E152: Real estate chaos, WeWork bankruptcy, Biden regulates AI, Ukraine's "Cronkite Moment" & more

Polling shows that by the time of the Time cover story and this podcast (late Oct–early Nov 2023), U.S. opinion had already shifted substantially toward seeing the war as a stalemate and favoring a quick end – and then largely plateaued, rather than “increasingly shifting” over the next few months.

1. Baseline just before/around the prediction (Oct–Nov 2023)
   • A Gallup poll summarized in the Washington Post in early November 2023 found that 41% of Americans said the U.S. was doing too much to help Ukraine (up sharply from 24% in Aug 2022), only 25% said “not enough,” and 64% said neither side was winning the war – clear evidence of a perceived stalemate. (cpnn-world.org)
   • In the same polling, Americans were essentially split between ending the war quickly even if Russia keeps some territory (about 49–50%) and continuing support so Ukraine can regain territory even if the war is prolonged (about 48–49%), a huge change from August 2022 when about two‑thirds favored backing Ukraine “even in a prolonged conflict.” (img.washingtonpost.com)
   In other words, a large bloc of the public already saw the war as a grinding stalemate and was open to a quicker, negotiated end before the “Cronkite moment” framing.

2. What happened over the “next few months” into mid‑2024?
   • Gallup’s later write‑up of this same question notes that support for helping Ukraine fight until it regained its territory fell sharply by October 2023 (to 54%), but then “views were steady in March” 2024 before shifting again only by December 2024, when Americans finally leaned 50% toward a quick end vs. 48% toward fighting on. (news.gallup.com) That implies little or no additional movement in the few months after the November 2023 Time story.
   • A February 16–18, 2024 Chicago Council/Ipsos survey still found majorities of Americans (58%) in favor of sending additional arms and 58% in favor of economic aid for Ukraine, with support eroding mainly among Republicans but not collapsing overall. (globalaffairs.org)
   • Pew’s April 2024 data (published May 8, 2024) showed about a third of Americans (31%) saying the U.S. was giving too much support, 25% “about the right amount,” and 24% “not enough,” up from just 7% saying “too much” in March 2022—but only modestly changed from late‑2023 figures. (pewresearch.org)
   • Pew’s July 1–7, 2024 survey likewise found opinion still split and stable: 29% said the U.S. was providing too much support, 26% about the right amount, 19% not enough, with Republicans concentrated in the “too much” camp and Democrats largely favoring current or higher aid. (pewresearch.org)
   Together, these data show that the major downshift in hawkish public opinion had mostly already occurred by October 2023, and from late 2023 through mid‑2024 public views were broadly steady, not undergoing the further sharp “watershed” evolution Sacks forecast for “the next few months.”

3. Policymakers in Washington during the same period
   On the other half of his claim – that “policymakers in Washington are the last ones to get the memo” and would stick to a pro‑funding, pro‑war posture – the evidence lines up well with his prediction:
   • Despite months of internal Republican resistance, the Senate passed a $95 billion foreign aid package including around $60–61 billion for Ukraine with a strongly bipartisan 70–29 vote in February 2024 and again in April as part of the final package. (theguardian.com)
   • The House ultimately approved the companion package on April 20, 2024, with all Democrats and 101 Republicans voting yes, 112 Republicans no, sending approximately $61 billion in additional Ukraine aid to the president’s desk. (theguardian.com)
   • President Biden and both party leaders in the Senate (Schumer and McConnell) consistently framed this aid as a vital U.S. commitment and made passage a top priority, even as polls showed growing public fatigue and a sizable bloc saying the U.S. was doing too much. (pewresearch.org)
   That is, the bipartisan establishment did keep backing large Ukraine aid packages through mid‑2024 despite clear signs of public skepticism.

4. Overall assessment
   • The second part of Sacks’s prediction – that Washington’s bipartisan establishment would largely stick to a pro‑funding, pro‑war stance – is well supported by the 2024 supplemental‑aid fight and eventual passage of a large new package. (reuters.com)
   • But the central, time‑bound part of his forecast – that “this week was a watershed” and that over the next few months public perception would increasingly move toward seeing the war as unwinnable and favoring negotiations relative to where it already stood in late 2023 – is not borne out. Major national polls indicate that:
   – perceptions of a stalemate and fatigue were already widespread by October 2023, and
   – additional movement in that direction was minimal between late 2023 and mid‑2024, with the next clear shift toward prioritizing a quick end to the war not appearing until late 2024. (news.gallup.com)

Because the core predictive content – a further, near‑term evolution of public opinion over “the next few months” – did not occur in the way or on the timeline he described, even though he was right about elites staying pro‑aid, the overall prediction is best judged wrong.

Chamath’s core claim was that the Israel–Gaza escalation would not evolve into a broader regional war but would revert to the historical pattern of “conflict, time out” between Israel and the Palestinians, and that markets would therefore de‑risk it, giving the Fed room to cut.

By late 2025, the conflict has clearly not reverted to a contained, cyclical Gaza flare‑up. Instead it has become what is widely described as a Middle Eastern crisis (2023–present), an ongoing regional conflict spanning multiple theaters: Gaza and Israel, the West Bank, Lebanon, Syria, Iraq, Yemen, the Red Sea, Iran, Qatar and the Strait of Hormuz.(en.wikipedia.org) This includes:

• A prolonged Hezbollah–Israel front and a 2024 Israeli invasion of southern Lebanon.(en.wikipedia.org)
• Direct Iranian missile barrages against Israel in April and October 2024, and large Israeli retaliatory strikes inside Iran later in 2024, plus an undeclared 12‑day Israel–Iran war in June 2025.(en.wikipedia.org)
• Extensive Houthi attacks on Red Sea shipping and repeated Israeli (and US/UK) airstrikes in Yemen, as well as US strikes on Iran‑aligned militias in Iraq and Syria.(en.wikipedia.org)

The Gaza war itself has remained intense and prolonged, with only a temporary January–March 2025 ceasefire before major Israeli operations resumed, and a broader ceasefire taking effect only in October 2025—much longer and more destructive than the shorter "conflict, timeout" episodes he was invoking.(en.wikipedia.org) This contradicts his expectation that it would essentially be “not a war” but just another entry in the usual Israel–Palestine cycle.

On the other hand, markets have indeed treated the conflict’s global economic impact as limited: research from the World Bank and Bloomberg Intelligence notes that, despite the human and regional toll, the Israel–Hamas war has so far had limited impact on global commodities and growth, with only a small or negligible geopolitical risk premium priced into oil.(businesstoday.in) The S&P 500 has rallied strongly in 2024–2025 on AI and earnings, and strategists project further gains, indicating that equities are not dominated by Middle East war risk pricing.(reuters.com) The Federal Reserve has also begun cutting rates, moving from 5.25–5.50% in mid‑2023 down to 3.75–4.00% by October 2025 as inflation eased and growth cooled.(en.wikipedia.org)

However, in the podcast he explicitly framed the bullish market/Fed scenario as contingent on the conflict not being a war but just another standard “conflict, time out” episode. That key geopolitical premise proved wrong: the situation evolved into a multi‑front regional conflict involving several states and proxy forces, not merely a localized Gaza round. Given that the central, time‑bounded claim about the nature and trajectory of the conflict failed, the prediction as stated is best classified as wrong, even though some downstream market and Fed outcomes occurred for reasons largely independent of that premise.

Condition check (rate‑cut cycle)

• After holding the policy rate at 5.25–5.50% from July 2023, the Federal Reserve began an easing cycle with its first rate cut in late summer 2024 (variously dated to August or the September 18, 2024 meeting in market commentary).(franklinresources.com)
• By definition, once the Fed started cutting and continued to discuss further reductions, markets were in the regime Sacks described (probability of cuts dominating hikes, i.e., the tightening cycle effectively over).

Outcome: growth‑stock & broad equity rally

• Franklin Templeton’s analysis notes that from the first cut of this cycle (August 2024) through August 20, 2025, the S&P 500 rose roughly 16%, consistent with historical patterns of strong equity performance during expansionary easing phases.(franklinresources.com)
• Growth‑heavy indexes rallied even more: Nasdaq’s September 2025 scorecard reports the Nasdaq‑100 at new all‑time highs, up 17.5% year‑to‑date through Q3 2025, with most Nasdaq indexes gaining.(nasdaq.com)
• The Nasdaq‑100 level progression (20,000 in July 2024, 22,000 in December 2024, 23,000 in July 2025, 24,000 in September 2025) shows a sustained surge from around the start of the easing cycle onward, underscoring a broad growth‑stock valuation rally.(en.wikipedia.org)
• Additional market commentary on this cycle characterizes year one of the current rate‑cutting phase as delivering strong double‑digit S&P 500 gains, and highlights that stocks have historically performed well in the second year of rate‑cut cycles too.(finance.yahoo.com)

Outcome: distressed / commercial real estate

• Private‑market commercial property values (Green Street’s CPPI) stopped falling and turned modestly positive: the all‑property index was up 4.1% year‑over‑year in May 2025 and about 2.7% over the prior 12 months by August 2025, indicating stabilization and mild recovery from earlier declines.(greenstreet.com)
• Other analysis notes that U.S. commercial property values fell about 22% from their April 2022 peak to a December 2024 bottom, then recovered about 5% in 2024 and were marginally positive in 2025, but still hovered around a 20% drawdown, with distress elevated in highly levered segments like offices.(linkedin.com)
• At the same time, several sources emphasize that much of commercial real estate—especially office—remains under significant stress (high vacancies, deep price drops, rising delinquencies), and that Fed cuts have not fully “fixed” the sector.(franknez.com)

Evaluation

• Sacks’ conditional claim was: if the Fed entered a rate‑cut cycle (odds of cuts > hikes), then public market valuations—“particularly” growth stocks and distressed real estate—would rally during that cycle, with “everything” becoming more valuable as rates moved lower.
• The core mechanism he described did play out for public equities, especially growth stocks: once markets transitioned into an easing regime, major equity indexes (S&P 500, Nasdaq‑100) saw broad, substantial rallies consistent with his expectation.
• For distressed real estate, the picture is more mixed: values appear to have bottomed and recovered modestly, but the sector is far from a clean "everything rallies" scenario, with ongoing distress in office and other leveraged segments. Still, the direction of change since the onset of cuts has been stabilization-to-slight‑recovery rather than continued collapse.

Given that the central, testable part of the conditional—a broad rally in public market valuations, especially growth stocks, during the rate‑cut cycle—has clearly occurred, while distressed real estate has at least stabilized and modestly rebounded from its trough, the prediction is best classified as right, albeit somewhat overstated in its "everything’s going to rally" phrasing for commercial real estate specifically.

Sacks was accurately paraphrasing San Francisco’s own controller and five‑year financial plan, and the near‑term part of his prediction has played out, but the 2027–2028 piece has not yet resolved.

What has already happened (supports the prediction):

• In December 2022, Mayor London Breed’s budget instructions stated that San Francisco faced a two‑year General Fund shortfall of about $728.3 million, with a $527.6 million deficit in the second year (FY 2024–25)—essentially “about half a billion.” (sf.gov)
• Subsequent updates and advocacy pieces describe the FY 2024–25 budget process as addressing a “nearly $800 million” shortfall, closed via leaving positions vacant, cutting contracts, and using one‑time revenues—clear evidence of fiscal stress and difficult trade‑offs. (sfmms.org)
• By April 2025, the mayor’s budget director told the Board of Supervisors that the March update to the five‑year financial plan showed an $817.5 million shortfall over the next two years and a roughly $1.3 billion structural shortfall over the five‑year outlook, again underscoring ongoing, large projected gaps and the need for corrective policies. (citizenportal.ai)
• Coverage of Mayor Daniel Lurie’s 2025–26 budget notes he is closing an $800 million deficit over two years by cutting roughly 1,400 city jobs and reducing contracts and grants—exactly the kind of “difficult choices” Sacks anticipated. (sfchronicle.com)

What is still unresolved (why the overall verdict is inconclusive):

• The controller’s March 31, 2023 update indeed projected that, absent policy changes, San Francisco’s deficits would cumulatively reach about $1.3 billion by FY 2027–28, a figure repeated in subsequent commentary on the city’s finances. (bondbuyer.com)
• However, FY 2027–28 has not occurred yet (as of November 30, 2025). The city is legally required to adopt a balanced budget each year, and updated forecasts between now and 2027 could raise or lower the out‑year gaps. We therefore do not yet know whether the eventual 2027–28 structural deficit will actually be around $1.3 billion or something materially different.

So, while the first part of Sacks’s prediction—large FY 2024–25 shortfalls and intense fiscal stress forcing hard choices—has clearly come true, the key claim that deficits will be “around $1.3 billion” by FY 2027–28 cannot yet be verified. That makes the overall prediction inconclusive (too early) rather than definitively right or wrong.

The prediction is explicitly about a 5–10 year lag in policy change, with an expected midpoint around 2032–2033 for “rationality” or meaningful reform in San Francisco’s governance and fiscal practices.

As of November 30, 2025, only about 2 years have passed since the prediction (made in late 2023). That is far short of the lower bound (5 years) of the forecast window, so we cannot yet determine whether:

• San Francisco will indeed fail to significantly reform over the full 5–10 year period, or
• A major course correction and sustained policy rationality will emerge earlier than 2032–2033.

Because the core claim is about when meaningful reform will manifest, and that time horizon has not yet arrived, the prediction cannot be evaluated at this point.

Therefore the correct status is: it is too early to tell whether the prediction is accurate.

Chamath’s prediction was that San Francisco would continue its existing progressive policy and fiscal “experiment” — including covering growing deficits with borrowing/one‑offs — without major structural reform for at least another decade from 2023.

By late 2025, that core “no major reform for a decade” assumption has already been broken:

1. Political direction clearly shifted away from the prior experiment. In November 2024, voters elected Daniel Lurie, a self‑described centrist/moderate Democrat who ran explicitly on “accountability, service and change” and a tougher approach to crime, drugs, and homelessness, defeating incumbent mayor London Breed. (theguardian.com) A Washington Post overview describes a “vibe shift” toward more centrist, pragmatic governance with a more moderate Board of Supervisors, focusing on public safety and business‑friendliness rather than the prior ultra‑progressive status quo. (washingtonpost.com)

2. Fiscal policy moved from patching deficits to structural reform. Breed’s administration had been closing large COVID‑era budget gaps with one‑time federal American Rescue Plan funds and other temporary measures, leaving an ongoing structural deficit. (sfmayor.org) Lurie, inaugurated January 8, 2025, explicitly rejected that model: in January he told department heads that the “era of one‑time or Band‑Aid solutions is over” and pledged to eliminate $1 billion in “overspending” by changing the city’s structural deficit rather than using one‑offs. (sfstandard.com) His May 30, 2025 proposed budget for FY 2025–26 and 2026–27 closes roughly an $800+ million two‑year deficit through ongoing cuts and structural changes (eliminating 1,400 positions, trimming underperforming contracts, and ending the practice of using one‑time funds for ongoing costs), and sets aside $400 million in reserves, which the mayor’s office and independent civic groups explicitly describe as structural corrections rather than continued fiscal experimentation. (sf.gov)

3. Policy on drugs/crime has also materially hardened. The city has moved away from a purely harm‑reduction model toward an abstinence‑oriented “recovery first” drug policy and granted the new mayor emergency powers to tackle the fentanyl crisis, reflecting a clear shift from the earlier, more permissive approach that critics labeled the “experiment.” (apnews.com) State‑level changes such as California’s Proposition 36, which increased penalties and allowed more felony charges for certain theft and drug crimes, further underscore a broader move away from the earlier, more lenient regime that underpinned that experiment. (en.wikipedia.org)

Although the 10‑year window (to ~2033) has not elapsed, the prediction hinged on continuity—that the same progressive/fiscal experiment would run uninterrupted for “at least a decade.” The election of a centrist change‑candidate plus early, large‑scale structural fiscal and policy shifts show that continuity has already been broken well before the decade mark. On standard forecasting logic, that is enough to score the prediction as wrong, rather than merely “too early to tell.”

WeWork did file for Chapter 11 in November 2023, but the post‑bankruptcy outcome did not match Sacks’s prediction of “some private equity player…buy[ing] this out of bankruptcy and mak[ing] a fortune.”

1. Who actually took control:

   • WeWork emerged from Chapter 11 in late May / June 2024 through a creditor‑led reorganization, not a sale of assets to a private equity firm.
   • Real‑estate software company Yardi Systems, via its subsidiary Cupar Grimmond, invested about $337M as part of a ~$450M exit financing and ended up with roughly a 60% majority stake, while other lenders and bondholders took most of the remaining equity. There was no 363 asset sale to a PE buyer; control shifted to Yardi and lenders under a court‑approved plan of reorganization. (en.wikipedia.org)

2. Restructuring leases and locations:

   • Through Chapter 11, WeWork eliminated about $4B of debt, cut roughly $8–12B in future rent obligations, and exited around 160–170 unprofitable locations, shrinking to about 600 locations globally. This matches the “restructure leases and locations” part of the thesis, but that restructuring was executed under the creditor/Yardi plan, not by a PE buyer acquiring the assets. (en.wikipedia.org)

3. “Make a fortune” outcome:

   • After emerging, WeWork became a private company with a projected equity value in the mid‑hundreds of millions and an internal plan merely aiming for modest profitability around 2025. There is no public evidence as of late 2025 that Yardi or any investor has realized “very large” returns or “made a fortune” on the post‑bankruptcy equity; the investment is still being worked out and remains illiquid. (wsj.com)

Because (a) no private equity firm bought WeWork’s assets out of bankruptcy and (b) there is no evidence yet of outsized realized returns from such a buyout, the prediction as stated is best classified as wrong, even though some generic elements (bankruptcy and lease restructuring) did occur.

Key parts of Sacks’ setup have already happened, but his core claim about sustained profitability is on a longer timeline than the data we have.

What has happened so far

• WeWork filed for Chapter 11 in November 2023 and emerged from bankruptcy in mid‑June 2024 under a reorganization that wiped out about $4 billion of debt and shifted control to a lender group and Yardi Systems, which became majority owner.(reuters.com)
• During the bankruptcy, WeWork exited roughly a third of its locations and renegotiated hundreds of leases, cutting future rent obligations by around 40–50% (about $8–12 billion) and keeping a smaller, more profitable footprint.(cnbc.com)
• Post‑emergence, CEO John Santora says WeWork now uses three agreement types—traditional leases, revenue‑share deals, and pure management agreements—with about 130 locations on revenue‑share/management structures, which matches the prediction’s idea of shifting to operator/revenue‑share models to de‑risk leases.(time.com)

Profitability status as of late 2025

• In a 2025 TIME interview, Santora states that WeWork has never been profitable, but that its most recent quarter was break‑even on an EBITDA basis, the first time in its history.(time.com)
• A July 2025 Wall Street Journal piece reports that WeWork generated about $2.2 billion in revenue in 2024 and delivered its first quarterly EBITDA profits, with three recent quarters showing positive EBITDA. This indicates improvement but not yet clear, sustained net income or free‑cash‑flow profitability.(wsj.com)

Why this is “inconclusive”

• Sacks’ normalized prediction is that “within a few years of emergence from bankruptcy” a buyer who restructures leases will be able to run WeWork as a profitable, cash‑generating business. WeWork only emerged from Chapter 11 around June 2024, so “within a few years” points roughly to 2026–2027.
• As of November 2025, WeWork has restructured in exactly the way he described and is approaching EBITDA profitability, but it is not yet clearly a sustained, cash‑generating, net‑profit business, nor has the full time window he gave expired.

Because the key profitability outcome could still plausibly go either way within the remaining horizon, the prediction cannot yet be judged definitively right or wrong; it is too early, so “inconclusive.”

Evidence clearly shows the existence of the $45B office‑to‑residential initiative, but not a clear, subsequent series of CRE‑targeted federal programs whose primary, though hidden, purpose is to mitigate commercial real estate (CRE) losses.

What we can document clearly

• In October 2023 the Biden administration launched a commercial‑to‑residential conversion push, highlighting high office vacancies and a housing shortage, and pointing to more than $35B in DOT lending capacity plus broader federal resources, often summarized as about $45B in federal funds for conversions and related housing projects. (presidency.ucsb.edu)
• That initiative is explicitly framed by the White House as addressing: (1) affordable housing supply, (2) hollowed‑out downtowns from office vacancies, and (3) climate/energy efficiency; it does not describe itself as a CRE bailout, even though it acknowledges high office vacancies and the economic drag from underused commercial buildings. (presidency.ucsb.edu)

Subsequent federal housing actions (2024–2025) After that initiative, the federal government did roll out and expand several housing‑focused programs, but they are broad and not specifically structured as CRE stabilization tools:

• HUD’s PRO Housing grants (Pathways to Removing Obstacles to Housing) awarded $85M in 2024 to state and local governments to change zoning, streamline permitting, and reduce barriers to building and preserving affordable housing. (reuters.com)
• Treasury announced an extra $100M over three years via the CDFI Fund to support thousands of affordable housing units, framed as responding to housing shortages and high rents, not as CRE rescue. (reuters.com)
• Treasury loosened rules on unspent COVID State and Local Fiscal Recovery Funds so they could support a broader range of housing projects and extended the FFB–HUD risk‑sharing program to make multifamily projects easier to finance; again, this is justified in terms of housing supply and affordability. (reuters.com)

All of these plausibly indirectly affect some commercial properties (e.g., conversions, mixed‑use projects), but they are designed and presented as general housing‑supply/affordability measures, not targeted assistance to office‑building lenders or owners.

What did not happen (through Nov 30, 2025)

• Despite mounting stress in office CRE—office mortgage delinquencies rising sharply in 2024 and analysts warning office loans are “living on borrowed time” (marketwatch.com)—there is no evidence of a dedicated federal bailout or backstop facility aimed specifically at office/CRE losses (e.g., no special Treasury/Fed program just for troubled office loans). The main systemic support program, the Fed’s Bank Term Funding Program, was aimed at banks’ securities losses after the 2023 banking crisis, not at CRE in particular, and it stopped making new loans in March 2024. (en.wikipedia.org)
• Losses and adjustments in office CRE appear to be working through private channels (banks taking write‑downs, loan sales to investors like Blackstone, regional banks selling CRE portfolios, etc.), not through a series of new federal CRE‑stabilization programs. (reuters.com)

Why the prediction is ambiguous rather than clearly right or wrong

• The prediction has two strong claims:
  1. Motive claim: that the 2023 $45B initiative is really about pumping money into CRE to cushion economic loss and balance‑sheet impairment, with affordable housing as the public framing.
  2. Serial‑program claim: that this will be the first of several such federal programs over the coming years.
• Motive (1) is inherently hard to verify or falsify from public evidence: official documents consistently emphasize housing supply, downtown revitalization, and climate goals; none explicitly say the primary objective is to protect bank or landlord balance sheets, even if reducing office vacancies and repurposing distressed assets could incidentally ease CRE stress.
• For claim (2), as of late 2025 we do see multiple new or expanded housing initiatives, but they are broad and long‑running extensions of the administration’s 2022 Housing Supply Action Plan rather than clearly new, CRE‑specific rescue facilities. Reasonable observers could disagree on whether such general housing‑supply programs count as “several programs…really designed to support [CRE] economic loss impairment.” (en.wikipedia.org)

Because:

• policymaker intent is not observable;
• the post‑2023 programs are broad housing policies without clear CRE‑bailout design; and
• no explicit CRE rescue series has emerged, despite continued office distress,

we cannot confidently classify the prediction as either right (demonstrated pattern of covert CRE‑support programs) or wrong (definitive absence of such intent or of any further possibly‑relevant programs). The outcome therefore remains ambiguous rather than clearly vindicated or falsified.

As of November 30, 2025, we have not yet reached the prediction’s evaluation window (“around late 2026” / roughly three years after the October 30, 2023 AI executive order), so it is too early to determine if it came true.

The October 30, 2023 Executive Order defines covered models and infrastructure using specific, fixed compute/parameter-like thresholds (e.g., dual‑use foundation models trained with >10^26 FLOPs, lower thresholds for primarily biological sequence data, and similar capacity thresholds for large compute clusters). These are precisely the sort of model‑size/compute‑based standards Friedberg was referring to as potentially becoming obsolete.(bidenwhitehouse.archives.gov)

Subsequent U.S. policy work through 2024–2025 (e.g., Commerce rulemakings and the emerging AI Diffusion Framework) still uses very similar absolute compute thresholds (10^26 FLOPs, etc.) as a primary regulatory hook, reinforcing that the original standards are currently still central rather than clearly obsolete.(theregister.com)

However, the prediction is about the situation by late 2026. Since that date is in the future relative to today (late 2025), we cannot yet say whether those model‑size/parameter/compute definitions will then be “largely obsolete and inapplicable.” Therefore the correct classification is inconclusive (too early) rather than right, wrong, or permanently ambiguous.

As of November 30, 2025, there is not enough evidence to say that Biden’s October 30, 2023 AI executive order (Executive Order 14110) is widely regarded as outdated or “medieval,” and the prediction’s full 2–3 year window (through late 2026) has not yet elapsed.

Key facts:

• Executive Order 14110, signed on October 30, 2023, set out a broad federal framework for AI safety, civil rights protections, competition, and watermarking/content authentication. It was widely described at the time as the most comprehensive U.S. AI governance step to date. (en.wikipedia.org)
• The order was rescinded by President Trump on January 20–21, 2025, as part of a broader rollback of Biden-era policies, with Trump and allies criticizing it primarily as burdensome and innovation‑stifling, not as technologically obsolete. (en.wikipedia.org) Its repeal is generally framed as ideological deregulation rather than a judgment that it had become outdated.
• Many policy and academic commentators continue to describe the Biden order as a significant or even “seminal” achievement in AI governance, on par with other leading jurisdictions, while emphasizing that it was only a first step and needed to be backed by legislation and further regulation. (time.com) That is closer to “important but incomplete” than to “medieval.”
• Some expert work in 2025 does argue that specific mechanisms in the order—especially its reliance on training compute thresholds for high‑risk models—face legal and technical loopholes and may not map well onto emerging AI development paradigms like heavy inference‑time reasoning. (arxiv.org) However, these are specialist critiques of particular provisions, not evidence of a broad consensus that the entire order is antiquated.
• Post‑repeal discourse in 2025 largely centers on concerns that removing Biden’s guardrails leaves the U.S. under‑regulated on AI, rather than on claims that the Biden framework had become laughably out of date relative to the technology. (apnews.com)

Because (1) we are only about two years out from the order, with the prediction explicitly allowing up to three years, and (2) the prevailing characterization in expert and media sources is that Biden’s order was a major, if imperfect, first step rather than something now seen as primitive or useless, it is too early—and the evidence is too mixed—to classify Chamath’s prediction as clearly right or clearly wrong.

As of November 30, 2025, the United States has not created a single, dedicated federal agency functioning as an FCC/FDA‑style regulator for AI or “big software,” as Sacks described.

1. Current federal structure is still multi‑agency and patchwork.
   Recent overviews of U.S. AI governance explicitly note that there is no single federal AI regulator; instead, AI is governed via executive orders, NIST guidance, and enforcement of existing laws by multiple agencies such as the FTC, EEOC, CFPB, DOJ, and sectoral regulators (e.g., FDA for medical AI).(quickcreator.io) These sources characterize the U.S. approach as fragmented and agency‑led, not centralized in a new stand‑alone commission.

2. The AI Safety Institute / CAISI is not a full regulatory commission.
   The Biden administration’s 2023 AI executive order led to the creation of a U.S. AI Safety Institute inside NIST, later renamed by the Trump administration to the Center for AI Standards and Innovation (CAISI). It focuses on standards, testing, and international representation, and Commerce Secretary Howard Lutnick has emphasized a voluntary, pro‑innovation posture rather than serving as a rule‑issuing regulator for all AI.(theverge.com) This does not match Sacks’s vision of a powerful, independent “federal software commission” analogous to the FCC/FDA.

3. Congressional proposals for a single tech/AI agency have not passed.
   Senators Bennet and Welch’s Digital Platform Commission Act would create a Federal Digital Platform Commission with broad authority over digital platforms and some AI issues. However, the Senate bill (S.1671, 118th Congress) remains at the introduced stage with no further action; no law has been enacted and no such commission exists in reality.(congress.gov)

4. Timing language makes the forecast open‑ended.
   Sacks frames the outcome as something that will happen as regulatory burdens accumulate—“this is how we’re going to end up with a federal software commission”—without specifying a time horizon. Since only about two years have passed since the November 2023 executive order, and U.S. policymakers are still debating whether to create such a body, current evidence only shows that the outcome has not yet occurred, not that it will not occur.

Because the key condition of the prediction—actual creation of a single, FCC/FDA‑like federal agency to regulate AI and large‑scale software—has not happened yet, but the forecast is effectively open‑ended in time, the correct assessment as of late 2025 is **“inconclusive (too early)” rather than definitively right or wrong.

The prediction was that U.S. federal regulation would evolve from narrowly targeting AI to putting “basically all software companies” under direct federal regulatory oversight.

What has actually happened by November 2025:

• The most comprehensive federal move in 2023 was Biden’s Executive Order 14110 on AI, which focused on artificial intelligence systems (not the broader software industry) and emphasized frontier AI models and government use of AI. It did not create a general licensing or supervisory regime for all large software firms.(bidenwhitehouse.archives.gov) In January 2025, President Trump rescinded that order and replaced it with Executive Order 14179, which explicitly aims to remove barriers to AI innovation and directs agencies to revise or rescind prior AI‑safety measures viewed as restrictive. This is a move toward deregulation of AI, not expansion of oversight to all software companies.(en.wikipedia.org)

• Congress still has no broad AI or software‑sector regulatory statute. The only major new AI‑specific federal law is the 2025 TAKE IT DOWN Act, which narrowly targets non‑consensual intimate imagery and deepfakes and imposes takedown and process obligations on “covered platforms” that primarily host user‑generated content. It does not regulate the software industry as a whole or even all large software companies—only certain online platforms in a specific abuse context.(en.wikipedia.org)

• Other federal initiatives remain targeted and limited: export‑control adjustments for high‑end AI compute, voluntary NIST AI Risk Management guidance, and FTC enforcement of existing consumer‑protection law against misleading AI marketing claims. None of these create a new, comprehensive federal oversight regime that applies across “essentially all large software companies”; they are narrowly focused on AI risk or on specific content types.(en.wikipedia.org) Legislative proposals like the Preserving American Dominance in AI Act would focus on frontier AI and national‑security risks, not on the broader software industry, and as of late 2025 have not become law.(king.senate.gov)

• The regulatory trendline is also inconsistent with the prediction. Reporting on U.S. policy in 2025 describes federal moves to loosen or block regulation—such as attempts (ultimately defeated in the Senate) to impose a 10‑year federal moratorium on state AI laws via a tax‑and‑spending bill—rather than to build a strong, centralized federal regime overseeing all software firms.(reuters.com) At the same time, the most aggressive new AI rules have come from states like California (e.g., SB‑53, the Transparency in Frontier AI Act), which targets only very large frontier‑model developers and operates at the state level, not as a blanket federal framework for all large software companies.(en.wikipedia.org)

• Some separate, sectoral tech measures (such as the TikTok‑focused Protecting Americans from Foreign Adversary Controlled Applications Act) address specific national‑security concerns about foreign‑controlled apps, not general domestic software regulation.(en.wikipedia.org) Existing antitrust cases against firms like Apple are enforcement of long‑standing laws, not evidence of a new federal software‑industry regulatory overlay.(en.wikipedia.org)

Given this record two years after the prediction:

• Federal action has not broadened from AI to a regime that covers “basically all software companies” or “essentially all large software companies.”
• The only clearly new, binding AI‑specific federal statute is narrow (deepfakes/NCII and hosting platforms).
• The main comprehensive AI‑governance executive order was rolled back, and current federal policy direction is at least as much about removing restrictions and pre‑empting state efforts as about expanding federal oversight.

While “over time” is vague and does not specify an exact deadline, the prediction was directional (“we are headed to a place…”) and implied a trend toward blanket federal regulation of the software sector. The observable trajectory by late 2025 runs counter to that claim, so on the evidence available today, the prediction is best judged as wrong.