google as a public company. Just because just keeping their share as owners of its retained earnings, it's that profitable. They'd still be worth $40 billion a piece. On the other hand, Jeff Bezos would be worth 10%, 5% of what he's worth. And so you clearly see that there's very, very different outcomes based on this betting market, which is what financial markets are. Now, the betting market supporting Jeff Bezos and Elon Musk is actually working like capital markets are supposed to. But I know a lot of Silicon Valley billionaires who created no value at all. They just won the bet. And I think we actually need to understand more deeply. And I would love to see more economists sort of studying these effects and asking, is this really the best of all possible worlds? Is this the best of all possible systems? Because of course, people are able to make enormous sums of money. And Bill has sort of documented this. But we use the wrong names. We have the wrong map. When Carl Icahn buys shares of Apple, he is not investing in Apple. Apple does not need his money. He's placing a bet that he can manipulate the stock. And he's earning money by manipulating the stock. And so again, how would we start to understand when, what is a true capital investment versus what is simply a bet in this betting economy that sort of has overlaid our real economy? And then what would be the policies that we would use to rein that in? That's a fertile subject for economic analysis. Thank you. So when you spoke about the fact that Uber doesn't have really an interest to buy self-driving cars, what I really heard is that their business model is to externalize the purchase of fixed capital and transfer the risk into workers. And because one of the topics on which I'm working is household debt, I saw on figures that auto loans and loans to buy cars in general are a count for a very large share of household debt. And at first I didn't know how to interpret that. And then I figured out that they need that to get to work or just to work plainly. And perhaps, and I would like to comment on this, you to comment on this, this is one other way to look at how policies could stop encouraging or even forcing people to get into debt. Also because that really locks in people into their working situation and prevents them to walk away, as you were saying. And one idea perhaps that I would like to ask you what you think about this is whether basic income could help people walk away from these situations. And after all, this would be very coherent with the initial philosophy of the first coders in California. And one last thing if I have time is that the topic of open source rather than just free software is very dear to me. And sometimes we forget the role that people and researchers at CERN had in developing internet at first, but they use that knowledge to really push the boundaries of our knowledge further. But the point is that I'm not really up to date to the weight in salaries of engineers in Silicon Valley, but I think that researchers, physicists, and engineers at CERN are paid less than people in Silicon Valley. So perhaps that's another way to look at how to use public funding in a good way, and also knowledge. I totally agree that debt is, again, one of these ways that we've kept this unsustainable system going. And it is, in fact, a way that companies have externalized their costs. They haven't really eliminated them. They've simply pushed them onto someone else. And again, I don't think our policies and our economic understanding has kept up with that. I loved your presentation the other day because it does seem to me that I haven't given as much thought at all to debt other than to just kind of say it was a way that we kicked an unsustainable economy, we kicked the can of an unsustainable economy down the road, and at some point it's gonna come back and bite us. Tim, this is where our two books and our two ways of thinking are so complimentary because one of the things that we've witnessed, first in the United States beginning about 40 years ago, in Britain beginning about 20 years ago, is the privatization more or less by stealth of what was one of the great central goods that our societies had sponsored. The US invented the public university in the middle of the Civil War. And for 100 years, access to education was deemed to be a public good, access to higher education. It created the most educated and most skilled and most productive workforce in the world by the time of the post-World War, Golden Age. The biggest debt issue that bothers me and that I think is crippling the US-UK Anglo model is student debt. Student debt in the United States is now larger than credit card debt. It's three and a half trillion dollars, I believe, currently. In Britain now, even with student fees capped at 9,250 pounds per year, which includes nothing for actually feeding and housing students, students are now, even on a three-year course, graduating with order of magnitude 50,000 pounds worth of debt. And, of course, it's the least advantaged, the ones who can't look to the bank of mom and dad for help who are going to be carrying that burden. This is an enormously stupid, retrogressive, retroactive shift in public policy and what were the first two leading countries in creating, inventing and displaying the modern economy. We're gonna pay for this as societies for a long time. That would be a beautiful place to end, but I can't resist pointing out the interplay of technology and globalization in this book. It's the first edition of the book in the UK from Penguin Random House and it's a paperback. And I started asking myself, why would they put out a paperback as their first edition? And it's because of Amazon, because traditionally the paperback is followed by a year or 18 months, but they're sitting there going, well, anybody who can buy the hardback, he's gonna have bought it on Amazon, the US hardback. And so I think this is very directly a response to globalization, the fact that that window has changed for publishers and the subsidiary publisher of the secondary market says, well, we're gonna actually do a little bit of arbitrage here and go right to paperback. I found that a fascinating little side light on this discussion. I have a footnote to that because my old fashioned pre-commercial publisher, Cambridge University Press, approached me last spring because somewhat to their amazement, my book and hardback had still continued to sell on Amazon. And they said, we'd like to bring out a paperback edition. I said, wait a second. We've had five years, not just Trump and Brexit, but five years of transformation in the market economy, in the role of the state, in the dynamics of financial speculation. You can't just reprint what was published in 2012 and they spent about a month or two in conversation thinking about it and said, okay, we'll bring out a second edition in hard copy. So that's gonna be it. I'm gonna have to call this to a close so we can get to the rest of the day, but I want to thank you all for being here. I want to encourage you not to walk away, but to come pick up a copy of this book. Look forward to the second edition. Both of you might be singing the Beatles song, Paperback Writer, if you had this soundtrack behind you. Paperback Writer. And I think the most important thing is to delve into this realm, this challenging, mysterious area and find out for yourself whether in the long click we are all dead. Thank you. Thank you. Thank you. Thank you. Wonderful.