A Review of "It's Time to Build" by Marc Andressen

If there is one thing we can take away from the pandemic, it's that the world was not prepared for it. The need to shut down the economy, force people to stay at home, and institute mandatory mask-wearing in public has led to a drastic change in our habits. Mask shortages, hand sanitizer shortages, and shortages of various sorts have been rampant as we adapt to new changes in daily life.

Marc Andressen, a prominent venture capitalist, wrote a manifesto that took the internet by storm. His manifesto, IT'S TIME TO BUILD, brings to light that we have been warned numerous times about how vulnerable our society is to disease, and despite that, we chose not to prepare. 

Before diving deep into Marc Andressen's manifesto, I've found that some people have criticized him for being a hypocrite for what he's writing. They mention things like how he spends his time with startups that provide little to society. People have frequently mentioned Clubhouse as one of the many startups that Andressen involves himself with and that provides little to society. In my view, I find that there might be ways that Clubhouse could provide value to society but because they currently have very few users, they're very exclusive, and they don't seem to be creating technology that one would label as 10X, then I do understand why people might question Andressen's credibility. At the same time, there might be more things happening in the background that we might not know about.

In his manifesto, Andressen mentions the shortages happening in the healthcare sector, the sector that is doing its best to save the world from the virus:

We don’t have enough coronavirus tests, or test materials — including, amazingly, cotton swabs and common reagents. We don’t have enough ventilators, negative pressure rooms, and ICU beds. And we don’t have enough surgical masks, eye shields, and medical gowns

Because demand for ICU rooms, PPE, and ventilators have been abnormal during these times, many manufacturers weren't prepared to supply the world with those items when the virus struck. Also, because the virus is relatively new to the world, we couldn't immediately create products that we can use to test people. We needed time to find ways to properly test people for the virus. 

Interestingly, Andressen mentions this:

We also don’t have therapies or a vaccine — despite, again, years of advance warning about bat-borne coronaviruses.

This is a great point that Andressen brings up and is great evidence that backs up his original claim, that we haven't been preparing despite the numerous warnings we had. A justification I can think of regarding our lack of preparation is that because every virus is different, scientists couldn't exactly protect ourselves from bat-borne coronaviruses. 

Andressen further mentions how we might not have enough factories to produce the vaccine and that regulatory approval for vaccines will take years, costing many lives in the process. In my view, I find that the safety and efficacy of a vaccine are more important than the speed of getting the vaccine deployed. If we release a vaccine that doesn't do any good or bad to us or even worse, a vaccine that makes us sick or more vulnerable to the virus, then the consequences will be a lot bigger than the consequences of waiting for a proper vaccine. 

Apart from this, with the mass unemployment happening in the world, Andressen criticizes the government for not preparing for worst-case scenarios like what we're currently experiencing. The $600 in unemployment benefits, which has helped many families survive periods of unemployment, already expired in August, helping families get through five months of unemployment. As the $600 in benefits expires, many people that are unemployed are struggling at a whole new level. 

To talk more about the failure of the government's efforts to help struggling Americans, Andressen writes:

A government that collects money from all its citizens and businesses each year has never built a system to distribute money to us when it’s needed most.

 In other words, many businesses and people are struggling during these hard times and despite all the money we pay in taxes to the government, the government hasn't been using most of it to help struggling Americans at their most vulnerable state. There are many ways to interpret this. One might say that the government was being irresponsible with our tax money the whole time. Another might say that because the government is choosing to not get involved with businesses and the economy, it's choosing to remain a capitalistic government.

While I do want the government to get involved and help the people and businesses struggling during the pandemic, I don't want people to continue to think that the government will keep going out of their way to save them in times of need. As Americans, we need to also help ourselves prepare for the bad times. Instead of spending cash and raising debt to fund share buybacks, companies should start saving that cash and also use that to fund innovation. Instead of spending your whole paycheck and getting in debt to finance frivolous purchases like fancy cars and extravagant vacations, save that money for a rainy day and avoid getting in debt as well. Not only should the government do its part to help the American people in times of need but we as Americans should also prepare for calamities. 

While Andressen has been using the concept to convey our lack of preparation for the virus, Andressen also applies the concept towards the many other problems plaguing America. One problem that has been plaguing America for a long time has been the lack of affordable housing. Andressen describes:

We can’t build nearly enough housing in our cities with surging economic potential — which results in crazily skyrocketing housing prices in places like San Francisco, making it nearly impossible for regular people to move in and take the jobs of the future. We also can’t build the cities themselves anymore.

Places like Silicon Valley are experiencing a housing crisis as those places continue to experiencing surging economic growth. Meanwhile, because there isn't enough housing being built, housing costs have skyrocketed. This phenomenon is unsustainable and at some point, Silicon Valley and other places with a housing crisis won't be able to accommodate more employees and continued economic growth. 

In addition, Andressen also applies the concept of building to solving the student loan and education crisis. As the demand for higher education increases, tuition costs are increasing. Also, education services are receiving more demand as more people pursue an education. Because of that, education resources are being strained. Andressen mentions: 

We have top-end universities, yes, but with the capacity to teach only a microscopic percentage of the 4 million new 18 year olds in the U.S. each year, or the 120 million new 18 year olds in the world each year. Why not educate every 18 year old? Isn’t that the most important thing we can possibly do? Why not build a far larger number of universities, or scale the ones we have way up? 

We know one-to-one tutoring can reliably increase education outcomes by two standard deviations (the Bloom two-sigma effect); we have the internet; why haven’t we built systems to match every young learner with an older tutor to dramatically improve student success?

First, Andressen wants to standardize higher quality education for universities. That's why he wants the top universities to increase their capacity. He might even want to go further as to have higher education be the new standard of basic education. While that will be more expensive for governments and institutions, it also reduces the value of higher education. 

Second, while it will be hard to match every young learner with an older tutor, with the internet, it is possible to do that. Tutoring is really expensive and that's because their skills are very valuable and there is a low supply of tutors at schools. While schools hire tutors and provide their services for free to students, because there aren't enough tutors, it can be hard for students to get tutoring. By finding ways to boost the supply of tutoring, more students will succeed in school. 

Andressen's manifesto takes an interesting approach to manufacturing. While mentioning that manufacturing output in America is higher than ever, he mentions how globalism has made the country more dependent and vulnerable to other nations. Andressen says:

We know how to build highly automated factories. We know the enormous number of higher paying jobs we would create to design and build and operate those factories. We know — and we’re experiencing right now! — the strategic problem of relying on offshore manufacturing of key goods.

He brings up a great point on how investing more in manufacturing onshore rather than offshore can create more jobs. Since we have the knowledge and the technology to create factories that are more efficient, we will no longer need to rely on offshore manufacturing and we can start relying on our own manufacturing prowess to meet the demand for the things we need most like face masks. 

After describing the need to build more factories, Andressen says:

Where are the supersonic aircraft? Where are the millions of delivery drones? Where are the high speed trains, the soaring monorails, the hyperloops, and yes, the flying cars?

Andressen brings up a great point. Many have that question as well. When you ask people from the mid and late 1900s on how they see America and the world looking like in the future, people will say that it will look like a sci-fi world. Currently, America doesn't look like a sci-fi world.

Why is it that America doesn't look like a sci-fi world? Is it money? According to Andressen, the lack of money is not a problem when it comes to innovation. With the bailouts of insolvent businesses, the wars waged across the globe, and the stimulus packages being passed by the government, it looks like money isn't an issue for the world.

According to Andressen, the reason why we don't live in a sci-fi world is that we don't have the desire to go above and beyond. We are comfortable with where we are and what we have and we aren't placing huge importance on breath-taking innovations. Instead of allowing greed and power to influence our decisions, we should start allowing the importance of innovation to control us. Instead of allocating capital towards share buybacks, companies should start allocating capital towards research and development. Politicians should start supporting innovation, not go against it. 

To combat the high prices of many things, Andressen suggests increasing the supply of something. 

The things we build in huge quantities, like computers and TVs, drop rapidly in price. The things we don’t, like housing, schools, and hospitals, skyrocket in price.

This concept is what he says will help lower healthcare costs, education costs, housing costs, and lower the costs of many other things. While it is hard to implement, it will help make society better. 

Altogether, Andressen has written a great manifesto about the need to build more things in order to make the world a better place. Without desire, we wouldn't be able to accelerate the development of a better future. I do agree with many of Andressen's solutions because they sound logically sound and the laws of economics do support it.

However, I do find issues with his claims.

I find that the reason why we can't build more is because of government regulations. In Silicon Valley, government regulations have prevented homebuilders from being able to build more housing. These regulations have not only increased the cost to build housing but have also limited the number of land homebuilders can build on. By reducing regulations for housing, the housing problem in Silicon Valley can be alleviated.

You can read more about the many other issues with Andressen's manifesto here. 

Andressen's manifesto has been really inspiring and I can't wait to see what the many future leaders of the world will do with the inspiration they gained from reading it.