Oct 27 • 2HR 26M

Brian Potter - Future of Construction, Ugly Modernism, & Environmental Review

Why construction isn’t getting cheaper and faster, Environmental review makes new construction expensive and delayed, “Ugly” modern buildings are the result of better architecture, And much more!

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Appears in this episode

Dwarkesh Patel
Host Dwarkesh Patel interviews intellectuals, scientists, and founders about their big ideas. YouTube: https://www.youtube.com/DwarkeshPatel Apple Podcasts: https://apple.co/3oBack9 Spotify: https://spoti.fi/3S5g2YK
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Brian Potter is the author of the excellent Construction Physics blog, where he discusses why the construction industry has been slow to industrialize and innovate.

He explains why:

  • Construction isn’t getting cheaper and faster,

  • We should have mile-high buildings and multi-layer non-intersecting roads,

  • “Ugly” modern buildings are simply the result of better architecture,

  • China is so great at building things,

  • Saudi Arabia’s Line is a waste of resources,

  • Environmental review makes new construction expensive and delayed,

  • and much much more!

Watch on YouTube. Listen on Apple Podcasts, Spotify, or any other podcast platform. Read the full transcript here.

Follow me on Twitter for updates on future episodes.

More really cool guests coming up; subscribe to find out about future episodes!

You may also enjoy my interviews with Tyler Cowen (about talent, collapse, & pessimism of sex). Charles Mann (about the Americas before Columbus & scientific wizardry), and Austin Vernon about (Energy Superabundance, Starship Missiles, & Finding Alpha).

If you end up enjoying this episode, I would be super grateful if you share it, post it on Twitter, send it to your friends & group chats, and throw it up wherever else people might find it. Can’t exaggerate how much it helps a small podcast like mine.

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A huge thanks to Graham Bessellieu for editing this podcast and Mia Aiyana for producing its transcript.

Timestamps

(0:00) - Why Saudi Arabia’s Line is Insane, Unrealistic, and Never going to Exist 

(06:54) - Designer Clothes & eBay Arbitrage Adventures 

(10:10) - Unique Woes of The Construction Industry  

(19:28) - The Problems of Prefabrication 

(26:27) - If Building Regulations didn’t exist… 

(32:20) - China’s Real Estate Bubble, Unbound Technocrats, & Japan

(44:45) - Automation and Revolutionary Future Technologies 

(1:00:51) - 3D Printer Pessimism & The Rising Cost of Labour

(1:08:02) - AI’s Impact on Construction Productivity

(1:17:53) - Brian Dreams of Building a Mile High Skyscraper

(1:23:43) - Deep Dive into Environmentalism and NEPA

(1:42:04) - Software is Stealing Talent from Physical Engineering

(1:47:13) - Gaps in the Blog Marketplace of Ideas

(1:50:56) - Why is Modern Architecture So Ugly?

(2:19:58) - Advice for Aspiring Architects and Young Construction Physicists

Transcript

Why Saudi Arabia’s Line is Insane, Unrealistic, and Never going to Exist 

Dwarkesh Patel 

Today, I have the pleasure of speaking with Brian Potter, who is an engineer and the author of the excellent Construction Physics blog, where he writes about how the construction industry works and why it has been slow to industrialize and innovate. It's one of my favorite blogs on the internet, and I highly, highly recommend that people check it out. Brian, my first question is about The Line project in Saudi Arabia. What are your opinions? 

Brian Potter 

It's interesting how Saudi Arabia and countries in the Middle East, in general, are willing to do these big, crazy, ambitious building projects and pour huge amounts of money into constructing this infrastructure in a way that you don't see a huge amount in the modern world. China obviously does this too in huge amounts, some other minor places do as well, but in general, you don't see a whole lot of countries building these big, massive, incredibly ambitious projects. So on that level, it's interesting, and it's like, “Yes, I’m glad to see that you're doing this,” but the actual project is clearly insane and makes no sense. 

Look at the physical arrangement layout–– there's a reason cities grow in two dimensions. A one-dimensional city is the worst possible arrangement for transportation. It’s the maximum amount of distance between any two points. So just from that perspective, it's clearly crazy, and there's no real benefit to it other than perhaps some weird hypothetical transportation situation where you had really fast point-to-point transportation. It would probably be some weird bullet train setup; maybe that would make sense. But in general, there's no reason to build a city like that. Even if you wanted to build an entirely enclosed thing (which again doesn't make a huge amount of sense), you would save so much material and effort if you just made it a cube. I would be more interested in the cube than the line. [laughs] But yeah, those are my initial thoughts on it. I will be surprised if it ever gets built. 

Dwarkesh Patel 

Are you talking about the cube from the meme about how you can put all the humans in the world in a cube the size of Manhattan

Brian Potter 

Something like that. If you're just going to build this big, giant megastructure, at least take advantage of what that gets you, which is minimum surface area to volume ratio.

Dwarkesh Patel 

Why is that important? Would it be important for temperature or perhaps other features? 

Brian Potter 

This is actually interesting because I'm actually not sure how sure it would work with a giant single city. In general, a lot of economies of scale come from geometric effects. When something gets bigger, your volume increases a lot faster than your surface area does. So for something enclosed, like a tank or a pipe, the cost goes down per thing of unit you're transporting because you can carry a larger amount or a smaller amount of material. It applies to some extent with buildings and construction because the exterior wall assembly is a really burdensome, complicated, and expensive assembly. 

A building with a really big floor plate, for instance, can get more area per unit, per amount of exterior wall. I'm not sure how that actually works with a single giant enclosed structure because, theoretically, on a small level, it would apply the same way. Your climate control is a function of your exterior surface, at some level, and you get more efficient climate control if you have a larger volume and less area that it can escape from. But for a giant city, I actually don't know if that works, and it may be worse because you're generating so much heat that it's now harder to pump out. For examples like the urban heat island effect, where these cities generate massive amounts of waste heat, I don't know if that would work if it didn't apply the same way. I'm trying to reach back to my physics classes in college, so I'm not sure about the actual mechanics of that. Generally though, that's why you'd want to perhaps build something of this size and shape. 

Dwarkesh Patel 

What was the thought process behind designing this thing? Because Scott Alexander had a good blog post about The Line where he said, presumably, that The Line is designed to take up less space and to use less fuel because you can just use the same transportation across. But the only thing that Saudi Arabia has is space and fuel. So what is the thought process behind this construction project? 

Brian Potter

I get the sense that a lot of committees have some amount of success in building big, impressive, physical construction projects that are an attraction just by virtue of their size and impressiveness. A huge amount of stuff in Dubai is something in this category, and they have that giant clock tower in Jeddah, the biggest giant clock building and one of the biggest buildings in the world, or something like that. I think, on some level, they're expecting that you would just see a return from building something that's really impressive or “the biggest thing on some particular axis”. So to some extent, I think they're just optimizing for big and impressive and maybe not diving into it more than that. 

There's this theory that I think about every so often. It's called the garbage can theory of organizational decision-making, which basically talks about how the choices that organizations make are not the result of any particular recent process. They are the result of how, whenever a problem comes up, people reach into the garbage can of potential solutions. Then whatever they pull out of the garbage can, that's the decision that they end up going with, regardless of how much sense it makes. It was a theory that was invented by academics to describe decision-making in academia. I think about that a lot, especially with reference to big bureaucracies and governments. You can just imagine the draining process of how these decisions evolve. Any random decision can be made, especially when there's such a disconnect between the decision-makers and technical knowledge.

Designer Clothes & eBay Arbitrage Adventures 

Dwarkesh Patel

Tell me about your eBay arbitrage with designer clothes. 

Brian Potter 

Oh man, you really did dive deep. Yeah, so this was a small business that I ran seven or eight years ago at this point. A hobby of mine was high-end men's fashion for a while, which is a very strange hobby for an engineer to have, but there you go. That hobby centers around finding cheap designer stuff, because buying new can be overwhelmingly expensive. However, a lot of times, you can get clothes for a very cheap price if you're even a little bit motivated. Either it shows up on eBay, or it shows up in thrift stores if you know what to look for. A lot of these clothes can last because they're well-made. They last a super, super, super long time–– even if somebody wore it for 10 years or something, it could be fine. So a lot of this hobby centered around finding ways to get really nice clothes cheaply. 

Majority of it was based around eBay, but it was really tedious to find really nice stuff on eBay. You had to manually search for a bunch of different brands, filter out the obviously bad ones, search for typos in brands, put in titles, and stuff like that. I was in the process of doing this, and I thought, “Oh, this is really annoying. I should figure out a way to automate this process.” So I made a very simple web app where when you searched for shoes or something, it would automatically search the very nice brands of shoes and all the typos of the brand name. Then it would just filter out all the junk and let you search through the good stuff. I set up an affiliate system, basically. So anybody else that used it, I would get a kick of the sales. While I was interested in that hobby, I ran this website for a few years, and it was reasonably successful. It was one of the first things I did that got any real traction on the internet, but it was never successful in proportion to how much effort it took to maintain and update it. So as I moved away from the hobby, I eventually stopped putting time and effort into maintaining the website. I'm curious as to how you even dug that up. 

Dwarkesh Patel 

I have a friend who was with you at the Oxford Refugees Conference, Connor Tabarrok. I don't know if you remember him. 

Brian Potter 

Nice. 

Dwarkesh Patel 

Yeah. Finding other information about you on the internet was quite difficult actually. You’ve somehow managed to maintain your anonymity. If you're willing to reveal, what was the P&L of this project? 

Brian Potter 

Oh, it made maybe a few hundred dollars a month for a few years, but I only ever ran it as a side hobby business, basically. So in terms of time per my effort or whatever, I'm sure it was very low. Pennies to an hour or something like that. 

Unique Woes of The Construction Industry   

Dwarkesh Patel 

A broad theme that I've gotten from your post is that the construction industry is plagued with these lossy feedback loops, a lack of strong economies of scale, regulation, and mistakes being very costly. Do you think that this is a general characteristic of many industries in our world today, or is there something unique about construction? 

Brian Potter 

Interesting question. One thing you think of is that there are a lot of individual factors that are not unique at all. Construction is highly regulated, but it's not necessarily more regulated than medical devices or jet travel, or even probably cars, to some extent, which have a whole vat of performance criteria they need to hit. With a couple of things like land use, for example, people say, “Oh, the land requirements, could you build it on-site,” explaining how those kinds of things make it difficult. But there is a lot that falls into this category that doesn't really share the same structure of how the construction industry works.

I think it's the interaction of all those effects. One thing that I think is perhaps underappreciated is that the systems of a building are really highly coupled in a way that a lot of other things are. If you're manufacturing a computer, the hard drive is somewhat independent from the display and somewhat independent from the power supply. These things are coupled, but they can be built by independent people who don't necessarily even talk to each other before being assembled into one structured thing. A building is not really like that at all. Every single part affects every single other part. In some ways, it's like biology. So it's very hard to change something that doesn't end up disrupting something else. Part of that is because a job’s building is to create a controlled interior environment, meaning, every single system has to run through and around the surfaces that are creating that controlled interior. Everything is touching each other. Again, that's not unique. Anything really highly engineered, like a plane or an iPhone, share those characteristics to some extent. In terms of the size of it and the relatively small amount you're paying in terms of unit size or unit mass, however, it's quite low. 

Dwarkesh Patel 

Is transportation cost the fundamental reason you can't have as much specialization and modularity?

Brian Potter 

Yeah, I think it's really more about just the way a building is. An example of this would be how for the electrical system of your house, you can't have a separate box where if you needed to replace the electrical system, you could take the whole box out and put the new box in. The electrical system runs through the entire house. Same with plumbing. Same with the insulation. Same with the interior finishes and stuff like that. There's not a lot of modularity in a physical sense. 

Dwarkesh Patel 

Gotcha. Ben Kuhn  had this interesting comment on your article where he pointed out that many of the reasons you give for why it's hard to innovate in construction, like sequential dependencies and the highly variable delivery timelines are also common in software where Ben Koon works. So why do you think that the same sort of stagnation has not hit other industries that have superficially similar characteristics, like software? 

Brian Potter 

How I think about that is that you kind of see a similar structure in anything that's project-based or anything where there's an element of figuring out what you're doing while you're doing it. Compared to a large-scale manufacturing option where you spend a lot of time figuring out what exactly it is that you're building. You spend a lot of time designing it to be built and do your first number of runs through it, then you tweak your process to make it more efficient. There's always an element of tweaking it to make it better, but to some extent, the process of figuring out what you're doing is largely separate from the actual doing of it yourself. 

For a project-based industry, it's not quite like that. You have to build your process on the fly. Of course, there are best practices that shape it, right? For somebody writing a new software project or anything project-based, like making a movie, they have a rough idea for how it's going to go together. But there's going to be a lot of unforeseen things that kind of come up like that. The biggest difference is that either those things can often scale in a way that you can't with a building. Once you're done with the software project, you can deploy it to 1,000 or 100,000, or 1 million people, right? Once you finish making a movie, 100 million people can watch it or whatever. It doesn't quite look the same with a building. You don't really have the ability to spend a lot of time upfront figuring out how this thing needs to go. You kind of need to figure out a way to get this thing together without spending a huge amount of time that would be justified by the sheer size of it. I was able to dig up a few references for software projects and how often they just have these big, long tails. Sometimes they just go massively, massively over budget. A lot of times, they just don't get completed at all, which is shocking, but because of how many people it can then be deployed to after it's done, the economics of it are slightly different. 

Dwarkesh Patel 

I see, yeah. There's a famous law in software that says that a project will take longer than you expect even after you recount for the fact that it will take longer than you expect. 

Brian Potter 

Yeah. Hofstadter's law or something like that is what I think it is. 

Dwarkesh Patel 

Yeah. I'm curious about what the lack of skill in construction implies for startups. Famously, in software, the fact that there's zero marginal cost to scaling to the next customer is a huge boon to a startup, right? The entire point of which is scaling exponentially. Does that fundamentally constrain the size and quantity of startups you can have in construction if the same scaling is not available?

Brian Potter 

Yeah, that's a really good question. The obvious first part of the answer is that for software, obviously, if you have a construction software company, you can scale it just like any other software business. For physical things, it is a lot more difficult. This lack of zero marginal cost has tended to fight a lot of startups, not just construction ones. But yeah, it's definitely a thing. Construction is particularly brutal because the margins are so low. The empirical fact is that trying what would be a more efficient method of building doesn't actually allow you to do it cheaper and get better margins. The startup that I used to work at, Katerra, their whole business model was basically predicated on that. “Oh, we'll just build all our buildings in these big factories, get huge economies of scale, reduce our costs, and then recoup the billions of dollars that we're pumping into this industry or business.” The math just does not work out. You can't build. In general, you can't build cheap enough to kind of recoup those giant upfront costs. A lot of businesses have been burned that way. 

The most success you see in prefabrication type of stuff is on the higher end of things where you can get higher margins. A lot of these prefab companies and stuff like that tend to target the higher end of the market, and you see a few different premiums for that. Obviously, if you're targeting the higher end, you’re more likely to have higher margins. If you're building to a higher level of quality, that's easier to do in a factory environment. So the delta is a lot different, less enormous than it would be. Building a high level of quality is easier to do in a factory than it is in the field, so a lot of buildings or houses that are built to a really high level of energy performance, for instance, need a really, really high level of air sealing to minimize how much energy this house uses. You tend to see a lot more houses like that built out of prefab construction and other factory-built methods because it's just physically more difficult to achieve that on-site. 

The Problems of Prefabrication 

Dwarkesh Patel 

Can you say more about why you can't use prefabrication in a factory to get economies of scale? Is it just that the transportation costs will eat away any gains you get? What is going on? 

Brian Potter

There's a combination of effects. I haven't worked through all this, we’ll have to save this for the next time. I'll figure it out more by then. At a high level, it’s that basically the savings that you get from like using less labor or whatever is not quite enough to offset your increased transportation costs. One thing about construction, especially single-family home construction, is that a huge percentage of your costs are just the materials that you're using, right? A single-family home is roughly 50% labor and 50% materials for the construction costs. Then you have development costs, land costs, and things like that. So a big chunk of that, you just can't move to the factory at all, right?  You can't really build a foundation in a factory. You could prefab the foundation, but it doesn't gain you anything. Your excavation still has to be done on-site, obviously. So a big chunk can't move to the factory at all. 

For ones that can, you still basically have to pay the same amount for materials. Theoretically, if you're building truly huge volume, you could get material volume discounts, but even then, it's probably not looking at things like asset savings. So you can cut out a big chunk of your labor costs, and you do see that in factory-built construction, right? These prefab companies are like mobile home companies. They have a small fraction of labor as their costs, which is typical of a factory in general, but then they take out all that labor cost while they still have their high material costs, and then they have overhead costs of whatever the factory has cost them. Then you have your additional overhead cost of just transporting it to site, which is pretty limited. The math does not really work out in favor of prefab, in terms of being able to make the cost of building dramatically cheaper. You can obviously build a building in a prefab using prefab-free methods and build a successful construction business, right? Many people do. But in terms of dramatically lowering your costs, you don't really see that. 

Dwarkesh Patel 

Yeah, yeah. Austin Vernon has an interesting blog post about why there's not more prefabricated homes. The two things he points out were transportation costs, and the other one was that people prefer to have homes that have unique designs or unique features. When I was reading it, it actually occurred to me that maybe they're actually both the result of the same phenomenon. I don't know if I'm pronouncing it correctly, but have you heard of the Alchian-Allen theorem in economics? 

Brian Potter 

Maybe, but I don't think so. 

Dwarkesh Patel 

Basically, it's the idea that if you increase the cost of some category of goods in a fixed way––let's say you tax oranges and added a $1 tax to all oranges, or transportation for oranges gets $1 more expensive for all oranges––people will shift consumption towards the higher grade variety because now, the ratio of the cost between the higher, the more expensive orange and the less expensive orange has decreased because of the increase in fixed costs. It seems like you could use that argument to also explain why people have strong preferences for uniqueness and all kinds of design in manufactured houses. Since transportation costs are so high, that's basically a fixed cost, and that fixed cost has the effect of making people shift consumption towards higher-grade options. I definitely think that's true. 

Brian Potter

I would maybe phrase this as, “The construction industry makes it relatively comparatively cheap to deliver a highly customized option compared to a really repetitive option.” So yeah, the ratio between a highly customized one and just a commodity one is relatively small. So you see a kind of industry built around delivering somewhat more customized options. I do think that this is a pretty broad intuition that people just desire too much customization from their homes. That really prevents you from having a mass-produced offering. I do think that is true to some extent. One example is the Levittown houses, which were originally built in huge numbers–– exactly the same model over and over again. Eventually, they had to change their business model to be able to deliver more customized options because the market shipped it. I do think that the effect of that is basically pretty overstated. 

Empirically, you see that in practice, home builders and developers will deliver fairly repetitive housing. They don't seem to have a really hard time doing that. As an example, I'm living in a new housing development that is just like three or four different houses copy-pasted over and over again in a group of 50. The developer is building a whole bunch of other developments that are very similar in this area. My in-laws live in a very similar development in a whole different state. If you just look like multi-family or apartment housing, it's identical apartments, you know, copy-pasted over and over again in the same building or a bunch of different buildings in the same development. You're not seeing huge amounts of uniqueness in these things. People are clearly willing to just live in these basically copy-pasted apartments. 

It's also quite possible to get a pretty high amount of product variety using a relatively small number of factors that you vary, right? I mean, the car industry is like this, where there are enough customization options. I was reading this book a while ago that was basically pushing back against the idea that the car industry pre-fifties and sixties we just offering a very uniform product. They basically did the math, and the number of customization options on their car was more than the atoms in the universe. Basically just, there are so many different options. All the permutations, you know, leather seats and this type of stereo and this type of engine, if you add it all up, there's just a huge, massive number of different combinations. Yeah, you can obviously customize the house a huge amount, just by the appliances that you have and the finishes that are in there and the paint colors that you choose and the fixtures and stuff like that. It would not really theoretically change the underlying way the building comes together. So regarding the idea that the fundamental demand for variety is a major obstruction, I don’t think there's a whole lot of evidence for that in the construction industry. 

If Construction Regulation Vanished… 

Dwarkesh Patel 

I asked Twitter about what I should ask you, and usually, I don't get interesting responses but the quality of the people and the audience that knows who you are was so high that actually, all the questions I got were fascinating. So I'm going to ask you some questions from Twitter. 

Brian Potter 

Okay. 

Dwarkesh Patel 0:26:45

Connor Tabarrok asks, “What is the most unique thing that would or should get built in the absence of construction regulation?”

Brian Potter 

Unique is an interesting qualifier. There are a lot of things that just like should get built, right? Massive amounts of additional housing and creating more lands in these really dense urban environments where we need it, in places like San Francisco–– just fill in a big chunk of that bay. It's basically just mud flat and we should put more housing on it. “Unique thing” is more tricky. One idea that I really like (I read this in the book, The Book Where's My Flying Car),  is that it's basically crazy that our cities are designed with roads that all intersect with each other. That's an insane way to structure a material flow problem. Any sane city would be built with multiple layers of like transportation where each one went in a different direction so your flows would just be massively, massively improved. That just seems like a very obvious one.

If you're building your cities from scratch and had your druthers, you would clearly want to build them and know how big they were gonna get, right? So you could plan very long-term in a way that so these transportation systems didn’t intersect with each other, which, again, almost no cities did. You’d have the space to scale them or run as much throughput through them as you need without bringing the whole system to a halt. There's a lot of evidence saying that cities tend to scale based on how much you can move from point A to point B through them. I do wonder whether if you changed the way they went together, you could unlock massively different cities. Even if you didn't unlock massive ones, you could perhaps change the agglomeration effects that you see in cities if people could move from point A to point B much quicker than they currently can. 

Dwarkesh Patel 

Yeah, I did an episode about the book, where's my flying car with Rohit Krishnan. I don't know if we discussed this, but an interesting part of the book is where he talks about transistor design. If you design transistors this way, can you imagine how slow they would be? [laughs] Okay, so Simon Grimm asks, “What countries are the best at building things?”

Brian Potter 

This is a good question. I'm going to sort of cheat a little bit and do it in terms of space and time, because I think most countries that are doing a good job at building massive amounts of stuff are not ones that are basically doing it currently.The current answer is like China, where they just keep building–– more concrete was used in the last 20 years or so than the entire world used in the time before that, right? They’ve accomplished massive amounts of urbanization, and built a lot of really interesting buildings and construction. In terms of like raw output, I would also put Japan in the late 20th century on there. At the peak of the concern and wonder of “Is Japan gonna take over the world?”, they were really interested in building stuff quite quickly. They spent a lot of time and effort trying to use their robotics expertise to try to figure out how to build buildings a lot more quickly. They had these like really interesting factories that were designed to basically extrude an entire skyscraper just going up vertically.

All these big giant companies and many different factories were trying to develop and trying to do this with robotics. It was a really interesting system that did not end up ever making economic sense, but it is very cool. I think big industrial policy organs of the government basically encouraged a lot of these industrial companies to basically develop prefabricated housing systems. So you see a lot of really interesting systems developed from these sort of industrial companies in a way that you don't see in a lot of other places. From 1850 to maybe 1970 (like a hundred years or something), the US was building huge massive amounts of stuff in a way that lifted up huge parts of the economy, right? I don't know how many thousands of miles of railroad track the US built between like 1850 and 1900, but it was many, many, many thousands of miles of it. 

Ofcourse, needing to lay all this track and build all these locomotives really sort of forced the development of the machine tool industry, which then led to the development of like better manufacturing methods and interchangeable parts, which of course then led to the development of the automotive industry. Then ofcourse, that explosion just led to even more big giant construction projects. So you really see that this ability to build just big massive amounts of stuff in this virtuous cycle with the US really advanced a lot of technology to raise the standard of development for a super long period of time. So those are my three answers. 

China’s Real Estate Bubble, Unbound Technocrats, and Japan

Dwarkesh Patel 

Those three bring up three additional questions, one for each of them! That's really interesting. Have you read The Power Broker, the book about Robert Moses

Brian Potter 

I think I got a 10th of the way through it. 

Dwarkesh Patel 

That's basically a whole book in itself, a 10th of the way. [laughs] I'm a half of the way through, and so far it's basically about the story of how this one guy built a startup within the New York state government that was just so much more effective at building things, didn't have the same corruption and clientelism incompetence. Maybe it turns into tragedy in the second half, but so far it's it seems like we need this guy. Where do we get a second Robert Moses? Do you think that if you had more people like that in government or in construction industries, public works would be more effectively built or is the stagnation there just a result of like other bigger factors? 

Brian Potter 

That's an interesting question. I remember reading this article a while ago that was complaining about how horrible Penn Station is in New York. They're basically saying, “Yeah, it would be nice to return to the era of like the sort of unbound technocrat” when these technical experts in high positions of power in government could essentially do whatever they wanted to some extent. If they thought something should be built somewhere, they basically had the power to do it. It's a facet of this problem of how it's really, really hard to get stuff built in the US currently. I'm sure that a part of it is that you don't see these really talented technocrats occupy high positions of government where they can get stuff done. But it's not super obvious to me whether that's the limiting factor. I kind of get the sense that they would end up being bottlenecked by some other part of the process. The whole sort of interlocking set of institutions has just become so risk averse that they would end up just being blocked in a way that they wouldn't when they were operating in the 1950s or 1960s.

Dwarkesh Patel 

Yeah, yeah, that's interesting. All right, so speaking of Japan, I just recently learned about the construction there and how they just keep tearing stuff down every 30 to 40 years and rebuilding it. So you have an interesting series of posts on how you would go about building a house or a building that lasts for a thousand years. But I'm curious, how would you build a house or a building that only lasts for 30 or 40 years? If you're building in Japan and you know they're gonna tear it down soon, what changes about the construction process? 

Brian Potter 

Yeah, that's interesting. I mean, I'm not an expert on Japanese construction, but I think like a lot of their interior walls are basically just paper and stuff like that. I actually think it's kind of surprising that last time I looked, for a lot of their homes, they use a surprising post and beam construction method, which is actually somewhat labor-intensive to do. The US in the early 1800s used a pretty similar method. Then once we started mass producing conventional lumber, we stopped doing that because it was much cheaper to build out of two-by-fours than it was to build big heavy posts. I think the boring answer to that question is that we’d build like how we build mobile homes–– essentially just using pretty thin walls, pretty low-end materials that are put together in a minimal way. This ends up not being that different from the actual construction method that single-family homes use. It just even further economizes and tightens the use of materials–– where a single-family home might use a half inch plywood, they might try to use three-sixteenths or even an eighth inch plywood or something like that. So we’d probably build a pretty similar way to the way most single-family homes and multi-family homes are built currently, but just with even tighter use of materials which perhaps is something that's not super nice about the way that you guys build your homes. But... [laughs]

Dwarkesh Patel 

Okay, so China is the third one here. There's been a lot of talk about a potential real estate bubble in China because they're building housing in places where people don't really need it. Of course, maybe the demographics aren't there to support the demand. What do you think of all this talk? I don't know if you're familiar with it, but is there a real estate bubble that's created by all this competence in building? 

Brian Potter

Oh, gosh, yeah, I have no idea. Like you, I've definitely heard talk of it and I've seen the little YouTube clips of them knocking down all these towers that it turns out they didn't need or the developer couldn't, finish or whatever. I don't know a huge amount about that. In general, I wish I knew a lot more about how things are built in China, but the information is in general, so opaque. I generally kind of assume that any particular piece of data that comes out of China has giant error bars on it as to whether it's true or not or what the context surrounding it is. So in general, I do not have a hard opinion about that. 

Dwarkesh Patel 

This is the second part of Simon's question, does greater competence and being able to build stuff translate into other good outcomes for these countries like higher GDP or lower rents or other kinds of foreign outcomes? 

Brian Potte

That's a good question. Japan is an interesting place where basically people point to it as an example of, “Here's a country that builds huge amounts of housing and they don't have housing cost increases.” In general, we should expect that dynamic to be true. Right? There's no reason to not think that housing costs are essentially a supply-demand problem where if you built as much as people wanted, the cost would drop. I have no reason to not think that's true. There is a little bit of evidence that sort of suggests that it’s impossible to build housing enough to overcome this sort of mechanical obstacle where the cost of it tends to match and rise to whatever people's income level are. The peak and the sort of flattening of housing costs in Japan also parallel when people basically stopped getting raises and income stopped rising in Japan. So I don't have a good sense of, if it ends up being just more driven by some sort of other factors. Generally though I expect the very basic answer of “If you build a lot more houses, the housing will become cheaper.”

Dwarkesh Patel

Right. Speaking of how the land keeps gaining value as people's income go up, what is your opinion on Georgism? Does that kind of try and make you think that housing is a special asset that needs to be more heavily taxed because you're not inherently doing something productive just by owning land the way you would be if you like built a company or something similar?

Brian Potter 

I don't have any special deep knowledge of Georgism. It's on my list of topics to read more deeply about. I do think in general, taxing encourages you to produce less of something for something that you can't produce less of. It's a good avenue for something to tax more heavily. And yeah, obviously if you had a really high land value tax in these places that have a lot of single-family homes in dense urban areas, like Seattle or San Francisco, that would probably encourage people to use the land a lot more efficiently. So it makes sense to me, but I don't have a ton of special knowledge about it. 

Dwarkesh Patel 

All right, Ben Kuhn asked on Twitter, “What construction-related advice would you give to somebody building a new charter city?”

Brian Potter 

That is interesting. I mean, just off the top of my head, I would be interested in whether you could really figure out a way to build using a method that had really high upfront costs. I think it could otherwise be justified, but if you're gonna build 10,000 buildings or whatever all at once, you could really take advantage of that. One kind of thing that you see in the sort of post-World War II era is that we're building huge massive amounts of housing, and a lot of times we’re building them all in one place, right? A lot of town builders were building thousands and thousands of houses in one big development all at once. In California, it’s the same thing, you just built like 6 or 10 or 15,000 houses in one big massive development. You end up seeing something like that where they basically build this like little factory on their construction site, and then use that to like fabricate all these things. 

Then you have something that’s almost like a reverse assembly line where a crew will go to one house and install the walls or whatever, and then go to the next house and do the same thing. Following right behind them would be the guys doing the electrical system, plumbing, and stuff like that. So this reverse assembly line system would allow you to sort of get these things up really, really fast, in 30 days or something like that. Then you could have a whole house or just thousands and thousands of houses at once. You would want to be able to do something similar where you could just not do the instruction the way that the normal construction is done, but that's hard, right? 

Centrally planned cities or top-down planned cities never seem to do particularly well, right? For example, the city of Brasilia, the one that was supposed to be a planned city— the age it goes back to the unfettered technocrat who can sort of build whatever he wants. A lot of times, what you want is something that will respond at a low level and organically sort out the factories as they develop. You don't want something that's totally planned from the top-down, that's disconnected from all the sorts of cases on the ground. A lot of the opposition to Robert Moses ended up being that in a certain form, right? He's bulldozing through these cities that are these buildings and neighborhoods that he's not paying attention to at all. So I think, just to go back to the question, trying to plan your city from the top down doesn't have a super, super great track record. In general, you want your city to develop a little bit more organically. I guess I would think to have a good sort of land-use rules that are really thought through well and encourage the things that you want to encourage and not discourage the things that you don't want to discourage. Don't have equity in zoning and allow a lot of mixed-use construction and stuff like that. I guess that's a somewhat boring answer, but I’d probably do something along those lines. 

Dwarkesh Patel 

Interesting, interesting. I guess that implies that there would be high upfront costs to building a city because if you need to build 10,000 homes at once to achieve these economies of scale, then you would need to raise like tens of billions of dollars before you could build a charter city. 

Brian Potter 

Yeah, if you were trying to lower your costs of construction, but again, if you have the setup to do that, you wouldn't necessarily need to raise it. These other big developments were built by developers that essentially saw an opportunity. They didn't require public funding to do it. They did in the form of loan guarantees for veterans and things like that, but they didn't have the government go and buy the land. 

Automation and Revolutionary Future Technologies 

Dwarkesh Patel 

Right, okay, so the next question is from Austin Vernon. To be honest, I don't understand the question, you two are too smart for me, but hopefully, you'll be able to explain the question and then also answer it. What are your power rankings for technologies that can tighten construction tolerances? Then he gives examples like ARVR, CNC cutting, and synthetic wood products. 

Brian Potter 

Yeah, so this is a very interesting question. Basically, because buildings are built manually on site by hand, there's just a lot of variation in what ends up being built, right? There's only so accurately that a person can put something in place if they don't have any sort of age or stuff like that. Just the placement itself of materials tends to have a lot of variation in it and the materials themselves also have a lot of variation in them. The obvious example is wood, right? Where one two by four is not gonna be exactly the same as another two by four. It may be warped, it may have knots in it, it may be split or something like that. Then also because these materials are sitting just outside in the elements, they sort of end up getting a lot of distortion, they either absorb moisture and sort of expand and contract, or they grow and shrink because of the heat. So there's just a lot of variation that goes into putting a building up.

To some extent, it probably constrains what you are able to build and how effectively you're able to build it. I kind of gave an example before of really energy efficient buildings and they're really hard to build on-site using conventional methods because the air ceiling is quite difficult to do. You have to build it in a much more precise way than what is typically done and is really easily achieved on-site. So I guess in terms of examples of things that would make that easier, he gives some good ones like engineered lumber, which is where you take lumber and then grind it up into strands or chips or whatever and basically glue them back together–– which does a couple of things. It spreads all the knots and the defects out so they are concentrated and everything tends to be a lot more uniform when it's made like that. So that's a very obvious one that's already in widespread use. I don't really see that making a substantial change.

I guess the one exception to that would be this engineered lumber product called mass timber elements, CLT, which is like a super plywood. Plywood is made from tiny little sheet thin strips of wood, right? But CLT is made from two-by-four-dimensional lumber glued across laminated layers. So instead of a 4 by 9 sheet of plywood, you have a 12 by 40 sheet of dimensional lumber glued together. You end up with a lot of the properties of engineered material where it's really dimensionally stable. It can be produced very, very accurately. It's actually funny that a lot of times, the CLT is the most accurate part of the building. So if you're building a building with it, you tend to run into problems where the rest of the building is not accurate enough for it. So even with something like steel, if you're building a steel building, the steel is not gonna be like dead-on accurate, it's gonna be an inch or so off in terms of where any given component is. The CLT, which is built much more accurately, actually tends to show all these errors that have to be corrected. So in some sense, accuracy or precision is a little bit of like a tricky thing because you can't just make one part of the process more precise. In some ways that actually makes things more difficult because if one part is really precise, then a lot of the time, it means that you can't make adjustments to it easily. So if you have this one really precise thing, it usually means you have to go and compensate for something else that is not built quite as precisely. It actually makes advancing precision quite a bit more complicated. 

AR VR, is something I'm very bullish on. A big caveat of that is assuming that they can just get the basic technology working. The basic intuition there is that right now the way that pieces are, when a building is put together on site, somebody is looking at a set of paper plans, or an iPad or something that tells them where everything needs to go. So they figure that out and then they take a tape measure or use some other method and go figure out where that’s marked on the ground. There's all this set-up time that is really quite time consuming and error prone. Again, there's only so much accuracy that a guy dragging a tape 40 feet across site being held by another guy can attain, there's a limit to how accurate that process can be. It's very easy for me to imagine that AR would just project exactly where the components of your building need to go. That would A, allow you a much higher level of accuracy that you can easily get using manual methods. And then B, just reduce all that time it takes to manually measure things. 

I can imagine it being much, much, much faster as well, so I'm quite bullish on that. At a high level and a slightly lower level, it's not obvious to me if they will be able to get to the level where it just projects it with perfect accuracy right in front of you. It may be the case that a person moving their head around and constantly changing their point of view wont ever be able to project these things with millimeter precision––it's always gonna be a little bit jumpy or you're gonna end up with some sort of hard limit in terms of like how precisely you can project it. My sense is that locator technology will get good enough, but I don't have any principle reason believing that. 

The other thing is that being able to take advantage of that technology would require you to have a really, really accurate model of your building that locates where every single element is precisely and exactly what its tolerances are. Right now, buildings aren't designed like that, they are built using a comparatively sparse set of drawings that leaves a lot to sort of be interpreted by the people on site doing the work and efforts that have tried to make these models really, really, really precise, have not really paid off a lot of times. You can get returns on it if you're building something really, really complex where there's a much higher premium to being able to make sure you don't make any error, but for like a simple building like a house, the returns just aren't there. So you see really comparatively sparse drawings. Whether it's gonna be able to work worth this upfront cost of developing this really complex, very precise model of where exactly every component is still has to be determined. There's some interesting companies that are trying to move in this direction where they're making it a lot easier to draw these things really, really precisely and whave every single component exactly where it is. So I'm optimistic about that as well, but it's a little bit TBD. 

Dwarkesh Patel 

This raises a question that I actually wanted to ask you, which is in your post about why there aren't automatic brick layers. It was a really interesting post. Somebody left in an interesting comment saying that bricks were designed to be handled and assembled by humans. Then you left a response to that, which I thought was really interesting. You said, “The example I always reach for is with steam power and electricity, where replacing a steam engine with an electric motor in your factory didn't do much for productivity. Improving factory output required totally redesigning the factory around the capabilities of electric motors.” So I was kind of curious about if you apply that analogy to construction, then what does that look like for construction? What is a house building process or building building process that takes automation and these other kinds of tools into account? How would that change how buildings are built and how they end up looking in the end? 

Brian Potter 

I think that's a good question. One big component of the lack of construction productivity is everything was designed and has evolved over 100 years or 200 years to be easy for a guy or person on the site to manipulate by hand. Bricks are roughly the size and shape and weight that a person can move it easily around. Dimensional lumber is the same. It's the size and shape and weight that a person can move around easily. And all construction materials are like this and the way that they attach together and stuff is the same. It's all designed so that a person on site can sort of put it all together with as comparatively little effort as possible. But what is easy for a person to do is usually not what is easy for a machine or a robot to do, right? You typically need to redesign and think about what your end goal is and then redesign the mechanism for accomplishing that in terms of what is easy to get to make a machine to do. 

The obvious example here is how it's way easier to build a wagon or a cart that pulls than it is to build a mechanical set of legs that mimics a human's movement. That's just way, way, way easier. I do think that a big part of advancing construction productivity is to basically figure out how to redesign these building elements in a way that is really easy for a machine to produce and a machine to put together. One reason that we haven't seen it is that a lot of the mechanization you see is people trying to mechanize exactly what a person does. 

You’d need a really expensive industrial robot that can move exactly the way that a human moves more or less. What that might look like is basically something that can be really easily extruded by a machine in a continuous process that wouldn't require a lot of finicky mechanical movements. A good example of this technology is technology that's called insulated metal panels, which is perhaps one of the cheapest and easiest ways to build an exterior wall. What it is, is it’s just like a thin layer of steel. Then on top of that is a layer of insulation. Then on top of that is another layer of steel. Then at the end, the steel is extruded in such a way that it can like these inner panels can like lock together as they go. It's basically the simplest possible method of constructing a wall that you can imagine. 

But that has the structural system and the water barrier, air barrier, and insulation all in this one really simple assembly. Then when you put it together on site, it just locks together. Of course there are a lot of limitations to this. Like if you want to do anything on top of like add windows, all of a sudden it starts to look quite a bit less good. I think things that are really easy for a machine to do can be put together without a lot of persistent measurement or stuff like that in-field. They can just kind of snap together and actually want to fit together. I think that's kind of what it looks like. 

3D Printer Pessimism & The Rising Cost of Labour

Dwarkesh Patel 

What would the houses or the buildings that are built using this physically look like? Maybe in 50 to 100 years, we'll look back on the houses we have today and say, “Oh, look at that artisanal creation made by humans.” What is a machine that is like designed for robots first or for automation first? In more interesting ways, would it differ from today's buildings? 

Brian Potter 

That's a good question. I'm not especially bullish on 3D building printing in general, but this is another example of a building using an extrusion process that is relatively easy to mechanize. What's interesting there is that when you start doing that, a lot of these other bottlenecks become unlocked a little bit. It's very difficult to build a building using a lot of curved exterior surfaces using conventional methods. You can do it, it's quite expensive to do, but there's a relatively straightforward way for a 3D-printed building to do that. They can build that as easily as if it was a straight wall. So you see a lot of interesting curved architecture on these creations and in a few other areas. There's a company that can build this cool undulating facade that people kind of like. So yeah, it unlocks a lot of options. Machines are more constrained in some things that they can do, but they don't have a lot of the other constraints that you would otherwise see. So I think you'll kind of see a larger variety of aesthetic things like that. That said, at the end of the day, I think a lot of the ways a house goes together is pretty well shaped to just the way that a person living inside it would like to use. I think Stewart Brand makes this point in––

Dwarkesh Patel 

Oh, How Buildings Learn

Brian Potter 

There we go. He basically makes the point that a lot of people try to use dome-shaped houses or octagon-shaped houses, which are good because, again, going back to surface area volume, they include lots of space using the least amount of material possible. So in some theoretical sense, they’re quite efficient, but it's actually quite inconvenient to live inside of a building with a really curved wall, right? Furniture doesn't fit up against it nicely, and pictures are hard to hang on a really curved wall. So I think you would see less variation than maybe you might expect. 

Dwarkesh Patel 

Interesting. So why are you pessimistic about 3D printers? For construction, I mean. 

Brian Potter 

Yeah, for construction. Oh God, so many reasons. Not pessimistic, but just there's a lot of other interesting questions. I mean, so the big obvious one is like right now a 3D printer can basically print the walls of a building. That is a pretty small amount of the value in a building, right? It's maybe 7% or 8%, something like that. Probably not more than 10% of the value in a building. Because you're not printing the foundation, you're not printing like the overhead vertical, or the overhead spanning structure of the building. You're basically just printing the walls. You're not even really printing the second story walls that you have in multiple stories. I don't think they've quite figured that out yet. So it's a pretty small amount of value added to the building. It's frankly a task that is relatively easy to do by manual labor. It's really pretty easy for a crew to basically put up the structure of a house. 

This is kind of a recurring theme in mechanization or it goes back to what I was talking about to our previous lead. Where it takes a lot of mechanization and a lot of expensive equipment to replace what basically like two or three guys can do in a day or something like that. The economics of it are pretty brutal. So right now it produces a pretty small value. I think that the value of 3D printing is basically entirely predicated on how successful they are at figuring out how to like deliver more components of the building using their system. There are companies that are trying to do this. There's one that got funded not too long ago called Black Diamond, where they have this crazy system that is like a series of 3D printers that would act simultaneously, like each one building a separate house. Then as you progress, you switch out the print head for like a robot arm. Cause a 3D printer is basically like a robot arm with just a particular manipulator at the end, right?

So they switch out their print head for like a robot arm, and the robot arm goes and installs different other systems like the windows or the mechanical systems. So you can figure out how to do that reliably where your print head or your printing system is installing a large fraction of the value of the building. It's not clear to me that it's gonna be economic, but it obviously needs to reach that point. It's not obvious to me that they have gotten there yet. It's really quite hard to get a robot to do a lot of these tasks. For a lot of these players, it seems like they're actually moving away from that. I think in ICON is the biggest construction 3D printer company in the US, as far as I know. And as far as I know, they've moved away from trying to install lots of systems in their walls as they get printed. They've kind of moved on to having that installed separately, which I think has made their job a little bit easier, but again, not quite, it's hard to see how the 3D printer can fulfill its promises if it can't do anything just beyond the vertical elements, whichare really, for most construction, quite cheap and simple to build. 

Dwarkesh Patel 

Now, if you take a step back and talk how expensive construction is overall, how much of it can just be explained by the Baumol cost effect? As in labor costs are increasing because labor is more productive than other industries and therefore construction is getting more expensive. 

Brian Potter 

I think that's a huge, huge chunk of it. The labor fraction hasn’t changed appreciably enough. I haven't actually verified that and I need to, but I remember somebody that said that they used to be much different. You sent me some literature related to it. So let’s add a slight asterisk on that. But in general the labor cost has remained a huge fraction of the overall cost of the building. Reliably seeing their costs continue to rise, I think there's no reason to believe that that's not a big part of it. 

Dwarkesh Patel 

Now, I know this sounds like a question with an obvious answer, but in your post comparing the prices of construction in different countries, you mentioned how the cost of labor and the cost of materials is not as big a determiner of how expensive it is to construct in different places. But what does matter? Is it the amount of government involvement and administrative overhead? I'm curious why those things (government involvement and administrative overhead) have such a high consequence on the cost of construction. 

Brian Potte

Yeah, that's a good question. I don't actually know if I have a unified theory for that. I mean, basically with any heavily regulated thing, any particular task that you're doing takes longer and is less reliable than it would be if it was not done right. You can't just do it as fast as on your own schedule, right? You end up being bottlenecked by government processes and it reduces and narrows your options. So yeah, in general, I would expect that to kind of be the case, but I actually don't know if I have a unified theory of how that works beyond just, it's a bunch of additional steps at any given part of the process, each of which adds cost. 

Dwarkesh Pate

Yeah. Now, one interesting trend we have in the United States with construction is that a lot of it is done by Latino workers and especially by undocumented Latino workers. What is the effect of this on the price and the quality of construction? If you have a bunch of hardworking undocumented workers who are working for below-market rates in the US, will this dampen the cost of construction over time? What do you think is going to happen? 

Brian Potter 

I suspect that's probably one of the reasons why the US has comparatively low construction costs compared to other parts of the world. Well, I'll caveat that. Residential construction, which is single-family homes and multi-family apartment buildings all built in the US and have light framed wood and are put together, like you said, by a lot of like immigrant workers. Because of that, it would not surprise me if those wages are a lot lower than the equivalent wage for like a carpenter in Germany or something like that. I suspect that's a factor in why our cost of residential construction are quite low. 

AI’s Impact on Construction Productivity

Dwarkesh Patel 

Overall, it seems from your blog post that you're kind of pessimistic, or you don't think that different improvements in industrialization have transferred over to construction yet. But what do you think is a prospect of future advances in AI having a big impact on construction? With computer vision and with advances in robotics, do you think we'll finally see some carry-over into construction productivity or is it gonna be more of the same? 

Brian Potter 

Yeah, I think there's definitely gonna be progress on that axis. If you can wire up your computer vision systems, robotic systems, and your AI in such a way that your capabilities for a robot system are more expanded, then I kind of foresee robotics being able to take a larger and larger fraction of the tasks done on a typical construction site. I kind of see it being kind of done in narrow avenues that gradually expand outward. You're starting to see a lot of companies that have some robotic system that can do one particular task, but do that task quite well. There's a couple of different robot companies that have these little robots for like drawing wall layouts on like concrete slabs or whatever. So you know exactly where to build your walls, which you would think would not be like a difficult problem in construction, but it turns out that a lot of times people put the walls in the wrong spot and then you have to go back and move them later or just basically deal with it. So yeah, it's basically a little Roomba type device that just draws the wall layout to the concrete slab and all the other systems as well–– for example, where the lines need to run through the slab and things like that. I suspect that you're just gonna start to see robotics and systems like that take a larger and larger share of the tasks on the construction site over time. 

Dwarkesh Patel 

Yeah, it's still very far away. It's still very far away. What do you think of Flow? That's Adam Neumann's newest startup and backed with $350 million from Andreeseen Horowitz.

Brian Potte

I do not have any strong opinions about that other than, “Wow, they've really given him another 350M”. I do not have any particularly strong opinions about this. They made a lot they make a lot of investments that don't make sense to me, but I'm out of venture capital. So there's no reason that my judgment would be any good in this situation–– so I'm just presuming they know something I do not. 

Dwarkesh Patel 

I'm going to be interviewing Andreeseen later this month, and I'm hoping I can ask him about that.

Brian Potter 

You know, it may be as simple as he “sees all” about really high variance bets. There's nobody higher variance in the engine than Adam Neumann so, maybe just on those terms, it makes sense. 

Dwarkesh Patel 

You had an interesting post about like how a bunch of a lot of the knowledge in the construction industry is informal and contained within best practices or between relationships and expectations that are not articulated all the time. It seems to me that this is also true of software in many cases but software seems much more legible and open source than these other physical disciplines like construction despite having a lot of the knowledge contained within people's minds and within the culture rather than excessively codified somewhere. So why do you think that construction seems more closed or stem software? It's interesting.

Brian Potter 

To go back slightly to our products versus projects industry, a slightly different way of thinking about that is craft-based industries versus industrial processes where this isn't a dichotomy, but a spectrum. In general, there's an expertise and judgment aspect of it that is pretty well embedded in the craft-based process, so you can't really remove it. Any sort of decision at any given point requires an expert or an artisan or somebody who understands the relevant context and knows how to proceed based on the specific variables in this specific situation. Industrial processes, on the other hand, have been sort of figured out. This is how it works every single time, and construction is just very, very much on the craft end of the production spectrum where the decision of how to put these things together and how to wire this building or whatever is all left up to the expertise and judgments of the people.

Doing the installation and what that gets you is it lets you put things together without having to do a very large amount of specifying things exactly as how you need. The drawings specifying a house going together are fewer than those needed to produce a Toyota Corolla. The design cost required to do it in terms in proportion to how expensive the thing is is also much lower as well. Again, I’m not an expert on software development, but it's somewhat more legible by the response, and the end-product is very clear. You can clearly see every single part of it and how every single part of it touches every single other part. I'm sure someone in software could say, “Well It's actually really not super obvious how these things work and why they're done this way” or whatever, but you can clearly inspect every single part of it and see exactly how it does what it does and how it connects together. 

The other part of it is you can't really do that with a building. I guess I would also maybe say that if you're a developer, with a building, it's not necessarily obvious how it got to the point that it did when it was put together. A lot of times with physical things, even if you have the object, it is unclear what the process was to create it. So a lot of times what you see is that even with like this comes industrial espionage. Or somebody who's trying to steal some particular thing or whatever a lot of times that doesn't help them as much as they would think to try to like recreate it. A lot of times they have to basically go through the entire process of figuring out how to make it and it takes them just as long to do it as it did the original people doing the development. You saw this with like the development of the atomic bomb for instance. We're like the people who stole this stole the plans for how to make it or who had information on exactly how their system would react if the bomb worked basically took as long to figure out how to make it as the US did.

So with a physical object, just the process used to make it is not necessarily super legible and it tends to be a little bit hidden. I was gonna say that perhaps that is not as true for software, but I actually realized that I don't actually know, and it's very plausible to me that you could have some piece of software that was written, and then it'd just be utterly inscrutable as to how it came together and how you could maybe duplicate a similar piece of software. Is that a category error? 

Dwarkesh Patel 

Yeah, that's a really good question. I think there are a lot of examples where if you don't have the context on why they were built a certain way, you wouldn't understand what was going on. If you've heard of the fast inverse square root, that's exactly what I was thinking of. 

Brian Potter 

Yeah, yeah.

Dwarkesh Patel 

For the people who are interested, there's a great YouTube video on this that goes through it but basically, the guy who created it–– John Carmack is a super genius. If you look at the algorithm, it's a few lines, but you would never understand like why this gives you an inverse square root unless you went through the mind of John Carmack where he goes through Newton's method and all these other things like particular float operations, etc. I guess the advantage software has is the ability to fork. You can't just take a building, make an exact replica of it and then just change the part you want to better understand and see what the effect is. Whereas with a software project, you can just fork it, or you can just make an API call or something. I guess it goes back to the modularity thing you were explaining–– try to understand a specific sub-component is easier with software.

Brian Potter 

Yeah, that's interesting. You can run experiments on your piece of software to understand how it works easily and at a lower cost than you can with any physical object (especially a giant building).

Brian Dreams of Building a Mile-High Skyscraper

Dwarkesh Patel 

Okay. So let's say the CEO of some mega-corporation is like, “Brian, we want to build some really interesting skyscraper or building, I've talked to the mayor and the governor, and they're willing to get rid of all the building codes.” So there are no building codes. There's no regulation. You just want to build a really cool skyscraper. What is it that you would do? What would be some innovation or change that you would make? What would you do if you were given this latitude to just build a really cool building? 

Brian Potter 

I would like to see us fulfill the dream of the Early to mid 20th century and build a mile-high skyscraper. This was where people saw the development of skyscrapers going during the 30s, 40s and perhaps 50s. Frank Lloyd Wright designed this mile-high skyscraper called the Illinois back when Chicago was a Metro rising in importance. The technology for it exists but you haven't really seen anyone do it. Even people who are clearly willing to build these giant, elephant projects–––– nobody's tried to go the distance and build something of this scale. I would like to see us do it.

Dwarkesh Patel 

Interesting. I know you have a really interesting essay about skyscraper height and one of the things you talked about is the superlinear increase in lateral forces and other kinds of impediments to building tall. How would you get over that kind of stuff? 

Brian Potter 

Basically by throwing a giant amount of money in. So the basic gist of that is the physical constraints do not allow you to build a front that’s a mile in height. It's the economic and legal constraints that sort of stop this extreme construction. Even the economic constraints are significant enough that even in places where there are no legal constraints, like China or Dubai, the economics of it are just so brutal. But yeah in this fantasy scenario, a giant stack of money would get devoted to doing this.

Dwarkesh Patel

[laughs] A stack of money a mile high. So speaking of which, in that post, you brought up that argument from the economist Glaeser that says that we were leaving billions of dollars basically on the table by having building height codes because we're just giving up on all this vertical space. I'm curious about why you think it's a case that these developers don't have any sort of lobbying or political influence to be able to like collect the billions of dollars of deadweight loss that are created by these codes? Why aren't they able to like organize politically in a way that like gets rid of these regulations that are helping no one? 

Brian Potter 

That's a really interesting question. In general, the strongest construction lobbying group I'm aware of is probably the National Association of Home Builders which exerts quite a bit of influence to try to keep the cost of building single-family homes low, I'm not aware of anything that exists for large commercial buildings or something like that. Maybe the Association of General Contractors or something. I guess my initial guess would be that something to the effect of the natural constituencies for opposing a big project like this is always going to be quite a bit great and at least as big (if not bigger) than the constituencies that would able would be able to act for it. So like any big giant construction project, even if it had a lot of developers mobilized to try to support that kind of thing also would have a large constituency that would exist to oppose basically anyone who lives in the area. 

They don’t want this giant shadow of a building, or they’re worried about the congestion that it would cause, etc. A paradox with this situation is that the places that need it the most because their rents are so high the people that are living there are gonna be financially well equipped to oppose it and in a certain sense they're losing the most out of it, right? If you're making $50,000 a year you might value the view out of your apartment at like $500, but if you're making five million dollars a year, you might value that view proportionately more and be willing to expend a lot more to prevent it from being obstructed. So I feel like this sort of mechanism by where places get wealthier and need more housing kind of also creates its own opposition to some extent.

Dwarkesh Patel 

I think a co-sign solution to this kind of thing would be optimal where if the view is worth more to you than the apartment is worth to somebody else, then you can just pay them not to build there. The view is not worth more than an apartment is probably worth to somebody, right? So then you have an optimal allocation of resources based on who has political influence.

Brian Potter

Yeah, it's interesting. I'm not super confident, and I should look into it. Why developers don’t have better lobbying efforts does seem like an unanswered question. 

Deep Dive into Environmentalism and NEPA

Dwarkesh Patel 

Speaking of being able to put projects into a tailspin, you just recently published a very interesting and thorough examination of how NEPA works. Do you want to explain what this law is and what its consequences are? Then I could ask you some more specific questions about it. 

Brian Potter 

Yeah. So NEPA is the national environmental policy act. This is the law that basically requires any major federal government action that might have significant environmental impacts to do a very long and thorough and expensive environmental impact study before anything is done on a project. It gets a large amount of attention because of how long these environmental impacts take to prepare. The average time currently is around four and a half years, and in some cases half of them take longer than that. The highway administration for instance, needed eight and a half years to do an environmental impact statement before they could build a new highway. So people are perpetually trying to figure out a way to reform this law so that we don’t have to wait years and years and years before building big important infrastructure projects. So that's the gist of what NEPA is and how it works.

Dwarkesh Patel

You had a really interesting point in the article where you said that by adding this cost, you can basically think of it as like a tax on all major government actions and the effect of a tax is to reduce what you're taxing. I thought at the end you had a really interesting argument about how like NEPA is anti-law. Can you explain this argument for the podcast listeners? 

Brian Potter 

It's my spicy take at the end that I always have to throw in right at the end but yeah, the basic argument is that the purpose of a law is roughly twofold: to encourage something that you would want more of or discourage something that you would want less of. We have laws against drunk driving because we think drug driving is harmful and we want less drug driving in our society. The second purpose of a law is to basically reduce coordination problems and enable exchanges that might not otherwise be able to take place. The government enforces which side of the road you're allowed to drive on, not because one side is inherently better than the other, but because it's good if everybody agrees on which side of the road to drive on. 

Contract law is in some ways like this. It's good if you know that people will be punished for breaking contracts because that allows people to enter into them, which allows exchanges that might not otherwise take place. I forget exactly what the example of this is, but the ability of the English government in the 1600s to 1700s to pay back its debts was a really important development because it allowed it to raise money that it otherwise wouldn't be able to because people could trust they would be able to get paid back. Anyway, those are the two rough purposes of a law and NEPA does not do either of those things. 

NEPA is basically a procedural statement or requirement it does not require the government to weigh environmental concerns especially heavily. It doesn't prevent a big oil and gas drilling project from taking place–– essentially what it does require is that for any major environmental effects, you just have to document them very thoroughly so all of it is a documentation requirement, and notifying the public of what you're doing but bit doesn't prevent major environmental negative ramifications. As long as you've documented it quite thoroughly, you can kind of do whatever you want, and the evidence is very unclear as to whether it has had net beneficial environmental effects to the extent that it has made it harder to do anything at all. 

The other side is about solving coordination problems and I think that NEPA actually is very very bad at this. It creates a lot of uncertainty because the requirements for doing the analysis are so unclear and the definition what an environmental effect keeps shifting over time. In the 1970s, it was maybe not obvious that greenhouse gas emissions were in major environmental effect, but now in 2020, it obviously is and so what you've had to do for a NEPA analysis changes over time which is of course fine in that sense, right? But it does mean that it's very unclear how long it's gonna take and what is going to be involved and whether anybody is going to sort of litigate your decision. This is the other sort of big part of NEPA–– people are basically able to sue people for not completing the analysis thoroughly enough. They can't permanently stop the project because all you need to do is basically show that you've documented your things thoroughly enough. 

So once you have documented it thoroughly enough, they don't have grounds for stopping it anymore, but they can't slow it down. If they slow it down enough, sometimes the project becomes unattractive and it gets canceled. That's kind of what a lot of these groups hope for and so basically instead of great uncertainty and solid coordination problems, it creates all this new uncertainty where people will like very deliberately try to avoid the NEPA process because they do not know how long it will take and how much it will cost to get their project approved and in some cases going through the process will take a very very very very long time. So making a business decision as to whether to do a new offshore wind development or develop a new forest resource or something like that is very hard to do. You don't know when your project is going to start because you don’t know how long the process will take. 

Dwarkesh Patel 

Yeah, that's so fascinating. All right, so I've got a lot more questions about this because your breakdown was really interesting. I don't know if you're familiar with the longtermist movement, maybe you’ve come across this before, but one thing they've proposed is not like a doctrine or anything, but on the periphery, some idea I saw was that just as we have environmental review we should have a posterity review so that you're analyzing the impacts of your actions on generations way down the line. What are the future impacts of actions just as we analyze what the environmental impacts reactions? What do you think of an idea like that given the various dysfunctions of the environmental review process? 

Brian Potter 

Yeah, a couple thoughts. One is just my gut response is that any additional review is just gonna add additional time and complexity to your process. It's a process that takes some amount of time and has some particular chance of success, right? So adding basically another filter to this process means that it's only going to make the process slower and less likely to succeed rather than more. The other thing is how accurately are you gonna be able to predict what your long-term impacts are/ it's not obvious to me that anybody making predictions over the past 20 years would have been able to do so with any degree of precision. It's not obvious that we would even be able to get like the sign right. Whether it would be net positive or net negative, that's off the top of my head, I could definitely be persuaded otherwise by somebody who is who has thought a lot more about it. So that is not a strongly held opinion, but that's fine. 

Dwarkesh Patel

Yeah, that is not my immediate impression. That would be my critique as well. In the 70s, correct me if I'm wrong, but the technical consensus of the time was that we would hit peak oil by the 90s, and of course, that's because they couldn't predict their ability to find new reservoirs and develop new technologies that made more oil available to us. So it was just very hard to predict future trends. I don't know how much that kind of law would help. I vaguely hear that the political deliberation is that they're discussing reform to NEPA. What would your ideal reform of Napa look like? How would you reform the implementation? 

Brian Potter

On a very simple level, I would like to even the playing field so a lot of these newer energy technologies have a lot of the same benefits that like the oil and gas industries have been able to acrew. For instance, oil and gas have a lot of categorical exclusions for certain drilling operations and for drilling in the Gulf of Mexico. They actually have a lot of new exclusions, which was perhaps one of the reasons you can obviously connect that to like the giant Deepwater Horizon spill. Giving technologies like wind and solar and large-scale transmission projects the same benefits that oil and gas drilling and like you're like natural gas pipelines have what I think to be like a massive massive boom. So just off the top of my head. That's one thing that I would like to see.

Dwarkesh Pate

Yeah, I wonder what you think about this–– one idea I had while reading the post that didn’t make sense to me was why this was enforced through the courts where anybody can just bring a lawsuit. Shouldn't there be a single coherent bureaucracy whose goal is to figure out who's messing up? It seems like a mistake to have this done through the courts. 

Brian Potter 

I was reading a paper earlier basically saying that NEPA is a horribly drafted law because it contains no provisions for funding it or the bureaucracy enforcing it or anything like this. Essentially through random chance at the courts (it was passed during a very activist period in the court); they decided to enforce this provision for the impact statement, which was kind of added late in the process without a lot of fanfare or consideration and then that one little part of it ended up becoming the most important part because that's what the court decided to enforce really really strongly. This is not how you would draft an environmental protection law if you were doing it from scratch. 

It's this weird thing that we've ended up with due to path dependency. An idea that I've seen floating around a few times is that you would want something that looked more like the OMB, which is basically charged with figuring out how much additional a given law will cost. You would want something like a bureaucracy attached to it that was designed to figure out the environmental effects, and that was decoupled from this specific agency. The downside of that, especially for an environmental protection statute, is whether it would be captured by political interests or not and either not enforced at all if it was very conservative of staffing or enforced extremely vigorously if it was on the other end of the spectrum. That's kind of the risk of that, but yes, it's clearly not ideal that the court system is responsible for basically determining this.

Dwarkesh Patel 

Even if there was a bias in how the law was enforced, if there's a bureaucracy, the benefit is that you can just fire the guy who's running it if you think he's not enforcing it correctly and replace him with somebody who you think will enforce it more appropriately. Whereas with the judiciary, if it's just dozens of different judges having independent opinions of how this should be enforced… There's nobody who's responsible to whom you can say to enforce it differently.

Brian Potter 

The court actually makes it a little bit hard to change because you don't actually know what the effect of any given change in the provision until somebody files a lawsuit referring to it and it works its way through the courts. Some people think that During the Trump administration, there were some changes to how people worked because one thing about it is that a lot of these laws are just our federal level laws which are comparatively simpler to change. They change some of these laws, and they’re designed to accelerate the process, but because it's unsure how the courts are going to interpret them, it's actually going to increase the risk for these projects in the short term until some of these lawsuits make their way through the courts and we know exactly what is required or not.

The court tells us that it's a very legitimate system of implementing environmental requirements. I don't think I'm an expert on this, but I don't think it's really how other countries do it. Almost every other country has something requiring environmental impact statements, but it doesn't necessarily mean that the courts are enforcing it via citizen lawsuits. A lot of times it's just done via a normal government bureaucracy or something like that. 

Dwarkesh Patel

Okay, I was actually just about to ask you that. Do countries that have different or no systems of environmental review have speedier and more cost-effective public works? 

Brian Potter 

I don’t actually know; it would be very hard to separate that.

Dwarkesh Patel 

That's all right. You had a comment in that post that I found interesting where you said that this uncertainty also makes changing NEPA somewhat risky. Experts have noted, for instance, that rules to accelerate NEPA processes or impose maximum timelines might result in more of them being challenged in court by failing to take the proper “hard look” Do you want to explain this? Because this is counterintuitive to me. 

Brian Potter 

Meeting the deeper requirement means you have to take what the courts call “a hard look” where you have to consider these impacts quite thoroughly. So the risk is that if you put a timeline cap on some of these processes, it has to be done in a year and if it's not done in a year, it's automatically approved. It's just an idea you see floated from time to time. The risk is that people will just say, “Okay well, we’ll go and litigate this project immediately, and then when we do, we will say that they did not look hard enough at these impacts and if they can't marshal the resources we needed to study some particular flowering species and it only has a flowering period of two weeks in the spring and the time period was up before that happens,” then the court is good, which is a thing that happens in NEPA apparently. 

It’s one of the reasons why these take multiple years because if you're observing some species or whatever, you might need an entire year to actually observe. But if you fail to look at this plant during the flowering season, you don't know if it's actually there and so you haven't considered the impacts on the potentially endangered species and the court would say, “Yeah, you did not look hard enough at this, go back and do it again.” You see that mentioned quite a few times that timeline caps could either easily backfire by increasing the amount of increasing susceptible litigation which just makes these things take longer than they already do already. You see a lot of extra analysis due to risk aversion from these federal agencies. The laws around NEPA actually say that your environmental impact statements should really not be longer than 150 pages except in extreme circumstances, but the average environmental impact statement is now 660 pages or something like that. So people are already going more than what the law says they should do just out of risk aversion. So if you don't fix the incentives that are causing this risk aversion, your solution will not work 

Software is Stealing Talent from Physical Engineering

Dwarkesh Patel 

I'm curious if you think that there's been a talent drain from physical engineering tasks (ex. construction) into software. Has that happened and has that had an impact on the world of atoms or is that just something people discuss on the internet and it's not real?

Brian Potter 

I do think that's almost definitely happening. I mean this was my constant opinion when I was working as an engineer–– especially when I was managing younger engineers who were getting paid comparatively little. I was always on the verge of telling them, “Why don't you just go learn how to code and go earn 3-4x as much at a FAANG company instead of doing this fairly thankless work?” Frankly yeah, I think it's very likely to be an issue. In some sense, it's theoretically self-correcting to the extent where if the labor moves out of the field, then it gets more expensive and the incentives are changed a little bit and you're forced to find ways of building things with less labor requirements where you can spread your labor development over a larger volume.

So arguably, if the engineers are leaving and engineers are getting more expensive, you're going to basically find a way that's gonna push you towards figuring out how to spread your engineering efforts over like a larger construction volume–– which would be using more prefab or using kits of parts, assemblies and things like that. So theoretically, to some extent, it is self-corrected. I guess the risk for that is if you screen off the top 20% of most talented people, does that fundamentally handicap what your industry is capable of doing? Or do your incentives kind of push the other way, and you try to lower your quality? I feel like I've heard some people make complaints to this effect with semiconductor research and how semiconductor engineering is actually not especially well paid. It’s relatively easy for semiconductor engineers to go get jobs working in software development so you see sort of a brain drain from that. 

Yeah, I think I think it actually may be correcting to some extent with engineers. I'm a little bit out of the engineering game, but the salaries for engineers have actually kind of risen quite a bit. A similar risk (and people are in construction complaining about this constantly) is just the innovative unavailability of skilled labor. We talked about how being able to do a lot of these tasks requires skilled expertise, and you saw a lot of these people leave the labor force during the greater session. People aren't just entering it at the rates that they need to. I think the average age of a construction worker is somewhere around the 40s or perhaps 50s. It's like very very high, so people are constantly complaining about how they can't get enough laborers, not enough workers, or whatever like that. 

But of course, this also is just gonna incentivize finding ways to basically get these buildings built using less labor. I'm a little bit less worried about potential negative affection. There are a lot of historical examples of labor constraints developing into labor-saving inventions–– the history of the US is like that, right? We developed a lot of labor-saving machinery in the American system of manufacturing. Yeah, I'm a little bit less worried about that, but I could see it definitely having effects on the other sides of the industry. 

Dwarkesh Patel 

There was this author of this global economic history book who made the point that the Industrial Revolution happened in Britain because the cost of labor was highest in Britain since there was a plague that killed up a bunch of people so labor was really expensive.

Brian Potter 

Yeah, I've heard that as well. I'm not an expert in economic history and sometimes try to avoid things I know very very little about. One other factor is just that now, as venture capital expands its tentacles into other industries, you're seeing a lot more effort in developing solutions for the built environment. So to some, you're seeing venture capital money flow into the space. So perhaps that will counteract to some extent. I don’t know.

Gaps in the Blog Marketplace of Ideas

Dwarkesh Patel

Tyler Cowen was interviewed by Patrick Collison and one of the things Tyler Cowen said was that there should be more blogs focused on one particular area or issue and just kind of raise the salience of it and help drive insight and understanding of it. I feel like you've done that really well with Construction of Productivity and I'm curious as to what other areas would you like to see the blogs that do for their area what you have done for construction productivity–– which is taking a broader view of what's happening, what the trends are, and trying to add more insight to professional problems.

Brian Potter 

Oh, good question. Yeah, I feel like there's so much about this I was complaining about. I think a very underrated problem is this giant Civilizational machine that takes in raw materials and spits out finished goods and services and high quality of life. Nobody really knows how it works and mostly how it works is completely undocumented. It does not exist in written information anywhere, and the information that is written down is maybe in one particular company’s shared drive or something like that. There are no instructions for building a Toyota, and it might be very hard to kind of recreate that if you needed to, but just in general, I would like to see somebody do something similar for manufacturing, especially since so much manufacturing knowledge has been lost to this move to China and other places where labor is cheaper. 

There's just so much information about how things get built and manufactured that just isn't written down anywhere or isn't written down anywhere accessible. You see kind of people share the same small number of resources for how these things work over and over again. I asked a few people who I thought would know about it, “Is there any book written that actually explains what it’s like to get something built in china or what building things in china are actually like, and they're all like, “No, I don't know any source that exists.” There are a few blogs that describe their particular experiences, which end up being overly valuable resources, but there's no general source of available information for how any of that works.

So yeah, I just think that documentation of how the civilization machine functions are just wildly under-invested in which I guess is true for documentation in general right? Nobody wants to do that because the payoffs are far in the future and uncertain, and the costs are upfront. So it's not surprising to me that it doesn't exist, but I do think that you know in general terms, people are really very interested in understanding how things work and if you can explain how something works, even if it seems like a fairly niche topic, you can get quite a bit of attention. So for anybody who works in manufacturing, I think you would find quite a bit of success if you started writing things about how it functions.

Dwarkesh Pate

Interesting. Okay, excellent. To listeners who know about manufacturing, do spin up your substacks.

Why is Modern Architecture So Ugly?

Dwarkesh Patel
Okay, so this is part two of my conversation with Brian Potter. The first conversation was really interesting, and then afterwards, I realized that I’d forgotten to ask Brian about this really interesting theory that Scott Alexander and others have written about. Brian is the perfect person to talk to about this. So, I took the convenience of asking him to come on again. The question is basically, “Why does modern architecture just look so much uglier than things that were built 100 years ago or 200 years ago?

You would have thought that due to increases in technology and the build-up in new ideas and designs that things would become prettier. But if you look at a building that was built in the last 100 years, it just looks like a cylinder or a rectangle of glass and concrete. But if you look at things that were built before, you’d see things like Sagrada Familia or intricate cathedrals or even these skyscrapers that have all these flourishes, ornaments, and all these decorations. So Brian, what is going on? Why are things so much uglier now? 

Brian Potter 

I have a few thoughts on this, and I don't know if I have an answer to the actual question, but I can add some context. I don’t necessarily think that I’m the best person to ask about this–– a better person to ask would be an architect who can talk about how design and taste have evolved over the course of the 20th and 19th centuries. Generally, I don't have a huge amount of opinion on aesthetics; to the extent that I do tend to favor simple minimalist, clean lines. One of my favorite pieces of construction is this bridge called Saglinatobel, which is built in Switzerland. It’s the banner on my Twitter account, and it's this really simple minimalist tiny curve of concrete that's exactly in the shape it needs to be to resist the forces acting on it. So to some extent, to me, it's like you're asking, “Why did aesthetics change from like worst aesthetics to better aesthetics?” That's obviously not what I actually think, but I just want to shed some light on where I'm coming from.

Do you want to separate out the question a little bit because I think it's more of a question about why modern buildings have less ornamentation. Not necessarily that they're ugly per se, but I think there's a really lot of really beautiful modern architecture. Again, an architect would be a better person to ask about this, but I will sort of muddle my way through using light and space and form to like create these big interesting open big impressive open spaces that create a lot of interesting shapes. A big expansive space is what they're really going for to be a good example of this. 

So you look at the new Terminal for the Portland airport, which has this big giant mass timber roof, which isn’t a usual way of building these big large-spanning structures, but it's really neat, it’s interesting, and that's a lot of what you see these days. A lot of architecture is focused on this, and that's been pretty common throughout history, right? If you like cathedrals, it's like they're trying to create these big impressive spaces using light and stuff to create this impressive space that feels like the Pantheon. It's the same thing. I think it's really about how you want to separate out the question of “Why it’s ugly” (which I do not necessarily agree with) and “Why does it not have so much?” Why is there so much less ornamentation is a little bit more defensible. 

Dwarkesh Patel 

Okay, actually, let me ask about the second one because I'm not sure I totally follow. So the ornamentation has been replaced by the openness…

Brian Potter

Well, yes. I guess my point is that traditionally, we were focused on creating these big impressive indoor spaces and playing with the light and stuff to do that. That's been common in buildings that people think are impressive. Our architects still do that a lot and use big open areas with a lot of glass everywhere as a kind of tool in their tool belt to some extent.

Dwarkesh Patel

Gotcha. Okay, so they were replacing the old stoneworks and stone masonry stuff and the gargoyles with these kinds of things. Okay, I see.So yeah, let's talk about one because the idea that the older designs were less efficient in some way to steer man to the opposite position. Someone might say that a lot of the value of construction and building is just the aesthetic presence that it has in a city or a neighborhood and to an extent, we've lost that. Maybe we got to use less material on a bridge or a skyscraper, but then it just acts as this ugly thing in the middle of the city. Or if not ugly, at least not as aesthetically pleasing as it could have otherwise been. How would you react to something like that?

Brian Potter

Yeah, so I guess to clarify what I was talking about before, I don't think that new buildings necessarily use less material in a sense. I just think they have an aesthetic that's more minimalist and streamlined without a lot of extra decoration. The complaint is that “Oh all buildings have to be a cylinder of glass or a rectangle of glass or whatever,” but I think one reason that is true is that, while it may not be super interesting from the outside, when you're on the inside of a building, you actually kind of want a whole lot of glass. It’s really nice to have a large open space to walk through and to have a lot of natural light.

That was very hard to do prior to the mid-20th century for a couple of reasons. One is because buildings weren't really air-conditioned before that. Another one is it was like really expensive to have big expansive glass. It's still expensive, but back then, it was even more expensive. As you go farther back, there was a glass-making process invented in the 1950s 1960s called the float glass process, which made it a lot easier for you to basically make really high-quality glass for way way way cheaper than it was possible to previously. So for air conditioning and stuff like that, it basically advances in like structural design and increases the use of steel. It basically became a lot more possible to just have your building be a big giant slab of glass with a lot of natural light and a lot of openness on the inside, and that creates kind of a nice experience if you're actually in the building.

To some extent, I think that applies a little bit more generally if you look at an HGTV remodel or something like that. Everybody wants to create a big giant open concept floor plan or whatever with all the walls blown out and lots of natural light coming in everywhere. So to some extent, it's just the technology. It seems like it's maybe a case of the technology evolving so you can create this nicer interior space. To some extent, that perhaps came at the expense of having a lot of really ornate decoration on the outside (not on the top, but the outside). If you're building a building, it makes sense to optimize the inside at the expense of the outside because that's what you're actually using.

Dwarkesh Patel

Okay. Yeah, that's an interesting way to put it. One comment that I've heard is the progress of YIMBYism has been hurt by the fact that new buildings, because of this rational self-interest, are ugly on the outside and very pleasant on the inside. The result is that the people who are community organizers will oppose these new buildings because what they get to see is the outside, and all these historical preservation boards will notice that these older buildings are not as pleasant on the inside and have obviously less occupancy and everything. They look more pleasant in their neighborhood than the new buildings that people want to tear down and build. So if we want to convince the Nimbys to go along with the new construction, you kind of have to make it look beautiful. What do you think about that? 

Brian Potter 

Yeah, it seems like it's true. That's like the fundamental tension in real estate, right? Any property you have will have a lot of externalities and influence with the value of everything around it, so it's this big game of negotiation between you and everything in the immediate area. That's why things like zoning and stuff like that exist in the first place. Even if it's not necessarily implemented in a special way that people think is good, I think it's probably a little bit easy to over-index on that. It would not surprise me if when you say, “We'll build this since it’s like a really beautiful old building”, people would still oppose it because it's still gonna be a giant building. It's still gonna mess up their traffic It's still gonna have a bunch of renters that are gonna come in and reduce property values. You see a lot of these historical preservation issues where people want to preserve things like old gas stations and laundry mats and things that are not beautiful at all. Parking lots and stuff like that. So I think that's probably true on some margin. I would be surprised if there was just “one thing” that we’d need to fix to untangle this problem.

Dwarkesh Patel 

Gotcha. By the way, you mentioned how indoor air conditioning and heating has changed this dynamic. Is it just because we have enough insulation now that even if you lose heat through the glass, it’s fine?

Brian Potter 

Basically if you have a big glass wall as your exterior building and you don't have air conditioning, then that thing is just going to cook whenever it gets hot out. It's going to basically be like a greenhouse So you basically need air conditioning to make that habitable and you see this with single-family homes too where when air conditioning started to become popular, all of a sudden they started building these houses with these big giant picturesque windows Which they didn't have before. Again, this makes a nice inside space, and if you're going to be inside, that's the part you want to focus on. But it basically is predicated on having air conditioning to control the climate.

Dwarkesh Patel 

That's a nice little detail that I want to be able to talk about. That explains why the outsides of buildings aren't as pretty as it used to be, but there's still the question of why the insides are so minimalistic. I don't know if you saw this, by the way, but about a year or two ago, Microsoft announced that they were building this new office for developers in India and they were looking at this very interesting architectural details and craftsmanship that made it look like you know for everything from the furniture to the floor layout to the arches of the entrances. It was supposed to be like like Taj Mahal, and it actually looks really cool. So why don't more developers do something like that on the interiors of these buildings? 

Brian Potter 

I mean again, good question. I think, for the most part, broadly speaking, and again, I'm not a developer so I'm gonna model my group as best I can. They're basically building the space to rent out, right? Or to sell to somebody else. So they're creating what a lot of times is called the development's shell and core, which I think I'm using correctly. They basically don't even finish the inside, it's all just raw and open studs and everything like that. So then the tenant comes in and does whatever they want to the space. But they're basically in the business of creating usable space for some given class of market that they're trying to attack, right? They're not in the business of making fancy architecture. Same if you're buying a single-family home. You come in with blank walls and you put up all your different pictures and decorations and paint it however you want, then add your funky wallpaper or whatever. When you move, you can take all that stuff out, and the next person can come in and put in everything that they want. So I think to some extent, you see a decoupling of the aesthetic design from the building itself. 

Dwarkesh Patel

So then this is really a revealed preference about the people who are actually renting or buying these properties. People who are living there actually don't want this kind of material design maybe? 

Brian Potter 

Yeah, I think that again, it comes back to a little bit about a question of aesthetic style and whether people want a lot of ornamentation and fundamental attractiveness. Cause again, people do focus a lot on making these spaces attractive. A lot of times, they do that by having a nice open space, a lot of natural light, and a cool glass staircase that goes from here to there. The new Google headquarters (I don't know how new it is, but on the newer side), is basically this big, big giant, dome-type thing with a lot of structural detail visible and a lot of just light coming in this big, giant open space. There are a lot of interesting staircases and stuff like that. So to some extent, it's just a style with less ornamentation necessarily than aesthetics per se. 

Dwarkesh Patel 

Okay, gotcha. The other theories that out there emphasize more of the cultural and aesthetic changes rather than the actual practical necessities of these kinds of changes you've talked about. So one theory is that if you look at the change in men's clothing over the last two centuries, it's also become much more minimalistic and much less colorful and ornamental, right? If you look at King Louie or something, he's wearing a suit with all of these studded colors, dyes, and even gems. But if you look at like a picture of Joe Biden, he's just wearing a suit, and not even a tie anymore, right? It's just a black suit and a white shirt. So there’s this continuation of this sort of aesthetic trend towards being very minimalistic. What's your reaction to that, Cik? 

Brian Potter

Yeah, I mean, I think that's true to some extent. This is one of the difficulties of having a conversation like that–– there are so many degrees of freedom. It's hard to pin down what specifically you're talking about, and what class of things you're specifically talking about. If you look at an example from fashion, if you look at streetwear or something like that, and you just Google streetwear, you will find a ton of pictures of really quite ornate, interesting clothing. There will be some stuff that's minimalist, but there will be a lot that's not necessarily minimalist at all. I guess in some way I disagree with the premise. If you're talking about like some like elite counter-signaling thing, it's so easy and cheap to make ornate colors for clothing that it's not a signal of status anymore. So you have to countersignal by wearing very simple clothing or maybe there's something to that, but that's a different thing than why are things ugly in general.

Dwarkesh Patel

One thing that people also talk about is the increasing cost of labor, so that now you can hire talented stonemasons to spend hours on every square foot of the outside of a building. I was in India like six months ago and we went to New Delhi to visit this new temple that was built, the Swaminarayan Akshardham. I'm sure I mispronounced it, but anyway, it has this really intricate and cool design on the outside. It is just covered in these hand-carved stones with like intricate idols and different images. It's really cool, but I think it took tens of thousands of hours and probably way more thousands of workers and stonemasons to actually construct. Which is obviously not going to be very feasible economically in a Western country. So one theory is just that it’s too expensive to do that kind of stuff anymore. You need to do something that doesn't require as much manpower. 

Brian Potter 

Yeah, I mean, that's definitely got to be part of the story, right? I mean, construction, as we know it, has not really gotten any cheaper, but it also hasn't gotten more expensive. A lot of other services that are pure labor, like medical care, education, etc, have gotten more expensive. Part of that is probably because we've found ways to pull labor out of the process. So construction only rises at the rate of inflation instead of faster than the rate of inflation. So super labor and things like masonry just doesn’t get done anymore. There's probably like a vicious cycle there where, you know, you hire less of it, so there's fewer masons available. So they get more expensive and the skill gets more scarce. Now it's difficult to hire someone to do really ornate masonry work in the US and it’s probably really difficult to like even find them. 

I'm sure they exist, but it's probably not trivial. If you have your schedule and you're trying to meet someone, it's not super straightforward. An interesting example of this is, I can't remember if we talked about this in part one or not, the Ise Jingu temple in Japan, which is this temple complex that gets torn down and rebuilt every 20 years. They've been doing this for 1300 years or something like that, so it's using like 1300-year-old construction techniques, thatched roofs, and particular woodworking methods or whatever. Now, it’s quite difficult for them to find a lot of these skills. There are just not that many roof thatchers around anymore. So, you know, again, I can imagine that it's some sort of a similar cycle with masonry. I don't think that's the whole story because a lot of these things are built in a way that makes building in this minimalist style actually quite expensive to do. 

A glass curtain wall is actually really expensive to build on a building because glass is just expensive by itself and because it lets in so much light and it gets so hot so you need a much more stronger mechanical system to keep it cool. I've talked to architects and why the owners love these, glass curtain walls because it seems like, especially for now, everyone is really concerned about like climate change and greenhouse emissions of whatever it is you're building. People are like, “Yeah, the owners just really love this all-glass look, and they're willing to pay extra to get it.” If you look very early, this is the sort of style of construction where you have a big glass facade. For a skyscraper, it’s called the international style. Early international-style skyscrapers were actually quite expensive, more expensive than the traditional way of building. But again, the people really liked the aesthetic. It gave you some other options in terms of light on the inside or whatever. So they decided that it was worth it. I think, yeah, that's definitely probably part of the story, but again, I think it definitely doesn't seem like it can be all of it. 

Dwarkesh Patel 

Gotcha. Okay. To the extent that it is part of the story, somebody left an interesting comment on one of Scott Alexander's posts about how modern construction looks different than older construction. This is a comment from fluffy Buffalo. He or she writes, “I think new technology should help a lot with 3D printers, CNC machines, robots, CAD, and AI. It shouldn't be too hard to come up with a way to produce pleasing ornaments, murals, and building shapes at a reasonable price.” Then they go on, that no one is doing it because the current crop of architects can apparently only think in steel, concrete, and glass. So how plausible do you think this is? 

Brian Potter 

I think I read some of the comments on that post. I think one of the people mentioned that the Victorian style of house basically came about because of mass production methods, which made really ornate wood decorations really, really cheaply. They were just cranked out on some milling machine in a factory somewhere, then you could just buy them and place them in your house or whatever. So that style is basically a function of technology making that cheaper. That was in style for a while, but it’s not in style anymore because of the shifting sands of aesthetics. I think part of this is more broadly applicable. It's actually kind of a hassle to have all this ornamentation all over your house.

 On the inside, it's just lots and lots of stuff to dust and keep clean, which again comes back to cost disease. If you have servants to do that for you, it's fine. But if you don't have servants, it's you, and it creates a lot of extra work for you. Same on the exterior. But then also there is the issue that in general, you want your building to shed water and direct it away from the house as possible. If you have a lot of little nooks and crannies and ornamentation stuff for water to collect, that's pretty bad from a durability perspective. I would be careful not to over-index on that because obviously, people did build extremely durable, beautiful masonry brick buildings. It's not like that makes it impossible. But it is something to consider because on the margin, it probably does make your maintenance costs go up. 

Dwarkesh Patel

Okay. Are you optimistic overall? Maybe not with these specific technologies, and maybe not with having ornamentation or something, but do you think that in a hundred years, the technology would enable the construction of buildings that look prettier than modern buildings, but are also more maintainable or at least as maintainable? Or is it basically going to be steel and glass towers for the time for the upcoming future? 

Brian Potter 

Yeah, that's a good question. There's a lot of enthusiasm. Some of it is architecture. So we'll see how well it actually gets adopted. But for timber and large tall buildings made out of heavy timber elements, I don't know if that’s partially it's an aesthetic thing. If you look at it from a carbon perspective, it's using a lot of timber versus steel or concrete which is way better on that calculus. And it does kind of look nice. A lot of these tech companies are building these ornate timber offices. So that's one trend. Then yeah, there's not an obvious technology that could usurp the sort of standard we have unless it's like a dramatic development in material science or whatever, where somebody finds some way of building something that's way cheaper and gives you way more options than you had before. 

That’s what steel and then concrete gave you, right? All of a sudden, you could build things in ways that you couldn't do before steel, and you could use so much less structure to build fine concrete, because it was like liquid. All of a sudden, you could make any shape that you want. That's when you get all these really cool interesting shells and really ornate concrete domes, which of course, we also don't build anymore. So I don't see an obvious technology that could replace that. I guess, you know, the other thing is like, when all of a sudden you had technology that could like easily duplicate or make any sort of art possible, did that usher in a new era of way better art or 2D aesthetics? I don't necessarily think that it did, right? So I think if you could all of a sudden build any sort of shape that you want cheaply and easily, it's not obvious to me that we would get really cool things. I'm sure you would see a lot of interesting experiments on the margin or whatever, but it's not obvious to me that the standard way of building in some ways might become even less interesting. 

Dwarkesh Pate

Right. So there is the question of why we haven't seen better aesthetics in these other fields. So given how much you can do with the traditional art today, why do these paintings that are selling for millions of dollars have the common perception and stereotype that they're very simple and ugly? So to apply that to architecture and engineering, there's this idea that Scott Alexander kind of talked about this a lot in his post about a cabal of modernist architects in these guilds who are just very obsessed with building these buildings that the public doesn't like to look at. Do you think it’s true that the architects just have a completely different sense of aesthetics than the average public? 

Brian Potter 

I think there's probably something to that where you go to architecture school and architecture school is adjacent to art school in the way that you learn how to design buildings, but you also learn a specific way of looking and thinking about them. That filters down into how you design your building, but I think architects are competing in a marketplace, and the vast majority of them who are not star architects are basically trying to deliver buildings that owners are happy with. If they don't do that, they're going to go out of business. I think most architects you will talk to will basically say, “Yeah, if I don't give the owner a building that he's happy with, I am not doing my job correctly.” They're definitely being hired for other things adjacent to a sense of taste. But perhaps that's, part of the story, and it's like a fragment or whatever, but I think it would be very easy to over-index. I think there's a lot of ways that's just not true. 

Advice for Aspiring Architects and Young Construction Physicists

Dwarkesh Patel 

So I'm really glad we got a chance to cover this topic and I appreciate all those explanations, but actually, there’s another question that I forgot to ask you the last time that I'm curious about. Let's say somebody listens to the conversation or they've been a follower of your blog and this has got them interested in engineering. Somebody may be in high school or maybe early in college. For them to be able to do cool things in these fields in the future, what kind of training and career advice would you give them so they could pursue and be able to get involved and innovate in these fields? 

Brian Potter 

Yeah, that's a good question. I don't have a super good answer to that. I fell into it very much, very much by accident. I spent a very large chunk of my career just doing pretty standard engineering-type of stuff. Then I sort of fell ass-backwards into a job at a construction startup which then led me to other places. I guess if you're an engineer (I feel sort of gross giving this answer) because in general, if you go to a good engineering school, it's like you're perpetuating the college industrial complex. But people do really care about that, especially in the fields of building engineering that I'm more familiar with. They do care about that quite a bit. I went to a reasonably good engineering school and that probably opened doors for me that I would not have otherwise. 

So yeah, go to a good engineering school, go get a lot of the status indicators that are very obvious, like an engineering school and a top-tier firm, whatever. That does kind of matter. People do pay attention to those things. It matters in the sense that people pay attention to those things in the building development world. If you went to MIT or Caltech, and then you had an internship and it's Skidmore or Merrill, that's gonna open quite a few doors for you. I'm not amazingly happy with that answer, but I do think that it is true. 

Dwarkesh Patel 

Yeah. 

Brian Potter 

Another way would just be to try to come in from a more oblique angle. Focus on software and then work at one of the many more new startups that are now tackling the construction space. They're increasingly in need of software developers and that would probably be a lower-risk way to do it because you don't need to necessarily go to a fancy school to become a software developer. Then if it doesn't work out, just go get a job at a FAANG company and make $600,000 a year. Look and see how the startups in the space are changing and growing. I think by the time some folks got out, the building space might look pretty different in technology, and software stuff is kind of slowly forcing its way in there a lot more. 

Dwarkesh Patel 

But if they want to transition from just being an engineer to working on the forefront stuff that you write and talk about, is working at a startup the ideal way to do that? 

Brian Potter

Oh, that's a good question. A lot of startups are doing really interesting stuff, not just in software, but a lot interesting building technology stuff. There's a lot of like green building that has worked, there's work out there that is being developed by folks working on low-carbon concrete and low-carbon steels. There's a lot construction robotics, a lot of prefab stuff, the startup world is really kind of trying to start to eat the construction world. There are a lot of opportunities there. Very broadly, I would say that I see a lot of innovation happening. So I think that's a good place to sort of look and see what's going on. 

Dwarkesh Patel 

Awesome. Okay. Well, Brian, thank you so much for coming back a second time. I really appreciate it. I'm glad we got a chance to talk about these questions. It is very interesting and it's good to get an actual engineer’s perspective on it so that we're not just doing like cultural theory and we actually understand the practicalities of what's involved in all these kinds of things.  I highly recommend people check out your blog and they can also follow you on Twitter. We'll leave the handle in the description. Anything else you'd like to plug or say at the end? 

Brian Potter 

I’m doing some work for the institute for progress, which is a think tank designed to advance industrial progress and progress studies ideas more generally so you should check them out as well. 

Dwarkesh Patel 

Okay, excellent. Thanks Brian, I appreciate it. 

Brian Potter 

Cool. 


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