Place Your Political Bets

[music]

00:05 Paul Matzko: Welcome back to Building Tomorrow, a podcast dedicated to all things tech and innovation from a libertarian perspective. I’m your host, Paul Matzko, and with me is Aaron Powell. We are returning to part two of an interview with John Aristotle Phillips, the founder of PredictIt, the aptly named political prediction market, and the college student formally known as the A-​Bomb Kid. Yep, sometimes the truth actually is stranger than fiction, because if teenage designer of nuclear bomb who creates a betting market for politics isn’t the best plot summary you’ve heard for an as yet unmade Coen Brothers film, I don’t know what is. But back to the show.

[music]

00:48 Paul Matzko: I know there’s a relationship between… I think Aristotle was involved with some of the planning for PredictIt, which is a political prediction market, but it’s based in New Zealand, off a New Zealand University. Explain a little bit of that.

01:02 John Aristotle Phillips: Sure. PredictIt is my favorite subject. This is, of more than three decades in the business of politics, this is something to which I’ve contributed that I am proudest of. PredictIt is just the coolest thing. It’s also a hell of a lot of fun. Are you guys PredictIt traders?

01:24 Paul Matzko: Oh, we have some here in, I think, in the building, but not me personally.

01:26 John Aristotle Phillips: It sounds like a lot. Yeah, you guys are definitely on PredictIt. [laughter] Alright, so PredictIt is what’s called a prediction market. It’s like a stock market where you buy and sell $1 winner-​take-​all shares, where two people… We put two people together, one person who thinks something’s gonna happen, the other person who doesn’t think this thing is gonna happen. Let’s just take Trump impeachment as an example. Right now, you can buy a share, a single share of Trump to be impeached in 2019. I don’t know if it’s… It may be selling for 22 cents. That means if you put down 22 cents that says Trump will be impeached in 2019, you get a dollar if it happens; or you could take the other side of that bet and you can put down 78 cents that says he won’t be impeached in 2019, and you get the dollar if he is not impeached. If what happens is the opposite of what you predicted, you lose whatever you paid for that share.

02:28 John Aristotle Phillips: You’re limited to $850 in any market. You can’t buy more than $850 in the market. And what’s cool about it is the price fluctuates by the second. There are thousands and thousands of people who are holding these $1 winner-​take-​all contracts and they’re watching the news and engaging in trying to figure out, in this case, will Trump be impeached in 2019. And as the likelihood of Trump being impeached increases or decreases, so does that 22-​cent share. It goes up in value, it goes down in value, based upon people bidding on it 24-7-365. That’s PredictIt. And we… It’s not an original idea to Aristotle. Prediction markets have been around a while. There was a…

03:18 Paul Matzko: Robin Hanson [03:19] ____ back in the ’90s.

03:19 John Aristotle Phillips: Yeah. Intrade was a famously fun, but also eventually shut down by the Commodity Futures Trading Commission. It was an Irish gambling site. But making predictions or… People think of the stock market sometimes as gambling, right? There’s a lot of research that goes into whether you’re gonna buy a share, and there’s a lot of thinking that goes and research that goes into whether or not you think impeachment’s gonna happen, or what you think the margin of victory is gonna be, or how many Senate seats the Republicans are gonna pick up or the Democrats are gonna pick up. All those things factor in. The reason PredictIt… And what’s fascinating about PredictIt, to me anyway, is that they’re so darn accurate. They’re not 100%. It’s not 20/20 vision into the future, but you’re pulling back these curtains just a little bit, you’re able to see a little bit through the fog, and that’s what prediction markets do.

04:14 John Aristotle Phillips: And the question is, “Why?” Robin Hanson and others have been researching prediction markets for a long time. And the question really is, why are markets accurate predictors of future events? How is it that a… Is it wisdom of crowds, as some people would like you to believe? Is it insider information coming into the market and causing the price to go up or go down on something like this? What is it about it? We know that markets are efficient, are highly efficient at distilling billions of pieces of information, and we could be talking about pork bellies or orange juice futures or the price of Tesla stock, okay, but we’re happy to talk about political events.

04:57 Paul Matzko: Great trading places reference. That’s nice.

[chuckle]

05:00 John Aristotle Phillips: But they distill billions of pieces of information, and these are generally about risk and value, and it distills it into odds and prices, and that’s what a market does. It’s what a stock market does. This is, if you think of this as a market for politics where you can make all kinds of predictions and you can put your money where your mouth is, and then, of course, there’s this whole comments board. We have more than a million comments, for instance, on some of these markets. It’s great and it’s great fun, and I still think you guys are traders. You’re just not saying it.

[laughter]

05:38 Aaron Ross Powell: This question of accuracy, so PredictIt is a large portion of the data behind the website elec​tion​bet​tin​godds​.com, which was the… It was like it and FiveThirtyEight in 2016, and then again this year, where everyone in DC is obsessively hitting reload on these two sites.

05:55 John Aristotle Phillips: Yes. Yeah.

06:00 Aaron Ross Powell: But one of the things about giving a percentage happening of a one-​time event, like will Trump or Clinton win the election, that’s a one-​time event. And so if PredictIt says that Trump has a 3% chance of winning and he wins, then PredictIt was still right. And if PredictIt says that Trump has a 75% chance of winning and he wins, you’d still say it was right, because these are one-​time. You can’t repeat it to see, out of 100 times running this election, he won either 97 or he won only 65.

06:38 John Aristotle Phillips: Or because there’s no way… You said because there’s no way to empirically test.

06:42 Aaron Ross Powell: Right. And so, when you’re talking about its accuracy, how are you getting to the question of its accuracy if you’re always in these one-​off things?

06:48 John Aristotle Phillips: Sure. Well, that’s the old gag about Washington. Everybody says that it’s a 60% chance that something’s gonna happen, right?

[laughter]

06:54 John Aristotle Phillips: That way, you’re right either way, no matter what happens.

06:56 Aaron Ross Powell: Yep. That’s right.

06:58 John Aristotle Phillips: When we think of accuracy, first of all, the premise of the question is, “Is it 100% correct?” in my opinion. When you say something is 20% chance that it’s gonna happen, that means 20% of the time, that thing is supposed to happen, and the other times, it’s not supposed to happen, because you can’t repeat it and all this stuff. How do you calculate accuracy? Well, there’s something called “Brier score,” which is what people who study prediction markets… It’s not just the odds are correctly cited with what actually happens, but how long in advance of the event and for how long it stays. ‘Cause there’s a virtue to being right five minutes before the event, to being on the right side of a bet five minutes before the event occurs, but the greater virtue is being on the right side of that same bet six months ago when you could have bought this share when everybody else was thinking the opposite was gonna happen. There are biases that enter into it when you’re… There’s long-​shot bias. There’s all kinds of bias that… And it’s fascinating how investors think about these things.

08:08 John Aristotle Phillips: And I’m not here to tell you I figured out how, why markets are as accurate. I gave you my theory, but I think it’s probably a combination of things. I think information flows through the market rapidly. They are obsessively… People are obsessively hitting the website trying to figure out if the odds are gonna change. What’s really interesting is you follow something like the Kavanaugh nomination hearings, or that Kavanaugh would even be picked in the first place, and you can really, really see the markets start to tip at various points, almost in advance of what’s going on in terms of the testimony. And you also… It’s not just politics, of course. If you can predict… How interesting would it be to predict the month and the year, or just the year when the first human being is gonna walk on Mars? All that stuff is really subject to… And again, prediction markets, and markets in general, and forecasting elections has gone on for a long, with money behind it, it’s gone on a long, long time, like hundreds of years.

09:20 Aaron Ross Powell: You said that there’s a, was it $850 cap on how much you can invest in a single market in here?

09:24 John Aristotle Phillips: Single market.

09:27 Aaron Ross Powell: Is that because of regulatory reasons? And then, would we be more accurate if we didn’t have those caps, so people could dedicate even more money?

09:38 John Aristotle Phillips: Yes and yes. Both of those… Okay. There is a regulatory history as to why, what you guys wanted to talk about… I’m happy to shorten it for you. But basically, what we did was, we… New Zealand, University of Victoria in New Zealand had been running a prediction market, and a good one. We went to them. And polling is broken, as everybody knows. It’s expensive. It’s hard to do. And yeah, people don’t wanna answer questions on the phone anymore, and somebody’s got cell phones. It’s really hard to get polling, to get it right. And if you can harness… And our interest was, “But, wow, look at these guys at Intrade, and they set this up, and also it’s just a lot of fun, any way you cut it.” So we teamed with Victoria University and said, “We wanna bring this to the United States.” And the Commodity Futures Trading Commission was the government agency to whom Victoria took the request and got what’s called a “no-​action letter.” And the no-​action letter stipulates some of these limits.

10:49 John Aristotle Phillips: It’s a balancing in terms of the limit survey useful function, although the limits could be and probably should be higher, but they’d limit survey useful function. The question is, “Well, how do you keep a whale out of the market, if a Russian whale wants to come in and buy a whole bunch of shares?” And that happened with Intrade, and irony with Intrade is they relieved the whale of more than a million of his dollars before the market settled back to what it would have been otherwise. Markets are very efficient at taking the money away from people who rely on fake news, and that’s part of… That’s one of the other things about it, which is, it’s a potential antidote to fake news. If you are watching fake news or consuming fake news and you’re drinking the Kool-​Aid, you probably should not be on PredictIt because the people on PredictIt are gonna relieve you of your money.

11:43 Aaron Ross Powell: When we talk about prediction markets, and they really… It seems like it was with 2016 is when they became a mainstream thing for, at least for people paying attention to the political races. We say, “Well, these are more accurate than… The kind of expert predictions are terrible.” The people who go on CNN and pontificate about who’s going to win, about horse-​trading politics are terrible. And the polling is not that great, or it has issues that you raised. But if those sources of information are not that great, where are the people who are betting on PredictIt getting their information? What information are they acting on? Because they’re not… These aren’t insiders in the political campaign, usually. They’re regular people.

12:35 John Aristotle Phillips: That’s a great question. I’ll reframe the question. Okay. What makes a superforecaster? ‘Cause somebody at that 3%, it wasn’t 3% of course, but to use the hypothetical, whoever picked the long shot at 3%…

12:51 Paul Matzko: Did very well.

12:51 John Aristotle Phillips: Six months… Made a killing, right?

[chuckle]

12:54 John Aristotle Phillips: Can you isolate the… It gets back to our original discussion about big data and databases and the like. Can you isolate the characteristics that make for a great forecaster? We call them superforecasters. And just see what what they’re doing and try to figure out, how does this person… For instance, and those questions haven’t been answered yet. We have 150 researchers at 85-​plus research universities. So they had an economics department, the marketing department, the political science, international relations department. These teams of researchers are digesting the anonymized data that we provide to them and trying to figure out what makes for a superforecaster. Is that fat cat in the Beltway, inside the Beltway, a better predictor of the outcome of the Iowa Republican Caucus than Grandma, to use that example again, who just reads the newspaper every day, or maybe doesn’t read the newspaper, maybe doesn’t pay any attention to it, but just she has some other methodology for figuring out what’s gonna happen. What makes a superforecaster? I can’t answer that question for you except that they probably have really good BS detectors.

14:08 Paul Matzko: This, actually, conversation reminds me about the debate within stock market prediction groups about whether or not you can truly beat the market. There’s the whole move over the last 40 years towards index funds. Your Burton Malkiel, “A Random Walk Down Wall Street,” even Warren Buffet, saying that, one of the most successful stock pickers of all time, saying, “You shouldn’t do this. This is not successful.” Over time, you cannot be the consensus of the market. There’s an anti-​superforecaster sentiment that’s been growing in the stock market picking. Is the same thing true in political prediction markets? Are there folks who are skeptical of whether such a thing as a super-​political forecaster exists?

14:53 John Aristotle Phillips: Well, you’re sitting across from somebody who’s a case study for how not to pick stocks.

14:58 Paul Matzko: Okay.

[laughter]

15:00 John Aristotle Phillips: My 401 suffers. Any time I get involved… Every time I leave it alone, it does fine. When I get involved, I’m sure something’s gonna happen. You can pretty much bet against it.

[chuckle]

15:10 Paul Matzko: Do as you say, not as you do.

15:12 John Aristotle Phillips: Yeah. That’s right. And I’m not allowed to play on PredictIt ’cause I’m affiliated with Aristotle. Your question was what?

15:24 Paul Matzko: Do you see that… You were talking about you’re trying to find a superforecaster, but is the superforecaster a myth, a unicorn?

15:31 John Aristotle Phillips: I don’t know.

15:32 Paul Matzko: Yeah. Okay.

15:32 John Aristotle Phillips: Somebody’s been… People are making money, and people are losing money. And over time, the question… It’s like the monkey, right? The monkeys throw the darts at the chart, the stock picking chart.

15:43 Aaron Ross Powell: I wonder if you had something like PredictIt… You’ve got people who are logged in and making lots of bets on lots of things, and I suspect that people who are really into it are betting on a lot of markets at the same time, but… I wonder if you had something like that, then coupled with the kind of almost creepy level demographic data that Facebook gathers about you, if you could start, like that question of, then you could figure out, “Is it the fact that grandmas in the Midwest who make below a certain income are 40% more likely to predict the outcome of elections?” You could imagine really interesting information coming out of aggregating all this data that’s being gathered.

16:27 John Aristotle Phillips: The analysis of what makes for accurate… It may be that it’s not “Svengali Grandma.” It may be that markets just function in a certain manner and they aggregate a lot of information. I don’t use the term “wisdom of crowds,” but that may have something to do with it. There’s some… I think it’s gonna be fascinating to see what kind of research comes out of this, just in terms of why markets are so accurate. And then they’re not perfect, as I said, they’re not 20/20.

17:05 Aaron Ross Powell: What’s the… I guess, outside of the obvious value for investors who are participating in this, at least the value for the one to win, what’s the long-​term value in prediction markets in this kind of mechanism of… If we get better at predicting the outcome of campaigns really far in advance, does that create positive externalities?

17:30 John Aristotle Phillips: That’s a great question, and I haven’t been asked that question before. I don’t know, I don’t know. I have to think about that one.

17:35 Paul Matzko: I can imagine, off the top of my top of my head, thinking of this being an advantage to the kind of political outsiders that we started talking about… We were talking about Aristotle, where, if you’re not part of the two-​party duopoly, it’s just assumed. The received wisdom is gonna be, you don’t stand a chance, but that’s not actually true. The chance is rarely ever zero. Maybe it’s only 1% or 2% or 3%, but it gets you on the board. A prediction market gets you on the board, whereas received wisdom keeps you off the board entirely. And some small… Yes, maybe it’s only a 1% or 2% chance, but across thousands of elections across the country every year, some of those 1% or 2% chances are more likely to pay off if we listen to prediction markets, rather than to expert opinion.

18:24 John Aristotle Phillips: Well, that’s possible. There are 20, at last count, between the billionaires and the Senators and the wannabes, there’s 20 candidates running for the Democratic nomination, or possible candidates. There’s probably 220 possible.

[chuckle]

18:40 Paul Matzko: Right, right. Yeah.

18:40 John Aristotle Phillips: But there’s 20 that… We’ve got markets open on them. Will they run? Then there’s a market on, will they announce? Will they get the nomination? Will they win the [18:53] ____? These are all different markets that you can go in on. And you can see the 2 percenters. There’s a whole bunch of people, they cluster down there, and itching to get up. Now, traditionally, what happens is they wouldn’t… They give a good speech, or have a good day, or something, file a good financial report, and that would go unnoticed, unless they were anointed by the Washington Press Corps as being the frontrunner or the dark horse that’s catching fire, whatever that means, the Big Mo. But the fact of the matter is, the prediction markets are pretty adept at picking that stuff up, and so it’ll be really interested with this election cycle to see how well they do in terms of… And somebody may be in the front now, and they may be at the back, or they may not even be a factor six months from now.

19:48 Paul Matzko: What do you say to… There are gonna be some folks listening to this, who are going to viscerally recoil at the idea of betting on political futures. To some extent, with Aaron and I, you’re preaching to the choir when it comes to, “Hey, markets can efficiently access information.” It’s a libertarian podcast after all. But there are gonna be folks who have a visceral reaction to that. What do you say to the idea that this is ghoulish, this is unsavory, that politics aren’t something you should think of as a crass mechanistic financial… You have a financial interest in, that you should vote your heart, not with your wallet or something. I can imagine lots of objections along those lines.

20:32 John Aristotle Phillips: Right. Those who do well in… First of all, I don’t have a perfect response to the person who says, “There should be no money in politics.” That’s an extension of that argument, which is, not only should you not make money, but you should not put money into politics ’cause you just encourage these politicians to do more of what they’re doing. In any event, there are lots of objections, and anything I’m involved in is never gonna be pure enough to satisfy everybody, or even many people. But my feeling is that this is one of those areas that should be reviewed more as political speech. If you decide to put your money where your mouth is, that, to me, is a pretty pure expression of democratic sentiment. Furthermore, PredictIt does function, and this is another area that’s being studied right now so it’s a little premature to jump to this conclusion. But if you ever come to the PredictIt parties we have, it’s debate night, they watch debates, or there’s election night parties, or we get… We open a bar, which is the political bar in the state capital.

21:47 John Aristotle Phillips: On election nights or nights when there are debates or something happening, those places are packed. And you will see a whole generation of people who really are… Many of whom have not been involved in politics before. But like sports fantasy, or some of the other types of places where you’ve actually got some skin in the game, all of a sudden, there is just this avid interest in hanging on every word in the debate, because you’re trying to figure out if Donald Trump is gonna say “Crooked Hillary” in the tweet tomorrow. PredictIt is an engagement tool. And I think one of the things that’s gonna come of this is we’re gonna discover that, especially the demographic that does sports fantasy and does Super Bowl, all this, I think you’re gonna see greater engagement by that demographic of young people who, otherwise, it’s a bunch of people talking about politicians, a bunch of people talking about stuff that’s not relevant to my life. And frankly, I didn’t see any of that tax cut.

22:52 John Aristotle Phillips: But if you’ve got 10 bucks riding on what’s gonna happen, you’re gonna pay attention. And it gets to another thing you just said which is, in a market, you’re not supposed to vote with your heart, you’re supposed to vote with your head. And that’s kind of what PredictIt does. It’s amazing. If you guys, or if your audience goes to Pre​dic​tIt​.org, you just put… You can open an account as little as 10 bucks. If you put as little as 10 bucks down, you’re gonna see how it clears your head in terms of what you’re making a prediction on, whether you’re not… It’s who the 2020 Democratic nominee is gonna be, Trump impeachment. You start to think, “Is that really worth 22 cents or should it be 23 cents? Maybe I’m gonna put in an offer for 21.” And that’s how prediction markets, I think that’s an element to why they’re so accurate.

23:38 Paul Matzko: And it produces a certain degree of another positive social externality, just as, say, fantasy football encourages people who are previously casual consumers of football to learn more about the sport, to be more engaged. It increases the level of knowledge about this venue. The same thing would be true in politics, that the process of engaging maybe exposes them to new ideas. There was a certain way they were voting because that’s how their family voted, they were party-​line voters and this way, but now that they have skin in the game, they’re spending more and more time engaged with the issues, learning about the candidate, looking… They’re higher information voters.

24:20 John Aristotle Phillips: You are so right about that. And in fact, if I may, just one second… The study shows that people who have money riding on a football game are 44 more times more likely to watch the football games, and in fact, the season. PredictIt, or people who are involved in fantasy sports or betting on sports become voracious consumers of sports statistics. You just have to ask ESPN about this. You buy, you consume. You try to get as much of that information as you possibly can because you wanna make the most accurate… Why? What’s the batting average? What happens on a rainy day? All that stuff. The same may be true with political prediction markets, is that you become real interested real fast, even if you’ve only got 10 bucks riding on what’s gonna happen. And the corollary of that is there’s a reward mechanism built in. As we said earlier, if you’re making your predictions based on fake news, you’re not gonna do so well.

25:23 Aaron Ross Powell: Just to sort of be the doom-​and-​gloom guy though, to counter that, does it run the risk that if I have bet a bunch of money on a slate of candidates, say, that when I then go to the polls, the person I’m going to vote for is not gonna be the one who I think will govern the best, has the best principles, is the best at the job, but rather, the person who I have predicted is going to win, and so therefore, my slate of candidates will pay off? Which would seem to be… It’s good for my income, but it’s not necessarily good for democracy, if that’s the reason we’re picking candidate.

26:02 John Aristotle Phillips: Yeah. You may have a perfectly valid point. I don’t know if… I talk to people who’s bemoaned the fact that they put money on the opposite of what they’re gonna do, because they hedge their bets. They say, “That way, I’m not gonna be disappointed when my candidate doesn’t win.” There’s that thing going on. How much of it is what you described, which is probably a lot, and how much is what I just anecdotally described to you? I don’t know. But that’s one of those things. Wouldn’t it be just interesting to know, look, who’s the better predictor of the outcome of a Democratic or Republican primary campaign? Is it somebody that’s a Democrat, a Republican, or independent? I don’t know the answer to that. We’re gonna know the answers to some of those questions pretty soon though.

26:47 Paul Matzko: I still like the theory, “Or Svengali Grandma in the Midwest.” [chuckle] I think, clearly, every time. Why don’t we move on, for the sake of time, to your original title, back before you were CEO, back before you ran for Congress, you were known as the A-​Bomb Kid, right? And this is quite a literal appellation. You were, as I understand it, an undergraduate at Princeton, and you designed an atomic bomb.

27:15 John Aristotle Phillips: I did.

27:15 Paul Matzko: Something that most undergraduates do, usually by their sophomore year.

[chuckle]

27:19 John Aristotle Phillips: Well, I was on academic probation at the time.

27:21 Paul Matzko: Oh, okay. [chuckle]

27:21 John Aristotle Phillips: So that’s… You had to do something. My thesis advisor was the eminent physicist, Freeman Dyson. That’s one of those interesting fun facts to know and tell. Freeman told me, when I set out to do this, this is a junior thesis, is what they have. You do this in your junior year. You pick a topic, and you dig into it, and you ignore your other classes and you’re supposed to… That’s what this project was. Freeman informed me from the first day when I asked him to be my thesis advisor, he wasn’t gonna be able to help me with any of this because he had security clearances, and I, frankly, nobody thought I was gonna succeed anyway at coming close. But, yes, that happened and it was quite a roller coaster after that. The point was to see how difficult it would be for a terrorist group or a criminal organization, or even a third world country, to build a bomb, which I didn’t do. I just designed it.

28:24 John Aristotle Phillips: And the premise… Much of the debate at the time about proliferation, it’s eerily similar to the debate now, but much of the debate about proliferation of nuclear weapons was that you didn’t need to tighten up security around plutonium and uranium, the raw ingredients for atomic bomb, because it would take a Manhattan Project to design and then build a bomb. And therefore, we should be lax in exporting technology and materials around the world because places like Pakistan would never be able to come up with an atomic bomb. It was sort of this hubris, which proved not to be the case. And as a result of a lot of work by people who were very concerned about proliferation, and had been working in the issue for a long, long time, especially in Washington, Democrats and Republicans. Some of… There were curbs placed on the spread of some of the technology, mostly plutonium reprocessing facilities. This is a whole great subject for another podcast.

29:35 Paul Matzko: Yeah.

29:35 John Aristotle Phillips: Happy to talk about it. This is… I had a bit role in this whole thing, but it was sort of a punctuation mark, I guess, for the proliferation debate, because once I did what I did, then it ripped the rug out from underneath the argument that you’re not to secure physical material.

29:55 Aaron Ross Powell: I have to ask, you said you designed one but you didn’t build one.

29:58 John Aristotle Phillips: Yeah.

29:58 Aaron Ross Powell: But could you have?

30:02 John Aristotle Phillips: The question is, could I have without killing myself?

30:05 Aaron Ross Powell: Sure.

30:07 John Aristotle Phillips: Yeah.

30:07 Paul Matzko: There was that kid who built one in his shed, the Boy Scout in Michigan, who built one in his potting shed in the ’90s and [chuckle] may have, yeah, irradiated himself pretty severely.

30:17 John Aristotle Phillips: It would not have been a trivial matter if you had… Part of the… The unfortunate part about the whole thing is that, the whole subject, is that even if you succeed… The atomic bombs that were used over Hiroshima and Nagasaki only consumed a fraction of the physical material, so they were not what we would call efficient, an efficient design. A lot of the work around atomic nuclear devices is to make it efficient so they can be smaller, so they can go on the top of a warhead, that sort of thing, or unfortunately, in a suitcase somewhere. And failure, if you create a dirty bomb, if that’s your intention, you set out to create a dirty bomb, you don’t really… You’re striving to do something different than create an efficient device. There’s still very good reason to keep security tight on these materials, and there’s… Personally, I think we were in a much more precarious situation, especially with the collapse of the Soviet Union. It was an example of… At the time, it wasn’t perfect, but it was an example of bipartisan support and international support to stop these weapons from falling into the wrong hands, and how successful we were, there’s evidence to that, ’cause we’re here today. But I don’t think that’s…

31:57 Aaron Ross Powell: It sounds like something we need a betting market on.

32:00 Paul Matzko: That’s right, yeah.

[chuckle]

32:01 John Aristotle Phillips: Yeah, I don’t… I think we’ll avoid that one.

32:04 Paul Matzko: That thesis made you something of a household name, lots of talk show circuit appearances. You’re the first 24-​year-​old not involved in fronting a rock band to get a cover article in Rolling Stone, [chuckle] as far as I know, and you leveraged some of that fame to run for Congress, where we talked about those campaigns in Connecticut in ’80 and ’82. What made you decide to switch from being the face of a campaign, and then the next year, after that second failed bid, is when you started Aristotle? What’s going on in your head as you go from young… And I think by the standards of the time, maybe not by the standards of 2016, 2018, you were considered fairly liberal on a lot of policies in 1982. How did you decide to go from that to running a bipartisan political campaign platform?

33:00 John Aristotle Phillips: It was those experiences. First of all, my brother and I were broke, so we needed a job. And so the thing we knew how to do was to run a campaign, which didn’t succeed in the general election, but did succeed in the primary election campaign. And so it was a… We loved the democratic process itself. It’s fascinating how people come together, how they try to articulate their point of view. It was highly inefficient. Computers were just the brand new thing. And we felt, based on the program my brother had cobbled together for the campaign, that this is an area where some… There’s room for growth, and there’s also a lot of room for improvement. It was just too hard to run a political campaign in those days, if you didn’t…

33:50 John Aristotle Phillips: Even if you had the blessing of the party, it was just really, really hard. And it shouldn’t be that hard. It should be easy to get your point of view across, and then let the voters make a decide. It’s one-​day sale. You let the voters make a decide as to how much merit your ideas have, and that’s the base of some, which I know it sounds naive, but the fact of the matter is, that is pretty much what Aristotle has dedicated itself to, in this intervening period of time, is to try to make it easier for points of view, which may not be mainstream, or mainstream, to be heard by voters so that they… ‘Cause ultimately, voters make the right choice in all these elections we’re involved in. Ultimately, they weigh their own personal circumstances, but also what they think is best for their community or their country, and their neighbors, and that’s how they cast their ballot.

34:44 Paul Matzko: One last thing, I think, unless you have something, Aaron. As I was reading the Rolling Stone interview, actually, there was this… This is the section where you talked, and this is in 1980, so it’s been a while. You talked about admiring the great figures in history, like Joan of Arc, Alexander the Great, Napoleon. You wanted to be like the ancient Greeks, who tried to make a substantive contribution in one’s lifetime as a way of leaving a legacy that outlived you. All this talk about, “I wanna be preserving civilization rather than destroying civilization.” You also mentioned a childhood dream of being an astronaut. In all this, so young, political, relative political radical for the time, trying to get into politics in the late ’70s, early ’80s, these big dreams and visions. And actually, while reading that, I thought of another politician, Newt Gingrich, someone who’s also obsessed with space travel, loves history.

35:40 Paul Matzko: It might sound like a bit more of a… I don’t know if that’s a compliment, given the trajectory of his career. But it’s interesting to me that there might be something about your generation, who are coming of age in the ’70s, so it’s post-​New Left, post-​1960s. You had a big vision, but also saw a lot of really systematic institutional problems in America and wanted to do something about it, albeit, I assume, your solutions in 1980 were rather different from Newt Gingrich’s, but some of that same energy. What that puts in mind, be in mind now, I think for my final question, would the 1980 24-​year-​old liberal wunderkind who invented the atomic bomb and then ran as a radical Democrat for Congress, would he be happy with you now, the 60-​some-​year-​old CEO of Aristotle?

36:32 John Aristotle Phillips: Oh, I’m sure grossly disappointed.

[chuckle]

36:35 John Aristotle Phillips: I was… My viewpoints when I ran for Congress were… Would today be considered pretty much mainstream or conservative.

36:45 Paul Matzko: Oh, yeah.

36:47 John Aristotle Phillips: That’s the irony of it, right?

36:48 Paul Matzko: There’s like medicinal marijuana and…

36:50 John Aristotle Phillips: So I ended up… Look. What I do… Look. I think what I’m involved in, what my company is involved in, things like PredictIt, I think these are important endeavors, and I’ve been very lucky. They’re also… I wanna stress how much fun it is to be doing what I do. I really enjoy being the CEO of a company. And I really enjoyed… It gives me the opportunity to do stuff like PredictIt, or look, how fascinating it is to be able to go to a foreign country and be able to help manage a political campaign, try to get your arms around what’s going on, and how… I told you earlier on, it’s invigorating, it’s inspiring. You see people waiting in the sun for hours to vote in an election, where you’re trying to make sure that the votes were all counted, etcetera. It’s just, it’s great. I have no regrets about that. I don’t think I would have, for the record, I don’t think I would have made a very good congressman.

[laughter]

37:51 Paul Matzko: I don’t think so either, and that’s a compliment, for sure.

37:52 John Aristotle Phillips: Alright. There you go.

37:53 Paul Matzko: Yeah. And I do think the ancient Greeks would approve. I think your 1980 version would be happy. And that’s all for today, and until next week. Be well.

[music]

38:06 Paul Matzko: Building Tomorrow is produced by Tess Terrible. If you enjoy our show, please rate, review, and subscribe to us on iTunes, or wherever you get your podcasts. To learn about Building Tomorrow or to discover other great podcasts, visit us on the web at lib​er​tar​i​an​ism​.org.